Market Data

Regional Outlook(17)

SOUTH

Miami closed 2010 on a high note with the sale of the ever-colorful 600,000-sf Miami Tower, which sold for $105.5 million at year-end, marking South Florida’s largest commercial transaction of the year. Originally the CenTrust Tower designed by I.M. Pei, the 80 percent leased, 24-year-old property sold to I&G Miami for a 25 percent increase over its last sale in 2003, according to The Miami Herald.

MIDWEST

Chicago-Area Retail Rebounds

Fourth-quarter 2010 brought improved conditions for Chicago-area retailers as rents rose and vacancies fell, according to ChicagoRealEstateDaily.com. The vacancy rate fell to 10.8 percent in 4Q10, after peaking in 1Q10 at 12.1 percent. Rents rose to $15.30 from $14.83 in 3Q10. Local brokers credit discounters and food stores filling empty big-box space and the expansion of fast-casual restaurant chains as two factors working in their favor.

MIDWEST

Hot Mama, a Minneapolis-based chain of clothing stores for — what else — trendy mothers who shop with kids, added six new locations in 2010, totaling 17 stores in seven states since its beginning in 2004. The chain hopes to reach 50 locations by 2014 and it might: Revenue for 2010 was $15.1 million, a 62 percent increase over 2009, according to Fast Company.

NORTH

EAST

“In 2010, for [property] sales under $20 million [the] rate was $85 psf in the Boston area. For vacant commercial building sales, the average sale price … was approximately $33 psf. This average will … provide a basis for the investors and lenders moving forward into 2011.”

— CB Richard Ellis, 2011 Market Outlook

WEST

Multifamily Strong in California

San Diego, Orange County, and San Jose, Calif., round out the top six multifamily markets for 2011, according to Marcus & Millichap’s 2011 national apartment report. A concentration of military personnel at bases near San Diego plus the construction of a 500,000-sf hospital will increase the demand for B and C apartments and send San Diego’s multifamily vacancy rate down to around 3.6 percent while pushing up effective rents 4.7 percent. Even stronger employment growth in San Jose and Orange County will fuel occupancy gains across all property classes in both markets, and limited new supply in 2011 — only 470 units in San Jose and just 300 units in Orange County — will push effective rent increases past 4 percent in both cities.

SOUTH

Birmingham, Ala., broke ground on a 300-room Westin Hotel early this year, being developed by Atlanta-based National Ventures Group. The $50 million hotel will sit next to a $20 million entertainment district that the city is hoping to develop as a destination site. The developer is funding $13 million of the construction, and despite a $70 million budget shortfall, the city is covering $37 million through a 30-year hotel tax extension.

Source: Real Capital Analytics

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