Tuesday, April 17, 2012
U.S. Office Market Is Recovering, One Small Step at a Time, Say Atlanta Commercial Real Estate Show Panelists
ATLANTA, GA (April 17, 2012) – The U.S. office market isn’t exactly setting the world on fire, but its recovery is well under way.
That was one of the points made by guests and show host Michael Bull on the most recent episode of the“Commercial Real Estate Show,” which provided an in-depth look at the sector’s performance in first-quarter 2012.
The national office vacancy rate fell 10 basis points to 17.2 percent during the first three months of the year, while asking and effective rents rose by .5 percent and .6 percent, respectively, said Ryan Severino (top right photo), a senior economist for Reis. The vacancy rate has now declined for four consecutive quarters, and rents have increased for the past six quarters.
“While this isn’t the breakneck pace that I think we would all like to see, it’s clearly another step in the right direction,” Severino said.
Generally speaking, office properties in primary markets are performing better than those in secondary and tertiary areas, while demand in suburban regions has picked up noticeably in recent quarters, Severino noted. The office markets in cities with a large concentration of technology firms – such as Boston, San Francisco and Seattle - are doing particularly well, he added.
As for 2012, prepare for more of the same, Severino advised. “I expect this slow, steady convalescence that we’re in the middle of to continue,” he said.
The presidential election could have an impact on demand for office space, Bull noted. “It sure seems that with a lot of the people we talk to – if there’s a more pro-business administration in the White House, they would seem to be a lot more excited about expanding and hiring,” he said.
Guests also discussed a variety of tips for landlords and tenants in today’s market.
Casey Keitchen (lower left photo), a vice president with Bull Realty’s National Office Group, urged tenants to move quickly to take advantage of current conditions. “Tenants really need to lock down these rates and these concessions while they have them,” he said. “They’re not going to be around forever. We’re already seeing a pullback to some extent.”
Landlords need to spend the time and energy to make sure their properties are always ready to show prospective tenants, said Harry Conley, CEO of Seven Oaks. “You really have to take advantage of every opportunity to show your space,” he noted.
It’s also a big mistake for landlords to wait “until the lease is about to expire before they embrace their tenants,” observed Andrew Zezas (lower right photo), CEO of Real Estate Strategies Corp. “From the day the tenants move in, that’s when [the best landlords] start servicing their customers, and those are the landlords that are experiencing the highest retention rates,” he said.
The next “Commercial Real Estate Show” will be available April 19 and will provide an update on the U.S. retail market.
Wilbert News Strategies
Office: (404) 965-5026
Cell: (404) 405-2354
McCarthy Building Companies Completes Construction of Santa Barbara, CA Cottage Hospital Replacement Facility
With grand opening ceremonies in January 2012 and patient move-in accomplished smoothly on February 12, the 370,000-square-foot project included construction of a diagnostic and treatment (D&T) pavilion and two, three-level patient pavilions with a basement and a new main entrance.
McCarthy also built a helipad for emergency air transportation atop the D&T Pavilion. Construction of the patient pavilions ensures the hospital’s compliance with Senate Bill 1953, which requires seismic upgrades for all acute care facilities before the 2013 deadline.
For a complete copy of the company’s news release, please contact:
(949) 453-8420 fax
(McCarthy Building Companies, Inc.)
LOS ANGELES, CA – Commercial real estate investment banking firm George Smith Partners has successfully arranged a total of $22.8 million in financing for Doerken Properties Inc.(DPI) for two Salt Lake City properties owned by affiliates of the company, according to Principal and Managing Director, Gary E. Mozer (top right photo) and Vice President, Josh Roseman (middle left photo).
The GSP team arranged financing for two properties, including a $15.3 million bridge loan on a Class B office building as well as the $7.5 million refinance of a retail property.
“Both of these properties had particularly challenging situations for achieving financing, including a lack of current rent stability and new redevelopment strategies,” explained Mozer. “By utilizing our industry experience and lender connections, we were able to leverage the borrower’s strong financing history, along with the individual strengths of each property in order to achieve financing.”
George Smith Partners’ Gary Mozer and Josh Roseman secured a $15.3 million partial-recourse bridge loan to facilitate the refinance of a 221,145 square-foot office building located in the Salt Lake City Central Business District, two blocks from the new City Creek Development.
The partial recourse loan carries a 36-month term with two 12-month extensions. The loan closed with an interest rate of LIBOR plus 3.25 percent, with no floor and a 65 percent loan-to-value. Financing was provided by a major national bank.
GSP’s Team Mozer also secured the $7.5 million refinance of a 54-percent-occupied retail center located in Murray, Utah, a bedroom community to Salt Lake City.
“This center was challenged with a history of lacking an anchor store, as well as high vacancy and underperformance in recent years,” explained Mozer.
“We successfully demonstrated the stability of our client by highlighting the property’s recent leasing velocity, including two leases over 10,000 square feet which were secured over the past six months. These leases were a direct result of the borrower’s aggressive leasing strategy, and demonstrated to the lender that our client is fully committed to the property.”
The recourse, senior, interest-only loan closed at a rate of 1-Mo LIBOR plus 3.0 percent for three years, with two 12-month extensions and a 65 percent loan-to-value. Financing was provided by a major national bank.
Corynne Randel/ Judith Brower
Brower, Miller & Cole
Las Vegas, NV (April 17, 2012) – The Higgins’ Investment and Leasing Team of Voit Real Estate Services’ Las Vegas office has recently completed two transactions in Las Vegas totaling 281,000 square feet for a total consideration of $14.49 million.
“These two transactions were quite different from each other, but both demonstrate our team’s ability to perform for our clients in a tough market,” said Kevin Higgins (lower right photo), Senior Vice President and leader of Voit’s Investment and Leasing Team.
In the most recent transaction with PROLOGIS, the Voit team identified an opportunity in an off-market distressed asset - the 2875 N. Lamb Blvd. building, rebranded as the Cheyenne Distribution Center (top left photo).
“This transaction required in-depth market knowledge, strategic recommendations, quick underwriting requirements and, of course, a buyer like PROLOGIS, that has the capability to perform quickly,” explained Higgins. “Our job is to constantly maintain contact with clients and maintain their specific investment requirements in order to present relevant opportunities as they arise, off-market or otherwise.”
The Cheyenne Distribution Center is a 171,000 square-foot, partially occupied, mid bay industrial building that PROLOGIS acquired for $7 million. Voit Real Estate Services represented PROLOGIS in the transaction. The seller, Kennedy Wilson, was unrepresented at the time of sale.
Voit also represented CIP Real Estate in the sale of a 110,000 square-foot, two-tenant distribution building at 985 Trade Dr. in North Las Vegas (middle right photo). The majority of the building was occupied by Cox Communications on a long term NNN lease, according to Higgins.
“With CIP wanting to deploy capital toward value-add acquisitions, we suggested that the time was appropriate to sell 985 Trade Drive. CIP agreed and we demonstrated our ability to execute a more traditional marketing program with the help of Mike Hefner in Voit’s Irvine office,” explained Higgins. “Selling an asset such as this requires the ability to justify market rents in a tough market, forecast realistic assumptions going forward, and a large enough network to find the appropriate buyer.”
In addition to the recent transactions above, Voit’s Higgins’ Investment and Leasing team in Las Vegas was recently selected to market the North Port Business Center I and II (middle left photo) on behalf of an Institutional Lender. The 172,328 square-foot North Port project is comprised of six office/flex/industrial buildings and is available for sale. The project is located at 3355-3675 W. Cheyenne Ave. in North Las Vegas, Nev.
For more information on the property please call (702) 734-4500 or visit the marketing website at https://my.rcm1.com/handler/teaser.aspx?pv=Db5rFBDs2rF_v3NEPRD6CVCfeBkZ0aGHnRD7xdnx8kA.
Jenn Quader/Judith Brower
Brower, Miller & Cole
360 Residences in San Jose is the largest single-asset multifamily sale to close in California’s Bay Area in 2012.
SAN JOSE, CA, April 17, 2012 – Institutional Property Advisors (IPA), a multifamily brokerage division of Marcus & Millichap serving the needs of institutional and major private investors, has arranged the sale of 360 Residences (top left photo), a 213-unit luxury high-rise tower in San Jose.
The sales price of $118 million represents a price of approximately $554,000 per unit and marks the largest single asset multifamily sale to close in the Bay Area year-to-date.
Stan Jones (middle right photo), an executive vice president investments; Sal Saglimbeni (middle left photo), a vice president investments; and Phil Saglimbeni (lower right photo), a vice president investments, represented the seller, an investment group led by Beverly Hills, Calif.-based Kennedy Wilson.
“The property’s prime downtown location in one of the strongest job markets with arguably the best demographics in the United States attracted numerous institutional buyers.
“ This underscores the strong demand for high-end product in the Bay Area. Just prior to marketing 360 Residences, our IPA team arranged the sale of 885 Woodside, a newly constructed condominium-quality community on the Peninsula that transacted at approximately $564,000 per unit,” Jones continues.
“360 Residences’ urban core setting with convenient access to hundreds of restaurants, bars, performing arts programs, theaters, museums and sporting venues, combined with the exceptional architecture and finishes of the community, resulted in a rapid lease-up,” adds Sal Saglimbeni.
“The property began leasing in April of 2011 and is now leased at 97 percent, demonstrating the strength of the multifamily market in Silicon Valley.”
Built in 2010, 360 Residences’ high-end construction, distinctly urban feel and vibrant downtown location make it the premier rental community in Silicon Valley.
The property’s 23 stories are accentuated with unique details, state-of-the-art amenities, elegant interior finishes and unparalleled views of the surrounding area. Floor plans average 1,320 square feet and include lavish penthouses on the 22nd and 23rd floors.
The IPA team of Jones-Saglimbeni has closed approximately half a billion dollars in institutional multifamily transactions since the beginning of 2012, consisting of 10 properties with 2,371 units throughout Northern California and Nevada.
Contact: Stacey Corso, Public Relations Manager, (925) 953-1716
- $13,550,000 for Navarro Discount Pharmacy Headquarters in Medley, Florida,
- $1,000,000 for Residences at 2nd Street and Pebble Court Apartments in Fort Myers, Florida
- $1,725,000 for Dollar General in Jacksonville, Florida and Dollar General in Holly Hill, Florida.
Thomas D. Wood Jr., (middle left photo) Company President, secured financing for 129 Hibiscus Boulevard in the amount of $1,275,000 through Thomas D. Wood and Company's correspondent relationship with StanCorp Mortgage Investors, LLC. The permanent, full-recourse loan has a term of ten years plus a ten year option, twenty year amortization, an interest rate of 5.375% and a loan-to-value of 68.7%. The borrower wanted to refinance an existing loan that was maturing. The 27,210 square-foot multi-tenant office building was built in 1981 and is located at 129 W. Hibiscus Boulevard, Melbourne, Florida 32901.
Thomas D. Wood Jr. also secured financing for Viera Self Storage (middle right photo) in the amount of $1,150,000 through Thomas D. Wood and Company's correspondent relationship with StanCorp Mortgage Investors, LLC. The permanent, fully-amortizing, full-recourse loan has a term of 15 years, based on an interest rate of 5.50% and a loan-to-value of 61%. The borrower wanted to refinance an existing loan that was maturing. The 74,487 square-foot self-storage building was built in 1999 and is located at 5900 South US Highway 1, Rockledge, Florida 32955.
Joe Dear (lower left photo), Company Vice President, secured financing for Gateway Commons in the amount of $1,600,000 through Thomas D. Wood and Company's correspondent relationship with StanCorp Mortgage Investors, LLC. The permanent, five year, 25 year amortizing loan is based on an interest rate of 5% and has a loan-to-value of 70%. The borrower wanted to refinance a maturing CMBS loan. The 9,600 square-foot multi-tenant retail building was built in 2005 and is located at 821 S. State Road 434, Altamonte Springs, Florida 32714.
Dear also secured financing for Navarro Discount Pharmacy Headquarters (lower right aerial photo) in the amount of $13,550,000. The borrower was able to refinance an existing bank loan through Thomas D. Wood and Company's correspondent relationship with American National Insurance Company. The permanent, five year loan with a 25 year amortization schedule has a loan-to-value of 75%. The 271,540 square-foot owner-occupied industrial building was built in 1996 and is located at 9400 NW 104 Street, Medley, Florida 33178.
Brad Cox (bottom left photo), CCIM, CPM, Company Vice President, secured financing for both the Residences at 2nd Street and Pebble Court Apartments in the amount of $1,000,000. The permanent, fully-amortizing loan has a term of 25 years, based on an interest rate of 5.375% and a loan-to-value of 70%. The Residences at 2nd Street is a 16 unit multi-family property situated on 1.02 acres of land, was built in 1983, remodeled in 2011 and is located at 2575 2nd Street, Fort Myers, Florida 33901. The Pebble Court Apartments is a 20 unit multi-family property located on 0.78 acres, was built in 1984, remodeled in 2011 and can be found at 2974 Jackson Street, Fort Myers, Florida 33901.
Cox also secured financing for two Dollar General Stores in the amount of $1,725,000. The permanent, five year loan with a 25 year amortization schedule has a loan-to-value of 63%. The retail properties are both 9,002 square-feet. Dollar General Jacksonville sits on 1.17 acres, was built in 2011 and is located at 10171 New Kings Road, Jacksonville, Florida 32219. Dollar General Holly Hill (bottom right photo) is situated on 1.47 acres, was built in 2011 and can be found at 1800 North Nova Road, Holly Hill, 32117.
For further information, please contact:
Ashlee E. Wood
Director of Marketing and Public Relations
Steven H. Wood
Chief Operating Officer
Thomas D. Wood Jr.
(407) 937-0470 ext. 7
Brad Cox, CCIM, CPM
McCarthy-Built Miramar College Police Substation in San Diego Area Receives USGBC LEED Platinum Certification
McCarthy Building Companies, Inc. (www.mccarthy.com), one of the nation's leading education and parking builders, constructed the new police substation, together with the adjacent 270,000-square-foot, 828-space parking structure (lower right photo).
Construction of the combined $17.9 million project was completed in late November on behalf of the San Diego Community College District (SDCCD). It is the first higher education facility in San Diego County to achieve LEED Platinum Certification, the highest rating possible.
For a complete copy of the company’s news release, please contact:
Kutch & Company
3904 Groton Street | Suite 203 | San Diego, California 92110
McCarthy Building Companies, Inc.
Phone: (314) 968-3300