of the Fifth-Third Center in downtown Charlotte, N.C., shows the strength of a
class A trophy property even in a tertiary market. Cousins Properties bought
the 30-story tower for $215 million from Parmenter Realty Partners, which
bought the building two years ago for $163 million from Bank of America. During
its tenure, Parmenter upgraded the building, added about 40,000 sf of new
leases, and extended a prominent law firm lease by 10 years. Currently the 697,817-sf
property is 83 percent leased. The $308-sf sales price sets a new record for
the Charlotte market, according to the Charlotte Business Journal.
industrial market is attracting attention around the country as a hub of new
construction. From 2Q13 to 2Q14 the area’s overall industrial vacancy rate fell 60 bps to 7.3 percent,
despite the addition of 1.3 msf of spec construction to the market, according
to Summit Realty Group’s
midyear report. In addition, a number of large build-to-suit projects will add
4.0 msf to the market by year-end, giving Indianapolis 5.1 percent of all U.S.
industrial construction, while having only 1.8 percent of the current
inventory. Industrial investors are also busy, as nearly 6.0 msf traded hands
by 2Q14, compared with only 3.8 msf by midyear 2013. More than 10 msf was bulk
product, which sold for nearly $450 million at an average cap rate of 6.9
Summit Realty Group/Cushman & Wakefield
Kansas City Comeback
The millennial generation is changing the face of downtown Kansas City, writes Gib Kerr, CCIM, vice president of Cassidy Turley in a Heartland Real Estate Business article. “Over the last 10 years, roughly 4 million sf of office space has been converted to multifamily housing in downtown Kansas City,” he says, attracting a younger generation that now makes up 59 percent of the downtown population. The trend, which will add another 1,500 units next year, is reducing the amount of smaller obsolete office space and re-imagining the downtown as lively neighborhood that offers shopping, dining, and entertainment venues. The successful conversion of office to multifamily is also attracting developers of new multifamily buildings, as demographics project the need for about 800 new units annually for the next 15 years.
“In 70 percent of markets surveyed, the increased capital is flowing to core suburbs, followed by core CBDs, a shift from recent quarters where CBD activity dominated.” —JLL, Q3 2014 U.S. Office Sentiment Survey
New York’s Hotel State of
City has more hotel rooms under construction than any other market, according
to STR. With more than 25,000 rooms being built — 23.6 percent of existing
supply — New York will have about 900 rooms opening per month in 2016, soundly
beating its 2010 peak supply period of 550 rooms per month. The next highest
markets are Houston, with about 8,500 rooms under construction, and Austin,
Texas, which has the highest percentage of rooms under contract — 25.4 percent —
when compared to existing supply.