Thursday, March 2, 2023

Seyfarth Shaw releases 8th annual Real Estate Market Sentiment Survey

 

Christine Kim

 NEW YORK, NY -- Seyfarth Shaw LLP has released the findings of its 8th annual Real Estate Market Sentiment Survey unveiling what commercial real estate (CRE) executives see as their top concerns, investment priorities, and key catalysts for change.

Seyfarth’s 2023 Survey examines the industry’s current market sentiment as it navigates economic challenges and a new workplace standard. A copy of the full survey can be downloaded here.

This year’s survey reveals that the CRE industry, similar to the country as a whole, is grappling with a vastly higher interest rate environment coupled with the possibility of additional rate increases, inflation, and a potential recession.

However, those headwinds have appeared to be taken in stride by the CRE community that, by and large, is focused on fundamentals and holds an optimistic view on 2023.

Paul Mattingly

“The Fed’s action on interest rates may not be sufficiently slowing the greater economy, but it is definitely chilling transactional activity,” said Paul Mattingly, chair of Seyfarth’s Real Estate department. “Our respondents are experienced and understand this part of the cycle, which explains their resilience and optimism.”

The survey reinforces that CRE performance is driven by and tied to fundamentals. Interest rates, a potential recession, and inflation remain the top concerns for CRE executives in 2023.

While the survey consensus follows the Fed guidance on increasing interest rates, respondents are mixed on whether we are in a recession or headed for one — and, if so, for how long.

Among the many other key findings in Seyfarth’s 8th Annual Real Estate Market Sentiment Survey and observations from the Seyfarth Real Estate attorneys:

Persistent Positivity: Despite the highest interest rate environment since 2007 and a looming recession, more than two-thirds (69 percent) of the CRE industry have a positive outlook for 2023. Though down from 84 percent in 2022, this resilient optimism flows in part from better than expected economic growth during the fourth quarter of last year and a continued decline in the rate of inflation. It too may reflect a move to invest in distressed assets.

Ronald S. (Ron) Gart

Partner Ron Gart: “The commercial real estate community is uniquely positioned to understand the immediate and long-term impacts of the current economy. That singular vantage point explains why on the one hand many, if not most, of the respondents consider the commercial real estate sector to be in a recession while being optimistic that the sector will experience a substantial turnaround by the end of the year.

Distressed Dynamics: Adversity can lead to prosperity for those poised and able to capitalize on the moment. 48 percent of all respondents plan to invest in distressed assets in 2023, while nearly 60 percent of those respondents who view 2023 as a year of opportunity also plan to invest in distressed assets. For those with money to spend, the decrease in debt availability and rise in financing costs may lead to falling asset values in the market and could explain why, despite these challenges, they see 2023 as a year of opportunity.

James O’Brien

Partner: James O’Brien: “The most surprising thing about the results is that nearly 70% of those responding believe that 2023 will be a year of opportunity, even though almost 90% of respondents indicate that we are either in a recession now or will be in one before 2023 is over. I think the answer to this seeming conundrum can be found in the appetite for distressed investments. 60% of those who view this as a year of opportunity say that they plan to invest in distressed assets.”

Workplace Woes: Work-from-home/hybrid models are now table stakes to remain competitive with top talent, though nearly two-thirds (62 percent) of CRE executives report a corresponding decline in company culture as a result. Perhaps in an effort to stem further declines, 85 percent of respondents, who are disproportionately owners and senior executives, plan to be in the office 2-5 days per week in 2023. It is unclear whether concerns over culture will trump retention and recruiting and drive the great return to work many CRE executives see as critical to stabilizing assets.

Partner Christine Kim: “The continuing tension between offering remote-work opportunities to attract top talent and encouraging in-office work to preserve company culture has interesting implications for the future of office assets.”


Pivotal Policies: Lowering interest rates reigns supreme in the eyes of respondents with more than 70 percent designating this as the most effective way the government can support CRE. While 60 percent of respondents identify low state taxes as the greatest driver of corporate relocations in 2023, social issues such as reproductive rights and ESG were immaterial when compared to economic concerns.

Kings of Capital: With the capital gap left by many lenders and institutional investors, CRE executives expect private equity to become the leading source of equity in 2023.

Urban Upheld: Nearly three-quarters of respondents anticipate a continued preference for urban market investments. These numbers are consistent with respondents’ views in 2022.

Preferred Properties: Traditional assets are the most attractive asset classes for investments in 2023. Multifamily and industrial are the preferred darlings among core property types, whereas senior housing and life sciences are the most alluring alternative assets. Single-family rentals, which were among the top two investment interests last year, fell to the bottom.

  CONTACTS:

 Tom Mariam

Director of Public Relations tmariam@seyfarth.com

 212-218-3366

 

John Garger

917-572-4820

 jgarger@rippmedia.com

 
Allan Ripp

 646-285-1779

 arippnyc@aol.com.

. KW PROPERTY MANAGEMENT & CONSULTING Adds Nearly 5,000 Units in Southwest Florida

 

Zuly Maribona

SOUTHWEST FLORIDA, March 2, 2023 – KW PROPERTY MANAGEMENT & CONSULTING, a premier Florida-based association management company, continued its significant expansion in Southwest Florida with the addition of six communities totaling nearly 5,000 units in the region.

The new assignments include large-scale master-planned neighborhoods, vibrant active-adult communities and condominium buildings.

Pelican Preserve, Fort Myers, FL

In Fort Myers, KWPMC took over association management and food-and-beverage operations of Pelican Preserve.

 Developed by WCI Communities, Pelican Preserve is a gated master-planned community with nearly 2,500 homes for 55-and-up residents.

 It is considered one of Southwest Florida’s top-tier active-adult communities and has a mix of condos, carriage homes, attached villas and single-family residences.

Gran Paradiso, Venice, FL

Gran Paradiso, a lavish Tuscan-inspired gated community with 1,935 homes in Venice, also retained KWPMC to enhance its association.

The high-end community spans more than 1,000 acres and is conveniently located near Venice’s Jacaranda Boulevard and I-75.

Other new Southwest Florida community assignments include:

  • Two Marco Island properties: Marco Beach Ocean Resort and the Tradewinds Apartments at Marco Island
  • Treviso at the Colony, a 21-story condo building in Bonita Springs
  •  

“Our consistent growth across Southwest Florida is a reflection of the sophisticated, high-tech and high-quality property management services we provide for a wide range of residential product types,” KWPMC Senior Vice President Zuly Maribona said.

“We look forward to announcing additional prestigious assignments in the region in the near future.”

Treviso at the Colony, Bonita Springs, FL

With more than 25,000 homes under management in Collier, Lee, Venice, Charlotte and Hendry counties, KWPMC has a substantial presence in the Southwest Florida region.

KWPMC is one of the fastest-growing property management companies in the U.S., with more than 80,000 homes under management and 22,000 employees. The company has developed its own digital platform and has grown organically since inception.

  CONTACTS:

 Eric Kalis

954-370-8999

ekalis@boardroompr.com

 

Daniel Benjamin

Senior Account Executive

 BoardroomPR

dbenjamin@boardroompr.com

O 954-370-8999

C 954-618-8287

 

www.kwpmc.com.

29th Street Capital Buys 232-Unit Solaire Apartments in Silver Spring, MD

Yalda Ghamarian 
 

 Silver Spring, MD – 29th Street Capital (29SC)  has acquired Solaire Apartments, a 232-unit Class A property in Silver Spring, Maryland. 

29SC plans to rebrand the property to “Maven at Wheaton” and will make property upgrades by renovating apartment units, and modernizing interior and exterior amenity areas.

 The price was not disclosed.

Brian Berry

The six-floor building features a 24-hour fitness center, swimming pool and sundeck, community room, and a courtyard patio with grilling station.

 

Brian Crivella
“Built in 2014, Solaire Apartments is a high-quality transit-oriented property within a short walk of both Wheaton Metrorail Station and Westfield Wheaton Mall,” said Brian Berry, Senior Vice President Mid-Atlantic for 29SC.

 “We look forward to executing on our business plan and continuing to expand in the

Washington DC region.”

 Brian Crivella, Walter Coker, Bill Gribbin, and Yalda Ghamarian from Berkadia represented the seller.

Walter Coker
Haven Residential, the 29SC-owned property management company, will oversee management and leasing.

 Formed in 2009, 29th Street Capital is a privately held real estate investment firm with 16 offices nationwide.

 Its current portfolio consists of more than 20,000 existing units and a development pipeline of over 3,800 units.

 In the last year, 29SC has acquired 16 multifamily assets across the United States that contain over 4,500 units.

Bill Gribbin
The firm continues to actively pursue new opportunities.

 CONTACT:

 Julia Eich

Director of Marketing and Communications

+1.847.977.0876 | 

julia.eich@havenresidential.com

 

29SC.com

 

 

Azor-Led Partnership Sells Suburban South Florida Retail Center for $13.85 Million

Beth Azor
 

 Sunrise, FL—Taking advantage of the sizzling hot retail market in South Florida, a partnership managed by Beth Azor has sold a neighborhood shopping center for $13.85 million.  

 

 The Sawgrass Home Design Center is located at 13001-13191 West Sunrise Blvd. in Sunrise, directly fronting the world-renowned Sawgrass Mills outlet mall which attracts over 20 million visitors a year. 


 The Sawgrass Home Design Center is located
at 13001-13191 West Sunrise Blvd. in Sunrise, FL

FVP Sawgrass LLC acquired the 70,642-square-foot center for $5.5 million in late 2011, more than doubling their investment.  

 

 Azor Advisory Services represented FVP in the transaction.  Apogee Realty Inc. and Capital Group Realty 2004 LLC represented the buyer, Harvest International Investments.

 

“The demand for strong-performing retail centers in densely populated areas of South Florida is more intense than it has been in many years,” said Azor, founder and CEO of Weston-based Azor Advisory Services.  




 “There is virtually no new development and very little product available for sale, so we decided to capitalize on the market.”

 

Azor Advisory services leased and managed the multi-tenant shopping center which was built in 1994 and most recently renovated in 2021.  

 

 It is currently 83% leased with key tenants that include DXL Casual Male, Bella Salon Suites, Lighting Outlet, Compass Research and Caremax.


     Plantation Town Center  2140 West Sunrise Boulevard

                                    in Plantation, FL  

 

In addition to Sawgrass Mills, the retail center also benefits from being next door to a massive mixed-used development planning to have over 2,000 homes, and near the arena where the Florida Panthers NHL team plays.

 

This is the second neighborhood shopping center that Azor and her investors sold in West Broward over the past half year. 

 

 In August 2022, a joint venture between Miami and Spanish real estate firms paid $22 million for the 70,369 square-foot, Aldi-anchored Plantation Town Center located less than a mile away at 2140 West Sunrise Blvd. in Plantation.  

 

 

 

 CONTACT:


Todd Templin

Executive Vice President

BoardroomPR

O 954-370-8999

C 954-290-0810