Western

Historic Core Los Angeles

Lee & Associates’ newly released Q1 2022 North America Market Report scrutinizes first-quarter 2022 industrial, office, retail and multifamily outlooks throughout the United States. This class-by-class review of commercial real estate trends for the first quarter of the year focuses on how real estate is adjusting to long-term post-COVID attitudes. Lee & Associates has made the full market report available here (with further breakdowns of factors like vacancy rates, market rents, inventory square footage and cap rates by city), but the overviews offered below provide sweeping looks at the overall health and obstacles for four major commercial real estate sectors. Industrial: Rents Pushed on Strong Demand Strong demand for industrial space throughout North America continued in the first quarter as vacancies fell to record lows and rent growth hit double digits. First quarter net absorption in the United States totaled 92.8 million square feet, which was up 25 percent year over year but down 35 percent from the 143-million-square feet average of the last three quarters of 2021. Annualized rents rose 10.1 percent in the U.S. and the average vacancy rate fell to 4.1 percent. Part of this trend was due to a pause in new construction starts early in the pandemic. However, …

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9151-E-Panorama-Englewood-CO

ENGLEWOOD, COLO. — Drawbridge Realty has purchased one of the Arrow Buildings at Dry Creek Station in Englewood for $106 million. The acquisition is Drawbridge’s first since completing a $1.7 billion recapitalization of its national portfolio in February with institutional investors KKR and General Atlantic. Arrow Electronics (NYSE: ARW) fully occupies the 223,177-square-foot, Class A headquarters building, located at 9151 E. Panorama, on a long-term basis. Constructed in 2017, the property enabled Arrow to consolidate its more than 1,600 local employees spread across nine buildings into one campus-style location. The seven-story building offers parking for more than 1,300 cars and is adjacent to Interstate 25 and near the Dry Creek light rail station. The acquired building is adjacent to Arrow’s other worldwide headquarters building. Terms of the transaction were not released.

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Interquest-I-IV-Colorado-Springs-CO.jpg

COLORADO SPRINGS, COLO. — Cushman & Wakefield has arranged the sale of Interquest I-IV, a four-building flex, office and healthcare portfolio located at 9925, 9945, 9950 and 9960 Federal Drive in Colorado Springs. An undisclosed seller sold the asset to a Denver-based private partnership for an undisclosed price. Aaron Johnson and Jon Hendrickson of Cushman & Wakefield represented the seller. Constructed in phases in 2001 and 2008/2009, the buildings offer a total of 241,232 square feet of flex, office and healthcare space. At the time of sale, the portfolio was 76 percent leased to a healthcare and technology tenants. Interquest I (9945 Federal Drive) and Interquest II (9925 Federal Drive) have LEED Silver certification.

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4433-42nd-Ave-SW-Seattle-WA

SEATTLE — Kidder Mathews has brokered the sale of a portfolio of apartment properties located in the Junction neighborhood of West Seattle. The communities sold for a combined price of $58.3 million. The names of the seller and buyer were not released. The portfolio includes an 80-unit building that opened in 2016 and a 62-unit building that opened in 2020. The properties are located at Junction Flats at 4433 42nd Ave. SW and Junction Landing at 4417 42nd Ave. SW. Jerrid Anderson, Brandon Lawler and Dylan Simon of the Simon and Anderson Team at Kidder Mathews’ Seattle headquarters represented the seller and directly sourced the buyer in the transaction.

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Edison-Apts-Gresham-OR

GRESHAM, ORE. — Trion Properties has completed the disposition of Edison Apartments, a multifamily community located at 1833 6th St. in Gresham, the largest suburb of Portland. An undisclosed buyer acquired the property for $19.5 million. Completed in 2020, Edison Apartments features 64 units with in-unit washers/dryers, stainless steel appliances, granite countertops, air conditioning, modern wooden blinds, large windows and storage units. Community amenities include onsite parking, a communal picnic area, children’s playground, landscaped grounds and video surveillance. Jordan Carter, Tyler Linn and Clay Newton of Kidder Mathews represented the seller in the transaction.

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Grunow-Memorial-Center-Phoenix-AZ

PHOENIX — Meridian has completed the sale of Grunow Memorial Medical Center, a medical office property located in Phoenix. A private Canadian investor acquired the asset for $17.9 million. Located at 925 E. McDowell, Grunow Memorial Medical Center features 53,000 square feet of medical office space. At the time of sale, the building was 90 percent leased to 12 tenants, including DaVita Dialysis. Lester A. Bryon designed the property, which was constructed in 1931. Mindy Berman of JLL represented Meridian in the transaction.

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Property tax systems vary from state to state across the country, with differing procedures in each assessor’s jurisdiction. Complicating things further, the personalities of assessors and their staff influence the way they interact with property owners or their agents. It is the responsibility of the property owner or their agent to learn and adapt to the procedures and behaviors at work in their assessor’s offices. However, there are universal pre-emptive steps that property owners in any jurisdiction can take to combat excessive valuations. These property-specific action items and best practices can significantly increase the chances of a successful valuation protest. 1. Document Property Financial Statements In most appraisal systems, income-producing apartment property will be valued using the income approach. Arguably the most important pieces of information the apartment owner can present in protesting assessed values are the property’s rent rolls and profit-and-loss statements. The timely preparation and completion of these documents prior to a protest is essential to any discussion of fair market value. Key line items such as potential gross income, vacancy and collection loss, and net operating income can assist in negotiating lower assessed values. Market rent, in-place rents and occupancy are key indicators on a rent roll …

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11605-E-55th-Ave-Denver-CO

DENVER — Stockbridge has acquired an eight-building industrial portfolio in Denver. The name of the seller and acquisition price were not released. Totaling more than 1.3 million square feet of infill industrial space, the portfolio includes: Table Mountain Commerce Center, 16163 W. 45th Drive West 53rd Place, 445 W. 53rd Place Leyden I, 4735-4795 Leyden St. Leyden II, 4725 Leyden St. Denver Business Center 5, 11175 E. 55th Ave. Denver Business Center, 11605 E. 55th Ave. Moline Distribution Center, 4865 Moline St. Moncrieff Distribution Center, 14303 E. Moncrieff Place Built between 1971 and 2009, the buildings offer clear heights ranging from 22 feet to 32 feet. At the time of sale, the portfolio was fully leased to 25 tenants in variety of industries, including electrical supplies; warehouse and distribution; manufacturing; construction and building materials; technology; and consumer goods. Jim Bolt, Tyler Carner, Jeremy Ballenger and Jessica Ostermick of CBRE’s Denver office represented the seller in the deal.

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SAN DIEGO — JLL Income Property Trust has purchased South San Diego Distribution Center, a three-building industrial portfolio in San Diego. Affiliates of Murphy Development Co. sold the asset for $158.5 million. Totaling 665,000 square feet, the three properties were 96 percent leased to eight tenants at the time of sale. The investment was acquired through the assumption of an in-place, $72.5 million first mortgage at a 3.18 percent fixed interest rate. The financing features interest-only payments for another four years with maturity in 2031. The acquisition also includes the issuance of $75 million in operating partnership units to the sellers. The balance of the purchase was funded with cash.

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CALIFORNIA AND WASHINGTON — A joint venture between owner-operator Merrill Gardens and publicly traded REIT National Health Investors (NYSE: NHI) has acquired six independent living communities located on the Pacific Coast. The communities were formerly managed by Holiday Retirement, and more recently, Atria Senior Living. The price and seller were not disclosed. The communities will be rebranded as part of the Truewood by Merrill brand. The properties include: Truewood by Merrill, Fig Garden; Fresno, Calif.; 103 units Truewood by Merrill, Modesto; Modesto, Calif.; 120 units Truewood by Merrill, Pinole; Pinole, Calif.; 98 units Truewood by Merrill, Roseville; Roseville, Calif.; 117 units Truewood by Merrill, West Covina; West Covina, Calif.; 110 units Truewood by Merrill, Vancouver; Vancouver, Wash.; 103 units NHI was already the owner of the communities and leased them to third-party operators. The acquisition brings in Merrill Gardens as the new operator under a joint-venture structure rather than a lease.

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