Western Feature Archive

Lee & Associates Breaks Down Third-Quarter Economic Outlook by Sector

by Sarah Daniels November 1, 2021

The calculus for which asset classes are likeliest to demonstrate strong growth continues to shift as the pandemic appears to be receding. Patterns in labor shortages, supply chain issues and material costs have managed to solidify through the third quarter of 2021. Lee & Associates’ newly released Q3 2021 North America Market Report dissects third-quarter 2021 industrial, office, retail and multifamily findings, with a focus on where demand is moving and the challenges facing each asset class. Lee & Associates has made the full market report available at this link (with further breakdowns of factors like vacancy rates, market rents, inventory square footage and cap rates by city). Below is a bird’s-eye overview of four commercial real estate asset classes as general categories, broken down to frame each through the trends and complications they faced up to the fourth quarter, according to Lee & Associates’ research. Industrial: Q3 Posts More Record Demand Pandemic-fueled consumer spending drove up third-quarter demand for warehouse and distribution facilities that eclipsed previous records. And despite a nationwide surge in new construction, some metros can barely accommodate the pace of tenant expansion. Additionally, year-over-year rent growth is at a record 6.7 percent for the industrial property sector …

November 1, 2021

Arizona California Features Industrial Nevada Western Western Feature Archive

CapRock Partners Seizes Industrial Opportunities in Western Region

by Kristin Harlow October 7, 2021

Newport Beach, Calif.-based CapRock Partners was busy before the pandemic, but shows no signs of slowing down even as brick-and-mortar retail reopens. The industrial investor, developer and asset manager’s newest venture is also its biggest: a 183-acre infill project in Phoenix where it plans to build an eight-building industrial complex that totals more than 3.4 million square feet. “Several years prior to the pandemic, we recognized the ecommerce trends along with the demand for larger logistics facilities and subsequently made investments in buildings and land positions in order to capture a segment of that demand,” says Bob O’Neill, CapRock’s senior vice president of acquisitions. “In the 16 months since the onset of the pandemic, our growth has accelerated.” Phoenix’s Industrial Market Rises CapRock has added about 4.8 million square feet of Phoenix-area industrial product to its portfolio since the pandemic’s onset. Its total pipeline in the Valley is now close to 6 million square feet, with its Phoenix-area acquisition closing in 2017. Aside from CapRock, Cushman & Wakefield also appears to be bullish on Phoenix’s industrial market. The firm projects Phoenix’s preliminary industrial absorption to be about 12 million square feet for the first half of 2021. This compares to …

October 7, 2021

Chris Destino SoCal Orange County Industrial

Acquisitions California Content Partner Development Features Industrial Lee & Associates Loans Western Western Feature Archive

Growing Southern California Industrial Demand Creates Shifts in Strategy, Outlook

by Sarah Daniels August 5, 2021

Industrial real estate in Southern California has become what one might conservatively call a “fast-paced atmosphere.” The presence of multiple offers, sellers pushing up values and buyers continuing to chase deals have made for constantly increasing values and activity. Christopher J. Destino, SIOR, principal at Lee & Associates, spoke to REBusinessOnline about making strategic decisions in this unusual environment. REBusiness: What is the forecast for demand in industrial properties in Southern California? Destino: The future of demand in the area is very strong, with developers seeking new sites aggressively and underwriting steady future rent growth over the next couple of years. A lot of that is driven by e-commerce, and there’s still so much room to grow in the e-commerce world. E-commerce accounted for approximately 13.6 percent of retail sales in the first quarter of 2021 (a number that is steadily increasing). There is still a lot of room for that percent to increase, and that’s what is driving most industrial demand. REBusiness: What are the types of tenants have the most demand for space right now? Destino: The big three are distribution companies, contractors and service-type industries. There is a still a small manufacturing base, but those are the …

August 5, 2021

Affordable Housing Build-to-Rent Features Multifamily Seniors Housing Single-Family Rental Student Housing Western Feature Archive

‘Astronomical’ Multifamily Investment Demand Drives Up Pricing, Says Marcus & Millichap’s IPA Panel

by John Nelson April 21, 2021

The U.S. multifamily sector remains an attractive option for real estate investors looking for a safe haven. Beyond the pool of traditional buyers who are actively acquiring apartment properties, the sector has become a landing spot for companies that aren’t legacy multifamily owners. Steven DeFrancis, CEO of Cortland, cited REITs like Blackstone Real Estate Investment Trust as newly establishing a presence in the multifamily sector. BREIT recently made a $240 million preferred equity investment in Tricon Residential connected with Tricon’s purchase of single-family rental (SFR) homes in Nashville. Nuveen Real Estate is also a recent institutional investor entrant in the emerging SFR sector. “We’re seeing a lot of new capital, whether it’s coming from overseas or from here,” said DeFrancis. “Institutional capital is continuing to move into real estate, and then within real estate there’s a lot of movement from other sectors into multifamily.” Jessica Levin, senior director of acquisitions at Intercontinental Real Estate Corp., said that the influx of capital into the U.S. apartment market the past six months has been “astronomical.” She also said that there’s no slowdown ahead. “Competition is stiffer now than in the past 10 to 15 years, and it’s only going to increase from …

April 21, 2021

Content Partner Features Lee & Associates Western Feature Archive

From Expanding Operations to Leveraging Technology, Lee & Associates Evolves in the Face of Change

by Sarah Daniels January 11, 2021

The situation is a familiar one from the past year: 2020 changed a banner year full of promise into a difficult scenario full of fear and challenges. Jeffrey Rinkov, CEO and chairman of the board at Lee & Associates reflects on how his company took an emphasis on technology and communications infrastructure and used the past year as a time for reflection and a period to promote growth and client engagement. He also discussed trends he’s seeing for the future, the lessons he’s learned from a most unusual year and why he’s feeling optimistic for 2021. Focusing on Clients from the Start It’s hard to believe that less than one year ago, Rinkov’s team was experiencing an industry-wide high of momentum with massive pipelines and robust capital. What happened when the unthinkable came to pass? Rinkov explains that the executive leadership team at Lee & Associates took a moment in the early chaos to pause and evaluate what was critical, “Employee and agent safety, client connectivity and how we could deploy resources throughout our platform in a completely different way to support our agents and their client pursuits and interactions.” Tech savvy, hours of leadership phone calls and ingrained communication …

January 11, 2021

Industrial Nevada Webinar Western Western Feature Archive

Webinar: Las Vegas Industrial Outlook — How has the Pandemic Changed the Industrial Sector in Nevada?

by Sarah Daniels October 21, 2020

The webinar Las Vegas Industrial Outlook — How has the Pandemic Changed the Industrial Sector in Nevada? hosted by Shopping Center Business and Western Real Estate Business, covers how industrial experts are approaching investment sales, leasing and development within the Las Vegas industrial sector in the wake of COVID-19. With shutdowns, social distancing, and the explosion of e-commerce, industrial has become essential. Shopping patterns have changed, affecting manufacturing as well as warehousing and logistics. How has the coronavirus pandemic impacted industrial activity within the Las Vegas market? What do industrial leaders expect to see in the rest of 2020 and into 2021? See a list of some topics covered below: How has the pandemic impacted industrial activity? How are rents and sales prices trending within the market? Will industrial development slow in southern Nevada or remain steady? What types of tenants are looking for space? What features are they looking for? What are the hot submarkets? What trends in industrial development are you seeing in the Las Vegas market? Panelists: David E. Waters, Lathrop GPM LLP (moderator) Erin Johnston, Copaken Brooks Andy Crimmins, Crossroads Retail Group Tyler Enders, Made in KC Dan Lowe, Legacy Development David Block, Block & Company Webinar sponsors: …

October 21, 2020

California Content Partner Features Lument Multifamily RED Capital Group Western Western Feature Archive

Rents Weaken, Investors Stay Active in San Diego Multifamily Market

by Sarah Daniels October 5, 2020

By Daniel J. Hogan The economic impact of the COVID-19 pandemic has been felt more severely in Southern California than in most areas of the country. The Southland’s high concentration of employment in the tourism and entertainment sectors made it especially vulnerable to the effects of social distancing protocols and the reluctance of many to board commercial aircraft. Not only were job losses particularly acute in the initial months of the pandemic — the subsequent recovery has been lethargic. The rate of unemployment for July in each of the four large Southern California metropolitan markets remained materially above the national average, and in the case of Los Angeles County (18.2 percent) was the highest of any metropolitan area west of the Hudson River save for Yuma and El Centro. As it always has, Southern California will recover and is likely to do so in even more spectacular fashion than before. In the interim, how can multifamily investors position themselves to prosper? San Diego is the ideal market to scrutinize possible changes in renter behavior during the pandemic and consider their potential investment implications. Indeed, a deep dive into this market may provide clues to some of the great mysteries of …

October 5, 2020

California Content Partner Lument Multifamily RED Capital Group Western Western Feature Archive Western Market Reports

In Search of Relative Value in Orange County’s Apartment Sector

by Sarah Daniels September 24, 2020

Orange County offers residents all the key elements of the American dream. Its virtues are numerous and faults few. Indeed, Moody’s Analytics ranks the quality of life in the OC 10th highest among the 378 U.S. metros it reports on, just a half-step behind leaders Santa Barbara and Santa Cruz. Orange County is a terrific place to live, but is it a good place to invest? Gauging by observed capitalization rate trends, one may conclude that county apartment properties are highly prized gems. Class A trophy properties trade to going-in yields in the 4.00 percent to 4.10 percent area, and Class B and C garden complexes are typically priced to yields in the mid-4s, all only 25 basis points or so behind Los Angeles and the San Francisco Bay Area comparisons. But judging from transaction velocity, one might draw a different conclusion. Only six Orange County multifamily properties of 50 units or more have changed hands since mid-year 2019, and not a single sale has closed since February. Even by the cautious norms of the moment, this stands out as a market in search of price discovery. Slow transaction velocity can be ascribed, in part, to the prevailing buy and …

September 24, 2020

California Features Leasing Activity Restaurant Retail Western Western Feature Archive

Yelp: 61 Percent of Restaurants Closed Due to Pandemic Won’t Open Again

by John Nelson September 18, 2020

SAN FRANCISCO — A majority of U.S. restaurants and cafés that closed their doors in response to the COVID-19 pandemic will remain closed for good, according to crowd-source review giant Yelp. In its September economic impact report, the San Francisco-based firm tallied 32,109 restaurants that were open and operating on March 1 were closed on Aug. 31. Of that total, 19,590 (61 percent) indicated they were permanently closed. Yelp tracks business closures via business owners marking their business as closed, including by changing their hours or through a COVID-19 banner on its Yelp page. The tech firm concedes that closure counts are likely an estimate as businesses not included in the report include those that remain open with curtailed hours and staffing, or because they have not yet updated their Yelp business pages to reflect closures. Yelp only counts closures that have been vetted by its User Ops team or have been updated directly by a business owner. According to Yelp’s findings, breakfast and brunch restaurants, burger joints, sandwich shops, dessert places and Mexican restaurants are among the types of restaurants with the highest rate of business closures. Restaurants that work well for delivery and takeout — such as pizza …

September 18, 2020

California Content Partner Lument Multifamily RED Capital Group Western Western Feature Archive

The Inland Empire: A Rare 2020 Apartment Sector Success Story

by Sarah Daniels September 15, 2020

Someone once remarked that eighty percent of success in life is just showing up. Human experience verifies that being in the right place at the right time often is the intangible ingredient that leads to triumph. The strong performance this year of the Inland Empire multifamily market is a variation on this theme. During the pandemic, many renters sought refuge from the high density and high costs associated with big city life, and the work-from-home phenomenon made this objective feasible. For many Angelinos, Empire living was the best solution — close enough to Los Angeles to maintain contact with family and friends or to go into the office when necessary but substantially less densely settled and more affordable than most L.A. neighborhoods. By way of quantification, the average Riverside and San Bernardino County monthly rent in July was about $1,578 — and that is 28 percent less than the L.A. County average. The percentage savings for Class A space were about 1 percent greater, and parking, an omnipresent issue for Southern Californians, is typically free. The cost economies found in the Empire are more than trivial. Moreover, renters are more likely than in the past to find the unit and …

September 15, 2020

Newer Posts

Older Posts