Market Data

Regional Outlook


Louisville's Big Deal

A public-private partnership is turning a 24-acre site once occupied by the National Tobacco Co. into a food hub - “a $45 million commercial agriculture park that will process, store, and distribute locally grown foodstuffs,” according to the Louisville Courier-Journal. After receiving the vacant land worth $1.2 million from the city, nonprofit developer Seed Capital Kentucky is seeking tax credits to fund the first phase of the West Louisville Food Hub: development of a warehouse, office building, and commercial kitchen. It is also working out agreements with agricultural companies to build a juicer, an industrial food processing plant, and a demonstration farm. A $20 million methane gas plant powered by compost will break ground later this year. An industrial and marketplace mixed-use format, food hubs have sprouted up in Baltimore, Philadelphia, and St. Louis.

Houston's Position Solid

Reports of Houston's demise due to falling oil prices are greatly exaggerated, according to a recent CBRE report. The city is in solid shape, having diversified its employment base and created four new jobs for every one it lost during the recession, says CBRE. Of the property sectors, retail should fare best: Houstonians, like the rest of Americans, will benefit from lower gas prices and most likely spend that money at the mall. Office is the most exposed property sector, given the number of energy firms headquartered in Houston, plus the large amount of space coming on line between now and 2017. Industrial and multifamily, already in strong positions, should fare well, with slower rent growth the only impact. However, CBRE expects oil prices to slowly drift upward in the next two to three years.


The Next Big Thing

Nashville, Tenn., East Bay, Calif., Raleigh-Durham, N.C., Denver, and Salt Lake City - dubbed the NERDS - are the next big thing for corporate tenants and office investors, according to a recent JLL report. The combination of an affordable housing and a big-city vibe without all the hassle has attracted a growing population of educated millennials. Since 2010, these cities have grown at twice the national rate and in the past three years the gross metropolitan product has increased 14 percent. For corporations looking to relocate or open additional offices, class A office space averages 35 percent below national average; for investors, those trophy properties trade at cap rates around 5.5 to 7.5 percent, and about $200 to $400 psf below national averages.


Office Investment Leaders

San Francisco, San Jose, Calif., and Seattle-Tacoma, Wash., topped Marcus & Millichap's 2015 National Office Property Index as tech firms keep offices filled and confined development keep tenants' space options tight. However, that may change as development ramps up big time in 2015.


New York Hospitality

Offshore investors traded trophy office buildings for luxury hotels in 2014, spending $1.9 billion in New York City hotel assets in 2014, according to JLL. That inbound foreign investment accounted for 58 percent of the city's hotel transaction volume, up from 12 percent in 2013. Along with Chinese investors, buyers from Qatar, Bahrain, Kuwait, Malaysia, and Singapore acquired properties. The strong activity pushed hotel cap rates down to 5.5 percent from 6 percent in 2013. JLL expects foreign hospitality investment in New York to reach $3 billion this year.



Building Progress

Fall 2020

Moody's Analytics Reis Chief Economist Victor Calanog, Phd, CRE, outlines how construction in many sectors will fail to meet expectations for 2020.

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This Is the Altered Normal

Fall 2020

Esri’s data on consumer behavior, demographics, and employment can help real estate adapt in the COVID-19 world.

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The CMBS Stress Test

Summer 2020

The commercial mortgage-backed securities market is particularly vulnerable amid the COVID-19 pandemic, with borrowers and lenders looking for creative solutions to unprecedented problems.

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Market Trends in Commercial Real Estate

Summer 2020

Office Renters Change Priorities in Wake of Pandemic | Recreational Real Estate on the Rise | Case Study: COVID-19's Impact on Eastern PA Big-Box Market | Hospitality Owners Have Reservations as Occupancy Drop | Seniors Housing Responds to Mounting Pressure from Pandemic | Mixed-Use Developments Can Keep It Local | Supply Chain Reacts to Social Distancing | Self-Storage Weathers Early COVID-19 Storm

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