Florida

Ameris Bank Riverplace Tower Downtown Jacksonville

Financial Services Sector is Driving the Growth of Jacksonville’s Office Market

by John Nelson March 28, 2016

With economic conditions improving across the country and business confidence significantly increasing, the Jacksonville office market is gaining momentum and seeing positive space absorption for the fifth consecutive quarter in a row. Jacksonville’s tax-friendly environment, competitive business relocation incentives and strong labor pool have historically been a magnet for Fortune 1000 companies looking to establish back-office locations, but over the last few years, the city has evolved into a regional hub for the headquarters of domestic and international financial services companies. Most recently, Georgia-based Ameris Bank announced that it would move its headquarters this January from Moultrie, Ga., to the 26th floor of Riverplace Tower in downtown Jacksonville. Among the reasons why Jacksonville was an attractive location for its headquarters is the ability to tap into the city’s growing skilled workforce and the opportunity to increase the bank’s footprint and brand exposure in this market. Jacksonville is also becoming a hotspot for global financial firms like German global banking and financial services company Deutsche Bank and Australia’s Macquarie Group. Deutsche Bank has been building its presence in Jacksonville since 2008, employing about 1,700 people, and continues to import jobs from the Northeast to Jacksonville as it grows its business operations. …

March 28, 2016

Florida Mixed-Use Multifamily Office Retail Southeast Top Stories

Magic Development Unveils Plans for $3.3B Mixed-Use Project Near Orlando

by Haisten Willis March 23, 2016

KISSIMMEE, FLA. — Magic Development LLC has revealed plans for Magic Place, an 87-acre, $3.3 billion mixed-use development near Walt Disney World Resort in the Orlando suburb of Kissimmee. Rodrigo Cunha and Luis Claudio Sinelli are co-CEOs of Magic Development LCC, which is developing several other projects in Florida. Italian designer Paolo Pininfarina designed the project. At full build-out, the project will include five towers, shops, restaurants and resort amenities. The multifamily portion will be a mix of residential, condo and fractional units as well as nightly rental hotel rooms. Construction will begin on the first phase in July, according to the Orlando Business Journal. Phase I will include a 25-story, 251-unit resort tower, 40,000 square feet of retail and a 20,000-square-foot office building on U.S. Highway 192. Plans call for the finished development to include 250,000 square feet of retail and 1,850 residential units. The residential portion has a construction value of around $1.7 billion, according to the Business Journal. James Mincy, the project’s manager, says the company plans to build one building every four or five years, making a total construction time of between 20 and 25 years. — Haisten Willis

March 23, 2016

SunTrust Arranges $138M Credit Facility for Expansion, Renovations at MorseLife Community

by Nellie Day November 9, 2015

WEST PALM BEACH, FLA. — SunTrust Banks Inc. has arranged a $138 million tax-exempt senior secured credit facility for MorseLife Health System. The credit facility will fund the $77 million construction of The Tower at MorseLife, a 135-unit luxury independent living expansion to The Tradition of the Palm Beaches in West Palm Beach. It will also fund renovations to the existing community. “The senior population in Palm Beach County continues to grow and The Tower at MorseLife is meeting the greater demand for luxury independent living in our community,” says Keith Myers, MorseLife’s president and CEO. Construction on The Tower at MorseLife is scheduled to begin before the end of the year and the project is expected to be completed in mid-2017. The Tower at MorseLife will be a full-service, luxury senior living residence with one- and two-bedroom apartments. It will include amenities like gourmet dining, housekeeping, wellness spa, an outdoor pool, theatre, synagogue, medical clinic, and educational and entertainment options. SunTrust Robinson Humphrey acted as sole lead arranger on the transaction, which includes a $66 million tax-exempt construction line of credit for The Tower at MorseLife and a $72 million tax-exempt term loan to refinance existing bonds outstanding at the …

November 9, 2015

Florida Market Reports Office Southeast Southeast Market Reports

Innovation Assists Orlando Office Market in Fighting its Way Back

by John Nelson November 9, 2015

After six painful years, vacancy is finally declining in the Orlando office market. Effects of the Great Recession on real estate markets have been thoroughly examined here before, but outside factors that have played such a prominent role in reshaping the office market are creating significant impact. These changes might appear to be negative, but they will ultimately prove positive. Quantum advances in communication and data storage, new attitudes regarding workplace culture, workspace sharing centers and virtual offices have stirred the submarkets that comprise the greater Orlando area. While they are affecting all sectors of commercial real estate, they are felt most acutely in the office markets, slowing employment growth and corporate expansion, which have always powered the rate of change in quarter-to-quarter vacancy declines. Cloud-based data storage and paperless transaction platforms have shrunk the size of private offices with file storage rooms. Text messaging, email and file sharing platforms such as Dropbox have reduced the need for face-to-face meetings and demand for conference rooms and private offices. Real estate closings that once involved several parties in a conference room are antiquated now. Over the past five years, staffed reception areas have given way to scaled down waiting salons with …

November 9, 2015

Florida Industrial Market Reports Southeast Southeast Market Reports

Small Tenants Causing Big Demand for Industrial Product in Orlando

by John Nelson November 2, 2015

The industrial market in Orlando has undoubtedly experienced robust leasing activity over the first half of 2015, especially among the smaller users ranging from 3,000 to 10,000 square feet. With an average industrial vacancy rate of 9.3 percent throughout Southeast / Southwest Orlando according to second quarter 2015 market reports, quality space for smaller tenants is becoming more and more scarce and available dock-high small space is virtually nonexistent. Industrial is Rebounding Two specific factors can be directly linked to the current industrial shifts in Central Florida: construction spending and theme park growth. The construction industry is booming, in particular within the single-family and multifamily sectors, allowing construction companies of all sizes market share due to high demand for services. Industrial parks are welcoming back smaller construction business owners that may have downsized and operated out of their homes during the downturn but are now looking for larger warehouses and mixed-use spaces for business. Secondly, theme park expansions, spurred by the record year of tourism in Orlando in 2014, have caused many businesses that were on the back lots of the parks to be pushed back out into the marketplace. Higher tourism rates represent a boost in consumer confidence and …

November 2, 2015

Starwood Capital Agrees to Buy More Than 23,000 Apartment Units from Equity Residential for $5.3B

by Nellie Day October 26, 2015

GREENWICH, CONN. — Starwood Capital Group has agreed to purchase 72 multifamily properties totaling 23,262 units from Equity Residential (NYSE: EQR) for $5.3 billion. The purchase price equates to approximately $230,634 per unit, with a capitalization rate of 5.5 percent. The deal represents the largest non-hotel acquisition in the history of Greenwich, Conn.-based Starwood Capital Group, which has extensive experience investing in the multifamily sector. Following the final closing of the transaction, expected to occur in the first quarter of 2016, Starwood Capital Group will control more than 88,000 units, making the firm one of the largest apartment owners in the United States. The portfolio contains properties in South Florida, Denver, Washington, D.C., Seattle and the Inland Empire area of Southern California (see below for a detailed breakdown of the properties sold). Including this transaction, Starwood has acquired or is under contract to acquire approximately 67,800 multifamily units over the past 12 months. “Our intimate market knowledge and access to capital allowed us to execute on this transaction quickly and efficiently,” says Christopher Graham, senior managing director and head of real estate acquisitions for the Americas at Starwood Capital Group. “Our existing multifamily portfolio provides us with tremendous insights into market …

October 26, 2015

Florida Market Reports Multifamily Southeast Southeast Market Reports

Job Growth Key to Orlando Apartment Market’s Strong First-Half Performance

by John Nelson October 26, 2015

Orlando’s multifamily market is in the midst of a golden era of sorts, as it sits squarely at the intersection of strong employment growth, an increasing population, a major demographic shift and a variation in lifestyle preferences. Together, these factors provide a tremendous tailwind for future strength in the local apartment market. While the national multifamily market continues to perform at a high level, Orlando is starting to show up on the radar of more institutional investors due to its recent outperformance and tremendous growth prospects. According to recent data from MPF Research, Orlando is on pace to see 5.6 percent rent growth in 2015, followed by 4.7 percent growth in 2016. The strong momentum in the MSA is being driven by a rapidly expanding and increasingly diversified job market. Going forward, the picture looks even brighter. MPF Research ranks Orlando as the No. 1 metro in the nation for job growth through 2020, with a growth rate (2.7 percent), more than twice the national average (1.1 percent). Unlike previous cycles, today’s growth is spread more evenly across employment industries, resulting in a more diverse, dynamic labor market. The highest growth sectors are forecast to be construction, healthcare/bio-tech, business services, …

October 26, 2015

Florida Market Reports Retail Southeast Southeast Market Reports

Tourism Industry Has Orlando Retail Market Firing on All Cylinders

by John Nelson October 19, 2015

Underpinned by a $50 billion tourism industry that drew a record-breaking 62.3 million visitors in 2014 in addition to strong job, population and residential growth, there is no question that Orlando’s retail real estate market is stronger than ever. According to 2014 U.S. census data, Orlando outpaced 99 of America’s 100 most populous MSAs in year-over-year population growth. The City Beautiful also recently ranked as the No. 1 U.S. city for job growth by Fortune Magazine following a 3.7 percent increase in its employment base in the same year. The Orlando retail market has also benefited heavily from healthy gains in the housing sector, powered by Central Florida’s tourism and construction industries, which stimulate economic development in the region. Orange County Property Appraiser, Rick Singh, reported that average home sale prices were up more than 10.5 percent in 2014, while residential construction rose 79 percent in the same period. With this type of growth, Orlando is experiencing strong consumer spending and an increase in demand for retail space. The Orlando region’s Index of Retail Activity rose 8.5 percent year-over-year in the second quarter of 2015, while the metro-wide retail vacancy rate decreased to 6.5 percent, down from 8.2 percent at …

October 19, 2015

Darden Restaurants to Spin Off 420 Restaurants into REIT, Names CEO

by Nellie Day August 17, 2015

ORLANDO, FLA. – Darden Restaurants (NYSE: DRI) has announced its plans to create a spin-off REIT called Four Corners Property Trust. Darden will transfer about 420 of its owned restaurant properties to Four Corners, which will lease those properties back to Darden. Darden currently owns and operates more than 1,500 restaurants. Its most notable brands include Olive Garden, LongHorn Steakhouse, Bahama Breeze, Seasons 52, The Capital Grille, Eddie V’s and Yard House. Bill Lenehan has been named CEO of Four Corners. Lenehan sits on Darden’s board of directors and is running for re-election at the company’s 2015 annual meeting of shareholders. He will resign from the board if the Four Corners spin-off becomes official. Lenehan has also removed himself from the independent committees of Darden’s board. “The board and I have been incredibly impressed with Bill’s leadership, knowledge, and skill related to the Four Corners transaction,” says Gene Lee, Darden’s CEO. “We have also been impressed with his vision and capability, which gives us confidence he will be able to lead and transform Four Corners into a leading growth company.“ Four Corners filed an initial Form 10 Registration Statement with the U.S. Securities and Exchange Commission on Aug. 11, though …

August 17, 2015

Florida Market Reports Multifamily Southeast Southeast Market Reports

Strong Demand Proves the Best is Yet to Come for Miami’s Multifamily Market

by John Nelson August 17, 2015

Miami’s multifamily market now ranks among the country’s strongest overall performers (if not the strongest). The city attracts, and benefits from, numerous tourists, investors, financial institutions, real estate funds, retailers and tourists from countries around the globe. The demand for condominiums and apartment buildings in Miami seems insatiable with the investors competing for increasingly scant deals. In practical terms, that means hotel and office developers often lose out across asset classes to the “ever-on-fire” multifamily sector. There is every indication in the first quarter of 2015 that Miami’s multifamily market’s upward trend will continue. Debt and equity continue to stream into the Miami-Dade County apartment and condominium sector from both local sources and out-of-area buyers attracted to solid asset performance and robust housing demand generators. Continued employment and population growth have bolstered housing demand as the overall Miami economy strengthened in 2014. The Miami metropolitan area added more than 30,000 jobs last year, and based on figures from the Bureau of Labor Statistics, Miami-Dade County’s unemployment rate continued its downward trend to 5.4 percent in February 2015. According to the Florida Bureau of Economic and Business Research, South Florida’s population is expected to increase by approximately 29 percent between 2013 …

August 17, 2015

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