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Monthly Archives: May 2012

2012 Twin Cities Apartment Sales on Track to Outperform 2011

Despite slowing local apartment sales across the Twin Cities in the early part of 2012, real estate brokers are expecting sales to strongly outpace last year’s transactions.

Local apartment trends are mirroring what’s going on nationally.

Multifamily by far has been the hottest sector nationwide. Multifamily in general is the only property sector to be going through a nationwide recovery,” said Dan Fasulo, managing director of Real Capital Analytics, a global commercial property research firm that tracks the capital investment markets in the commercial real estate industry.

“There’s somewhat of a perfect storm brewing in that sector right now,” he said.

In the first quarter, Real Capital Analytics tracked $11.98 billion in apartment sales across the U.S., a 31 percent increase compared with the first quarter of 2011. Real Capital Analytics tracks apartment sales of $2.5 million or more. Fasulo said that industry conferences on multifamily properties are drawing standing-room-only crowds.

2012 Twin Cities Apartment Sales on Track to Outperform 2011

Despite slowing local apartment sales across the Twin Cities in the early part of 2012, real estate brokers are expecting sales to strongly outpace last year’s transactions.

Local apartment trends are mirroring what’s going on nationally.

Multifamily by far has been the hottest sector nationwide. Multifamily in general is the only property sector to be going through a nationwide recovery,” said Dan Fasulo, managing director of Real Capital Analytics, a global commercial property research firm that tracks the capital investment markets in the commercial real estate industry.

“There’s somewhat of a perfect storm brewing in that sector right now,” he said.

In the first quarter, Real Capital Analytics tracked $11.98 billion in apartment sales across the U.S., a 31 percent increase compared with the first quarter of 2011. Real Capital Analytics tracks apartment sales of $2.5 million or more. Fasulo said that industry conferences on multifamily properties are drawing standing-room-only crowds.

Market Stability Apparent as New Commercial Real Estate Brokerages Eye U.S.

In what may be a sign of market recovery durability, new commercial real estate brokerages are launching in the U.S.

While real estate brokerage staples seek to enlarge their footholds, newcomers such as Australia’s UGL Ltd and BGC Partners Inc, who recently built Newmark Grubb Knight Frank, work to develop strategies they hope will make them contenders on the US brokerage stage.

The value of global commercial real estate available for investing is between $10 trillion and $15 trillion, with half of that in the United States.

In a recent report by the global commercial property research firm Real Capital Analytics, the U.S. commercial property brokerage industry is fragmented, with 801 firms brokering property transactions of at least $10 million in 2011.

According to Real Capital Analytics, only six firms are global – CBRE, Jones Lang LaSalle, Cushman & Wakefield, Savills, Colliers International and Newmark Knight Frank, now called Newmark Grubb Knight Frank. The top three – CBRE, Jones Lang and Cushman & Wakefield – accounted for 35 percent of the $326 billion in sales brokered in 2011.

Market Stability Apparent as New Commercial Real Estate Brokerages Eye U.S.

In what may be a sign of market recovery durability, new commercial real estate brokerages are launching in the U.S.

While real estate brokerage staples seek to enlarge their footholds, newcomers such as Australia’s UGL Ltd and BGC Partners Inc, who recently built Newmark Grubb Knight Frank, work to develop strategies they hope will make them contenders on the US brokerage stage.

The value of global commercial real estate available for investing is between $10 trillion and $15 trillion, with half of that in the United States.

In a recent report by the global commercial property research firm Real Capital Analytics, the U.S. commercial property brokerage industry is fragmented, with 801 firms brokering property transactions of at least $10 million in 2011.

According to Real Capital Analytics, only six firms are global – CBRE, Jones Lang LaSalle, Cushman & Wakefield, Savills, Colliers International and Newmark Knight Frank, now called Newmark Grubb Knight Frank. The top three – CBRE, Jones Lang and Cushman & Wakefield – accounted for 35 percent of the $326 billion in sales brokered in 2011.

Downtown L.A. on the Rise

Hit hard by the recent recession, the once suffering downtown Los Angeles office market is reawakening and beginning to attract office investors due in part to the resurgence of its residential market and the rebirth of the area’s entertainment industry.

Despite the increased interest in Downtown LA’s office market, it still lags behind tonier surrounding areas such as West LA, Santa Monica and Beverly Hills.

Per-square-foot prices are still well below peak levels in 2007 when Downtown Los Angeles office buildings sold for as much as $450 a square foot according to Real Capital Analytics, , a real-estate research firm. The pending $236 million deal for 400 South Hope Street comes in at about $337 a square foot, just shy of its last trade in 2005 at $351 a square foot.

“If any central business district is lagging, it’s Los Angeles,” says Dan Fasulo, a RCA’s Managing Director.

While office investors haven’t descended on the area in droves, they are taking notice. During the depths of the downturn, downtown office deal activity ground to a halt with no large office building transactions in 2009 and only $211 million in 2010, according to the global commercial property research firm Real Capital Analytics.

Downtown L.A. on the Rise

Hit hard by the recent recession, the once suffering downtown Los Angeles office market is reawakening and beginning to attract office investors due in part to the resurgence of its residential market and the rebirth of the area’s entertainment industry.

Despite the increased interest in Downtown LA’s office market, it still lags behind tonier surrounding areas such as West LA, Santa Monica and Beverly Hills.

Per-square-foot prices are still well below peak levels in 2007 when Downtown Los Angeles office buildings sold for as much as $450 a square foot according to Real Capital Analytics, , a real-estate research firm. The pending $236 million deal for 400 South Hope Street comes in at about $337 a square foot, just shy of its last trade in 2005 at $351 a square foot.

“If any central business district is lagging, it’s Los Angeles,” says Dan Fasulo, a RCA’s Managing Director.

While office investors haven’t descended on the area in droves, they are taking notice. During the depths of the downturn, downtown office deal activity ground to a halt with no large office building transactions in 2009 and only $211 million in 2010, according to the global commercial property research firm Real Capital Analytics.

Midtown South Emerges as a market for New York’s Prime Office Space

With an influx of demand and peaked interest, Midtown South is emerging as a hotspot for companies in search of office space in trendier areas.

There is a push, particularly from those in the technology field, to move beyond the glossy high rises traditionally associated with Midtown Manhattan to buildings and neighborhoods with character; former warehouses, factories, and trendy fashion boutiques.

This shift is taking place at a time when key industries have seen a decline in job growth. While the financial services and securities industries continue to deal with its instabilities, the information and technology industries continue to see fast paced growth that has them clamoring for office space which, in turn, has driven up demand along with establishing Midtown South as one of New York’s premiere office space markets.

Evidence of this can be seen by this month’s purchase of the 155,000-square-foot office building at 148 Lafayette St. in Soho for about $132 million, or $850 a square foot, by Epic UK Ltd. That square-foot price was higher than the per-square-foot price paid in January for 530 Fifth Ave., a 26-story tower near Grand Central Terminal in Midtown, according to global commercial property research firm Real Capital Analytics Inc.

Midtown South Emerges as a market for New York’s Prime Office Space

With an influx of demand and peaked interest, Midtown South is emerging as a hotspot for companies in search of office space in trendier areas.

There is a push, particularly from those in the technology field, to move beyond the glossy high rises traditionally associated with Midtown Manhattan to buildings and neighborhoods with character; former warehouses, factories, and trendy fashion boutiques.

This shift is taking place at a time when key industries have seen a decline in job growth. While the financial services and securities industries continue to deal with its instabilities, the information and technology industries continue to see fast paced growth that has them clamoring for office space which, in turn, has driven up demand along with establishing Midtown South as one of New York’s premiere office space markets.

Evidence of this can be seen by this month’s purchase of the 155,000-square-foot office building at 148 Lafayette St. in Soho for about $132 million, or $850 a square foot, by Epic UK Ltd. That square-foot price was higher than the per-square-foot price paid in January for 530 Fifth Ave., a 26-story tower near Grand Central Terminal in Midtown, according to global commercial property research firm Real Capital Analytics Inc.

Interest Grows in B Malls

Rebounding retail sales is causing investors like Barry Sternlicht and KKR & Co. to buy second-tier malls from Nebraska to Chicago – a big turnaround from last year when demand for class A retail centers pushed down yields, driving investors seeking higher returns to B malls.

According to Dan Fasulo, managing director at global real estate research firm Real Capital Analytics, “The investor community just wasn’t ready to take on the risks associated with those malls. They’ve started to trade again.”

Interest Grows in B Malls

Rebounding retail sales is causing investors like Barry Sternlicht and KKR & Co. to buy second-tier malls from Nebraska to Chicago – a big turnaround from last year when demand for class A retail centers pushed down yields, driving investors seeking higher returns to B malls.

According to Dan Fasulo, managing director at global real estate research firm Real Capital Analytics, “The investor community just wasn’t ready to take on the risks associated with those malls. They’ve started to trade again.”

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