Posts tagged commercial
The Industrial Sector in Central Ohio continues to be on a good path again this quarter. Vacancy rates are continually declining to almost record levels, 7.1%. With fewer spaces on the market, rental rates are on the rise. Developers are paying attention and speculative buildings are coming out of the ground.
The 3rd quarter has brought a strong mix of owner/user and investment sales. Loeb Electric, a Columbus-founded electrical company, has made a move from Grandview to the east side. Loeb Electric is reportedly selling its Grandview warehouses at 915 Williams and 906 Burr Ave to Grandview Yard developer Nationwide Realty Investors. The electrical contractor purchased a 264,000/SF facility at 1800 E Fifth Avenue. The new location at 1800 E Fifth Ave was the former Design Center building at East Fifth and Leonard Avenues in Columbus. (more…)
The 3rd quarter of 2013 saw a continuation of trends that have been developing over the previous quarters in the retail sector in central Ohio. With vacancy rates continuing to fall, prime retail space is becoming more and more difficult to find. With limited availability, lease rates on this prime retail space are as well, indicating a stronger market on the investment side.
In central Ohio, the housing market remains strong and new apartment complexes are springing up all over. With the influx of new houses, condos, and apartments, one of the strongest segments within the retail sector continues to be the restaurant industry. (more…)
The Columbus office market continues to improve. For simple proof of this, try renewing a 2008 lease at the same terms today. It’s just not going to happen. Class A & B direct vacancy rates are down to nearly 14.5% as Columbus’ 30 million SF inventory continues to be absorbed with nearly 360,000 SF of positive absorption in the last 12 months.
As vacancy decreases, we are seeing an uptick of rates in select submarkets. For example, in the CBD, Tenants rolling out of recession-era lease deals can expect some sticker shock as overall rates have gone up about $0.65 cents per SF in the last 12 months alone, primarily in the Class A product. Having said this, we are beginning to see a trickledown effect to some extent as higher end Class B buildings have initiated or will soon initiate a rate hike. Typically, this refers to those who are at occupancy levels of 75% or greater.
Notable new developments recently announced include Daimler’s construction of 250 S. High Street, a 160,000 SF Class A building in the CBD to be anchored by Resource. Daimler will also soon begin construction of Westar V, a 103,000 SF spec office building playing off their original four building development in Polaris.
Notable sale transactions include Romanek Properties Ltd. purchase of Two Miranova for $27 Million and Lawyers Development Corp. purchase of 200 Civic Center Drive (Columbia Gas Building) for $15 million. Notable lease transactions include Century Insurance relocating into 60,000 SF at Westar II in Polaris and Hewlett-Packard consolidating two local office operations into 30,000 SF at Atrium II in Dublin.
Class A office rents are on the rise, resulting in several speculative buildings. 250 S High Street will bring 160,000 SF of new Class A office to the downtown market, the first new project near the Square since Fifth Third Center in 1991. Other hot markets – Polaris, Grandview & New Albany boast both speculative and build-to-suit construction. The leading developer in the office sector is Daimler, who is heading up 4 of the 5 current projects. In other news, Ohio University is planning a 120,000 SF Oncology Hospital in Dublin at Post & 33 to be completed by Fall 2014.
Build to suit activity is driving the industrial real estate market. Multiple developers have projects under way, from Duke’s 500,000 SF for Ace Hardware in London to Exxcel’s CenterPoint IV for Avnet. Vacancy rates continue to decline to an overall rate of just above 7%. Large blocks of space are scarce. Although asking lease rates remain flat, actual rates are approaching an all time market high. With rates on the rise, can speculative construction be far behind?
Commercial Real Estate appears to me minimally impacted by the recent Government shutdown. The biggest impact is in Multi Unit Housing sales. The FHA will be approving no new commitments for multi-family financing during the shutdown period. Despite a brief period of uncertainty within the market and with interest rates, the commercial real estate industry appears mostly unaffected, although it could simply still be too early to see any fallout.
One of the most recognizable buildings in Northern Columbus,1105 Schrock Rd has a new owner this morning, due to impressive marketing efforts of Matt Gregory, Phil Bird and Mike Simpson of NAI Ohio Equities. At the time of transfer, the 213,000 SF building was over 85% occupied at the time of sale. The property is recognized by its prominent fountain visible from I-71. “Although the property was taken back by the bank in 2010,” says team lead Matt Gregory, “Our challenge was to present it as a Class A office investment, not a distressed asset.’” After securing lease renewals from the four anchor tenants, the team set about filling vacant space in the property. Combined with ongoing property upgrades, the resulting offering garnered 6 offers – and the property sold to a Canadian investor on July 11th. The selling price of almost $10,000,000 – or almost $45 per square foot – belied its “Distressed asset value.” Sandy Simpson boasts, “We’re very proud of this team and think that this their dramatic success will lead to further assignments of this type.” (more…)
While the commercial real estate industry continues to try to comeback from recession lows, agents who are able to find a market niche and who are able to find creative solutions to add value and incentive to both buyers and sellers are finding ways to get deals done.
NAI Ohio Equities office agent Peter Merkle has brokered multiple deals in the central business district over the last several months. Peter has done a variety of deals in this area: value add, sale – leaseback, and speculative investment. (more…)
With $17.3 billion in commercial mortgages coming due in 2012, landlords are more motivated than ever to incentivize tenants to renew their existing leases. Landlords are trying to stabilize their buildings and refinance. To do so, they must show a strong rent roll to the bank.
Some incentives such as free rent, reduced rent (blend and extend), upgraded lighting and dock doors have become common concessions offered by landlords to tenants who renew. It’s easier and safer for landlords to provide these concessions and keep their current tenants than try to re-fill the space. (more…)
Just as there were many factors leading to the recent economic recession in the United States, many factors are also leading to the slow economic recovery, none more apparent than the proliferation of online retail stores.
According to a Goldman Sachs research study in 2010, it is estimated that by the year 2019 retailers will see online sales surpass 50% of their dollar growth. As online sales continue to increase, the importance of online stores will only grow. (more…)
Over the past few years you have most likely heard of commercial properties going “into receivership”. This happens usually when a lender initiates foreclosure on a borrower in default of its mortgage agreement. If the Judge determines cause exists to preserve and protect a creditor’s asset, a receiver will be appointed to manage and control the asset during the foreclosure process. (more…)
NAI Ohio Equities, LLC are excited to announce that Rick Stearns and Matt Lasky will be joining the company.
Rick Stearns brings 35 years mortgage banking experience financing commercial real estate developments with institutional lenders. He will be part of the Asset Services Division at NAI Ohio Equities working with financial institutions, law firms, and partnerships dealing with distressed properties and REO.
View Rick Stearns’ bio page here.
Matt Lasky graduated from Miami University’s Farmer School of Business Cum Laude where he received his bachelor’s degree in finance with a concentration in statistical analysis. He will be specializing in the leasing and sales of investment properties at NAI Ohio Equities.
View Matt Lasky’s bio page here.