Commercial real estate – Papa Byrd http://papabyrd.com/ Tue, 17 May 2022 17:19:03 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://papabyrd.com/wp-content/uploads/2021/10/icon-120x120.jpg Commercial real estate – Papa Byrd http://papabyrd.com/ 32 32 Dewberry plans to start redesigning Campanile by fall https://papabyrd.com/dewberry-plans-to-start-redesigning-campanile-by-fall/ Wed, 11 May 2022 17:50:26 +0000 https://papabyrd.com/dewberry-plans-to-start-redesigning-campanile-by-fall/ After more than two years of delay, John Dewberry could finally start work on the major overhaul of his Campanile building. Courtesy of John Dewberry, Peter Logan and Gary O’Connor in collaboration with Smallwood Rendering of the renovations of the ground floor of the Campanile building. Dewberry Group, led by a former Georgia Tech quarterback […]]]>

After more than two years of delay, John Dewberry could finally start work on the major overhaul of his Campanile building.

Courtesy of John Dewberry, Peter Logan and Gary O’Connor in collaboration with Smallwood

Rendering of the renovations of the ground floor of the Campanile building.

Dewberry Group, led by a former Georgia Tech quarterback and one of Atlanta’s most well-known commercial real estate personalitiesis looking to add six new stories to the top of the 455K SF office tower at 1155 Peachtree St. and hopes to begin work this fall, project officials said at a meeting of the Downtown Development Review Committee Tuesday evening.

The redesign of the tower, which would also include eight floors of new commercial space around its base, is expected to take two years, Smallwood partner Michael Brown, architect of the project, said at the meeting.

In all, Dewberry would add a total of 265,000 square feet of office and 39,000 square feet of retail to the tower sandwiched between Peachtree Street and Piedmont Avenue off 14th Street in the heart of Midtown, and its height would rise from 21 to 27 floors, according to the request of the DRC.

“There’s a demand for that,” Brown said when asked by DRC board members about potential tenant interest in Campanile.

The MDRC, which offers the city its initial view on new projects in the city center before developers seek final approval, plans to recommend the project pending minor changes.

Dewberry’s executive vice president of finance, John Freeman, said bisnow after the MDRC meeting that the developer will begin construction of the addition without waiting for pre-letting, but that the company has “construction financing lined up”. Freeman declined to give further details.

brown said bisnow how Dewberry plans to add floors to the top of the tower: a contractor will add concrete pillars to the existing steel frame on the top floor, then erect additional steel bars to frame the new floors above. Although not unknown, he is unusual for developers to add additional floors to existing skyscrapers, especially since more than 80% of the world’s commercial towers have built since 9/11.

This is Dewberry’s latest push to redevelop Campanile since it acquired the former BellSouth tower in 2010 for $36 million. BellSouth left in 2007, and more recently SunTrust Bank liberated five floors after it merged with BB&T, becoming Truist in 2021. The building’s remaining tenants today are Pandora Music Co. and Northwestern Mutual, according to the Atlanta Business Chronicle.

In December, Dewberry refinanced Campanile with a debt of $75 million from ACORE Capital, Reported Trade Observer.

“We are thrilled to fund a premier local sponsor with extensive experience in the Atlanta market and cutting-edge vision for this asset,” ACORE Origins Director Eric Ramirez told CO. “This is a high quality investment opportunity for ACORE in a location we believe in for the long term, with very strong local sponsorship within the Dewberry Group.”

This loan came after Dorin Investment Group purchased a non-performing loan of more than $185 million from HIG Realty Partners and Square Mile Capital last August, guaranteed by Campanile, The Atlanta Journal-Constitution reported.

Renovation of the Campanile began in 2019, but stalled a year later, leaving the base of the tower unfinished. Lack of work led the City of Atlanta Bureau of Buildings to label it a project abandoned in Octobersubjecting Dewberry to potential code enforcement violations.

Dewberry told the AJC last year that the work delays were due to many factors, including disputes with the company’s general contractor over price estimates, but that work on the project was due. to resume.

“Once we’re done, I think 14th and Peachtree Street will really be Atlanta’s ground zero,” Dewberry told AJC.

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TATA Realty and Infrastructure Limited and CPP Investments Announce Commercial Real Estate Joint Venture in India https://papabyrd.com/tata-realty-and-infrastructure-limited-and-cpp-investments-announce-commercial-real-estate-joint-venture-in-india/ Tue, 12 Apr 2022 07:00:00 +0000 https://papabyrd.com/tata-realty-and-infrastructure-limited-and-cpp-investments-announce-commercial-real-estate-joint-venture-in-india/ The joint venture will be launched with two assets, Intellion Park Chennai (GLA2: 4.6 million square feet) and Intellion Edge Gurgaonnational capital region of delhi (GLA: 1.8 million square feet), which are currently owned and managed by TATA Realty and Infrastructure Limited. Intellion Park Chennai, one of india major office parks, is a LEED platinum […]]]>

The joint venture will be launched with two assets, Intellion Park Chennai (GLA2: 4.6 million square feet) and Intellion Edge Gurgaonnational capital region of delhi (GLA: 1.8 million square feet), which are currently owned and managed by TATA Realty and Infrastructure Limited. Intellion Park Chennai, one of india major office parks, is a LEED platinum rated asset occupied by leading national and international companies.

The joint venture would also pursue Tier A commercial developments in the main hub cities of the Indiawith an equity allocation of INR 20 billion (333 million Canadian dollars). Cities under consideration include Bombay, delhi, Punebangalore, Hyderabadand Chennai who collectively contribute to the majority india total stock and demand of Class A office space.

Sanjay DuttCEO and CEO, Real Estate and Infrastructure Limited, said, “TATA Realty and Infrastructure Limited believes in building centers of excellence that provide tenants with high quality spaces that allow businesses to grow and scale. With CPP Investments as a long-term strategic partner, the vision of this joint venture is to provide world-class sustainable office space solutions to a diverse set of businesses. This will open new business opportunities for TATA Realty and Infrastructure Limited, allowing us to accelerate our current growth.

Hari Krishna V, Managing Director, Head of Real Estate India, CPP Investments, said: “This new relationship with TATA Realty and Infrastructure Limited, one of india major operators, provides an excellent avenue from which to explore opportunities in the growing commercial real estate sector. This is an important step in expanding CPP Investments’ relationships with market leaders to deliver strong long-term risk-adjusted returns to CPP contributors and beneficiaries. »

On TATA Realty and Infrastructure Limited

TATA Realty and Infrastructure Limited is a wholly owned subsidiary of Son of Tata and one of the leading real estate development companies India with an extensive portfolio of over 50 projects in 15 cities. With an intelligent, collaborative and dynamic project distribution program, TATA Realty and Infrastructure Limited has developed approximately 16.8 million. m² of commercial projects and ~30 min. square feet of projects under development and planning.

After establishing itself firmly in ChennaiGurugram and Bombay, TATA Realty and Infrastructure Limited aims to add 10 mins. square feet over the next 3 years and progress towards its goal of having a portfolio of 45 million square feet by 2027.

In line with Tata’s philosophy of leadership in sectors of national economic importance, TATA Realty and Infrastructure Limited and Infrastructure Ltd were established to identify the most promising growth opportunities in real estate and infrastructure in India. TATA Realty and Infrastructure Limited is currently focused on long-term infrastructure projects of national significance, as well as mixed-use projects in the real estate sector. As with all Tata businesses, project selection is a specialized process, with the eventual shortlist scoring high not only on business objectives, but also on Tata’s guiding values ​​and policies. Tata is one of india largest conglomerates, with an annual turnover of more than $100 billionand 107 operating companies in seven business sectors, employing more than 750,000 people worldwide.
For more information: https://www.tatarealty.in : www.intellion.in

About RPC Investments

The Canada Pension Plan Investment Board (CPP Investments™) is a professional investment management organization that manages the fund in the best interests of more than 21 million contributors and beneficiaries of the Canada Pension Plan. In order to build diversified asset portfolios, investments are made worldwide in public equities, private equities, real estate, infrastructure and fixed income securities. Based at Torontowith offices at hong kong, London, Luxemburg, Bombay, New York City, San FranciscoSao Paulo and sydney, CPP Investments is governed and managed independently of the Canada Pension Plan and at arm’s length from governments. On December 31, 2021the Fund has totaled C$550.4 billion. For more information, please visit www.cppinvestments.com or follow us on LinkedIn, Facebook or Twitter.

___________________

1

CAD = INR 60.0

2

GLA: Gross leasable area

SOURCE Canada Pension Plan Investment Board

For further information: Media Contacts: TATA Realty and Infrastructure Limited, Shruti Kaushik Agrawal, +91 9901051378, [email protected]; Richa Seth, +91 9930143531, [email protected]; Ashish Dwivedi, +91 8830382648, [email protected]; CPP Investments, Connie Ling, Managing Director, Corporate Communications, +852 3959 3476, [email protected]; Frank Switzer, Managing Director, Corporate Communications, +1 416 523 8039, [email protected]

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TATA Realty and Infrastructure Limited and CPP Investments Announce Commercial Real Estate Joint Venture in India https://papabyrd.com/tata-realty-and-infrastructure-limited-and-cpp-investments-announce-commercial-real-estate-joint-venture-in-india-2/ Mon, 11 Apr 2022 07:00:00 +0000 https://papabyrd.com/tata-realty-and-infrastructure-limited-and-cpp-investments-announce-commercial-real-estate-joint-venture-in-india-2/ The total aggregate net worth of the joint venture will be INR 53 billion (CA$8661 million), with an equity commitment from CPP Investments at INR 26 billion (438 million Canadian dollars). The joint venture will consist of two assets with a gross value of INR 80 billion (1.3 billion Canadian dollars) alongside the intention to […]]]>
  • The total aggregate net worth of the joint venture will be INR 53 billion (CA$8661 million), with an equity commitment from CPP Investments at INR 26 billion (438 million Canadian dollars).

  • The joint venture will consist of two assets with a gross value of INR 80 billion (1.3 billion Canadian dollars) alongside the intention to allocate more capital investments of up to INR 20 billion (333 million Canadian dollars) for future purchases.

Mumbai, India, April 12, 2022 /CNW/ – TATA Realty and Infrastructure Limited and the Canada Pension Plan Investment Board (“CPP investments“) today announced a new joint venture to develop and own commercial office space across India. The joint venture will target stabilized and developing assets, aiming to reach over INR 50 billion (800 million Canadian dollars) in assets under management.

Intellion Park (CNW Group/Canada Pension Plan Investment Board)

The joint venture will be launched with two assets, Intellion Park Chennai (GLA2: 4.6 million square feet) and Intellion Edge Gurgaonnational capital region of delhi (GLA: 1.8 million square feet), which are currently owned and managed by TATA Realty and Infrastructure Limited. Intellion Park Chennai, one of india major office parks, is a LEED platinum rated asset occupied by leading national and international companies.

The joint venture would also pursue Tier A commercial developments in the main hub cities of the Indiawith an equity allocation of INR 20 billion (333 million Canadian dollars). Cities under consideration include Bombay, delhi, Punebangalore, Hyderabadand Chennai who collectively contribute to the majority india total stock and demand of Class A office space.

Sanjay DuttCEO and CEO, Real Estate and Infrastructure Limited, said, “TATA Realty and Infrastructure Limited believes in building centers of excellence that provide tenants with high quality spaces that allow businesses to grow and scale. With CPP Investments as a long-term strategic partner, the vision of this joint venture is to provide world-class sustainable office space solutions to a diverse set of businesses. This will open new business opportunities for TATA Realty and Infrastructure Limited, allowing us to accelerate our current growth.

Hari Krishna V, Managing Director, Head of Real Estate India, CPP Investments, said: “This new relationship with TATA Realty and Infrastructure Limited, one of india leading operators, provides an excellent avenue from which to explore opportunities in the growing commercial real estate sector. This is an important step in expanding CPP Investments’ relationships with market leaders to deliver strong long-term risk-adjusted returns to CPP contributors and beneficiaries. »

On TATA Realty and Infrastructure Limited

TATA Realty and Infrastructure Limited is a wholly owned subsidiary of Son of Tata and one of the leading real estate development companies India with an extensive portfolio of over 50 projects in 15 cities. With an intelligent, collaborative and dynamic project distribution program, TATA Realty and Infrastructure Limited has developed approximately 16.8 million. m² of commercial projects and ~30 min. square feet of projects under development and planning.

After establishing itself firmly in ChennaiGurugram and Bombay, TATA Realty and Infrastructure Limited aims to add 10 mins. square feet over the next 3 years and progress towards its goal of having a portfolio of 45 million square feet by 2027.

In line with Tata’s philosophy of leadership in sectors of national economic importance, TATA Realty and Infrastructure Limited and Infrastructure Ltd were established to identify the most promising growth opportunities in real estate and infrastructure in India. TATA Realty and Infrastructure Limited is currently focused on long-term infrastructure projects of national significance, as well as mixed-use projects in the real estate sector. As with all Tata businesses, project selection is a specialized process, with the eventual shortlist scoring high not only on business objectives, but also on Tata’s guiding values ​​and policies. Tata is one of india largest conglomerates, with an annual turnover of more than $100 billionand 107 operating companies in seven business sectors, employing more than 750,000 people worldwide.
For more information: https://www.tatarealty.in : www.intellion.in

About RPC Investments

The Canada Pension Plan Investment Board (CPP Investments™) is a professional investment management organization that manages the fund in the best interests of more than 21 million contributors and beneficiaries of the Canada Pension Plan. In order to build diversified asset portfolios, investments are made worldwide in public equities, private equities, real estate, infrastructure and fixed income securities. Based at Torontowith offices at hong kong, London, Luxemburg, Bombay, New York City, San FranciscoSao Paulo and sydney, CPP Investments is governed and managed independently of the Canada Pension Plan and at arm’s length from governments. On December 31, 2021the Fund has totaled C$550.4 billion. For more information, please visit www.cppinvestments.com or follow us on LinkedIn, Facebook or Twitter.

___________________

1

CAD = INR 60.0

2

GLA: Gross leasable area

CPP Investments logo (CNW Group/Canada Pension Plan Investment Board)

CPP Investments logo (CNW Group/Canada Pension Plan Investment Board)

Tata Realty and Infrastructure Limited logo (CNW Group/Canada Pension Plan Investment Board)

Tata Realty and Infrastructure Limited logo (CNW Group/Canada Pension Plan Investment Board)

SOURCE Canada Pension Plan Investment Board

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Show original content to download multimedia: http://www.newswire.ca/en/releases/archive/April2022/12/c4173.html

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Arlena Hawthorne’s forte is working in commercial real estate https://papabyrd.com/arlena-hawthornes-forte-is-working-in-commercial-real-estate/ Sat, 09 Apr 2022 07:00:00 +0000 https://papabyrd.com/arlena-hawthornes-forte-is-working-in-commercial-real-estate/ Arlena Hawthorne is Commercial Relations Manager at Wells Fargo Arlena Hawthorne is Wells Fargo’s Commercial Relations Manager. She was present at black business Power Women Summit in Las Vegas. Hawthorne spoke with deployment about her role at Wells Fargo, how she got involved in commercial real estate, and what black men can do to better […]]]>
Arlena Hawthorne is Commercial Relations Manager at Wells Fargo

Arlena Hawthorne is Wells Fargo’s Commercial Relations Manager. She was present at black business Power Women Summit in Las Vegas.

Hawthorne spoke with deployment about her role at Wells Fargo, how she got involved in commercial real estate, and what black men can do to better protect black women.

What things are you all focused on at Wells Fargo to help the black community?

We try to bring a lot of young African Americans or people of color into the community by engaging them in panels and conferences that we host. For example, I work in commercial real estate and investment management, so we’re really trying to tap into talent to engage them on Wall Street and get more involved in commercial real estate.

Who is the person who got you involved in commercial real estate?

My grandfather actually had a construction company. Coming here, I hadn’t realized the value of entrepreneurship and having your own business and running it. I worked there at a younger age, and so here I am now, still in the business, but on the business side and learning a lot.

How do you connect people to real estate opportunities?

It is [by] build relationships, no matter where you are, or who you are, and no matter what socio-economic area you represent. It is about transmitting this knowledge.

How can black men better protect black women?

I just think I’m there [and] support the efforts of women. Of course, there have been challenges, but certainly, opportunities are opening up. I think what men can do is just really stick together and keep opening those doors. Let’s walk side by side to build better communities.

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“The hottest market I’ve seen” – Loveland Reporter-Herald https://papabyrd.com/the-hottest-market-ive-seen-loveland-reporter-herald/ Fri, 08 Apr 2022 07:00:00 +0000 https://papabyrd.com/the-hottest-market-ive-seen-loveland-reporter-herald/ Despite increasingly worrisome economic indicators, the commercial real estate market in Northern Colorado is still seeing incredible demand. That was the message from Ryan Schaefer, CEO of brokerage firm NAI Affinity, at the Northern Colorado Real Estate Summit hosted by BizWest last week. “It’s the hottest commercial real estate market I’ve seen in my career,” […]]]>

Despite increasingly worrisome economic indicators, the commercial real estate market in Northern Colorado is still seeing incredible demand. That was the message from Ryan Schaefer, CEO of brokerage firm NAI Affinity, at the Northern Colorado Real Estate Summit hosted by BizWest last week.

“It’s the hottest commercial real estate market I’ve seen in my career,” Schaefer said.

Schaefer’s forecast for commercial real estate included bad news and good news. The bad news, Schaefer said, is that many broader economic indicators are moving in the wrong direction. Inflation has become excessive. The movement of the Treasury to 10 years is worrying. And the recent oil price shock following Russia’s invasion of Ukraine is also alarming.

“There’s a 90% chance of a recession within two years of an oil shock,” Schaefer said.

Despite all of this, however, the commercial real estate market in Northern Colorado is booming to unprecedented levels and shows no signs of slowing down. The hottest sectors, Schaefer said, are industrial, quick-service restaurants and rest areas.

Large industrial facilities are springing up all along the Interstate 25 corridor in northern Colorado. Schaefer cited projects such as the Access 25 logistics park in Mead as an example. As the economy becomes increasingly reliant on e-commerce, these types of distribution, last-mile and warehouse facilities will begin to phase out traditional retail developments, Schaefer said.

“Industrial is the new retail,” he said.

Schaefer also cited Amazon Inc. (NYSE:AMZN) as an example of this trend. The e-commerce giant is closing all of its retail stores in the United States, showing that this strategy has failed. However, he has become one of the biggest names in retail thanks to his industrial projects such as the planned 3.8 million square foot distribution facility in Loveland, Schaefer said.

To accompany this, retail construction in northern Colorado is slowing.

“Every retail piece built on the Front Range last year would fit in a regional mall,” Schaefer said.

Now the name of the game in retail is convenience, Schaefer said. This is exemplified by the continued development of quick service restaurants and rest areas such as the planned 50,000 to 70,000 square foot Buc-ee’s in Johnstown, scheduled to open in 2024.

Driving all of this is a supply of commercial real estate that is still quite limited, Schaefer said. Demand is so high that he closed a sale last year in 45 days, when the process usually takes eight to 12 months. Rents are rising and triple net leases are seeing increased interest.

“We’re seeing huge buyer demand,” Schaefer said, “and huge increases in values.”

This article was first published by BizWest, an independent news agency, and is published under a license agreement. © 2022 BizWestMedia LLC.

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Commercial real estate is what big investors should be looking for right now https://papabyrd.com/commercial-real-estate-is-what-big-investors-should-be-looking-for-right-now/ Wed, 06 Apr 2022 07:00:00 +0000 https://papabyrd.com/commercial-real-estate-is-what-big-investors-should-be-looking-for-right-now/ A rise in interest rates and an inflationary environment have always been favorable to real estate performance. But above all, understanding investor demand and long-term secular trends is the focus when looking to deliver superior investment returns. Investing in multiple regional real estate markets and investing in both direct real estate and REITs (Real Estate […]]]>

A rise in interest rates and an inflationary environment have always been favorable to real estate performance. But above all, understanding investor demand and long-term secular trends is the focus when looking to deliver superior investment returns.

Investing in multiple regional real estate markets and investing in both direct real estate and REITs (Real Estate Investment Trusts) can help maximize the benefits of real estate diversification. Many private real estate investors worry about rising interest rates increasing the cost of debt and driving its value down.

However, with funds that focus on institutional-grade real estate, where most investors use little or no debt, the cost of leverage isn’t as important a driver of value. of real estate compared to private real estate owners. What we find is that there is little connection between institutional real estate values ​​and rising interest rates. Historically, commercial real estate returns, particularly in the United States, have been excellent during periods of rising interest rates when tied to economic growth.

Investor demand and economic growth have a much greater influence on real estate values ​​than interest rates. In short, while it is important to monitor interest rates as part of the overall environment, there are other more relevant factors to consider when assessing the value of real estate.

Real estate offers stability and is seen as a good hedge against inflation which, in an environment of stock market uncertainty and fears of rising interest rates and inflation, contributes to support strong investor demand. It is this investor demand that has a greater effect on value than inflation.

That ultimate hedge?

That said, property returns are more strongly correlated to inflation than stocks or bonds, which is clearly a positive in an inflationary environment. This is, in part, derived from leases creating a revenue stream that can adjust for inflation. This is why investors use real estate as a hedge against inflation.

In the United States, a closer analysis of historical information shows that commercial real estate has generally outperformed during periods of high inflation. Similar trends can be observed in Europe and Asia.

Although interest rates and inflationary pressures have some influence, better understanding how we use real estate to consume, live, innovate and connect – CLICK – allows us to match uses to secular trends that create demand long-term real estate. This approach is the one that best represents the evolving range of opportunities that real estate offers to investors.

For example, changing consumer behavior, changing demographics, and ongoing urbanization are all creating a shift in demand patterns for real estate. People need real estate for many different reasons. Understanding how we live and work, connect and consume can not only help uncover new investment opportunities, but also identify real estate products that may have a limited depth of demand.

When it comes to sustainability and the environment, real estate is an asset class where it is possible to have a direct and demonstrable impact while adding value to the investment. One of the main reasons to invest in real estate around the world is that not all trends are the same. We see different opportunities in different markets.

Different ways to inflate

For example, at first glance, inflation in the United States and Europe looks like similar trends. However, it is worth looking into a little more detail. In the United States, inflation is mainly due to the imbalance of supply and demand from businesses, labor shortages and the expansion of the money supply.

In Europe, however, the main contributor to inflation is the cost of energy, which has clearly increased recently. Although the drivers of inflation and the outlook for rising interest rates around the world differ, what is consistent globally is investor demand that is supporting real estate values ​​and, in many sectors, with occupant demand outstripping supply supporting rental growth.

Real estate returns are driven by human needs. How these combine with the influence of various global structural trends and economic cycles determines current and future demand. Investing globally provides the opportunity to overweight or underweight regions and countries depending on where we expect the highest returns to be generated.

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Commercial Mortgages: With Fed Rising Interest Rates, Commercial Real Estate Interest Rates Are Rising | Economic news https://papabyrd.com/commercial-mortgages-with-fed-rising-interest-rates-commercial-real-estate-interest-rates-are-rising-economic-news/ Sun, 03 Apr 2022 07:00:00 +0000 https://papabyrd.com/commercial-mortgages-with-fed-rising-interest-rates-commercial-real-estate-interest-rates-are-rising-economic-news/ Federal Reserve Chairman Jerome Powell was channeling the “this is just the beginning” refrain from the Chicago rock band’s hit “Beginnings” of the late 1960s and 1970s when he announced that the Federal Reserve was going to raise the federal funds rate by 0.25%, but then went on to signal that six more increases could […]]]>

Federal Reserve Chairman Jerome Powell was channeling the “this is just the beginning” refrain from the Chicago rock band’s hit “Beginnings” of the late 1960s and 1970s when he announced that the Federal Reserve was going to raise the federal funds rate by 0.25%, but then went on to signal that six more increases could be on the way this year and possibly four more in 2023.

He doubled down last week when he indicated the Fed might act more aggressively against inflation if needed.

While the move and commentary matched investor expectations, reality rocked the bond market and the 10-year Treasury yield rose 0.40% in two short weeks.

Since many commercial real estate lenders use it as a benchmark, interest rates are up from last month and, according to John B. Levy & Company’s National Mortgage Survey, interest rates over 5 and 10 years are now at 3.75%. 3.80% for low leverage trades.

For commercial real estate investors, the fight against inflation comes with mixed feelings. Typically, real estate benefits in an inflationary environment as a good hedge. However, higher interest rates used to fight inflation are seen as negative in a highly indebted industry.

People also read…

Interestingly, there is a great deal of evidence to suggest that commercial real estate cap rates, which are used as a measure of short-term value (representing the return on an unleveraged property over a one-year period), do are not quite correlated to the 10-year Treasury.

Ryan Severino, JLL’s Chief Economist, has pointed out for many years the negative correlation between interest rates and cap rates.

You can go back to the 1980s and see several years where the 10-year Treasury yield was actually above average cap rates. It’s hard to imagine an investor buying an apartment complex for a 4% return if they could buy a risk-free 10-year treasury note that was yielding 5%.

However, that’s what happened in the 1980s and the reason is that while a capitalization rate is a value-over-time mechanism for commercial real estate, it’s not very good at measuring d other variables such as future rents or the cost of capital.

Today, multi-family and industrial properties are fetching at average cap rates that represent a very small premium over the 10-year Treasury risk-free rate, but the sudden and steep rise in interest rates is unlikely to interest significantly alters this. Trade. The reason for this is that investors believe that growth in net rental and operating income will increase returns over time and result in a much higher premium on average.

The sharp rise in rates is much more likely to impact single tenant contracts with low cap rates where leverage is used. These transactions tend to have slower rental growth over time and are less likely to be an inflation hedge or post returns that justify the low risk premium.

Richmond’s commercial real estate market continues to buzz. The most commonly heard challenge is that the cost of building new apartments makes it difficult to justify development risk. This could lead to more rental growth as supply is limited and demand continues to inflate.

On another note, Apartment List recently released a report in honor of Women’s History Month. According to her research that takes into account recent data that reflects economic equity, business representation, affordability and community satisfaction for women, Richmond ranks sixth out of 80 for best cities for working women. .

John B. Levy & Co. partner and investment banker Andrew Little can be reached at alittle@ jblevyco.com.

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Commercial real estate will hit ‘inflection point’ this year, analyst says https://papabyrd.com/commercial-real-estate-will-hit-inflection-point-this-year-analyst-says/ Thu, 31 Mar 2022 15:43:07 +0000 https://papabyrd.com/commercial-real-estate-will-hit-inflection-point-this-year-analyst-says/ Rebecca Rockey, global head of economic analysis and forecasting at Cushman & Wakefield, joins Yahoo Finance Live to discuss the outlook for commercial real estate as vacancies continue to rise as more companies choose to continue to work from home. Video transcript [MUSIC PLAYING] AKIKO FUJITA: Office vacancy rates are rising in cities across the […]]]>

Rebecca Rockey, global head of economic analysis and forecasting at Cushman & Wakefield, joins Yahoo Finance Live to discuss the outlook for commercial real estate as vacancies continue to rise as more companies choose to continue to work from home.

Video transcript

[MUSIC PLAYING] AKIKO FUJITA: Office vacancy rates are rising in cities across the country as businesses increasingly choose to continue working remotely. This leads to growing signs of distress for mortgages on office buildings. Let’s bring in Rebecca Rockey. She is the global head of economic analysis and forecasting at Cushman & Wakefield. She joins us on the phone today. Rebecca, it’s good to have you today. We saw a note from Barclays that basically said that the share of problem mortgages was at the highest level since the current financial crisis. What do you see in the market? REBECCA ROCKEY: So I think when it comes to fundamentals, we continue to see an ongoing correction for the desktop, even if it’s really running out of steam. And we’ve seen a number of markets actually turn the tide, so to speak. And by that, I mean we’ve seen them move into territory of positive absorption and significant accelerations in rental activity and so on. But of course, we’re still dealing with an ongoing wave of supply that was ramping up just before the pandemic and, of course, finally hitting the market. So even in some of these positive absorption markets, for example, you can still see vacancy rates go up due to the amount of construction coming on the market. We nationally expect this inflection point to occur this year, so demand will stabilize and begin to rise again. But we are still in this transition phase. And it’s really the only real estate sector that’s still in that phase. BRIAN CHEUNG: Rebecca, this is Brian Cheung here. Great to talk with you. Have there been any structural changes during the pandemic in demand here? Because we know that many offices have spoken anecdotally of wanting to downsize simply because of this hybrid situation which will likely be a more permanent feature of our work culture. On the other hand, however, you have businesses that are effectively locked into leases they signed before the pandemic that span decades here. So, in your opinion, to what extent has the pandemic been structural on the demand for offices? REBECCA ROCKEY: Yeah, I think that’s kind of a tough question to answer. Because something we’ve seen throughout the pandemic, and really for the first half of 2021, is that companies still had a lot of uncertainty about their future office plans in general, and they were really focused on the safety of their employees, making sure that any type of return to work plans were things that people felt comfortable with. So, thinking about long-term leases and workplace design and all those things, while some companies were well positioned to go there, it certainly wasn’t the majority of them. And I think what was exciting in the second half of last year is that we started to see a return of conviction with leases of 10 years or more, going back to sort of a normal share of the rental activity. I mean, we’ve started to see activity really pick up. When it comes to structural factors, we’re definitely seeing a movement that’s really going to be here to stay towards flexible working. We believe this will affect what we call the marginal effect of a new office job on office demand. But the other thing that I think is important and that we found in our analysis is that clerical jobs are really an inordinate share of all new jobs. So they make up about 20% of all jobs nationally, but they make up well over 20% of new jobs. And that tends to be a compensating factor. And indeed, that’s why in many cases – in fact, in about 25 of the 90 markets we track, we actually started to see positive absorption last year. And it was really on the back of these favorable labor market winds. AKIKO FUJITA: So it sounds like you’re saying that the vacancy rates we’re seeing right now are more of a temporary lull. We’ve had so many conversations about whether, in fact, you’re saying clerical jobs make up about 20% of some of the listings we see, and yet we’re also hearing employees increasingly seek out those jobs that allow for a some flexibility and remote working, which would suggest you don’t need as much office space as we had before the pandemic. REBECCA ROCKEY: Yeah, I think– well, it’s sort of– they’re not mutually exclusive. So we saw a massive market correction in 2020 and really throughout 2021. And that was bigger than anything we’ve seen before. But that’s largely diminishing and becoming increasingly isolated in fewer and fewer cities. So nationally, we’re starting to see green shoots translating into positive fundamentals. This will cause the vacancy to stabilize. Recording positive uptake and accelerating market momentum is not incompatible, in our view, with the recognition that businesses will change the way they work, the kind of role the office plays. We’ve certainly seen the emphasis on high quality, a wealth of amenities, finding a space that makes people excited to come to the office. And what we’ve also seen is that the desire to work from home is definitely there. It’s not going to go away. But when you still have most people coming into the office on certain days of the week, you may not be able to downsize as much as you thought you could, or you may change the look of your space. So maybe you now have more collaboration space or meeting space than you had rather than assigned seating. And so we see a lot of those changes still unfolding. I would say it’s really a trial and error phase. But I think the best news we’ve seen and continue to see in the data is that the tide is turning. We’ve been through a pretty tough time over the past couple of years. And we think with this wave of construction hitting this year, that will be the peak of vacancy, and then we’ll start to see the improvements. But certainly, there is a lot of variation depending on the market. And we think the impact of working from home is there. We absolutely do not deny that it will certainly have an influence moving forward. BRIAN CHEUNG: Yes, certainly the world in 2022 is very different from what it was at the start of 2020. But Rebecca Rockey, global head of economic analysis and forecasting at Cushman & Wakefield, thank you very much. And Akiko, I just want to point out very quickly here, I’m in the office right now, but you’re not. Then I do not know. Can’t wait to get back to the office? AKIKO FUJITA: I feel like they’re calling me because I’m not in the office. I can’t wait to get back to the office. I’m curious how the lack of flexibility is going to affect this schedule that we’ve all grown accustomed to over the past two years. And I think maybe our newsroom, like a lot of other newsrooms, is very specific in that we operate collaboratively. And so it helps to be all in the same room. It’s interesting. Rebecca noted that the experience might be a little different – more seats awarded, which, by the way, Yahoo Finance is also tracking. So I’m open to experience. I’m glad everyone is back in the office. But what about the days when I want to do other things and have the flexibility of being home so I can multi-task? I don’t know how I’m going to feel. BRIAN CHEUNG: Yes. Well, I mean, the first day when you come back, and you already have to take care of me for over an hour a day in person, so maybe you’re going to want to get home pretty quickly. But we’ll have to see once we get back to the office. AKIKO FUJITA: No, Brian, I like being in the same office, don’t I? BRIAN CHEUNG: Oh. AKIKO FUJITA: And we talk a lot more often when we’re in the same room. It makes for a better show. BRIAN CHEUNG: Write it down. If someone can put us next to each other, we can be best friends. Akiko right next to Brian.

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Meet Barbara Bouvier, Commercial Real Estate Advisor https://papabyrd.com/meet-barbara-bouvier-commercial-real-estate-advisor/ Thu, 31 Mar 2022 07:00:00 +0000 https://papabyrd.com/meet-barbara-bouvier-commercial-real-estate-advisor/ (YourDigitalWall Editorial): – Bethesda, Maryland March 31, 2022 (Issuewire.com) – “As a wife and mother, the most important thing is to be a role model for my daughter. I want to show her that women can trace their own way”.https://www.barbarabouvier.com My career started in the cosmetics industry as a business manager working with small teams […]]]>

(YourDigitalWall Editorial): – Bethesda, Maryland March 31, 2022 (Issuewire.com) – “As a wife and mother, the most important thing is to be a role model for my daughter. I want to show her that women can trace their own way”.
https://www.barbarabouvier.com

My career started in the cosmetics industry as a business manager working with small teams to help increase sales activity. In this role, I lead promotions, events, launch new product lines, develop business and build teams while actively growing a business. With my entrepreneurial spirit, I knew I wanted more. What I wanted was to build something for myself instead of building someone else’s dreams. I received an out of the blue phone call from a manager of a real estate company who asked if I would be interested. I knew I liked real estate, but I thought it had to be commercial real estate. I started my real estate career in 2010 and knew from the start that this was exactly what I was looking for. I started out as a residential agent, but I knew it wasn’t for me. Commercial real estate speaks to my soul! What I absolutely love about my career in commercial real estate is that you build your own business and be around like-minded people who keep you accountable and motivated.

I follow my role as a commercial real estate expert, helping powerhouse businessmen and women align their goals with their office and industrial rental and investment vision. I work with medical practices, corporate headquarters and government offices. Industrial warehouse and flexible space. I love the real estate business and this was the best decision I’ve made. I do free consultations online or in person, visit https://www.barbarabouvier.com/booking

The tool that keeps me motivated and successful is having a growth and success mindset. I believe that mindset is everything and without the right mindset, nothing improves. You have to take action, have a plan and move towards that goal. It is by taking action that you will see change, whether good or bad, and both will lead you to success. Giving up is never an option. If you are going to invest, I say invest in yourself and put in the hours. If you do this, your life will change for the better.

I am very proud of the abilities I have acquired over the years to build my own business, serve my community and build partnerships with my clients. My contribution to success would not be possible without the support and investment of those who believe in me. For that, I am extremely grateful.

My advice to women who want to start their own business is to go for it. It doesn’t matter where you start, in your basement, your spare room or your garage, do it. Go ahead, find a mentor and get started. Surround yourself with like-minded people who can help you grow. It’s nothing like creating your own success and blazing your own trail.

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The region’s commercial real estate market is expected to maintain its upward trend https://papabyrd.com/the-regions-commercial-real-estate-market-is-expected-to-maintain-its-upward-trend/ Sun, 27 Mar 2022 07:00:00 +0000 https://papabyrd.com/the-regions-commercial-real-estate-market-is-expected-to-maintain-its-upward-trend/ The commercial real estate market in central Arkansas is expected to continue to stabilize in the final nine months of 2022 as covid anxieties ease and more workers return to the office. The region ended 2021 with a recovery in sight for key industrial, office and retail sectors, with the industrial market generating low vacancy […]]]>

The commercial real estate market in central Arkansas is expected to continue to stabilize in the final nine months of 2022 as covid anxieties ease and more workers return to the office.

The region ended 2021 with a recovery in sight for key industrial, office and retail sectors, with the industrial market generating low vacancy rates and a boom in speculative construction to meet growing demand. That momentum has continued through the first three months of this year and is expected to remain strong through 2022, according to a report from Colliers of Arkansas that outlines real estate market trends in central Arkansas.

“As the pandemic persisted and user needs for mixed-use spaces increased, industrial vacancy tightened and remained so throughout the year,” notes the report on last year’s activity. . “Speculative construction began to appear on the metro to help alleviate the unprecedented demand. Still, there was minimal availability throughout the central Arkansas industrial market and rental rates continued to fall. increase.”

No change seems in sight. Investors need more flexible multi-tenant properties, and that need should fuel an increase in rental rates in the region, Colliers predicts. Industrial markets will continue to outperform other sectors this year as landlords and lessors remain in a prime position to demand higher rents.

It’s a different story for the office market, which held steady in 2021 – with vacancy rates remaining stable from January to December. Still, the rest of 2022 is an open book, though Colliers projects a “stable” approach as suburban markets continue to outpace downtown Little Rock, which is filled with older high-rises with towering towers. halls that were built for a different banking environment.

Suburban growth and downtown decline are expected to continue. “This trend will likely continue for the foreseeable future as major downtown properties struggle with oversized lobbies that are no longer in demand by banking institutions,” Colliers reports.

The outlook for 2022 is more similar for the office market. “Overall, the Central Arkansas office market held up reasonably well during the two-year COVID-19 pandemic,” the report said. “We are cautiously optimistic that this will continue in the short term.”

Retail trade is expected to boom with rising consumer spending and “explosive growth” in the leisure and hospitality sectors. Hotel and restaurant owners report that this year business is expected to return to 2019 levels and a pre-covid environment. However, low population growth and inflation are of concern and could dampen the retail sector.

Real estate development increased in 2021, supported by a favorable credit environment that fueled growth in multi-family, single-family, industrial and banking developments. Much of this growth, like the office market, is occurring in suburban areas such as Benton, Bryant and Conway.

While construction has accelerated, supply chain issues and labor shortages remain challenges for the real estate industry. “While 2022 looks promising, we expect to see continued tension due to supply chain disruption, rising material costs and rising interest rates,” Colliers reports.

Colliers, a global real estate investment and management firm, has offices in Little Rock and northwest Arkansas. It has over 19.3 million square feet of space under management and over $550 million in total Arkansas sales.

BROADBAND EXPANSION

Little Rock-based Windstream Holdings Inc. reports that it is rapidly deploying the nearly $523 million in federal funding it has won to expand 1-gigabit service across its 18-state footprint. The company says it will eventually reach more than 19,000 new Arkansas residents and businesses with the funding.

Company officials say about 2,800 Arkansas customers will receive the service this year. Under federal funding rules, Windstream has six years to complete construction.

“As the pandemic has demonstrated, robust broadband has become an essential service as more of the national economy moves online, and public-private partnerships are essential to make it available in the most remote areas. rural areas in America,” said Tony Thomas, president and CEO. CEO of Windstream. “That’s why Windstream participates in network expansion partnerships at the federal, state and local levels to deliver future-proof fiber broadband connectivity to our customers, and we have a strong track record of of our commitments.”

Windstream’s efforts are funded through the Rural Digital Opportunity Fund, which was established by the Federal Communications Commission to accelerate the delivery of high-speed Internet to rural communities in hard-to-reach and expensive areas.

The federal funding will allow Windstream to provide fiber internet access to more than 192,000 locations in its service area, according to the company.

ENTERGY DISCOUNT

Entergy Arkansas customers are eligible for cash rebates when they purchase electric technology under a new initiative that has been approved by state regulators. This includes purchases of forklifts, cranes, golf carts and electric vehicle chargers.

The program will help the utility in its sustainability efforts and improve control of greenhouse gas emissions, the company said. “This will help manage greenhouse gas emissions while supporting the advanced technology options our customers want,” said Laura Landreaux, president and CEO of Entergy Arkansas.

The eTech initiative, which is known as a beneficial electrification program in the industry, can be used by any Entergy Arkansas customer, including homeowners and businesses. More than 40 utilities in North America offer similar programs.

The Arkansas Public Service Commission has approved 14 technologies eligible for rebates, such as refrigerated trucks, school and transit buses, drayage trucks, digital billboards, scissor lifts , scrubbers and sweepers, tugs and tow tractors and belt loaders.

Rebates range from $150 for a golf cart to $5,000 for a digital billboard. The company said it has no annual limit on the number of discounts per customer.

Ideas for columns or recommendations? Any thoughts or daydreams that need to be pursued? Contact me at amoreau@adgnewsroom.com or 501-378-3567.

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