Market Reports

Greater Des Moines Retail Market Is on Track for Fast Recovery

by Kristin Harlow July 22, 2021

By Christopher Stafford, Cushman & Wakefield The Greater Des Moines retail market continues to emerge from the pandemic and is quickly regaining its footing from the closures and challenges experienced by many retailers, restaurants and businesses alike. Despite a few setbacks, occupancy rates and rents have generally held steady. Consumer spending is surging and according to a WalletHub study, Iowa’s COVID-19 recovery is the quickest in the nation, earning a total score of 75.25 out of a possible 100. The study compared all 50 states across three categories: COVID health; leisure and travel; and economy and labor market. Trends, observations A local real estate mogul recently made the analogy that the Des Moines retail market is currently much like a chessboard — lots of moving pieces and strategic repositioning by the current players. Greater Des Moines, like other Midwest cities, is experiencing a handful of post-pandemic retail trends that include: • Integrated retail approach (omnichannel): Bricks & mortar + online presence and ordering + apps + delivery/pickup. The presence of drive-thru and pickup services will shape the future of retail and are in high demand by restaurants and retailers. • Space transformation: Spaces once occupied by traditional retailers are now …

July 22, 2021

Market Reports Northeast Northeast Market Reports

Northeast Property Owners: Beware Overlap Between Property Tax Valuation Methods

by Taylor Williams July 21, 2021

There are multitudes of ways for property owners to reduce their tax burdens, as well as missteps that can derail a tax strategy. With that in mind, taxpayers should beware of trying to prove a low value for a tax appeal while simultaneously claiming a higher value in another proceeding. And here is how it can happen. Protesting a High Assessment Most real estate taxes in the Northeast — including those in New York, Pennsylvania, Connecticut and Massachusetts — have an “ad valorem” or “value-based” assessment method. Thus, the greater a property is worth, the higher its real estate tax burden. A property tax bill is calculated by multiplying the property assessment by the tax rate. The assessment or taxable value is determined by the local assessor or board of assessors and is typically a percentage of market value. This percentage varies among states and even municipalities. In New York, it is based on a comprehensive analysis of sales. The percentage is released annually by the state’s Office of Real Property Tax Services and is different for each municipality. For example, Connecticut sets its percentage by statute. In Pennsylvania, it is set by the state’s Tax Equalization Board. But regardless …

July 21, 2021

Industrial Market Reports Multifamily Texas Texas Market Reports

Growing Pool of Investors Targets Multifamily, Industrial Deals in Fort Worth

by Taylor Williams July 20, 2021

By Bobby Weinberg, senior vice president of debt and equity, NorthMarq Employment growth is providing a powerful tailwind for the Dallas-Fort Worth (DFW) commercial real estate market. And while Dallas may be the headline name that is attracting employers and investment capital to the metroplex, Fort Worth is commanding attention as a formidable market in its own right. DFW embodies a classic story of a high tide raising all boats. The metro has been one a national leader in terms of employment growth for several years, and the region is expected to add another 150,000 jobs this year. Employers that are looking to tap into that workforce are finding that Fort Worth checks all the right boxes. It has an educated labor pool with colleges and universities that include Texas Christian University and the nearby University of Texas-Arlington, among others. Furthermore, the city has a business-friendly government. An important third leg to that stool involves the affordable cost of living for workers. Fort Worth offers a multitude of workforce housing options — both in its single-family residential and its growing multifamily sector — that provide lifestyle choices for workers that employers like. Investors are discovering that there is not a …

July 20, 2021

Florida Market Reports Multifamily Southeast Southeast Market Reports

South Florida’s Reliable, Robust Apartment Market is a Safe Haven for Investors

by John Nelson July 18, 2021

South Florida multifamily fundamentals are, and will continue to be, the single biggest driver of performance in the market. Strong rent collection and occupancy performance through the pandemic, population and household growth, low homeownership rates, increasingly expensive home prices, an improving job market, higher wage growth, limited land and a wonderful lifestyle all contribute toward sustainable long-term growth. Demand for multifamily rentals will increase post COVID-19 as South Florida becomes a hotbed of population growth from people migrating from other states due to the business-friendly environment and tele-workers who are choosing South Florida as their new home. In fact, household formations in South Florida are expected to increase more than 44,000 each year over the next five years. Assuming this projection materializes, at 60 percent homeownership rate (consistent with historic homeownership rates) represents over 17,000 new renters per year in South Florida. Investment sales skyrocket In the span of less than 12 months, the South Florida multifamily market went from near-record sales activity to virtually none before rebounding again to close the year. Last year ended with 254 multifamily sales totaling $3.1 billion. Despite almost six months of virtually no investment activity from April through September, total sales volume was …

July 18, 2021

Market Reports Massachusetts Multifamily Northeast Northeast Market Reports

Rent Growth, Absorption in Boston Multifamily Market Begin to Exceed Expectations

by Taylor Williams July 16, 2021

By Simon Butler, vice chairman, CBRE; Biria St. John, vice chairman, CBRE; John McLaughlin, senior vice president, CBRE; and Colleen Pentland Lally, vice president, CBRE As we emerge from pandemic-era lockdowns and restrictions, Boston’s multifamily market is proving once again to be extremely resilient. With businesses, offices, restaurants and leisure activities rapidly returning to normal, both the overall economy and multifamily fundamentals are rebounding with a velocity that has far outpaced industry expectations to date. Throughout the winter and spring of 2021, job recovery has been swift in the metro Boston region, with employment levels now over 92 percent of pre-pandemic levels, according to the Bureau of Labor Statistics (BLS). The positive momentum is translating into remarkable near-term recovery and growth within the multifamily market. The overall health, stability and resiliency of the greater Boston region is a direct result of the highly skilled and educated labor force, which continues to attract high-paying jobs across the technology, medical, pharmaceutical and educational sectors, among others. Metro Boston is also home to the largest life sciences cluster in the nation, where the local economy has benefited and will continue to benefit from the stability and growth in this industry. In fact, according …

July 16, 2021

Illinois Industrial Market Reports Midwest Midwest Market Reports

Chicago Industrial: Full Speed Ahead at End of Second Quarter

by Kristin Harlow July 15, 2021

By Adam Haefner, Avison Young The Chicago industrial market continues to move at full speed at mid-year 2021, with strong tenant demand keeping vacancy around 6 percent, despite 64.7 million square feet of new construction added since 2018. At this stage in the pandemic recovery, large corporate healthcare, retail, logistics and e-commerce businesses continue to drive much of the leasing activity, which totaled 27.5 million square feet near the mid-point of 2021. Companies such as Wayfair, which is building a 1.2 million-square-foot distribution facility in the I-55 Corridor, are joining the ranks of Walmart, Target, Amazon, Home Depot and others that are expanding their industrial space in the Chicago market to keep pace with soaring demand. There are also many small to mid-sized industrial businesses that are increasing their output and expanding their space after seeing slowdowns due to the pandemic. While the industrial sector is navigating some supply chain disruption and fluctuations in construction materials costs, those headwinds are not enough to slow market activity. Given the boost in consumer and business activity from the vaccine rollout and subsequent reduction in the state’s pandemic mitigation measures, demand for industrial space should be strong for the foreseeable future. Avison Young …

July 15, 2021

Market Reports Office Texas Texas Market Reports

Demand for Class A Office Space, Flexible Work Routines Juxtaposed in Fort Worth

by Taylor Williams July 13, 2021

By Chris Doggett, executive vice president, Stream Realty Partners The allure of the Dallas-Forth Worth (DFW) market continues to make it one of the top corporate destinations in the country. This past year, DFW ranked number one in the nation in raw population growth. Specifically, an average of 328 people per day were added to the DFW fold, which equates to approximately 119,748 more residents this past year. This is truly an incredible stat and reflects the fact that the consistent, historically growth of DFW shows no signs of changing course. The cost of living, tax benefits and incredibly convenient location — directly in the middle of the Central Time Zone allowing for a three-hour flight time to anywhere in the continental United States — are second to none. The vast majority of new, Class A office transactions, including relocations from other states, have landed in new office developments in Irving, Uptown Dallas, the greater Legacy/Frisco area, Allen and Cypress Waters along the LBJ Freeway. This begs the question — why is the Fort Worth area not front and center for these deals? While many companies in Fort Worth have already returned to their offices, the thinking and processes behind …

July 13, 2021

Georgia Market Reports Office Southeast Southeast Market Reports

Atlanta’s Office Market Trending Upward as Workers Set to Return En Masse

by John Nelson July 11, 2021

Following a challenging year in 2020, momentum in the Atlanta office market is beginning to trend upwards. The COVID-19 pandemic forced office users and owners to sideline their business plans and made tenants reevaluate their office needs. As government restrictions have lifted and vaccines for COVID-19 have become widely available, many companies in Atlanta are going back to the office and the “new normal” for the workplace is here. There have been several notable office announcements made in Atlanta this year. Two large technology corporations announced they were expanding their plans for major hubs in Atlanta, and companies including Adecco and Minute Maid announced plans to make Atlanta their headquarters or a hub. In total, there have been over 20 major relocation or expansion announcements in the past year, accounting for more than 3 million square feet of recent or anticipated near-term absorption. Atlanta’s most significant office lease in 2021 has been Global Payments’ 206,542 square-foot commitment at 5995 Windward in the North Fulton submarket. Other notable leases include Soliant Health’s 87,419-square-foot deal at Summit at Peachtree Parkway in the Peachtree Corners submarket and ServiceMaster’s 53,440-square-foot lease at One Glenlake in the Central Perimeter submarket. Other companies including Centene and …

July 11, 2021

Healthcare Market Reports Texas Texas Market Reports

Build Today, Sell Tomorrow: Three Ways Healthcare Developers in Texas Can Maximize Marketability

by Taylor Williams July 9, 2021

By Ben Reinberg, CEO, Alliance Consolidated Group of Cos. Healthcare real estate has proven to be one of the most resilient asset classes, able to bend but not break in the midst of global economic upheaval. Investors have become keenly aware of this fact, perhaps even more so during the latest downturn brought on by COVID-19. According to the 2021 U.S. Medical Office Trends report by CBRE, year-over-year investment volume for medical office properties fell 12.7 percent between the fourth quarters of 2019 and 2020. However, that’s far better than the 27.6 percent, 40.2 percent and 42.8 percent declines in investment sales volume that were respectively felt by the multifamily, office and retail sectors. Medical office buildings (MOBs) even beat out the white-hot industrial sector, which saw a 15.9 percent fall in annual investment volume last year. For developers eager to satiate this investor appetite for medical real estate, what is it that experienced buyers and newcomers to the space actually want in a healthcare asset? Ultimately it comes down to three things: location, size and use of space. Go Where the People Go “If you build it, they will come” may have worked for Kevin Costner’s cornfield baseball diamond, …

July 9, 2021

Market Reports Multifamily New York Northeast Northeast Market Reports Student Housing

Student Housing Sector Leads New York City Multifamily Market’s Comeback

by Taylor Williams July 8, 2021

By Mark Fogel, founder, ACRES Capital Despite the pandemic-related uncertainty that dominated the markets in 2020, the student housing sector consistently displayed strong pre-lease occupancy rates among properties under construction, suggesting that the asset class would be well-positioned to hit the ground running in 2021. According to RealPage Analytics, students, encouraged by the prospect of fully reopened campuses, fueled a nearly 10 percent nationwide increase in pre-lease occupancy at off-campus housing between March and April of this year. This data in particular seems to support improvement for the student housing sector overall. Research organization RealPage has tracked student housing occupancy rates at 175 major universities across the country, a sort of barometer for the larger industry. As of March, the company’s data showed that 59.6 percent of beds at those universities were preleased for the fall 2021 semester. While that figure is still 200 basis points below the March 2020 level, it seemingly speaks to students’ preference to get back to living on campus. And while this is good news for operators and developers, the resiliency of the student housing market is bringing forth an unintended, but positive effect on one of the hardest-hit rental markets in the country: New …

July 8, 2021

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