Property Type

Howard Hughes Corp. Acquires Two Office Campuses in Metro Houston for $565M

by Alex Tostado January 2, 2020

HOUSTON AND THE WOODLANDS, TEXAS — The Howard Hughes Corp. (NYSE: HHC) has acquired Century Park in Houston and The Woodlands Towers at The Waterway in The Woodlands, a master-planned municipality just north of Houston. HHC paid $565 million for the 2.8 million-square-foot office/industrial portfolio, nearly all of which is Class A office space. Century Park is a 17-building, 1.3 million-square-foot office park in Houston’s Energy Corridor. The Woodlands Towers at The Waterway is a three-building campus that includes two office buildings totaling 1.4 million square feet and a 125,000-square-foot warehouse. The purchase also includes 9.3 acres of developable land adjacent to The Woodlands Towers at The Waterway. The seller of the portfolio, Occidental Petroleum Corp. (NYSE: OXY), will fully lease back the 32-story, 808,000-square-foot office building and warehouse at the Woodlands property. The tower was built in 2002. Both leases are for 13 years. HHC announced in October that it would relocate its corporate headquarters from Dallas to The Woodlands Towers at The Waterway, where it will occupy the 595,000-sqaure-foot building at 9950 Woodloch Forest Drive, which was built in 2014. The 31-story building features a rooftop garden, fitness center, basketball court and conference rooms. The Woodlands is a …

January 2, 2020

Features Multifamily

Healthy Occupancy Hinges on Winning the Apartment Amenities Arms Race

by Taylor Williams January 1, 2020

When deciding where to live, the choice isn’t always a matter of finding the newest property on the market. Oftentimes it comes down to which property can most effectively meet and exceed your expectations as a renter. For example, these two “blind” multifamily rental listings identified below are within the same five-mile radius in Upstate New York. They’re both firmly in the luxury rental space and offer in-unit washers and dryers and dishwashers. In other words, they’re practically identical in terms of location and necessities. Can you guess which of the two commands a higher rental price and much more interest from renters? Property A: Built in 2018, average unit size of 1,180 square feet, two bedrooms, two bathrooms, community fitness center, dog park, private patio. Property B: Built in 2010, average unit size of 1,395 square feet, two bedrooms, two bathrooms, community fitness center, dog park, shared outdoor and indoor spaces. If you guessed property B, you’re right. You’re also probably wondering if you’ve heard the full story about that rental property and its amenities. That community fitness center? It’s filled with new equipment from Wellbeats and Peloton. That dog park? It’s a full-on playground for pets, with agility …

January 1, 2020

Industrial Market Reports Texas Texas Market Reports

Pricing for Industrial Assets in Dallas Increases 20 Percent in 12 Months

by Taylor Williams December 31, 2019

Pricing for industrial distribution and warehouse properties has climbed in many U.S. markets over the past 12 months as investors have continued to focus on markets tied to large population centers and their connections to logistics and e-commerce spaces. According to an Avison Young Industrial Investment Review, prices in the Dallas-Fort Worth (DFW) market rose the most out of the major industrial markets reviewed, increasing 20 percent to $85 per square foot. Prices for DFW industrial assets rose more than those in New York/Northern New Jersey (15.9 percent to $167), Miami (14.8 percent to $140), Los Angeles (11.6 percent to $168), and California’s Inland Empire (7.5 percent to $123). The review analyzed data from Real Capital Analytics (RCA) from the fourth quarter of 2018 to the third quarter of 2019. Strong population growth in North Texas has generated demand for a wide range of industrial assets, including e-commerce, and has propelled DFW into the spotlight for global investors. The market benefits from solid infrastructure, with four major intermodal terminals and the massive DFW International Airport helping position it as one of the nation’s largest inland ports. The DFW industrial market is also supported by strong job growth, construction activity, absorption …

December 31, 2019

District of Columbia Market Reports Multifamily Southeast Southeast Market Reports

D.C. a Hotspot for Multifamily Investors, Lenders as Absorption Ticks Up

by Alex Tostado December 30, 2019

Driven by increasing high-paying jobs, billions of dollars in public and private investment and healthy population growth, the Washington, D.C., metro area boasts a dynamic multifamily market with rebounding rent growth and stabilizing occupancy rates. Washington, D.C., gained 20,500 jobs in June and another 13,000 jobs in July, according to the District of Columbia Department of Employment Services. Additionally, D.C.’s population topped 700,000 for the first time since 1975. The Washington metropolitan area’s total population has climbed to more than 6 million, and more households mean more demand for apartments. These strong fundamentals have led to increased rent growth in the apartment sector. D.C.’s average net asking rate is $1,990 — up 1.7 percent, making it the sixth-fastest rent growth in the United States, according to Reis. The net asking rate increased for 10 consecutive quarters. Between now and year-end 2020, asking rents are expected to climb 2.5 percent and 3.6 percent by year-end 2021, Reis notes. The District’s apartment occupancy rate is currently 94 percent. In nearby suburban Maryland, rents rose 1.2 percent, and in Northern Virginia, 1.4 percent. Demand, supply in balance Although there was concern over an influx of new construction, multifamily product has been well-absorbed. The …

December 30, 2019

Hawaii Market Reports Office Western Western Market Reports

Government Services Keep Downtown Honolulu’s Office Market Humming

by Taylor Williams December 28, 2019

Honolulu’s office market has remained relatively unchanged for the past decade, but recent events have led to a dramatic shift in the direction of the Downtown submarket. Office vacancy rates in Downtown Honolulu have increased consistently in recent years, and steady leasing activity has led to declining vacancy. The Downtown office market is currently the tightest it has ever been. The vacancy rate in Downtown Honolulu decreased 70 basis points to 12.1 percent in the third quarter of 2019, which is the lowest vacancy rate for the submarket in more than nine years. The average gross asking rate in Downtown decreased slightly from $2.94 per square foot to $2.90 per square foot in third-quarter 2019. A significant amount of movement within the Downtown office market is driven by government need. The federal government, IRS, and city and county of Honolulu, as well as other engineering firms tied to civil projects, are some of the most active employers when it comes to leasing office space in the area. Non-governmental office-using job growth has stagnated in the past four years, which has hindered more growth in the overall office market. Unemployment statewide was at 2.7 percent for October 2019, according to Hawaii …

December 28, 2019

Features Industrial

How E-Commerce Has Impacted Industrial Real Estate

by Taylor Williams December 27, 2019

Over the past decade, the way we shop has undoubtedly changed. With the evolution of e-commerce, subsequently, so has industrial real estate. Increasing delivery speeds and near-immediate access to goods have become top priorities for consumers, pushing retailers and their supply chains to follow suit. The demand for warehouse space in close proximity to major highways and transit hubs has steadily increased. These locations allow for faster and more efficient deliveries to the end user. Over the past five years, the industrial real estate sector has experienced healthy growth while other sectors have struggled to maintain demand, further showcasing the correlation of growth to the rise in e-commerce. As online retailers continue to competitively decrease their shipping windows — think Amazon’s and Walmart’s one-day shipping policies — demand for last-mile delivery facilities has risen. The last mile refers to the final movement of goods from a warehouse or distribution center to a final destination. The need for modernized, last-mile facilities has increased with the requirement to meet consumer demands and increase shipping speeds. Shifting Expectations Throughout the last few years, when it comes to shipping and delivery time frames, customer expectations have significantly increased. Ten years ago, it was expected …

December 27, 2019

Market Reports Office Texas Texas Market Reports

Dallas, Fort Worth Office Markets See Strong Growth in Professional Services

by Taylor Williams December 27, 2019

The Dallas office market has changed drastically over the past 10 years. Though Far North Dallas has gotten its fair share of notoriety during this time (and justifiably so), the fundamentals of North Texas as a great place for business are sparking growth and activity across the market for established companies and those looking to relocate. Consider Las Colinas, which over the last few years has seen several major headquarter relocations, including large healthcare providers that have expanded or consolidated their regional workforces in this area. Currently, Dallas has 5.3 million square feet of Class A office product under construction, 2 million of which is in Las Colinas. In fact, since 2009, Las Colinas has added over 54,000 employees. That’s equivalent to a full Boeing 737 landing in Las Colinas every day for a year, unloading its passengers and everyone staying. Even with this remarkable influx of new jobs and our growing population, the competition for talent in Dallas remains fierce. Jason Savings, an economist with the Federal Reserve Bank of Dallas, recently noted that we’re in the midst of a historically tight labor market, the likes of which haven’t been seen since 1969. The Irving–Las Colinas submarket leads the …

December 27, 2019

Hawaii Market Reports Retail Western Western Market Reports

Expansion Continues in Hawaii’s Retail Market

by Taylor Williams December 27, 2019

Like so many markets nationally, the Hawaii retail real estate market was firmly in a state of flux in 2019. Despite more new vacancies than new openings — and limited new development — the Hawaii market held its own amidst challenging times. Investment sales demand and fundamentals remained strong, new and prominent retailers entered the market, and existing operators continued to expand and innovate. Last year brought both closings and openings to the Hawaii retail sector. Bucking historic trends, store closures outpaced new store openings. The closings that did occur were all related to corporate downsizing decisions, versus poor store performance by the Hawaii locations. Hawaii stores consistently post strong sales performances when compared to same-store national averages. In most instances, the Hawaii locations were the last to fold, given their consistently strong sales. Sears closed its 128,000-square-foot Windward Mall in Kaneohe, Oahu, in May. Kmart closed its last Hawaii location, a 119,000-square-foot store in Lihue, Kauai, in September. There are currently five vacant Kmart buildings and one vacant Sears location throughout the state. Early 2020 will follow suit, with the anticipated February closure of all seven Pier 1 stores on the islands. Brighter news included the return of Marshalls, …

December 27, 2019

Acquisitions Midwest Office Ohio

Lingerfelt CommonWealth Acquires 308,337 SF Office Tower in Downtown Columbus

by Kristin Harlow December 24, 2019

COLUMBUS, OHIO — Lingerfelt CommonWealth Partners LLC has acquired 100 East Broad Street, a 308,337-square-foot office tower in downtown Columbus. The purchase price was undisclosed. The property, also referred to as Chase Tower after its anchor tenant JP Morgan Chase, is situated in the heart of downtown Columbus across from Capitol Square. It is 60 percent occupied. Lingerfelt CommonWealth plans to immediately implement a multi-million-dollar renovation, consisting of a full elevator modernization, lobby improvements, new HVAC equipment and a new amenity package. Atlantic Real Estate Capital provided acquisition financing.

December 24, 2019

Development Illinois Midwest Office

Parkside Realty Tops Off 90,000 SF Office Building in Chicago’s Fulton Market

by Kristin Harlow December 24, 2019

CHICAGO — Parkside Realty Inc. has topped off Fulton East, a 12-story, 90,000-square-foot office building in Chicago’s Fulton Market district. Clayco is leading the design-build construction along with its in-house architecture firm Lamar Johnson Collaborative. Located at 215 N. Peoria St., the building is slated for occupancy in June 2020. Fulton East features an 8,000-square-foot landscaped rooftop park exclusively for tenant use. Each floor also has its own balcony. On the ground level, 5,000 square feet of retail space is available for lease.

December 24, 2019

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