Texas

Matt Rocco of Grandbridge Real Estate Capital

Competition Will Continue for Top Quality Commercial Real Estate in 2019

by Jaime Lackey February 2, 2019

Matt Rocco, president of Grandbridge Real Estate Capital, realizes this year may not maintain the exact same lending velocity as last year. However, he sees plenty of opportunities in workforce and affordable housing, as well as in industrial real estate. This, combined with plenty of capital, may keep competition fierce for strong commercial assets in the foreseeable future. Many believe lending velocity may slow this year compared to 2018. What is your take on this? Rocco: We expect transactional velocity will be flat or down slightly as compared to 2018. This year and 2020 only have modest maturity activity. As a result, many new refinancing assignments will come from floating-rate loans that are converting into fixed-rate loan terms. Given the very flat yield curve, we anticipate many clients will move from these floating-rate loans to match their ownership objectives. They will likely seek fixed-rate loan terms at the same coupon rate as their floating-rate alternatives. We also expect lending volume from CMBS, agency and life insurance companies to be flat or slightly down in 2019 compared to the record year in 2018. Are there any specific product types that seem particularly attractive in 2019? Rocco: We expect to see robust …

February 2, 2019

Features Finance Insight Midwest Multifamily Northeast Seniors Housing Southeast Texas Western

Experience Pays Off for Reputable Seniors Housing Operators

by Jaime Lackey February 2, 2019

Mark Gould, national production manager of M&T Realty Capital Corporation, believes the seniors housing continuum of care may hold vast opportunities for those with the know-how and discipline to weather any short-term storms. Where do lending opportunities – and challenges – lie in 2019? Gould: We have been active in the seniors housing sector for a very long time. We see this asset class continuing to grow in 2019 as the U.S. aging population will drive growth. Challenges will lie with inexperienced parties trying to capitalize on the favorable demographic trends who do not fully understand the complexity of operating in the healthcare space. Wage pressures and nurse staffing shortages will further heighten the operating challenges in this space. I also think dollar volumes will stay steady. Rising rates have placed some DSC [debt service coverage] limitations and have required more equity into deals. There didn’t seem to be as many large portfolio deals in fiscal year 2018, which we believe resulted in a heightened number of transactions. This is an indication of a healthy market. Does the seniors housing market have room to grow beyond its 2018 activity? Gould: We are seeing some very innovative solutions from our customers that …

February 2, 2019

Features Finance Insight Midwest Multifamily Northeast Southeast Texas Western

Multifamily Sentiment Remains Strong For The Foreseeable Future

by Jaime Lackey February 2, 2019

Hilary Provinse, executive vice president and head of mortgage banking at Berkadia, highlights the trends, strategies and activity attendees should have on their radar ahead of MBA CREF 2019 in February. Coming off a strong and surprisingly consistent year in 2018, we’re feeling good about 2019. The year is off to an interesting start to say the least, and we’re keeping our eye on several factors. These include Treasury rates, the regulatory environment, tariffs and development costs that will impact our business. Even keeping these in mind, however, there are positive factors that point to the potential for continued economic strength and activity in the multifamily market. Fundamentals of the Economy Remain Very Strong Unemployment continues to fall, and jobless claims remain extraordinarily low. Despite the recent decrease in consumer confidence — volatile in its own right — it remains near the highest levels since 9/11. GDP growth also remains strong with consumption, investment and government outlays all supportive. Multifamily Demand-Supply Dynamics Remain Solid The percent of population living in multifamily units has experienced a slow, but consistent, increase since the 2008 financial crisis. Loan maturities are expected to increase in 2019 versus 2018 across several sources. Maturities are inevitable events that …

February 2, 2019

Acquisitions Office Texas

Granite Properties Buys Office Complex in Houston’s Energy Corridor for $78.4M

by Taylor Williams February 1, 2019

HOUSTON — Plano, Texas-based investment firm Granite Properties has purchased Eldridge Place, a three-building, 824,632-square-foot office complex in Houston’s Energy Corridor area, for $78.4 million. Granite Properties will invest $20.6 million in capital improvements to the lobbies, mechanical systems and amenity spaces, which include a conference center, fitness center and a café. Jeff Hollinden and Marty Hogan of HFF represented seller, TIER REIT Inc. (NYSE: TIER), in the transaction. Scott Martin and Paul Bennett represented Granite Properties internally.

February 1, 2019

Retail Texas

Houston Area to Add 2.5 MSF of New Shopping Center Space in 2019, Says Wulfe & Co.

by Taylor Williams February 1, 2019

HOUSTON — Wulfe & Co., a Houston-based full-service firm specializing in retail properties, has released its annual retail survey stating that approximately 2.5 million square feet of new shopping center space will open in the Houston area in 2019. The survey noted that average annual deliveries over the last decade were roughly 2.7 million square feet, and that overall retail occupancy should remain around 95 percent this year. The report also notes that according to the Greater Houston Partnership, the city added more than 111,000 new jobs in 2018 and is currently sitting at 3.9 percent unemployment.

February 1, 2019

Acquisitions Industrial Self-Storage Texas

Marcus & Millichap Brokers Sale of 587-Unit Self-Storage Facility in Texarkana, Texas

by Taylor Williams February 1, 2019

TEXARKANA, TEXAS — Marcus & Millichap has brokered the sale of Payless Storage Inc., a 587-unit facility located at 927 N. Robison Road in Texarkana, located near the Arkansas border. Situated on 15 acres, the property spans two buildings offering 87,600 net rentable square feet. Brandon Karr and Danny Cunningham of Marcus & Millichap’s Karr Self Storage team represented the seller, a locally based limited liability company, and procured the buyer, a New York City-based private investor. Both parties requested anonymity.

February 1, 2019

Acquisitions Mixed-Use Texas

Stream Realty Partners Acquires 194,332 SF Mixed-Use Building in Dallas

by Taylor Williams February 1, 2019

DALLAS — Stream Realty Partners has acquired The Quadrangle, a 194,332-square-foot mixed-use building in Uptown Dallas. Originally built on four acres in 1966, the eight-story property features office and retail space and is located within walking distance of more than 75 restaurants and 55,000 multifamily units in various stages of development. HFF represented the seller, American Realty Advisors, in the transaction. HFF also represented Stream in securing acquisition financing. The sales price was not disclosed.

February 1, 2019

Courtyard-Marriott-Riverwalk-San-Antonio

Hospitality Loans Texas

NKF Arranges $27.8M Loan for Refinancing of Marriott-Branded Hotel in San Antonio

by Taylor Williams February 1, 2019

SAN ANTONIO — Newmark Knight Frank (NKF) has arranged a $27.8 million loan for the refinancing of Courtyard Marriott Riverwalk, a 220-room hotel in San Antonio. The 17-story hotel opened in 2009 and is located within walking distance of San Antonio River Walk, The Alamo, Rivercenter Mall and numerous other dining and shopping options. Amenities include a Starbucks, meeting space, pool, fitness center and a business center. Ben Greazel of NKF’s placed the 10-year loan through New York-based Benefit Street Partners on behalf of the borrower, Finvarb Group, which completed a renovation of the property in 2018.

February 1, 2019

Market Reports Multifamily Texas Texas Market Reports

Survey: Multifamily Metrics Will Cool in 2019

by Taylor Williams February 1, 2019

Multifamily properties have produced strong returns for commercial developers and investors over the past few years. But the apartment supply wave appears to have crested, suggesting 2019 will bring a slower pace of rent growth. Consequently, pricing levels should come down, cap rates should creep upward and returns on investment should cool. According to a report from commercial real estate research firm Yardi Matrix, America’s multifamily market experienced 3.1 percent annual rent growth for the 12-month period ending November 2018, the latest data available at the time of this writing. The report also featured 2019 rent growth projections for America’s 30 largest multifamily markets, 19 of which are expected to see their paces of rent growth either decline or remain the same this year. Brokers who participated in Texas Real Estate Business’ annual forecast survey indicated that investment activity for multifamily assets in Texas should be more modest in 2019. This group ranked multifamily second among property types likely to experience a high velocity of sales in 2019, suggesting the new year could see more properties brought to market in anticipation of future elevation of cap rates. Numerical Context Most recently, the story on multifamily in Texas has been demand, …

February 1, 2019

Acquisitions Data Centers Industrial Office Texas

ESRP Arranges Sale-Leaseback of 1 MSF Office, Data Center Campus in Plano

by Taylor Williams January 31, 2019

PLANO, TEXAS — Metro Dallas-based brokerage firm ESRP has arranged the sale-leaseback of a 1 million-square-foot office and data center campus in Plano, a northeastern suburb of Dallas. The seller/tenant is NTT Data, a Japanese data systems integration company, and the buyer was an undisclosed, San Francisco-based private equity firm. The property includes two data centers and leasable office space and has the capacity for future data center development. Steve Jarvie, Darren Woodson, Karra Guess and Damian Rivera of ESRP represented the seller in he transaction. Paul Moser and Rob Kennedy of Stream Data Centers represented the buyer.

January 31, 2019

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