Market Data
Regional Outlook
West
San Diego’s Big Deal
The aptly named
DiamondView Tower — whose 15th-floor skybox overlooks the San Diego Padres
field — sold for $121 million, the area’s largest single office building sale
for 2012, according to CBRE, which handled the transaction. San Diego developer
Cruzan/Monroe and Cigna Investments purchased the 95 percent leased property
for $121 million from The Netherlands-based Wereldhave USA, which paid $161
million for it in 2008. The transaction was a bargain in more ways than one:
Although not located in the city’s center, DiamondView pulls in the region’s
highest net operating income at $33.70 psf — $10.2 million annually, according
to London Group Research.
Midwest
Chicago Multifamily Market Tight
Apartment hunters may not find
Chicago their kind of town, as city multifamily vacancy rates have declined for
the past 3.5 years to 4.3 percent, with asking rents increasing 2.9 percent for
2012, according to Marcus & Millichap. With only 200 rentals completed last
year in the suburbs, those vacancies fell to 3.9 percent as asking rents rose
2.4 percent. Investors are also moving to the suburbs, as multifamily
transactions outside of Chicago increased 25 percent last year.
South
West
Denver Offers Total Package
No longer just a winter
destination, Denver has morphed into a “year-round, four-sport,
convention-oriented, leisure city all connected through a new bus and light
rail system,” says Greg Hartmann, executive vice president and national
director of valuations of Jones Lang LaSalle Hotels. “It’s a model for
noncoastal urban centers such as Houston, Dallas, Salt Lake City, Kansas City,
Sacramento, San Jose, Omaha, and Cincinnati.” Hotel investors have discovered
Denver as well, Hartmann adds, as upper-scale properties attract around
$350,000 per room, with select-service hotels priced at more than $250,000 per
room.
East
National
“Increased
competition amongst net-leased investors has triggered the 3Q12 national
bid-ask spread to compress by 6 basis points on average when compared to last
quarter.”
Midwest
CCIM Restores Local Asset
Brent Sears, CCIM, SIOR, of
NAI/Bergman in Cincinnati was instrumental in helping revitalize a retail asset
in the tertiary market of Hillsboro, Ohio. After purchasing and renovating the
58,127-sf Hillsboro Plaza, property owner Buckeye State Investors retenanted,
leasing a portion of the space to retail tenants. HealthSource of Ohio also
signed a 10-year lease for 14,000 sf, which it occupies with another medical group.
Buckeye then created a deed split and sold the portion of the center occupied
by the medical groups to HealthSource for $1.4 million. The remainder of the
center, 100 percent occupied, mostly by national tenants, is on the market for
$3.5 million. “This revitalization effort created many jobs in a community with
11 percent unemployment,” says Sears. “When these stores opened up, there were
hundreds of people in line for a position. CCIMs get things done in small
cities as well as large ones.”