Market Data

Regional Outlook(20)

East

Boston Office Market Improves

Except for three submarkets, all of Boston's CBD and suburban office markets have equalized, with Cambridge and the Back Bay showing landlord-favorable conditions, according to Jones Lang LaSalle's 2Q11 report. Helped by the city's 6.7 percent unemployment rate, Beantown's CBD has seen a 5 percent increase in rents since 3Q10 and the Back Bay submarket has an enviable vacancy rate of 8.4 percent.

D.C.'s Big Deal

The largest — and probably only — U.S. downtown development of this size this year, the $700 million CityCenterDC broke ground this spring, fully backed by the Qatari Diar, the real estate arm of Qatar, a tiny Arab Emirate state. The investment — Qatar's first on U.S. soil — solidifies global investment faith in the U.S. and particularly in Washington, D.C., which has seen several offshore transactions in the past year. Built on the site of the old convention center, the first phase of the Hines/Archstone development will add 185,000 sf of retail and 520,000 sf of office space, 458 rental units, and 216 condos in a 4.5 block area. Scheduled delivery is fall 2013.

Largest Retail Closings

South

Florida Snapshot, 2Q11

Top Southern Markets: Industrial Absorption, 2Q11

Midwest

St. Louis Tops Retail Closures

Retail closures hit St. Louis hard in 2Q11, as 520,000 sf of space was added to the market, the highest amount in the nation, according to International Council of Shopping Centers/PNC Real Estate research. Along with Baltimore, St. Louis also tops the list of major markets with the most closed space: 0.8 percent of its retail market's total gross leasing area is dark. About 0.04 percent of the nation's retail stock is dark, down considerably from 0.2 percent in the first quarter.

Hotel Goes Rental

The 160-suite tower of the Sheraton Hotel at Keystone Crossing in Indianapolis is being converted into 129 studio, one-, and two-bedroom luxury apartments, according to Flaherty & Collins Properties, which is handling the conversion. The $8.2 million project should be completed by 1Q12. Renting for $800 to $1,550 a month, the apartments are the only high-rise multifamily construction in the area and are connected to the adjacent upscale Fashion Mall.

Five Below Hits the Midwest

We're not talking temps — Five Below, the "extreme value" retailer for tweens and pre-teens, opened 10 stores in the Chicago suburbs this summer and has plans to open 10 more by year-end, eventually reaching 75 locations. It recently opened five stores in the Detroit area, with plans for as many as 25, according to Tom Vellios, co-founder and CEO of Five Below. The store also is looking for locations for five to six stores in the Indianapolis market. Five Below is taking advantage of the weak retail space market, finding locations it previously could not afford, such as the well-traveled Woodfield Mall in the Chicago suburbs, where it leased a portion of a shuttered Circuit City. The store sells DVDs, fashion accessories, toys, and games for $5 or less.

West

No Sway in Hawaii's Office Market

Honolulu won't see much of a recovery in its office market until 2012, according to James Brown, CCIM, SIOR, president of Hawaii Commercial Real Estate. Downsizing and right-sizing are keeping absorption negative and while tenants have multiple options for new space, they often find relocation costs too high to justify the move.

San Diego Retail Activity

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