CRE Report 03.12.2012
March 12, 2012 at 11:50 am | Posted in Radio Show Reports | Leave a commentTags: Albuquerque Economy, Albuquerque Real Estate, Apartments, Baby Boomers, Investing, office, office market, radio show, real estate, Real Estate Investing, recession, retirement, unemployment, vacancies, walt arnold
Where are all the jobs?
Bob – Walt you mentioned attending the Urban Land Institute Luncheon last week and some of the interesting trends they talked about, can you tell us about some of those trends.
Walt – Yes thanks Bob, good morning. Urban Land Institute presentation discussed some trends that will affect commercial real estate. One trend that is developing is “Less is Better”. Tenants and owners are beginning to squeeze more out of every square foot of space in every type of commercial space. This efficiency means less square footage, but it also is about creating environments that are multi-dimensional, adaptable and create a greater intensity of use.
What does that mean? It means we are going to see office and commercial space that aligns itself with this work from anywhere, at anytime, 24/7 workforce and we will see changes in spaces that start to reflect this change in mobility and adaptability more and more.
Bob – The name of the presentation is” Where the Hell are the Jobs” (NOTE–Soften it if you want). Did you get an answer?
Walt – The world is obviously getting smaller and we have seen globalization of capital, instant technology and labor.
Workers will need college education with degrees for New Mexico to gain substantial job growth in this new economy. We are competing with 49 other states for global markets.
The majority of jobs are going to be in Medical, Education, Healthcare, and customized manufacturing. Meds and Eds is a phrase you will start to hear more often.
So for real estate investors, commercial buildings with those types of tenants are going to be less risky and hopefully more profitable.
Bob – Anything else for us today?
Walt – For all the Boomers get ready for extended employment! 40% of Boomers say they don’t have enough money to retire. So Bob, make sure you take care of that golden voice of yours, you might need it a while!
The Boomers are going to ramp up Senior Housing requirements for the next several years and Albuquerque has already seen strong growth in the Senior Housing and Assisted Living markets.
With declining home ownership rental-housing demand will continue to grow and the demand for rental units will remain strong for the next few years. Think about stricter mortgage requirements, more waves of foreclosures and many families rethinking the costs of home ownership will keep the demand for apartments strong.
Bob – How can people contact you to discuss commercial real estate?
Walt – Thanks Bob. Call me, Walt Arnold at 256-1255, become a fan on Facebook, follow me on Twitter or visit my website waltarnold.com for current listings in the Abq area. Sperry Van Ness is a full service commercial real estate company helping Landlords and Tenants solve space and lease requirements, investors maximize their cash flow and rates of returns through investment in commercial properties and through our professional property management we help owners maximize cash flows and preserve assets. Hey Bob, happy first Monday of daylight savings time. I’ll talk to you next week.
Photo Credit http://usdailyreview.com/tag/unemployment
CRE Report 02.12.2011
February 13, 2012 at 9:30 pm | Posted in Market Reports, Radio Show Reports | Leave a commentTags: albuquerque, Albuquerque Commercial Real Estate, CRE, Grammys, industrial, Industrial report, industrial summary, market, market report, office, office market, office report, office summary, Reid Associates, sperry van ness, Titan Development, vacancies, walt arnold
Office and Industrial updates
Bob – Good morning Walt, What do you have for us today?
Walt – Bob, I know you’re not a big Paul McCartney fan, but I really enjoyed the Grammy’s last night and his performance at the end was awesome. But I digress, back to commercial real estate.
Today I wanted to give a year-end summary for office and industrial markets for the Albuquerque metro area,
The Albuquerque office vacancy was 18.7% which is slightly up from a year a year ago. Some notable construction completions were the U.S. Forest Service building and DEA both completed projects in 2011. REDW also occupied a 46,000 ft.² built to suit in December 2011.
Median asking rates for the market were at $15.50 per square foot down $.13 from a year ago.
Blend and extend strategies where the landlord gives the tenant some concessions now and extends the lease term for longer a longer period of time are still working in this market. Most landlords are doing all that they can to retain tenants.
Class A space is $22.50 per square foot per year
Class B space is $17.73 per square foot per year
Class C space is $14.00 per square foot per yea
Bob – What about the industrial markets?
Walt – At the end of 2011 the vacancy rate in the industrial market was at 9.4%.
Some notables that happened in 2011: 609,000 ft.² of the former GE plant in the South Valley was removed from the market statistics when the building was demolished. CNM also moved about 82,000 ft.² out of the market vacancy numbers by occupying a building at Jefferson and Alameda; those two properties removed 1.7% of the industrial market from the vacancy statistics. That one way to improve the numbers is to remove supply from the market
Another notable was that US foods built a 134,000 ft.² building in the South Valley. Only 23,000 ft.² of speculative space was built in the Albuquerque market in 2011.
Median asking rates: $6.69/sf/yr on a triple net (NNN) basis down 16 cents from a year ago and R&D/Flex space vacancy was at 9.5%.
Bob – If you were handing out any awards for last year, do you have any winners?
Walt – Yes I do, it would have to go to Titan Development/Reid and Associates for completing the Forest Service Building in the Journal Center, also for selling both of those buildings for approximately 50 million dollars and also the completion of the REDW building in the Journal Center. If they were at the Grammys they would be like Adele, they would have won all the awards and been the star of the show, so congratulations to Titan Development and Reid and Associates for a great year.
Bob – Walt, how can people contact you for information on commercial real estate?
Walt – Thanks Bob, they can call Walt Arnold, 256-1255 or check us out on the web at waltarnold.com also follow me on Twitter of become a fan of Sperry Van Ness on Facebook. For all you guys and gals out there don’t forget tomorrow is Valentines Day. Make tomorrow a great day. See you next 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 commentTags: 2011 construction, Commercial Real estate future, Commercial Real Estate Predictions, construction, finance, lenders, loans, office market, real estate recovery, recovery, refinance, retail market
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.
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…
Q2 Results in Rising Vacancy Rate for Office
August 6, 2010 at 11:17 am | Posted in Market Reports | Leave a commentTags: albuquerque, commercial, CRE, economy, for lease, for sale, industrial, investors, leased space, market report, New Mexico, office, office market, real estate, recession, retail
The Albuquerque office market slipped in Q2-2010, with a New Mexico Business Weekly report suggesting a historic vacancy rate approaching. The job market continues to struggle and it results in a rising vacancy rate for office space:
Office vacancy rates climbed to 17.9 percent in the second quarter as Albuquerque underperformed the nation. With the economy teetering on the verge of a double dip recession, an historic 20 percent vacancy rate could be coming.
The article includes some interesting charts from CB Richard Ellis reporting the latest industrial net absorption, completions and vacancies, retail asking lease rate ranges, and an overall office review the Albuquerque market in the second quarter.
Industrial Net Absorption, Completions, Vacancies
Retail Asking Lease Rate Range
Office Overview Q2 2010
The article continues: Continue Reading Q2 Results in Rising Vacancy Rate for Office…
Metro Office Vacancy Hits New High
July 23, 2010 at 12:21 am | Posted in Market Reports | Leave a commentTags: albuquerque, commercial, CRE, economy, employment rate, for lease, investment, jobs, leased space, market report, New Mexico, office, office market, property, real estate, recession, tenants
In our last weekly commercial real estate radio report on KKOB News Radio 770, we talked about the retail markets and how critical job growth is to fortifying consumer confidence. A report this week in the Albuquerque Journal business outlook talks about the road head in job growth as office vacancies have hit a new high. However, the ABQ market is doing better than the national average. Industry experts are looking to past trends to predict the break in the cycle, and ultimately, that prediction is that there will be one… at some point. The article begins:
The stagnant job picture continues to weigh on the rental market for office space, pushing up the vacancy rate to a new high of 17.7 percent in the second quarter, according to the latest Office Trends Report by Grubb & Ellis New Mexico.
“Any chances for even a small rebound appear to be slight at best,” the report says.
More than a half million square feet of office space has gone empty in the Albuquerque metro area since the second quarter of 2009, when the office vacancy rate was 14.1 percent. The vacancy rate set a recent Continue Reading Metro Office Vacancy Hits New High…
Investment Opportunity: Corrales Overlook Office Condos
June 5, 2010 at 9:07 am | Posted in Property Listings | Leave a commentTags: commercial, condos, investments, leased space, listings, New Mexico, office, office condos, office market, office park, opportunities, real estate, rio rancho, tenants, walt arnold
Corrales Overlook Executive Plaza
1350-1400 Jackie Road SE, Rio Rancho, NM
• Attractive Office Park w/Condominium Units for Sale/Lease (See brochure below)
• Land Size: ±1.88 acres
• Total Bldg. Size: Bldg. 1: ±11,196 sq. ft., Bldg.2: ±12,204sq.ft., Bldg. 3: ±11,196 sq. ft SOLD, Total: ±23,400 sq. ft.
• Sale Price: $145/sq. ft. NOW $119/sq. ft. (shell costs only); 2.5% to outside broker (shell costs only)
• Zoned C-1
• Units also available for lease: $18.50/sf/yr NNN depending on build-out; Lease Term: 5+ years
For terms, features and floorplans, view the brochure below! Email Walt Arnold or Dana Van Doren for more information, or call (505) 256-7573.
Albuquerque office space secured for Outcomes Health Information Solutions
May 26, 2010 at 7:41 am | Posted in Uncategorized | Leave a commentTags: albuquerque, commercial, CRE, for lease, healthcare, leased space, New Mexico, office, office market, property, real estate, sperry van ness, sublease, tenants, transactions, walt arnold
Sperry Van Ness®/Walt Arnold Commercial Brokerage, Inc. along with Matt Hart of Studley, Inc. represented Outcomes Health Information Solutions, LLC in securing a location at 7850 Jefferson NE, Albuquerque, NM. Outcomes has occupied approximately 19,000 square feet in the Ashcraft Real Estate owned property. Outcomes has taken advantage of the sublease market and has taken over a space in the property formerly occupied by Lifemasters. The space was in “move-in” condition, including furniture and infrastructure. Outcomes will eventually have 200-300 people at this location.
For more information on leasing, brokerage representation or other services through Sperry Van Ness, call (505) 256-1255 or email me at walt.arnold@svn.com.
The Advisor magazine just out with great investment insights
March 3, 2010 at 8:05 pm | Posted in Uncategorized | Leave a commentTags: commercial, CRE, industrial, investments, market, market report, office, office market, property, real estate, retail, sperry van ness, The Advisor
The 2nd and latest edition of Sperry Van Ness’s The Advisor magazine is hot off the press and you can find it here:
Albuquerque Commercial Real Estate Report 2.1.10 – Super Bowl Edition
February 8, 2010 at 11:38 am | Posted in Radio Show Reports | Leave a commentTags: albuquerque, commercial, CRE, for lease, investments, market report, NFL, office market, property, radio show, real estate, super bowl, walt arnold
Last week we discussed the “For Lease” office market as well as my predictions for the Super Bowl. Did 8 years in the NFL and 2 playoff games pay off in my game day forecast? Listen below to find out…
Click HERE to listen to the Real Estate Report for 2.1.10
Bob Clark, News Radio 770 KKOB: Walt, you wanted to talk about the “For Lease” office market. What do you have for us?
Walt: 2009 was an up and down year for the Metro Office market. The overall vacancy rate was the highest in recorded history at 18.1%.
On the flip side the office market actually grew by 454,000 sf or 3.8%, thanks to Fidelity Investments 108,000 sf, and the 53,000 sf Aperture building, both in Mesa Del Sol, and HP’s 218,000 sf building in Rio Rancho.
The median asking lease rate in the metro office market is $16/sf/yr. Asking rates for Class A is $22.50/sf/yr, Class B-$19/sf/yr and Class C is $15/sf/yr.
Bob: The high vacancy rate must be pushing these rates down. What is going to happen with the actual lease rates this year?
Walt: Our asking lease rates are holding up well but Landlord’s are competitive both to acquire new tenants and retain existing ones. Blend and extend strategies will continue with Landlords making concessions now and Continue Reading Albuquerque Commercial Real Estate Report 2.1.10 – Super Bowl Edition…
Walt Arnold, SIOR, CCIM
Create a free website or blog at WordPress.com.
Entries and comments feeds.
Albuquerque Commercial Real Estate News 