Regional Outlook

Regional Outlook

{Northeast}  

New York’s Big Deal

The Boston-based Rockpoint Group purchased One Dag Hammarskjold Plaza, an 815,000-sf office tower in Manhattan, for approximately $600 million. The seller was Ruben Companies, represented by Cushman & Wakefield. Named for the United Nations’ second secretary general who died in a 1961 plane crash, the 50-story building is located near the U.N. and houses the permanent missions to the U.N. of several countries.

Sources: GlobeSt.com, The Real Deal

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{National}

Fast-Growing Flex Markets

Flexible office space has grown 23 percent annually since 2010 and, in 2018, accounted for more than two-thirds of U.S. office market occupancy gains.     

    Source: “Flexing Their Muscles: Markets to Watch in 2019,” JLL

    +++

    {Midwest}

    Retail on the Rise in Western Michigan

    A recent report from the Bradley Company, a commercial real estate firm based in Grand Rapids, Mich., noted that investment in shopping malls and grocery-anchored developments has increased in the western Michigan. The market has benefited from tourism as well as population growth and sturdy economic development. Recent projects or work scheduled for 2019 include:

    • Developments on the west side of downtown Grand Rapids,  including a smaller-format urban grocery store, the first of six planned by the Meijer grocery chain.
    • The NorthTown 794 redevelopment in Muskegon, which  will turn a 21,000-sf retail space into a three-story commercial hub featuring a brewery and restaurants.
    • $30 million to $40 million in new investments in  downtown Holland.
    • Several large-scale mixed-use developments in downtown Kalamazoo that will add 30,000 sf of new retail space to the market this year.

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    {West}  

    States Taking the LEED

    In 2018, LEED-certified projects totaled 615.27 million sf for 2,886 projects. Top states for LEED certification:

    Source: U.S. Green Building Council

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    {National}

    Rising Industrial Markets

    Colliers International singled out 10 emerging industrial markets in the U.S., based on population and labor demographics, logistics advantages, inventory, and new construction. They include:

    Greenville/Spartenburg/Anderson, S.C.: 6.9 million sf under construction; multiple shipping options; 2018 vacancy rate lowest in more than a decade

    Florida I-4 Corridor: Fast-growing population base; average warehouse worker wage below national average; 62.5 percent increase in absorption from 2017-2018

    Las Vegas: Decreasing vacancy rates (from 14.3 percent in 2010 to  3.6 percent in 2018); strong tourism; increasing rental rates

    Lehigh Valley, Penn.: Especially strong demand for facilities over 500,000 sf; proximity to two large cargo airports; population of 62 million within 250 miles

    Minneapolis/St. Paul: Large millennial population; 2018 vacancy rate lowest in a decade; strong logistics for sea, air, rail, and road

    Source: “10 Emerging U.S. Industrial Markets to Watch in 2019,” Colliers International

    +++

    {Southwest}

    Medical Office Heats Up in Phoenix

    Phoenix’s medical office market  finished 4Q2018 on a positive note.

    Rental Rates

    4.2 percent increase YoY from 2017

    Vacancy Rates

    11.9 percent (200 basis points lower than 4Q2017)

    Under Construction

    300,836

    Investment Sales

    $362.9 million (up from $346.6 million in 2017)

    Health Care Employment in Phoenix Area

    4.6 percent annual increase since 2013  

    Source: Avison Young

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