OZARK, ALA. — Marvin’s Building Materials and Home Centers has leased 30,000 square feet of build-to-suit retail space in Ozark, roughly 22 miles northwest of Dothan, Ala. The store is currently under construction at the new Mixon Plaza located at the intersection of Highway 231 and Deese Road. The store is expected to open in spring 2015. Upon completion, the store will feature a 30,000-square-foot home center and an attached lawn and garden center, as well as a drive-thru lumberyard. The project team includes developer Engineered Systems Inc., owner Martindale Properties and project manager Felton Woodham. Marvin’s currently operates 27 stores in Alabama, Mississippi, Georgia and Tennessee.
TUSCALOOSA, ALA. — Capital One Multifamily Finance has provided a $7.7 million Fannie Mae loan to refinance two student apartments in Tuscaloosa near the University of Alabama. The financing will be used to retire construction debt on the 33-unit Central Park Apartments and the six-unit Gramercy Park Apartments. Chad Thomas Hagwood of Capital One Multifamily’s Birmingham office originated the 10-year loan with two years of interest-only payments and a 30-year amortization schedule. College Station Properties will manage the two apartment communities, which are fully occupied and consist of two- to four-bedroom units.
HOOVER, ALA. — Berkadia has brokered the $63.4 million sale of a three-property, 825-unit multifamily portfolio in Hoover known as the “Hoover 3 Portfolio”. The properties — Park at Galleria, Place at Galleria and Renaissance at Galleria — sold for $76,784 per unit. David Oakley, David Etchison and Royce Emerson of Berkadia represented the seller, CLK Properties, in the transaction. The buyer was Chicago-based Intercapital Partners Ltd.
CULLMAN, ALA. — Birmingham, Ala.-based Merchants Retail Partners has broken ground on the expansion of Cullman Shopping Center, bringing the retail asset to more than 325,000 square feet. New tenants coming to the center include Publix, PetSmart and a custom-designed Dick’s Sporting Goods. All three tenants are new entrants to the city of Cullman. Existing tenants at the shopping center include Belk, Books-A-Million and Shoe Dept.
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 …
Birmingham was recently ranked among the “Top 10 Emerging Downtowns in the Country” by Livability.com, and the city has also become an attractive place for national investors. The Birmingham apartment market has shown stable occupancy of 93 percent and experienced gains in effective rents, despite 540 units being delivered in 2013. Construction of new communities is ramping up as projects delivered in 2012 and 2013 such as The Hill, Tapestry Park, Village at Lakeshore Crossing and Ashby at Ross Bridge were absorbed at record-setting rental rates. Additionally, new buyers are flocking to the Birmingham multifamily market. Improving Fundamentals Rental rates among Birmingham properties are showing encouraging signs of growth. Between mid-year 2012 and mid-year 2013, 61 percent of Birmingham-area properties experienced average effective rent increases, and 53 percent experienced quoted rent increases. This growth is reinforced by nearly universal drops in concession usage. Only one of the eight Birmingham submarkets (East submarket) experienced increased concession usage, and only the West submarket experienced no change. Overall, the Birmingham area experienced an 11.3 percent drop in the number of properties offering concessions. Between mid-year 2012 and mid-year 2013, six of eight submarkets in the Birmingham MSA experienced overall effective rent growth. Of …
Birmingham — Alabama's largest apartment market — is in the midst of a continued recovery from the economic downturn. The city posted a net-gain in jobs, occupancy and rental rates, which has helped spur new development, particularly at close-in urban locations. Last year was a turnaround year for Birmingham. The city gained 700 jobs and the Birmingham-Hoover unemployment rate dropped to 5.8 percent by December, two percentage points below the national average, according to the Bureau of Labor Statistics. The gain in jobs was the first annual increase since 2007. For the apartment market, 2012 results were strong: a 2 percent increase in occupancy pushed occupancy rates to 93.2 percent market-wide. Additionally, rent levels increased by 3.2 percent in 2011 and 1.9 percent in 2012, according to MPF Research. The favorable market dynamics have drawn the attention of regional and national investors, which has led to healthy transaction and development volume. In 2012, 27 apartment complexes traded in the Birmingham MSA, totaling approximately $300 million in volume. Both local owners and several owners headquartered in New York and Florida, for example, made significant investments in Birmingham, including the CLK Properties acquisition of the five-property Park Lane portfolio in April. On …
In the decade between 1997-2007, a massive amount of retail development swept the country, and Birmingham — like much of the Southeast — was considered a demographic sweet spot. During this 10-year period, the majority of the population was at a peak buying age, the economy was performing well and most of the population was experiencing higher income levels. In Alabama, developers and retailers alike scrambled to keep up with the growth by building new shopping centers anchored by big and junior box concepts in every major town across the state. Then the recession hit. As the market continued to slow, big and junior box retailers experienced decreasing sales and an overabundance of square footage brought new development pipelines to a halt. Despite a growing desire among today’s retailers to lease new space, the market is lacking supply. Now that big box development has largely stopped in Birmingham and retailers are starting to downsize, there is virtually no development pipeline for new shopping centers within the suburban markets. Competition for prime leasable space within these suburban locations has become fierce. Retailers, medical office tenants, and restaurants are all now vying for the same spaces that were built 10 years ago. …
The city of Huntsville, Alabama, is no stranger to threats of economic disaster, so overcoming it is a matter of pulling together a team of commercial brokers and economic development professionals who will see office and industrial buildings half-full, rather than half-empty. In 1948, the U.S. Army hung a ‘For Sale’ sign on Redstone Arsenal, only to remove it for a team of rocket scientists. In the 1970s, Huntsville’s space industry packed its bags after the last Apollo launch, leaving the city like a bad divorce, before the hands of fate reached out in the form of missile defense. In 2005, the Base Realignment and Closure (BRAC) initiative set Huntsville on a fast track to economic growth and commercial prosperity. Three hard years of unprecedented national financial crashes played havoc with the market, but what remains is a handful of proverbial optimists. The North Alabama Commercial Brokers Association (NALCOM) meeting in February entertained a loyal group of survivors who at this point are unlikely to fail. They believe an increase in inquiries is a positive sign, even if they aren’t at 2007 levels. Rather than analyzing high vacancy rates and crying over companies who left two years ago, they shifted …
Sonny Culp of Birmingham-based Graham & Co. looks at the Birmingham industrial market through an optimist’s glasses. While the recession has slowed activity significantly — Culp estimates that the bulk distribution vacancy rate is somewhere around 20 percent — transactions are still taking place. And on the bright side, at least the current development standstill means Birmingham won’t have tons of warehouse space sitting empty for the next few months. “The economy has slowed construction, so that when the market rebounds, those projects that need to get filled first most likely will,” Culp says. Birmingham, by location and size, is a secondary market. The city’s industrial market is closely tied to the health of corporate America; when corporations do well, space gets occupied, but in the current stagnant financial situation, it’s harder to find firms hungry for a transaction. “Historically, Birmingham has always been two or three deals shy of a shortage,” Culp says. “Today, you might say that two or three figure is eight or nine.” Sales are now the territory of mom-and-pop companies, and the leasing arena mostly consists of renewals and small leases for short terms. This is the broker’s new reality. “Any transaction person is finding …