CRE Report 09.10.2011

September 19, 2011 at 10:03 am | Posted in Market Reports, Radio Show Reports | Leave a comment
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Retail 2nd Quarter Rap Up

Bob – Walt, you wanted to talk about the retail market today.  What do you have for us?

Walt – Good Morning Bob. I was just reviewing the 2nd quarter retail numbers from CoStar and here are some of those numbers. The overall retail vacancy rate has increased slightly to 6.8%.  Average quoted rental rates  decreased from the first quarter to $13.58 per square foot per year.  86,000 square feet of space was still under construction at the end of the quarter.
Bob – Can you give us some details on Tenants in the market, who’s moving out and who’s moving into spaces?

Walt– There hasn’t been a lot of movement. Murray Billiards moved out of 8,820 square feet at 10020 Coors Bypass, Elyte ATM vacated 7,600 square feet at 8900 Menaul.

Some tenants moving in were Firestone into 17,362 square feet at 2631 Coors, ATI moving into 14,640 square feet at Montgomery Plaza and El Mezquite occupying just over 14,000 square feet on Southern.  Tomato Café signed a lease for 6,000 sf at the Shops at Montano and Aaron Rents leased 5,600 sf at Guadalupe Plaza.

Bob – We usually talk about construction on these quarterly reports, are there any new projects coming out of the ground?

Walt – There was 117,000 square feet of new construction; some notable construction deliveries include the Premier Cinema, 86,000 square feet in Rio Rancho and the Firestone on Coors.

Just a few trivia numbers for you, CoStar tracks the Albuquerque market with 56 million square feet of retail space in about 5,300 buildings, including 359 shopping centers. You just never know when you might need that information!

Bob – Walt, what is your crystal ball projecting for the retail market in the near future and what are the prospects for retailers this Holiday Season, which is approaching quickly?

Walt – It appears the retail market forecasters are saying the retail market will be rockier than expected for recovery over the next 12 months.  Statistics are pointing to a gradual recovery but; weak hiring, a flat housing market and sagging consumer and investor confidence are hampering the retail recovery.

Bob – Walt, how can people get a hold of you to talk about commercial real estate?

Walt – Thanks Bob, Walt Arnold at 256-1255, our website is waltarnold.com.  If you’re considering buying, selling, leasing, tenant representation or property management in today’s commercial real estate market, give us a call at Sperry Van Ness.  We know how to navigate this difficult market.  We do it every day and we do it very well.  Let’s get together and discuss the Sperry Van Ness Difference in commercial real estate.

Bob thanks for the time today, have a great week.

CRE Report for 08.22.2011

August 22, 2011 at 10:07 am | Posted in Radio Show Reports | Leave a comment
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Good Construction News and Investing in Commercial Real Estate

Bob – Walt, what is going on in the commercial real estate world?

Walt – Good morning Bob!  I wanted to give a little perspective from our SIOR NM chapter meeting last week and what’s happening with some local businesses that are directly tied to commercial real estate in this market and fortunately it’s somewhat refreshing.

On the construction side, Dave Doyle of Enterprises Builders said they are busy, although the size of the work is less than what it used to be, the work under half a million dollars is active. Dave said construction costs today are at 2005 levels.

One area Dave talked about was the costs of construction materials.   Copper, sheetrock and metal are all still at high levels.

So there is construction going on in our local market, not necessarily new buildings but there is construction work.

Mike Kelly, a commercial lender said he will do more loan volume in the next few months than he did in the last 2 years.  Interest rates remain low and there is movement in the lending market and lenders are starting to get back in the game.

So that is a little good news for Monday morning.

Bob – Walt, with the significant up and downs in the stock market, investors must be thinking about moving in back into real estate as an investment vehicle.  Are you starting to see that in your business?

Walt – With money market rates at .02 percent, commercial real estate is an investment that is definitely worth considering.  There are going to be some great opportunities in real estate.  With professional advice from a CRE broker like the brokers at Sperry Van Ness we can help investors make the right choices in analyzing and acquiring the commercial real estate, manage the asset (if necessary) and develop an exit strategy to sell the asset at the right time.

Bob, 10 year treasuries are at 3%.  Pre tax yields for real estate, on average are currently at almost 10% and the opportunities to invest in real estate are continuing to show themselves.

So give me a call and let’s develop a plan to capitalize on the commercial assets coming to market.

Bob – How can you help people with the risks associated with purchasing commercial real estate? There are still risks that investors have to deal with in this market.

Walt – There are risks and that is why it is important to go through a process to determine how much risk a person wants and put together a plan to analyze the risk, to evaluate the preferences in property type (office, industrial, retail multi-family, self storage, land, hotel motel) and that’s where Sperry Van Ness has the tools, experience and brokers to help through the process.

Bob – How can people contact you?

Walt – Thanks Bob, Walt Arnold 256-1255, waltarnold.com also visit me on Facebook or Twitter. Thanks Bob have a great week.

CRE Report for 07.11.2011 – Office and Retail Recovery

July 12, 2011 at 12:40 am | Posted in Market Reports, Radio Show Reports | Leave a comment
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Bob – Walt, what do you have for us today?

Walt – Good morning Bob, at my house last night we had these wet droplets falling from the sky, I think it’s called rain.

I want to briefly discuss the recovery in the retail and office markets.

The retail recovery will continue to be a slow grind; vacancies are going to be in bouncy territory over at least the next year.

Using a baseball analogy, the retail market is about in the 3rd inning of a 9 inning game and the game appears to be heading for extra innings.

We might a few projects come out of the ground but any new construction will be closely analyzed.

The other point about retail is the significant amount of struggling properties working their way to their loan call which could potentially spell trouble, as those loans coming due will have difficulty in getting refinanced.

Bob, the numbers are staggering for the amount of loans coming due in 2015, 2016 and 2017; even though that is a ways off, it shows the issues retail properties will be dealing with over the next few years.

 Bob – Walt, I know that we haven’t had any good news for the commercial sector since you started talking about this a couple years ago, is there any good news for office properties in today’s market?

Walt – I know it has been a tough market.  As a retired NFL football player I’m praying that my retirement will get a major boost with the new agreement.

The office sector especially in new construction is on hold.

First, there just aren’t enough tenants willing to occupy enough space to trigger construction, second there is very little willingness with lenders to finance any projects, the third reason is the high vacancy rate which in ABQ is over 18%, is just too much risk for developers, and lastly office construction usually coincides with strong Gross Domestic Product or GDP, with a negative 2% GDP in 2009, until GDP improves significantly new office construction will not happen.

Bob – Is there any silver lining in these markets and what are the prospects for commercial real estate investors?

Walt – The saying is, the height of pessimism is the time to invest. There are opportunities in this market, and at Sperry Van Ness we are in this market everyday talking to lenders and property owners that need to dispose of their assets and we work with buyers and investors trying to navigate this difficult environment.

 Bob – How can people contact you to discuss these opportunities?

Walt – Thanks Bob, call Walt Arnold at 256-1255, our website is waltarnold.com. With over 20 years in the commercial real estate business, I know how to help buyers, sellers; landlords and tenants get through this difficult environment.  Thanks for the time today, have a great week.

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