Stand in the center of Des Moines, take a look in all directions and one will discern that retail growth is not discriminating. It’s occurring in all areas of the marketplace.That’s not surprising for a metro area of 600,000 that was recently named “America’s Wealthiest City” by NBC’s Today show as part of a special series titled “Healthy, Wealthy, Wise.” In 2013, Forbes magazine ranked Des Moines tops on its 15th annual list of “Best Places for Business And Careers.” Market statistics provide plenty of evidence. Occupancy in neighborhood retail centers has increased for three straight years, rising to 81.9 percent at the close of 2013. Leasing activity has been robust with more than 300,000 square feet of positive absorption during the past 12 months. Only a few big-box retail spaces are now available with occupancy rising to 97.5 percent in December 2013. Although growth is occurring in all areas, the Jordan Creek Town Center corridor continues to grab headlines. Hurd Real Estate continues construction on the 328,597-square-foot Plaza at Jordan Creek. In addition to Lowe’s and the recently opened Dick’s Sporting Goods, both HomeGoods and Nordstrom Rack are nearing completion. The Nordstrom lease is a significant milestone for Iowa …
Market Reports
Las Vegas investors remain risk averse, favoring Class A and B properties. Increased buyer demand and a lack of inventory will support more aggressive pricing, with the sellers capitalizing on improving property performance. With stronger operations, Class C owners are encouraged to bring assets to market, pushing deal flow for the properties. The location of the asset is crucial to investors searching for higher returns, which is expected to exceed 8 percent. With an improving local economy, new construction, strengthening job market and a new “downtown,” we can expect a lower apartment vacancy and higher rents in Las Vegas this year. The improving local market and strengthen job market is being driven by some noteworthy construction and openings this year. They include the Linq, SLS Hotel (formerly Sahara Casino), the Downtown Summerlin Mall, the Grand Bazaar Shops, the Malaysia-based Genting Berhad’s $4-billion Resorts World Las Vegas (formerly Echelon) and the announcement of the $2.5-billion renovation of the Las Vegas Convention Center. These projects will create more than 15 million direct and indirect jobs. On top of this, occupancy rates keep rising. The Las Vegas market absorbed more than 3,000 units in 2013. It has absorbed another 760 net-leased units so …
Did Richmond get hip while you weren’t looking? If you missed all of the skinny jeans, slim-fit plaid, tattoos, beards and craft breweries, then you were not paying attention. Is there a correlation between the amount of breweries, luxury apartments and historic rehabs? Maybe, but something is happening here and it has little to do with Richmond’s former designation as the Capital of the Confederacy and more to do with a vibrant and diverse culture, native-brick buildings, the James River, Virginia Commonwealth University (VCU) and a great quality of life. Millennials are flocking here and Richmond has gotten cooler (i.e. better) every year, albeit somewhat slowly. In terms of apartments, there are several hotspots in the area that continue to be, or are becoming, destinations to live, work, shop and play, and multifamily developments are leading the way. Shockoe Bottom is booming, Manchester is coming to life, Scott’s Addition & Boulevard could become Richmond’s SOHO, Short Pump is moving into Goochland County and does not seem to be stopping anytime soon, and Chesterfield County, once you get around the cash proffers, continues to surprise. Richmond has just over 70,000 units and a very stable vacancy rate of 4.5 percent. Class …
The Houston retail market has changed dramatically in recent years, but 2014 has seen historically strong real estate fundamentals to date. It is a sign of considerable economic strength that per capita personal income reached a new peak in 2013, even while Houston experienced the largest change in population across U.S. metro areas, according to the latest estimates from the U.S. Census Bureau. Houston’s population increase of nearly 137,700 over the year ending in July 2013 outpaced all other metro areas, with New York in second place (111,749) and Dallas/Fort Worth in third (108,112). Additionally, with Houston employment growth among the strongest in country, it should come as no surprise that household incomes are rising and retail sales are strong. A Retail Landlord’s Market Retail occupancy in Houston reached nearly 93 percent during the first quarter of 2014. While retail availability is extremely limited across the city, it is particularly tight inside the Loop as well as in the northwest areas inside of Beltway 8. Class A product is in high demand across all submarkets, so much so that the highest profile centers currently have no availability. However, despite this high demand, retail construction activity is less than a quarter …
Three staggering announcements highlighted downtown Chicago’s office sector during the second and early third quarter as investors jockeyed to get a piece of a market that has been the beneficiary of the tech boom. The CBD office vacancy rate is now at its lowest level in five years — 14.1 percent — aided by downtown net absorption of 592,328 square feet during the second quarter, the most in nearly seven years, according to CBRE Group. Asking rents in the city have risen 3.9 percent over the past year. There have been seven sales of more than $300 million since October 2013, including the deal that will come to define downtown Chicago for a long time to come — the disposition of 300 N. LaSalle St. to Newport Beach, Calif.-based The Irvine Company for $850 million in May. The purchase price equals $654 per square foot for the 60-story trophy tower. To put that figure into context, consider that KBS Realty Advisors LLC paid a then-record $503 per square foot for the building in 2010 to Hines Interests LP. So why did 300 N. LaSalle fetch a record price? There are a few reasons. First, the tower is 97 percent leased …
Investor money has returned to the industrial market in Las Vegas. Compressing cap rates continue to result in rising values on properties even in the hardest-hit areas of Las Vegas. Couple that with limited available industrial product, and the result is the need for today’s buyers to act quickly and competitively if they want to acquire quality properties that will deliver attractive yields. MCA Realty initially entered the Las Vegas market in mid-2011 to acquire incubator/mid-bay, multi-tenant industrial properties significantly below replacement cost. Since that time, the firm has seen a substantial shift in the number of buyers competing for this product type in this market. This increasing competition will continue to drive values up, and investors will need to rely even more heavily on their local brokerage relationships to make deals work. On the leasing side, vacancy rates continue their downward trend. Occupancy is up on all industrial product types, and confidence from business owners continues to rise. The result is increased stabilization throughout the market. A key component driving the tenant demand for multi-tenant industrial is the resurgence of hotel construction and renovation in the works on the Las Vegas Strip. This activity has created a surge of …
When The New York Times has something positive to say about Birmingham, you know something really good is in the works — and that’s exactly what happened last August. The paper ran an article entitled “A Return to Downtown Birmingham” that highlighted Railroad Park, Regions Field, the new Westin Hotel and the renovation of Lyric Theatre. It quoted David Fleming, CEO of REV Birmingham, calling attention to the public enthusiasm that’s driving the revitalization. “There’s a feeling that [the downtown] is back, and that wasn’t true 10 years ago,” he said. This past March, Livability.com added to the buzz by ranking Birmingham 10th in the nation in its ranking of downtowns in small- and mid-sized cities. Developers Betting Big As a result, there’s a question that’s now on the minds of many apartment investors: Is the sky the limit for downtown Birmingham? It’s too early to tell, but an increasing number of developers are placing their bets on the Magic City. At the end of April, the Bristol Development Group announced plans to build 250 high-end apartments downtown, joining such local companies as Harbert Realty, Watts Realty, KRE Development Holdings, RGS Properties and Scott Bryant & Co. that have about …
Home to many of the fastest growing communities in Maine, the Sebago Lakes region is continuing its rebound from the Great Recession. Recent Census data puts Windham as the second-fastest growing Maine community, just behind our neighboring town of Gorham. All six of Windham’s bordering towns are in the top 30 fastest growing communities, including four in the top 10. Windham acts as the marketplace and service center for the region and serves a primary trade area population of 61,000 residents, and a secondary trade area of 80,000 people. The four-season nature of the region draws 500,000 visitors annually. Retail sales have rebounded from recession lows — and with 50 percent of the region’s sales, Windham leads the way. Construction of Single-Tenant Retail Remains Steady Tractor Supply (19,000 square feet), Goodwill (17,800 square feet) and Dollar Tree (10,000 square feet) have added to the 1.5 million square feet of retail space since 2012. AutoZone recently submitted plans for a 7,500-square-foot building to be constructed in the center of our retail district, and other retailers are showing interest in locations south of the retail center along U.S. Route 302. Vacancy Rates Remain Low Windham’s retail vacancy rate continues to remain low, …
It should come as no surprise at this point that Orange County is on course with a robust economic recovery. Furthermore, there are favorable indicators for a steady increase in value over the next few years. Even though industrial product is limited in the county, development is picking up now that vacancy rates have been on a downward slope and rental rates continue their course on a gradual upturn. While all sectors in Orange County are seeing movement in a desirable direction, quality industrial space is becoming even more of a premium. The larger industrial spaces are drying up in Orange County. Most of the industrial spaces available today are smaller than 20,000 square feet. Meanwhile, many older buildings are being converted or remodeled to invite a variety of other property uses like residential, creative office and self-storage. The average asking price for investment-grade industrial properties of more than 20,000 square feet in Orange County is at $147 per square foot, as of the halfway point through the second quarter of 2014. This number has been on the rise year-over-year since the drop at the end of 2010 when the average asking price dipped to $120 per square foot. The …
The center cores of Baltimore and Washington, D.C., are located approximately 40 miles apart, and talk has renewed about the possibility of connecting the two metropolises by a Maglev rail system. The Baltimore/Washington region is generally considered the fourth largest in the country, boasting nearly 9 million people in the common area. But, when it comes time to rate the demographics, quality of life and overall attributes between the two, Baltimore assumes its secondary status in most comparisons, especially among some professionals in the retail real estate industry. Yet, given the recent successes of retail ventures that have opened in Baltimore City within the past year, prospects for future developments that promise to reinvigorate oft-neglected sections of the city and planned expansions of other mixed-use projects, Baltimore is currently enjoying a “charmed” life. The iconic advertising campaign for National Bohemian beer, which referred to Maryland as “The Land of Pleasant Living,” seems like an appropriate descriptor these days. The project that still has Baltimoreans buzzing is The Shops at Canton Crossing, the 330,000-square-foot retail shopping center situated within the city’s east side that opened last fall, and could easily serve as a national model for successful brownsfield development. Abandoned warehouse …