Features

Communities’ Appetite for Food Halls Grows But Risks Abound, Says IEDC Panel

by John Nelson October 2, 2018

ATLANTA — Five years ago, there were about 30 food halls across the entire country. By 2020, Cushman & Wakefield predicts there will be 300. “I agree we have a lot of food halls coming,” said Jamestown president Michael Phillips. “In some regards it signals the end of the food hall.” The comments from Phillips came Monday morning during a panel discussion at the annual conference of the International Economic Development Council (IEDC). The four-day conference, which ends Wednesday, has drawn 1,600 economic developers, city planners, marketing professionals, consultants and community leaders to the Hyatt Regency in Atlanta. It’s the largest number of conference attendees ever and the first time in a decade that Atlanta has served as the host city for the annual gathering. The panel Phillips participated in was titled “Intersection of Food and Economic Development.” His fellow panelists included Adam Schwegman, senior vice president of Brookfield Properties Retail, who is stationed in Atlanta; Thomas McNair, executive director of Cleveland-based Ohio City Inc.; and Haile Johnston, founder of The Common Market in Philadelphia. Catherine Timko, CEO of Wilmington, Del.-based economic development consulting firm The Riddle Co., served as panel moderator. Food traffic, the right demographics, and a community …

October 2, 2018

Conference Coverage Features Healthcare

InterFace Panel Ponders How Mergers, Consolidations Will Impact Healthcare Real Estate

by Taylor Williams October 2, 2018

DALLAS — The past 12 to 18 months have seen a strong uptick in the number of mergers and consolidations among healthcare providers in the United States, and industry experts are still trying to figure out how this activity will impact cash flows, pricing and cap rates for healthcare properties. A recent report from the Health Research Institute at PricewaterhouseCoopers (PwC) identified 255 healthcare merger and acquisition deals in the second quarter of 2018 alone. That figure actually represented a 7.3 percent decline in this kind of deal volume from the first quarter of 2018. The PwC report noted that healthcare providers are facing declining revenues driven in part by lower reimbursement rates for both public and private payors, forcing them to cut costs to stop the bleeding. Mergers, partnerships and strategic alliances provide conduits for this kind of cost cutting. Larger deals proposed or closed this year include the $69 billion merger between Aetna and CVS, as well as Cigna’s $67 billion acquisition of pharmacy benefit manager Express Scripts. Rite Aid also cast merger bids with Walgreens and Albertsons, though both failed to reach completion. And on Oct. 2, two Texas-based healthcare providers, Baylor Scott & White and Memorial …

October 2, 2018

Conference Coverage Development Features Multifamily Texas Texas & Oklahoma Feature Archive

Panel: Multifamily Developers in DFW Should Focus on Costs, Not Revenue

by Taylor Williams September 27, 2018

DALLAS — After experiencing exceptional rent growth between 2014 and 2017, it may be time for developers of multifamily product in the Dallas-Fort Worth (DFW) metroplex to shift their attention from the revenue side of the equation to the expense side. According to CoStar Group, average asking rents across DFW rose by about 12 percent between 2014 and 2017. The year-over-year rent growth of 6.3 percent that occurred between 2014 and 2015 marked a 10-year high for the market and kicked new development into high gear. Now, however, the metroplex has become inundated with new multifamily supply — nearly 22,000 new units delivered in the past 12 months. Rent growth has slowed to about 2.2 percent year-to-date and vacancy is inching upward. But rather than pump the brakes on building, developers should be looking for ways to cut costs, not push rents, if they want to maintain their current levels of profitability. Such was the conclusion of six multifamily developers who gathered at the seventh annual InterFace Multifamily Texas conference on Sept. 26. Held at the Westin Galleria hotel in Dallas, the event drew roughly 250 attendees. Matt Brendel, divisional president and managing partner at Irving, Texas-based JPI, was the …

September 27, 2018

Conference Coverage Features Georgia Multifamily Seniors Housing Southeast Southeast Feature Archive

Seniors Housing Development Costs Dictate Market Entry, Says InterFace Panel

by Kristin Harlow September 25, 2018

ATLANTA — The pace of seniors housing development has accelerated sharply in recent years. Approximately 396 seniors housing properties came online or opened in the top 100 metro areas in the country from the fourth quarter of 2016 to the fourth quarter of 2017, according to data from Plante Moran Living Forward, a senior living development consulting firm. During the two years prior, about 596 communities opened. What’s more, approximately 65 percent of those newly added properties were from operators that only had two or fewer properties, according to Dana Wollschlager, practice leader for the firm and moderator of the development panel at the 2018 InterFace Seniors Housing Southeast conference. The significant number of developments and new entrants to the seniors housing space were major discussion points for the panel, which took place on Wednesday, Aug. 29 at the Westin Buckhead in Atlanta. The one-day conference drew nearly 520 developers, lenders, investors and operators in the senior living space. Joining Wollschlager on the panel were Richard Ackerman, managing partner of Big Rock Partners; Jeff Arnold, chief operating officer of United Group of Cos.; Blanding Beatty, chief investment officer of Traditions Senior Living; Andy Isakson, managing partner of Isakson Living; and …

September 25, 2018

Arizona Conference Coverage Features Industrial Western Western Feature Archive

InterFace Brokerage Panel: Phoenix Industrial ‘Moving Up the Food Chain’

by Jaime Lackey September 21, 2018

The InterFace Phoenix Industrial conference and networking event was held on Wednesday, Sept. 12, featuring three panel discussions. The brokerage panel, moderated by Rob Martensen, executive vice president with Colliers International, featured a lively discussion about activity in local submarkets and a recap of the reasons Phoenix is winning deals over Southern California and Nevada. Industrial Activity in Arizona Microsoft recently purchased 267 acres for a data center in the West Valley, said Anthony Lydon, national director, Industrial Supply Chain & Logistics Solutions with JLL. Qualified data centers receive waivers on personal property tax for 10 years, Lydon said, noting that each rack in a data center is approximately $1 million in personal property, so data centers are certainly enjoying the benefits of locating in Arizona. Arizona will also be a huge winner in the manufacturing sector, Lydon added. He cited Colorado-based food packaging provider Ball Corp. as an example of a company that was looking at Mexico for space before the 2016 election but has since opened a plant in the West Valley submarket of Phoenix due to the strategic location between Mexico and Southern California. Minnesota-based Andersen Windows & Doors is buying 64 acres from Opus to build …

September 21, 2018

Conference Coverage Features Multifamily Western Feature Archive

It’s All About Job Growth for Phoenix Multifamily, Say InterFace Panelists

by Amy Works September 20, 2018

With moderator John Lotardo, senior vice president of Commonwealth Land Title Co., at the helm, owners and developers dove into a discussion about Phoenix’s multifamily market — current trends, future activity and more — at the InterFace Phoenix Multifamily Conference on Sept. 11 in Scottsdale. And the main consensus for the Phoenix market? It’s all about the job growth, absorption is steady and the current activity should continue for the next few years. Decrease in Homeownership, Increase in Jobs Overall the marketplace has experienced an increase in job growth, particularly throughout the workforce sector, resulting in a steady need for multifamily housing options across the area. “Homeownership has gone down approximately 12 percent overall and jobs are increasing,” noted John Rials, executive vice president of Western Wealth Capital. This trend is creating a more complex demand for housing throughout the market. While there is an increase in jobs, it’s important to note that the majority of those jobs are workforce-level. Developers and owners need to be cognizant of rent ceilings for residents, explained Nicole Wray, senior director with Greystar. New Audiences, New Exposure Along with meeting the needs of the continuing influx of renters, owners and developers are navigating the …

September 20, 2018

The Laguna medical office building, Orange County, California

Features Healthcare Office

Is Today’s Boom Market for Healthcare, Medical Office Real Estate Built to Last?

by Jeff Shaw September 19, 2018

By John Pollock CEO, Meridian It is hard to refute that demographic changes occurring in the United States are having a positive impact on healthcare real estate. Based on the latest U.S. Census data, the number of people age 65 and over is on a steep increase and on track to nearly double between 2010 and 2030. The utilization rate of healthcare facilities by people in this age cohort is dramatically more than the younger cohort. According to a report released by Transwestern in September, an aging demographic and higher utilization rates will increase the demand for practitioners and physical space. Transwestern says there is an estimated 110 million square feet of available medical office space among existing buildings and those under construction in the United States as of the second quarter. If all of the required practitioners needed to meet the increased consumer demand were to locate within the traditional medical office space, there would be a shortfall of more than 40 million square feet. The answer to the question of whether today’s boom market for healthcare is built to last is most assuredly yes. That being said, the healthcare sector is attracting attention from more and more investors. …

September 19, 2018

Content Partner Features

The Case-by-Case Realities of Student Housing Financing

by Amy Works September 17, 2018

Providing and securing financing for student housing properties — whether acquisition, refinancing or new development — is a competitive market. “The rewards of working in student housing are numerous. There is a constant supply of tenants, revenue tends to be stable, and the sector is considered recession-resistant,” says Justyna Daniuk, commercial real estate lending analyst with Alliant Credit Union. However, Daniuk notes, student housing financing does have risks, including occupancy stability, changing taste of student residents and market competition. A lender’s familiarity with the nuances of student housing — like yearly turnover and unique leasing cycles — will lead to a better lending experience for both the borrower and lender. For example, Daniuk explains, lenders should understand that sometimes landlords have to offer shorter leases and incentives to win the business of their student-residents and their parents, who often guarantee the leases. While most financing arrangements are a case-by-case situation, there is a particular set of criteria that lenders look for to ensure a successful lending package in the ever-evolving student housing sector. Top Five Considerations for Student Housing Lenders • Proximity — A property’s distance from a university or college campus is often a top concern for lenders. Ideally, …

September 17, 2018

Conference Coverage Features Multifamily Seniors Housing Southeast Feature Archive

Market Studies Are ‘Just One Piece of The Puzzle’ for Seniors Housing Developers, Says InterFace Panel

by Camren Skelton September 13, 2018

ATLANTA — Investing in a quality market study is an important step for a developer to take before breaking ground on a new seniors housing community, but the analysis alone cannot predict the success of a future property. “The report gives you a point-in-time idea of where you’re at, but it doesn’t take into consideration what’s really happening within the marketplace, on the ground, in competing communities each and every day,” said Joe Jasmon, CEO and managing partner of American Healthcare Management Group, a consultant to the seniors housing and healthcare industries. According to Jasmon, in order to get a true feel of the properties you are competing against, it’s imperative to have boots on the ground. “Everybody looks good on the Internet and everybody will tell a good story on the phone,” he said. “But if you don’t actually go into these communities, you’re missing out on a whole story about the marketplace.” Jasmon’s comments came during the “Getting Good Data” panel discussion at the fifth annual InterFace Seniors Housing Southeast conference held Wednesday, Aug. 29 at the Westin Buckhead in Atlanta. The one-day event drew nearly 520 developers, lenders, investors and operators in the senior living space. Joining …

September 13, 2018

Features Georgia Hospitality Southeast Southeast Feature Archive

Economist: Hotel Sector Benefitting from Strong Consumer Confidence, Uptick in Income and Corporate Profits

by John Nelson September 11, 2018

ATLANTA — Roger Tutterow, director of Kennesaw State University’s Econometric Center, encourages hoteliers to be optimistic about today’s historic level of consumer confidence because it directly impacts the leisure travel side of the hospitality sector. In late August, the consumer confidence index increased to 133.4, its highest level since October 2000, according to The Conference Board. The index gauges consumers’ confidence levels about business and labor conditions. “This is still a consumer-driven economy, and it’s very important that we maintain those confidence levels,” said Tutterow, who was one of the featured speakers at Atlanta Lodging Outlook 2019. The Atlanta Convention & Visitors Bureau, Cornell Hotel Society and the Georgia Hotel & Lodging Association jointly hosted the annual event, which took place on Tuesday, Sept. 4 at the InterContinental Buckhead hotel in Atlanta. Spending Power Impacts Hotel Performance Personal income gains and corporate profits also affect hotel absorption as these determine the spending power of leisure travelers and businesses. According to the Bureau of Economic Analysis, personal income increased by 3.5 percent over the past six months, while corporate profits rose 20 percent during the same period. “You’ve got support both from the personal income and corporate profits side,” said Tutterow …

September 11, 2018

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