By John Bailey and William Bailey, Marcus & Millichap ‘ Chicago Investors looking to diversify their holdings should continue to consider buying student housing properties. Whether in major cities or smaller communities, most colleges and universities don’t have enough beds for all the students enrolled. Reports indicate that there are only between 25 percent and 30 percent of necessary beds on-campus at colleges and universities versus enrollments. At the same time, more and more students are registered and attending classes each year. Are there many opportunities to buy a student housing property? Nationally, there are over 4,300 degree-granting institutions and branches. An opportunity may be closer than you think! A recent trend is development of student living units being built near regional campuses that previously had been considered only commuter schools. What is the best way to begin looking for an opportunity? Finding the right college town to match your investment criteria may be as simple as listing to the younger generation of friends and family who are applying to college. As they go off on their college tours trying to decide which institution is best, they pay nearly as much attention to the town, retail amenities, environment and accessibility …
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By Cara Aliek Uptown Village at Cedar Hill Cedar Hill, Texas (March 12) The recently opened Uptown Village at Cedar Hill was birthed 4 years ago when veteran retail developer Buddy Herring of MGHerring Group went down to Cedar Hill to check out JCPenney’s new prototype store, one of the first in the nation to open up. He had been hearing about the Trade Area of Cedar Hill/DeSoto/Duncanville/Lancaster, all just south of Dallas and decided to look around the area while on that trip. After putting more than 200 miles on his car, Herring discovered that based on the housing, income and growth of the area, the residents of Cedar Hill needed a major department store, more retail and upscale restaurant options. And so Uptown at Cedar Hill was born. Gar Herring, Buddy Herring’s son and president and COO of MGHerring Group, says that the open-air shopping center is aimed at providing a place for residents to meet at and relax. “One of the features we’re really proud of is Uptown Village being a hub for the community. We have a Village Green with an interactive water fountain, a stage and a park for families and people to congregate and …
By Brian Patton, CCIM, Capital Realty Advisors LLC The bad news of the residential market over the last few months begs the question of what will happen to the commercial real estate market this year. In order to gauge investors’ expectations for 2008 in this market segment, a group of leading research companies recently surveyed more than 1,000 developers and investors. The survey group included 92 institutional investors with an average of 19 years experience and an average real estate portfolio of $36.6 million. Among the findings is that the majority of the respondents, 57 percent, believe that the economy will stay the same or improve over 2007. When compared to past surveys, it’s obvious that respondents are less optimistic than in years past, but 16 percent are of the opinion that it will improve this year. Investors are most optimistic about apartments and mixed-use projects. Nearly two-thirds of those surveyed expect to see an increase in rents for one or more property types and especially look to apartments as a segment with good promise for rental increases. It appears that most of the interest in the apartment sector is because of the mortgage crisis and the obvious negative effect …
By Cara Aliek It seems everywhere you look these days, the message of environmental consciousness is grabbing for our attention. Gargantuan gas-guzzling SUVs are slowly being passed over for more environmentally-friendly hybrids, retailers are reaping the benefits of offering products that donate a portion of their sale to environmental protection efforts, and a growing trend — if not the largest in terms of size and money — is re-establishing the functionality of land and buildings. In some cases, these properties are designed using energy-efficient Leadership in Energy and Environmental Design (LEED) principles, a trend still continuing to explode. This spring (May 5-7) Detroit hosts The National Brownfields Conference and with many sites still untouched, (it’s estimated 1 million brownfield sites are available in the U.S.) investors and developers are taking advantage of their benefits. In this article, we’ll take a look at a few upcoming brownfield projects and what they’re doing to reuse, reduce and recycle community eyesores. We’ll also introduce a company that helps persuade companies to donate their vacant industrial property so they can be used for small businesses. LIBERTY HARBOR Brunswick, GA During World War II, the J.A. Jones Company Shipyard cranked out 99 Liberty ships in …
By Bill Donges, CEO Lane Co. Despite recession fears and the contraction in the real estate market, the apartment sector remains a bright spot, which may grow even brighter in the next few years. Many things are happening simultaneously: * Echo boomers are graduating from college in massive numbers, which means a growing pool of 25 to 32-year-old renters. * Many baby boomers are downsizing and looking for a lifestyle less burdened by the maintenance and upkeep of their homes. * Families caught in the credit crunch are looking for apartments instead of homes. * Immigration is increasing, and immigrants are more likely to rent than buy. Many institutional investors see these changes on the horizon, and don’t want to bet against such a large demographic movement. Apartment investment has done better than the S&P 500 index over the last 10 years, and properties could continue to grow in value. Because of the frenzy of condo conversions, and the state of the capital markets, there is a significantly lower supply of rental housing than in the past. Plus, developers are less likely to start new projects. Preliminary Census Bureau figures indicate that last year, starts of buildings with five or …
By Brian Eliason Just 7 years ago, $200 million of equity flowed into Tenant-in-Common (TIC) properties — now, that figure tops $3 billion. Why? The IRS got things rolling in 2002 when an IRS ruling provided guidance for TIC properties to be able to qualify as viable 1031 Exchange options — expanding the pool of commercial properties available for this tax-deferred rollover. This, in turn, made the 1031 Exchange more accessible to small, individual investors. The Basics — TICs and 1031 Exchanges A 1031 Exchange allows an investor to roll over the capital gain from the sale of one investment property into a “like-kind” investment property and defer the capital gains taxes indefinitely into the future. A TIC is a form of real estate ownership in which: two or more people co-own a property ownership shares do not have to be equal ownership interests can be inherited owners may receive a steady cash flow owners are not bothered with the day-to-day hassles of managing the properties The IRS, by allowing TIC 1031 Exchanges into fractional ownership structures, gave investors the opportunity to pool their proceeds with other investors toward the purchase of larger, more diverse investment properties such as multifamily …
By Bruce Gibson and Lisa Silvers, Senior Housing Group ‘ CB Richard Ellis There have been numerous headlines about the recent credit crunch and the real estate downturn. However, it should be noted that the impacts are reflected in different ways depending on the fundamentals, relative pricing/return levels, and supply and demand of each real estate sector. Senior housing is one sector of the real estate market that may behave a little differently than the others. The recent slide in the residential market along with the credit crunch has impacted certain segments of the senior housing industry, but to varying degrees. New resident move-in rates for Independent Living have declined as seniors recognize the equity in their homes has been eroded. Some seniors, considering the move to an Independent Living Facility or a Continuing Care Retirement Community, are holding off the move to see what happens in the residential market with the hope that they will regain the equity they recently lost. However, Assisted Living and Skilled Nursing Facilities have not seen a decrease in move-in rates as this type of move is a health driven decision, as opposed to a lifestyle decision as with Independent Living. Silvers Within the …
By Cara Aliek The Residences at Dixon Mills possesses something ground-up buildings will never be able to achieve: status as a historical landmark. This five-building property is the former site of the Dixon Mills factory in Jersey City, N.J., and is in the process of converting apartments into 467 luxury condominiums. But to understand the historic relevance of this project, a dateline should be established. In 1847, inventor Joseph Dixon built a factory in Jersey City, N.J., for his growing pencil company called the Joseph Dixon Crucible Co. Mr. Dixon wanted “a fine American name for a fine American pencil,” and named his writing utensil after Fort Ticonderoga in New York. The Civil War required a need for dry writing pieces and business soared. By 1869, the Joseph Dixon Crucible Co. was the world’s largest dealer and consumer of graphite. In 1982, the Joseph Dixon Crucible Co. merged with Bryn Mawr Corp. to form Dixon Ticonderoga Co., which today is based in Heathrow, Fla., and has manufacturing facilities all over the world. Mr. Dixon’s Jersey City factory was converted into apartments in the late-1980s by New Jersey-based The Morris Company. The Robert Martin Co. acquired the property in 2006 and …
By Kevin Assef, Marcus & Millichap The diverse markets comprising the Western commercial real estate region have been impacted in varying degrees by the credit crunch and subsequent devaluation of the U.S. dollar that manifested itself in the last half of 2007. Despite fallout from the subprime mortgage crisis, prices for well-located Class A product have remained relatively stable and will continue to increase steadily in 2008, particularly in cities such as San Francisco, Los Angeles and Seattle. Investors will monitor smaller, secondary markets and the performance of Class B/C assets closely this year as pricing shifts become more apparent. APARTMENT INVESTMENT TRENDS Denver Renter demand for Denver apartment properties will remain strong in 2008, supported by an expanding pool of renters and the metro’s fifth consecutive year of healthy employment growth. While job gains will be more modest in 2008 than in recent years, population growth will generate additional renter demand, with an annual average of 29,000 new residents forecast to enter the metro in the next 5 years. On the supply side, apartment builders will accelerate construction activity this year, particularly in the Aurora-South submarket, where deliveries will result in a 5 percent inventory gain by year’s end. …
By Norma Sutton, BioScience Specialist, NAI Realvest Just How Big is this Business? The global biotechnology market grew by 12.6 percent in 2006 to reach a value of $153 billion. The forecast for 2011 is $271 billion, an increase of 76.5 percent. Medical products represent 62.5 percent of the revenues and the Americas account for 58.3 percent of the revenues generated in this market. This is truly the great growth industry of our time. It has been said that the 21st century belongs to Molecular biology and the Human Genome. What does all this mean? Maybe that the quest for knowledge, control and immortality is surging. Maybe that technology is advancing so quickly that there will be a burst of new diagnoses, treatments and preventions in our lifetime. And surely that this industry is the darling of all. We have moved from the industrial age to the informatics age and now it appears we have moved to the biotechnology age. Life sciences and biotechnology are terms you see everyday now in the media. There is so much to report on — so many discoveries that no one can keep up much less quantify their importance and potential for our benefit. …