PHOENIX — Scientific Technologies Corp. has leased 26,174 square feet of office space at a warehouse and distribution site that is being converted into an office building. The space is located at 411 S. 1st St. in Phoenix. The site was formerly occupied by Phoenix Packaging Products. The property is being converted to creative office space as part of an adaptive reuse project. Jim Sadler and Darius Green of Keyser represented Scientific Technologies Corp., while CBRE’s Corey Hawley and Jimmy Cornish represented the landlord, 1st Buchanan LLC, in this transaction.
Investors are attracted to Boston due to its diverse economy, education base and strong market fundamentals. In fact, major corporations like GE, Reebok, New Balance, and most recently Asics have all relocated to the city or are in the planning to relocate or rebrand here. As a result of this heightened interest in Boston as a global headquarters destination, the city is expected to grow, which in turn creates housing demand. Rhythm between Cap Rates and Interest Rates As investors know, there is a direct correlation between cap rates and interest rates. However, while a correlation exists, not all buyer profiles are necessarily affected in the same way in a shifting interest rate environment. Highest impact: Leveraged buyers would be most impacted by rising interest rates since they are typically trying to maximize leverage when pursuing an acquisition. With shifting interest rates, higher rates have a direct impact to potential returns. If leveraged buyers can borrow less at high rates, this has a direct impact to pricing/cap rates. Within the leveraged buyer profile, groups possessing strong balance sheets and banking relationships will be less impacted than groups not necessarily in the same financial position. Moderate impact: Cash and low-leverage buyers …
LOS ANGELES — Red Mountain Group Inc. has acquired La Cienega Triangle, an 8.6-acre property located at the three-pronged intersection of La Cienega Boulevard, Centinela Avenue and La Tierja Boulevard in Los Angeles. The price was not disclosed. The local trade area is home to more than 826,000 residents in a five-mile radius, employs 321,000 and sees over 135,000 cars a day. A 117,838-square-foot urban redevelopment project calls for an immediate adaptive reuse of the existing 43,138 square feet of streetfront retail along La Tierja Boulevard. The redevelopment will be followed by an additional 42,700 square feet of ground-up improvements on the balance of the site. The development will include a grocery store, entertainment, soft goods carriers, sit-down food service facilities and four drive-thru operators. A 30,000-square-foot office building is also located on the site. Bill Bauman of Savills Studley and Luke Palmo of Coldwell Banker Commercial brokered the transaction.
When you visit Los Angeles, the sight of the cranes looming in the sky in all directions shows a city undergoing significant revitalization and redevelopment. Not so long ago, the Downtown area of Los Angeles went “dark.” This occurred after the hustle and bustle of the normal workday was done and the streets were mostly empty, businesses closed. Fortunately, Los Angeles has seen significant construction and redevelopment over the past few years. According to the Downtown Center Business Improvement District (DCBID), the population of Downtown Los Angeles was 18,000 people in 1999. Today, the population is estimated at 63,208, with a daytime population of 500,000. The residential inventory consists of 36,964 units with 11,868 under construction and 19,054 proposed for a total of 48,832 units as of the third quarter of 2016. There are 8,163 hotel rooms with 2,765 more under construction and 3,636 proposed for a total of 14,564. Retail has 2 million square feet under construction and an additional 1.5 million square feet proposed. Major industrial activity includes the announcement of Warner Music Group relocating from Burbank to the Arts District where it will occupy 257,000 square feet at the former Ford Factory, which was constructed in 1912. …
ATLANTA — Ponce City Market, the 2.1 million-square-foot adaptive reuse of the former Sears Roebuck building in Atlanta’s Old Fourth Ward District, has earned a spot on the National Register of Historic Places. Originally built in 1926 on the site of the former Ponce de Leon Amusement Park, the mixed-use project now features 550,000 square feet of Class A loft office space, 300,000 square feet of retail and restaurants and 259 residential flats. Situated along the Atlanta Beltline, Ponce City Market is owned by Jamestown and is the largest adaptive reuse project in Atlanta’s history, as well as the largest brick building in the Southeast. The National Park Services placed Ponce City Market on the registry because of its historical significance to Atlanta. The building opened as a nine-story regional distribution center and retail destination for Sears and was surrounded by freight and trolley lines, as well as the Atlanta Crackers baseball field. Sears closed the retail component in 1979 but operated the regional office until 1987. The city of Atlanta purchased the property in 1991 and used it to house administrative offices until mid-2010 before selling it to Jamestown in 2011. In addition to its historical status, Ponce City …
DURHAM, N.C. — NAI Carolantic has arranged a 70,000-square-foot lease with Nutanix, a San Jose-based software firm that is expanding its East Coast presence. The company will occupy space at the Chesterfield, an adaptive reuse of a former tobacco building in downtown Durham that Wexford Science + Technology is currently redeveloping. Upon completion the property will include lab and office space, a six-story atrium, 11,500 square feet of ground-level retail space and 42,000 square feet of shared lab innovation space. Robin Roseberry Anders of NAI Carolantic is the leasing agent for the Chesterfield building. Other committed Chesterfield tenants include Duke University for 100,000 square feet and BioLabs NC for 42,000 square feet. Marlene Spritzer, Edwin Yarbrough and Whitney Rodgers of Savills Studley’s Durham office advised Nutanix in the lease negotiations. Joe Brady and Mike Mordaunt of Savills Studley’s San Jose office, who have worked with Nutanix’s headquarters office since the tech firm’s founding, collaborated with Savills Studley’s Durham team on the transaction. Wexford plans to deliver the property in January 2017.
WASHINGTON, D.C. — A joint venture between Roadside Development and North America Sekisui House LLC (NASH) has purchased the famous Fannie Mae headquarters campus located at 3900 Wisconsin Ave. in Washington, D.C. The acquisition includes the 228,000-square-foot office building and 10 acres of land. The venture paid a little less than $90 million for the site, according to the Washington Business Journal. Roadside Development is a private adaptive reuse developer, and NASH is the American arm of Sekisui House Ltd., Japan’s largest homebuilder. The companies plan to reposition the campus once Fannie Mae moves its headquarters to its new office tower at 1100 15th St. N.W. in Washington, D.C., which is still under construction.
Many of the national trends unfolding in the multifamily sector are playing out in Grand Rapids, the second largest city in Michigan, with a population estimated at 195,000 and slightly more than 1 million metrowide. A combination of demographic, economic and lifestyle trends are leading to the creation of more renter households. This includes Baby Boomers, Millennials and renters by choice across all income levels. In addition, Grand Rapids is experiencing an urban renaissance that is bringing new commerce, housing and amenities into the downtown area. During the 2016 National Multifamily Housing Council conference in Orlando, Grand Rapids was recognized as one of the top three small to mid-sized markets in the country for multifamily investment. Annualized apartment rent growth in Grand Rapids has been running at a robust 7 to 8 percent for the past two years, but some momentum has been lost in the wake of a large number of units that have come on line. The annual rent growth slipped to 4.6 percent during the four-quarter period that ended Sept. 30. The average occupancy rate remains above 97 percent, but is gradually coming off a peak of 98.6 percent in the third and fourth quarters of 2013. …
LEBANON, PA. — The Woda Group Inc., as developer, has opened Kreider Commons, an affordable seniors housing development located at 631 N. Eight St. in Lebanon. An adaptive reuse of a six-story manufacturing/warehouse building, the property features 50 one- and two-bedroom rental apartments for independent seniors aged 62 or older. Additionally, the building features all new systems, two elevators, drive-up entry, on-site parking, a community room with kitchen, library, computer room, grandchild room and crafts rooms. The project team includes Kinsley Construction, Marks Thomas Architects, Steckbeck Engineering, and Woda Management and Real Estate LLC. Financing for the development was provided by PNC Bank, Pennsylvania Housing Finance Agency, Lebanon County, Pennsylvania Department of Community and Economic Development and Federal Home Loan Bank of Pittsburgh.
RICHMOND, VA. — Phillips Realty Capital has secured a $24 million loan for 8th & Main Apartments, an adaptive reuse apartment community located in downtown Richmond. The property features 195 loft residences with one-, two- and four-bedroom layouts; nearly 10,000 square feet of ground-floor commercial space, the majority of which has been leased to Apple REIT; a rooftop swimming pool and terrace; and a fitness center. Charles DuBose structured the loan on behalf of the borrower, The Monument Cos. Monument converted the former Morris Plan Bank and office building into a Class A apartment community using Historic Rehabilitation Tax Credits.