Market Data

Regional Outlook

South

Houston’s Big Deal

A new spec office building is big news in most markets; in Houston, the story is that the property is fully leased before it even opens. Technip USA will occupy all 17 floors of Energy Tower III being developed by Mac Haik Realty, according to the Houston Business Journal. The French energy company signed a 15-year lease for the 428,831-sf class A, LEED-certified tower scheduled to open in January 2014. As a sign of Houston’s booming economy, five other developments have broken ground in the Energy Corridor along Interstate 10, and another 18 are in proposal stages, according to Jones Lang LaSalle.

First Watch Plans Big

Breakfast and lunch restaurant First Watch out of Bradenton, Fla., plans to have 300 outlets by 2017, according to an interview with chief marketing officer Chris Tomasso in Nation’s Restaurant News. Southeast Florida, Atlanta, Baltimore, Washington, D.C., Nashville, Tenn., and Indianapolis are target markets for this growing chain, which has 105 restaurants and plans to add 20 more this year. The company is looking for locations with substantial daytime populations: “We like to be around daily needs, like grocery stores and dry cleaners,” Tomasso said.

National

West

Phoenix Rises

A predicted 3.5 percent employment growth rate for 2013 has put Phoenix on the radar of apartment developers, according to Marcus & Millichap’s 2Q13 multifamily report. With slightly more than 1,000 units added in 2012, developers are scheduled to deliver 3,100 units this year, increasing the inventory by 1 percent. Overall, 3,800 units are under construction and more than 17,000 are in the planning stages for the Phoenix metro area.

East

Charleston’s Office Opportunity

“Buildings that have not seen any interest in years are now getting attention and getting leased,” in Charleston, S.C., according to a Collier’s International 1Q13 market report, which is creating opportunities for value-add investors. Charleston’s office vacancy rate has dropped from 16.1 percent in 1Q11 to 12.3 percent in 1Q13, due to expanding corporate tenants such as Boeing and tech companies. Capital-rich investors can buy and upgrade B and C properties in key locations, knowing they will lease quickly, the report adds.

North

Midwest

Indianapolis Races to the Top

Affordability, access to universities, and good old local boosterism are moving Midwest cities to the top of site selection lists for corporate headquarters relocations, according to Site Selection magazine. Indianapolis was recently named as the most affordable U.S. market in a corporate headquarters cost analysis of 50 U.S. and Canadian markets by The Boyd Co. Total operating costs for a corporate headquarters in the Indianapolis market are at least $10 million less than comparable cities on the East and West coasts. Indy’s overall office vacancy rate dropped below 20 percent in 1Q13 for the first time since 2008, according to Summit Realty. The Meridian Corridor, a popular submarket in suburban Carmel, Ind., had a YOY vacancy drop of 4.5 percentage points.

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