In the central Connecticut market, owner/users are beginning to seek fair priced industrial facilities that can be financed by mostly local community banks using SBA and some conventional loans. Also we are seeing companies come up from Fairfield County (Bridgeport and Stamford) to take advantage of Waterbury Development Corp. loans and some forgivable grants. One 35,000-square-foot user put up their equipment as collateral to obtain a $500,000 loan for modern space where they could become more productive at a much lower cost of occupancy and expand their workforce. One landlord is buying large vacant industrial facilities at $20 per square foot and rehabbing and subdividing for re-lease programs. We are also seeing some new construction and facility expansions in industrial parks that offer Enterprise zone incentives. Municipal and state Department of Economic and Community Development incentives are driving transactions. These incentives include the Urban Jobs program, Enterprise Zones and Corridors, SBA 504 loans, and tax abatements and other enhancements. Waterbury has four industrial parks and at least five business parks surrounding the city, including Watertown, Plymouth, Naugatuck, Cheshire, Oxford and others. The city of Waterbury offers many perks, and the others offer lower taxes and suburbia. The Naugatuck Industrial Park …
Market Reports
Property performance improved meaningfully with both vacancy and concessions trending lower in 2011. Asking rents ticked up 2.7 percent to $1,084 per month during that span. Furthermore, the 6,400 fewer jobs recorded during the first half of 2011 was offset by the hiring of 29,000 workers over the final two quarters. These gains supported a 29.5 percent increase in deal flow to 57 sales. However, the prevalence of small acquisitions caused a 13.2 percent dip in dollar volume to $500.5 million last year. New apartment completions, as well as permits issued, were the lowest annual total on record in more than 15 years. The Inland Empire will follow economic growth patterns more reflective of national trends through 2012 and into the future. It will not be returning to the iconic growth that characterized the region from the early years of the past decade up to 2007, when the last notable expansion firmly cemented the metro area as one of the nation's top economic engines of the time. As the region continues to mature, with vast swaths of land developed over the past decade for infrastructure, housing and distribution centers, one of its key growth drivers, construction, is apt to remain …
Salt Lake City’s retail market will post modest occupancy growth through year’s end, though performance will vary considerably by location, as weak housing conditions weigh heavily on parts of the metro. For example, many shopping centers in the Midvale/Sandy/Southeast, Southwest and Weber and Davis counties submarkets, which were home to significant residential and retail construction during the housing boom, will post vacancy in the mid-teens this year. While weakness will persist until the housing market enters a formidable recovery, outer suburbs may offer strong long-term growth opportunities, particularly in the south, as the final leg of Trax extends from Sandy to Draper. In the near term, however, close-in submarkets will outperform. In the South Central area, which experienced limited construction ahead of the recession, vacancy will hover around 5.5 percent. Within the submarket, discount stores, such as Savers, Goodwill and Dollar Tree, along with fitness centers, have started to backfill vacant spaces, taking advantage of discounted rents. Investors will seek healthy returns in Salt Lake City, though limited for-sale inventory will hamper velocity. Private buyers, mostly from Utah or the Western region, will favor performing strip centers and smaller single-tenant deals, such as fast food and drugstore assets, along with …
The Greenville-Spartanburg office market includes more than 10 million square feet of leasable office space located along Interstate 85 between Charlotte, North Carolina, and Atlanta. The market is expected to enjoy increasing absorption levels with a modest drop in vacancy, which currently stands at just over 16 percent. The biggest news on the construction front is Hughes Development’s ONE building in the Greenville CBD. The property will deliver 370,000 square feet of Class A office space to the market in its two phases. Phase I is expected to be completed by the end of 2012. Phase II is expected to be completed by third quarter 2013. Anchor tenants for the property include CertusBank, Haynesworth Sinkler Boyd and Clemson University, which is relocating its Master’s of Business Administration program to the project. Banking is one sector that stands to be a high-growth industry in the local market through the end of 2013. In addition to rapidly growing CertusBank in the new ONE building, TD Bank recently announced its intention to permanently occupy the Interstate 85 campus the company acquired with the purchase of a regional bank, The South Financial Group. This removed 150,000 square feet of vacant Class A space from …
Restrained development, an unsettled single-family housing market, and growing rental housing demand are driving a robust turnaround in the Hartford multifamily sector, making the market one of the strongest in the country. Vacancy will fall to less than 3 percent in 2012, enabling property owners to raise rents significantly. Some of the greatest gains will likely occur in the North/West Hartford and South Hartford/North Middlesex submarkets, where vacancy rates are less than 3 percent. Overall, vacancy and rents have likely improved sufficiently to justify construction, and many planned projects may accelerate through the pipeline in the quarters ahead. The track record of recently delivered projects will likely embolden developers. For example, in the North/West Hartford submarket, vacancy fell 60 basis points last year after a 264-unit complex came online. The multifamily sector is also getting a lift from the still-struggling single-family housing market, where sales volume fell 20 percent last year. Mortgages remain hard to obtain, and many would-be homebuyers will remain in rentals for an extended period as a result. The Hartford market continues to attract attention from investors, perhaps to a greater extent than other markets of similar size. A slight decline in transaction velocity over the past …
Driven by robust demand from tech and media companies, operations in Manhattan will recover at a moderate pace, though trouble looms in the financial industry. Turbulence in the global economy, a political gridlock in Washington, D.C., and new regulations will prompt hedge funds and investment banks to shed jobs. A few of these users will offer space for sublease to cut costs, which will encourage landlords in Midtown to offer lucrative concessions to compete for tenants. Midtown South will boast the tightest vacancy in Manhattan in 2012 as media and tech firms backfill space, while the redevelopment of Hudson Yards will ignite leasing activity in the area. Tenants priced out of Midtown will target downtown, where Condé Nast expanded its lease at One World Trade Center to 1.2 million square feet. In Brooklyn, the New York City Human Resources Administration will consolidate operations into 400,000 square feet near Atlantic Yards this year, which will further transform the area. New York City fundamentals remain among the best in the country. Citywide, payrolls will grow 1.5 percent this year, or 56,000 jobs, while office-using sectors will gain 15,000 positions. In all five boroughs, approximately 1 million square feet of office space will …
For years El Paso was thought of as a sleepy little outpost in far West Texas on the Mexican border. Many people from the rest of the state knew little about the city, and thought it well suited to be part of New Mexico. The economy was always fairly stable especially in the commercial real estate sector. There was never boom nor bust, just steady growth fueled internally. Arguably the biggest things to happen in El Paso were the construction of Interstate 10 and the Sun Bowl. That was of course until recently with the opening of the Texas Tech School of Medicine, and explosive growth at Fort Bliss. The Army post is in the last phases of a $4.5 billion expansion. That does not include a $1.5 billion, 250-acre Army medical campus, and VA Hospital that recently broke ground. It is estimated that Ft Bliss’s population will expand by 40,000 troops and their families during the next few years. In spite of the economic downturn, El Paso’s future is as bright as ever. It has received many national accolades. Forbes Magazine recently ranked the city as having the 2nd best performing economy nationally in 2011. El Paso is the …
The industrial warehouse locomotive is back on track in Upstate South Carolina. We experienced tremendous positive absorption in warehouse space in 2011 — around 1.7 million square feet — and vacancy is down to pre-recession levels at 9 percent. Vacancy has been dropping steadily from 10.8 percent since the fourth quarter of 2009, and experienced a dramatic drop in 2011. This recovery is a result of the recent surge of announcements of new and expanding operations by manufacturing companies in the Greenville/Spartanburg area. Corporations such as Michelin, Bosch Rexroth Corp., Scio Diamond Technology, Honeywell International, PRETTL Electronics, Griffin Thermal Products and BMW will invest more than $277 million combined in our area and create 3,714 new jobs. There are 4,014 industrial properties currently in the Greenville/Spartanburg market. Sixteen leases and four sales for industrial warehouses were reported in the first few weeks of 2012. Rental rates for warehouses range from 32 cents per square foot to $13.12 per square foot, a wide range that depends on size, location and condition. Overall, the average rental rate is $2.92 per square foot. With vacancy dropping continually and no new developments underway or on the horizon, inventory is being depleted, which is creating …
As all of us in the retail market know, the past few years have been downright tough. It’s safe to say that we all felt a slight shift in mid-2011 where it seemed that we may — just may — have stabilized. With Tivioli’s success, Sportsman’s Warehouse re-entering the market and Hobby Lobby taking the plunge into Las Vegas, it seems we may have overcome the black “X” looming over our market. Our asking rent numbers are hovering around $1.50 per square foot, and retailers like Nima Accessories, Firestone Tires, Children’s Place, Winco and Dollar General are taking advantage of these rents and expanding valley wide. More than half of the leases completed in the past year were local retailers either relocating or expanding. The retail vacancy rate valley wide is about 11 percent, up from the fourth quarter of 2010. The Southwest submarket shows the lowest vacancy rate, about 9 percent, with the West Central submarket at the highest, about 15 percent. The market absorbed more than 119,000 square feet of retail product throughout the year. Two new Winco stores add 195,000 square feet to our retail inventory, and to the net absorption for 2012. Retail sales also picked …
The apartment market in the Greater Salt Lake area continues to be strong and vibrant. The past two quarters of 2011 demonstrated an upward pressure on rents. Overall occupancy is at 94.9 percent, up from 93 percent in 2010. Vacancy presently hovers around 5 percent and appears as though it will remain so, which is evidence of a tight rental market. These signs enable managers/owners to increase rental rates and drop concession offerings with exception to newly constructed projects during their initial lease up. Apartment development also remains robust in the downtown Salt Lake market where the City Creek project, being developed by the Church of Jesus Christ of Latter Day Saints, will be adding more than 1,000 new units. These units will be a part of a significant redevelopment of several downtown city blocks that will add new office and retail product in addition to multifamily. With this kind of unit increase in the immediate downtown market, nearby small and large projects will soon be able to raise rents as the new units will command the highest rates. The total amount of new units expected to come onto the market in the next year is approximately 1,900, with the …