Tuesday, January 31, 2012
ATLANTA, GA – It may be the least glamorous of the commercial real estate sectors, but the U.S. industrial market is set to shine in the near future and will prove a popular destination for investors’ dollars.
Guests on the most recent episode of the “Commercial Real Estate Show” shared those observations and others in a thorough update on the market. Topics included sector fundamentals, investment sales activity, tenant attitudes and spec development.
Nationally, the industrial real estate market has experienced seven consecutive quarters ofpositive net absorption, noted Mike Felton (top right photo), vice president, corporate industrial services, for Bull Realty. In 2011, the national vacancy rate declined from 10 percent to 9.5 percent.
Mitch Roschelle (top left photo), a partner with PricewaterhouseCoopers, said 2012 will be “a transition point” from the recent recession to a period of rent growth and new development. 2013 and 2014 will feature “a mini-explosion in the expansion of the sector,” he said.
Investment sales in the sector also will pick up steam in the year ahead, Roschelle predicted. “It’s a neat little niche in the commercial real estate sector that often gets overlooked because it’s not as sexy as some of the other property types but it’s got a great yield, and I think that’s going to be the catalyst for a big pickup in transaction volume, starting in 2012 and continuing thereafter,” he added.
“I agree: I think it’s going to be a favored asset class moving forward,” replied show host Michael Bull (lower right photo), the founder of Bull Realty.
Tenants are finally exhibiting at least some increased confidence, said Ralph Kittrell, (lower left photo) a principal with Exceter Property Group. “Being somewhat optimistic but being careful is the best way to put,” he said.
“I would echo that … For every deal that’s got a right of first offer on a space that’s adjacent to them, it’s also got a termination option on what they’ve actually got under lease, so they’re looking to get out on both sides,” said Doug Smith, senior vice president for Seefried Properties.
Kittrell also said his company is starting to see some demand for smaller deals. “I think that’s good because the smaller companies are starting to see some growth and coming back into the market,” he said.
Approximately 40 percent of the 32 million square feet of industrial space under construction is spec development, Smith noted.
In the near future, such development “is going to be spotty, and it’s going to be in specific markets where there’s some real drivers to convince folks to go spec, whether it’s in Florida or [Southern California’s] Inland Empire, Houston, and around some of the airports.”
Wilbert News Strategies
SACRAMENTO, CA – The California Public Employees’ Retirement System (CalPERS) has named Stacie Sormano to lead the pension fund’s Retirement Research and Planning Division (RRPD).
The RRPD identifies retirement industry trends and develops new ways to better serve our members and employers. As the Chief of RRPD, Sormano and her team will be responsible for addressing public policy issues to proactively protect the sustainability of the retirement plan. Her appointment was effective January 1, 2012. She reports to Ann Boynton (top right photo), Deputy Executive Officer for Benefit Programs Policy and Planning.
“Stacie brings a wealth of leadership and experience to her new role,” said Boynton. “We will rely on her strengths in administration and analysis as we evaluate our own policies and participate in the Legislative process examining pension systems throughout the State.”
This is Sormano’s second stint at CalPERS. She served for four years as the Assistant Chief of CalPERS Health Policy and Program Support Division before moving on to First 5 California, where she served as the Deputy Director of the Research and Program Evaluation Division. Most recently, she was the Chief of the Office of Planning and Accreditation at the California Department of Corrections and Rehabilitation.
Sormano holds a Master of Arts degree in Government and Public Policy, a Bachelor of Arts in Economics, and a Certificate in Management from the California State University, Sacramento.
CalPERS is the nation’s largest public pension fund with approximately $229.5 billion in assets, providing retirement benefits to more than 1.6 million State, public school, and local public agency employees, retirees, and their families, and health benefits to more than 1.3 million members. The average CalPERS pension is $2,332 per month. For more information about CalPERS, visit
External Affairs Branch
Robert Udall Glazier, Deputy Executive Officer
Brad Pacheco, Chief, Office of Public Affairs
PCCP LLC Provides $22.56 Million Senior Loan to Refinance Portion of Westover Marketplace in San Antonio, TX
Galovan reported that Coventry has hired CBRE to manage the property as well as head up leasing activity. The major portion of the vacancy is a 48,000 square foot space formerly occupied by Sportsman’s Warehouse.
Westover Marketplace is well-located along the heavily trafficked 410 loop in the northwest San Antonio submarket. The center is highly visible to 155,000 vehicle trips per day along Loop 410, while Highway 151 at this intersection sees another 80,000 vehicle trips per day.
The San Antonio area is one of the United States’ healthiest markets with 7.3 percent unemployment and 2.5 percent job growth in 2011. Population growth was twice the national average the past 12 months due to strong in-migration caused by its diversified economy and low cost of living.
PCCP, LLC is a premier real estate private equity firm focused on commercial real estate debt and equity investments. PCCP has over $6 billion under management in multiple closed-end funds and joint ventures with institutional investors.
With 33 investment professionals and 55 employees across four offices located in New York, San Francisco, Sacramento and Los Angeles, PCCP invests throughout the United States.
Learn more about PCCP at www.pccpllc.com.
Contact: Darcie Giacchetto, Spaulding Thompson & Associates, 949.278.6224.
Charles Dunn Co. Completes $17 Million Sale of Los Angeles Multi-Family Property Portfolio totaling 199 Units
LOS ANGELES, CA, Jan. 31, 2012 – Charles Dunn Company, one of the largest full-service regional real estate firms in the Western United States, has completed the $17,025,000 sale of a 199-unit multi-family portfolio consisting of four properties in the Mid-Wilshire submarket of Los Angeles. The properties are situated in prime Koreatown locations and are non-rent controlled buildings.
Janet Neman (top right photo) and Bryan Glenn (top left photo) of Charles Dunn Company represented both sides of the transaction.
The buyer was a Los Angeles-based investment company, and the seller was Los Angeles-based 4D Development.
David Pourbaba (middle right photo), CEO of 4D Development, purchased the Mid-Wilshire portfolio as a distressed asset in 2011 from Wells Fargo Bank. Through repositioning of the asset and a change in management, he was able to improve the value of the portfolio and sell it approximately one year later for a substantial profit.
The closing cap rate was 7.16 percent. The Charles Dunn team won the listing over several other large brokerage firms and sold the property for substantially more than what other firms had originally suggested as an asking price.
“We won the listing based on our successful sales track record and knowledge of the local market,” said Neman who marks this as her fourth transaction she has participated in with this portfolio over the past 10 years. “We quickly identified a buyer who owned similar product in the area and put in a strong offer before the portfolio officially hit the market.”
The properties are all renovated 1920s Art Deco architecture buildings and include 97 studio units and 102 one-bedroom units. Following is information on each property:
- 3835 W. 8th Street (bottom left photo) is six stories, was built in 1928, and includes 59 units
- 715 S. St. Andrews Place is four stories, was built in 1927 and includes 43 units
- 324 Catalina Avenue is four stories, was built in 1926 and includes 48 units
- 326 S. Normandie Avenue is five stories, was built in 1930 and includes 49 units
- “The Mid-Wilshire multi-family submarket is showing strong rental demand with solid rental rates and the market vacancy factor at around four percent,” said Glenn. “This portfolio offered the buyer a rare opportunity to own vintage properties in great condition that are not subject to rent control.”
Glenn added that at the time of sale, the properties also had a higher than market vacancy factor and offered a repositioning opportunity through aggressive management.
Janet Neman is a senior managing director with Charles Dunn Company and is in the top 10 of the firm’s top producing agents. In 2011 she was chosen by Real Estate Forum magazine as a “Woman of Influence” in the commercial real estate industry.
Contact:Darcie GiacchettoD.G. Communications, Inc.949.278.6224
Hyatt represented receiver Lloyd Berger (lower left photo) in the sale of a 7-unit apartment complex, located at 3355 Central Ave. in Sarasota, for $170,000 to buyer Expat Properties.
Hyatt also represented seller Symbolism Properties, LLC in the sale of an 18-unit apartment building, located at 2619- 2687 Crystal Lake Acres Drive in Lakeland, to OLI-5 LLC for $337,500.
Additionally, Hyatt represented seller States Resources Corp. in the sale of a 1,745-square-foot office/warehouse building, located at 2440 N.W. 54th St. in Miami, to 2440 N.W. 54 LLC for $125,000.
In 2011, Hyatt sold 13 apartment buildings, one former car dealership and an office warehouse building.
Pierson Grant Public Relations
(954) 776-1999, ext. 226
CORAL GABLES, FL -- Thomas D. Wood and Company, a Strategic Alliance Mortgage LLC member, secured financing in the amount of
- $7,665,000 for six Stor-All Self Storage facilities.
- $1,900,000 for Boyton Beach Stor-All Self Storage,
- $1,685,000 for Johnson Ferry Stor-All Self Storage,
- $1,265,000 for Tucker Stor-All Self Storage,
- $1,025,000 for Dunwoody Stor-All Self Storage,
- $945,000 for Coastal Stor-All Self Storage
- $845,000 for Decatur Stor-All Self Storage all through Thomas D. Wood and Company's correspondent relationship with The Standard Life Insurance Company.
Steven H. Wood (top right photo), Company Chief Operating Officer, secured financing for the Boyton Beach Stor-All Self Storage (top left photo) in the amount of $1,900,000. The permanent, fully-amortizing, partial-recourse loan has a term of 25 years, based on an interest rate of 5.50% and a loan-to-value of 59%.
The 62,430 square-foot self storage building, located on 4.44 acres of land, was built in 1989 and 1991, and is located at 4390 Hypoluxo Road, Lantana, Palm Beach County, Florida 33462.
Wood also secured financing for Johnson Ferry Stor-All Self Storage (middle right photo) in the amount of $1,685,000. The permanent, fully-amortizing, non-recourse loan has a term of 25 years, based on an interest rate of 5.50% and a loan-to-value of 41%. The 73,703 square-foot self storage building, located on 4.57 acres of land, was built in 1990 and 1994, and is located at 4365 Johnson Ferry Place NE, Marietta, Cobb County, Georgia 30068.
Wood secured financing for Tucker Stor-All Self Storage in the amount of $1,265,000. The permanent, fully-amortizing, non-recourse loan has a term of 25 years, based on an interest rate of 5.50% and a loan-to-value of 36%. The 97,240 square-foot self storage building, located on 5.53 acres of land, was built in 1973 and renovated in 1993. The property is located at 1750 Montreal Circle, Tucker, DeKalb County, Georgia 30084.
Wood also secured financing for Dunwoody Stor-All Self Storage (lower left photo) in the amount of $1,025,000. The permanent, fully-amortizing, non-recourse loan has a term of 25 years, based on an interest rate of 5.50% and a loan-to-value of 26%. The 68,560 square-foot self storage building, located on 1.85 acres of land, was built in 1994. The property is located at 4340 Dunwoody Park South, Dunwoody, DeKalb County, Georgia 30038.
Wood secured financing for Coastal Stor-All Self Storage in the amount of $945,000. The permanent, fully-amortizing, non-recourse loan has a term of 25 years, based on an interest rate of 5.50% and a loan-to-value of 54%. The 46,230 square-foot self storage building, located on 3.30 acres of land, was built in 1984. The property is located at 6351 Lake Worth Road, Lake Worth, Palm Beach County, Florida 33463.
Wood also secured financing for Decatur Stor-All Self Storage in the amount of $845,000. The permanent, fully-amortizing, non-recourse loan has a term of 25 years, based on an interest rate of 5.50% and a loan-to-value of 33%. The 57,406 square-foot self storage building, located on 3.00 acres of land, was built in 1974 and renovated in 1993. The property is located at 1504 Austin Drive, Decatur, DeKalb County, Georgia 30032.
Ashlee E. Wood
Director of Marketing and Public Relations
Steven H. Wood
Chief Operating Officer
Island Hospitality Management to Implement Plan to Double Size within Five Years; Tim Walker Rejoins Firm as President
PALM BEACH, FL, Jan. 31, 2012—Officials of Island Hospitality Management LLC, one of the nation’s largest hotel management companies, today announced that Tim Walker (top right photo) has rejoined the company as president.
Walker will be responsible for executing a new growth strategy to double the size of the company’s managed portfolio over the next three to five years to approximately 150 hotels. Currently, Island manages a portfolio of 76 hotels for five different ownership groups.
To achieve its growth goals, the company will focus on forming strategic relationships with a limited group of institutional owners who require sophisticated operating and reporting systems and have a longer-term ownership model. Island plans to increase its ownership base from five ownership groups currently to approximately 10. The company will operate hotels within Island’s core competency—upscale extended-stay, select-service, and compact full-service hotels ranging in size from approximately 200 to 250 rooms.
“Island and its predecessor companies have a 25-year proven track record of operating in these segments with superior results,” Walker said. “Our portfolio has consistently achieved industry-leading RevPAR premiums, compared to its competitive set. Part of that success is due to our team of professionals who have an owner focus and work closely together to improve revenues and margins. Historically, our margins have averaged upwards of 40 percent.”
Walker spent the majority of his career at Island, where, over 17 years, he rose to the position of president. He served briefly as CEO of Innkeepers USA Trust, a private ownership group with more than 70 hotels, before rejoining Island.
He began his career with Promus Corporation, operating Embassy Suites-branded hotels. He has received numerous awards throughout his career from Marriott, Hilton and Starwood in guest satisfaction and sales and revenue management. He is on the Owners Advisory Committee of Hyatt House, formally known as Summerfield Suites.
Additional information is available on the company’s Web site, http://www.islandhospitality.com/.
Jerry Daly, Carol McCune
Daly Gray, Inc.
Office: (703) 435-6293
Cell: (703) 300-8289