Albuquerque Commercial Real Estate Report 7.26.10: Hiring A CRE Broker
August 19, 2010 at 10:07 am | Posted in Radio Show Reports | Leave a commentTags: albuquerque, broker's opinion of value, commercial, CRE, economy, for lease, for sale, industrial, investments, leased space, listings, New Mexico, office, office market, opportunities, property, property management, property values, radio show, real estate, retail, sperry van ness, tenant representation, walt arnold
Click HERE to listen to the Commercial Real Estate Report for 7-26-10!
Bob Clark, News Radio 770 KKOB: Walt, if I needed to hire a commercial real estate broker, what skills and abilities would I look for in that person?
Good morning. Commercial real estate is so different from residential real estate and there are just so many more moving parts to the commercial business which includes office, industrial, retail, hospitality, self storage and apartments. There is the investment side; the owner user and also the leasing end of the business and each have their own intricacies. So first off you would want to make sure the broker is an expert in the field of commercial real estate you need. That is the first criteria.
Bob Clark: What else is important in selecting a commercial broker?
Having a level of experience which might include membership in either the CCIM Institute, which requires years to complete the certification process or an SIOR, a select group of 2,800 commercial brokers worldwide is an important component in selecting a broker to work with.
At Sperry Van Ness we talk about having encyclopedic market area knowledge and stress being the recognized expert in the market area. Someone looking for a broker wants to make sure they understand the market and have strong knowledge of it.
Another important trait is a broker that listens to your needs and assesses those needs and then works diligently to complete the transaction and keeps everyone apprised of the progress as it moves toward the completion
Bob Clark: Walt you have talked before about all the parts of the commercial transaction, how can a broker help put it all together?
There are many parts to the puzzle of a commercial transaction and making sure your Broker understands those pieces, like the ALTA survey, Phase One environmental report, space planning, financing, the lease document, the Tenant Improvement process including TI drawings dealing with architects, contractors, attorneys, owners and tenants requires someone with many skills to help analyze the commercial transaction from start to finish and beyond. Continue Reading Albuquerque Commercial Real Estate Report 7.26.10: Hiring A CRE Broker…
Albuquerque, NM retail market featured in Western Real Estate Business
July 2, 2010 at 7:39 am | Posted in Uncategorized | Leave a commentTags: absorption, albuquerque, broker's opinion of value, commercial, CRE, in the news, landlords, leased space, market report, new construction, New Mexico, property, real estate, retail, sperry van ness, tenant representation, tenants, vacancy, walt arnold
April’s issue of Western Real Estate Business featured a highlight on the Albuquerque, N.M. retail market supplied by Sperry Van Ness/Walt Arnold Commercial Real Estate. Take a look at what makes Albuquerque stand out:
Compared to performance nationally, the Albuquerque retail market is bucking the trend with limited increases in vacancy rates as well as limited reductions in lease rates. Albuquerque’s insulation from what other markets throughout the Southwest, such as Phoenix and Las Vegas, are experiencing is based on the city’s economic engine being driven by a heavy concentration of federal government support, which spins off a stable layer of private enterprise. Secondly, unlike other larger markets, Albuquerque was not burdened with an over inventory of vacant and in-development projects when the economic downturn began. This is not to say that Albuquerque has not experienced its share of real estate woe.
At the end of 2009, Albuquerque’s retail market had a net absorption of 144,000 square feet, which was almost four times higher than 2008. This was primarily due to the decrease in new construction. The vacancy rate rose from 8 percent at the end of 2008 to 10.8 percent a year later. The last two quarters of 2009 reflect decreases from previous quarters and forecasts indicate a vacancy rate of 10 percent at the end of 2010, far below the projected national vacancy rate of 11.7 percent.
Perhaps the most distressing to retail property owners, as with all commercial landlords, will be the reduction of lease rates not only with prospective tenants and renewing tenants, but also with the existing tenant, whose lease still has a number of years remaining, asking to renegotiate. Throughout 2009, retail lease rates fell, across all retail types, anywhere from 15 to 20 percent. Only in fourth quarter 2009 did Albuquerque start to see the beginning of stabilization in lease rates. Strip and neighborhood centers showed level or slight increases in lease rates whereas larger community centers tracked slightly downward. Available space is declining, and deals are being made, which will cause lease rates to continue on their current course.
To continue reading this article, click HERE. And, contact me to learn how you can capitalize with an investment in this unique marketplace!
Albuquerque continues to grow in population
June 18, 2010 at 1:46 pm | Posted in Uncategorized | Leave a commentTags: albuquerque, broker's opinion of value, investment, market report, New Mexico, population growth, real estate, walt arnold
A recent study in New Mexico Business Weekly reports a 16% growth over the last decade with good marks for advanced college degrees and jobless rate. And of course personally, I can see the attraction! People want to enjoy the desert southwest and quality of life in New Mexico’s largest city. No hurricanes, tornadoes, floods, earthquakes and a great quality of life that allows for snow skiing and golf on the same day in the winter and in the summers with the mile high elevation rarely a 100 degree day with low humidity (it’s a dry heat)!
Albuquerque Commercial Real Estate Report 5.24.10: Property Prescriptions
May 27, 2010 at 6:46 am | Posted in Radio Show Reports | Leave a commentTags: asset, broker's opinion of value, commercial, CRE, economy, for lease, investment, investors, leased space, listings, market, office, opportunities, property, property management, property values, radio show, real estate, retail, taxes, tenant
>>> Click here to listen to the Commercial Real Estate Report for 5-24-10 <<<
Bob Clark, News Radio 770 KKOB: Walt, you’ve talked before about the difficulties investment property owners are facing these days, what can property owners do to get through these tough times?
Good Morning Bob. Owners need to check their properties vital signs, possibly look at some preventative measures, call in a specialist or even perform cosmetic surgery if a property looks weathered or needs a boost. Wherever the property is in its life cycle the goal is to avoid emergencies and create strategies against plummeting values.
Bob: Are there some specific strategies owners can implement?
Yes Bob there are. First is to examine the income and expenses. This will reveal if the property’s lease rates are competitive with other nearby investments and check to see if all potential sources of income are being collected. The expense side will reveal any expenses that are out of line. Make sure there is a budget in place and review it monthly and be realistic and diligent to anticipate any potential surprises.
Next, look at the tenants. Are they right ones for the property? Maybe local tenants would be a better choice instead of spending a lot of time chasing national tenants. Analyze the tenant use and determine if certain types of tenants are missing.
3rd: a little stucco or paint can go a long way. Add some new doors, maybe a loading dock, these types of things will make the most impact for the money. Tenants love to see the owner investing in the property and in them.
Finally, taxes make sure to protest Continue Reading Albuquerque Commercial Real Estate Report 5.24.10: Property Prescriptions…
Albuquerque Commercial Real Estate Report 5.10.10: 3 Approaches to Valuing CRE
May 24, 2010 at 7:32 am | Posted in Radio Show Reports | Leave a commentTags: acquisitions, albuquerque, asset, broker's opinion of value, cap rate, capital, commercial, cost analysis, cost approach valuation, CRE, income approach valuation, investments, investors, leased space, market comparison, opportunities, price analysis, property values, radio show, real estate, sperry van ness, valuation, walt arnold
>>> Click here to listen to the Commercial Real Estate Report for 5-10-10 <<<
Bob Clark, News Radio 770 KKOB: Walt you wanted to discuss how commercial real estate is valued and the different approaches to valuing commercial real estate.
Good morning Bob. Residential properties are usually valued in one way and that is by comparison approach or analyzing comparable properties. The market comparison approach is also used in commercial real estate. The comparison approach is analyzing similar properties in similar areas and adjusting values for any differences both positive and negative versus the subject property.
The second approach is the cost approach. The value of the land is first figured separately from the improvements. An estimate is made to the replacement cost of all improvements, as if new, on the property and then deducting depreciation from the improvements. This requires an excellent knowledge of building costs. Again, the Cost approach is value of land plus costs of improvements as if new minus depreciation.
The third approach, the income approach, analyses the income and expenses of the investment and then assigns a capitalization rate or a cap rate to analyze the investment.
Bob: Walt, we hear the term “cap rate” a lot in commercial real estate. I know there are several parts to the term Cap Rate, can you elaborate on it?
Sure, I’ll give the “Cliff Notes” version. Investment property is analyzed by looking at the total income of the property, Continue Reading Albuquerque Commercial Real Estate Report 5.10.10: 3 Approaches to Valuing CRE…
Albuquerque Commercial Real Estate Report 4.5.10: CRE Prices Rise
April 14, 2010 at 9:11 pm | Posted in Radio Show Reports | Leave a commentTags: bottom, broker's opinion of value, commercial, distressed assets, extend and pretend, FDIC, industrial, Moody's, multi-family, pricing index, property pricing, real estate, retail, tax assessments
>>> Click here to listen to the Commercial Real Estate Report for 4-5-10 <<<
Bob Clark, News Radio 770 KKOB: Walt you say you’ve got some good news for us today about commercial real estate?
Hey good morning Bob. And yes there is a little glimmer of good news in commercial real estate. According to Moody’s Commercial Property Pricing Index, commercial real estate pricing rose in January for the 3rd straight month. We still have a rough and uncertain road ahead and pricing patterns will fluctuate in the coming months but November was the first increase since December 2008, the December 2009 number of 4.1% was the highest on Moody’s tracking record and then January had a 1% increase in property pricing, so that is some good news.
Bob: These increases have come after the commercial markets have been rocked with some pretty severe downturns in pricing. Do you think the market is at the bottom?
I can only hope it is. If you look nationally at the numbers in declining values from 2007 to end of 2009, Industrial properties were off 34%, both multi-family and office were down 31% and retail 26%. So it is a little of a false positive on the increases. In other words with pricing going so far down it has to go up. An upward trend is the good news.
One strategy implemented by some lenders is to extend maturity dates of troubled assets. This means there are still distressed properties that have not hit the market. Once these assets are foreclosed and sold by lenders or the FDIC, this will create some new benchmarks for pricing in the marketplace and until that happens I don’t believe we are at the bottom of the market. Continue Reading Albuquerque Commercial Real Estate Report 4.5.10: CRE Prices Rise…
Walt Arnold, SIOR, CCIM
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