NAI Global Enters Into Strategic Alliance with JAJ Consultants

NAI Global, the world’s premier managed network of commercial real estate firms and one of the largest real estate services providers worldwide, announced Monday it has entered into a strategic alliance with JAJ Consultants, a leading provider of real estate valuation and consulting services in the Middle East and Asia Pacific regions.

Headquartered in Dubai, JAJ Consultants is a leading provider of asset valuations, appraisals and strategy consulting services. JAJ has been active in the Middle East and GCC for over 33 years and has extensive expertise in valuation and appraisal of land, building, structures and civil works, and various types of industrial valuation including plants, machinery, equipment, large industries, factories, stocks, goods in trade and transit, etc.

Through its alliance with NAI Global, JAJ will collaborate with NAI offices to provide consulting services relating to strategy, valuation, development feasibility as well as highest and best use consulting to NAI clients. The alliance will focus on the Middle East, GCC and Asia Pacific regions but can provide service to clients in Europe, Africa and the Americas as well.

“Our alliance with NAI Global will enable us to geographically expand our client base,” stated JAJ President & CEO, Shahid Umerani. “Through NAI Global, we will be able to develop new opportunities for our clients as well as establish new relationships with investors, government agencies, property developers and corporations from around the world.”

“We are excited to enter into an alliance with JAJ Consultants,” said Stephen Atherton, NAI Global’s Managing Director for Asia Pacific & Middle East. “JAJ has an outstanding reputation throughout the Middle East, and we look forward to working together to provide NAI clients with best-in-class valuation and consulting services in the Middle East and Asia Pacific.”

JAJ Consultants (www.jajconsultants.com) is based in Dubai, United Arab Emirates with a second office in Riyadh, Saudi Arabia. Headquartered in Princeton, NJ, NAI Global manages a network of 350 offices and 5,000 professionals in 55 countries across the globe.

About the author

NAI Global is the premier network of independent commercial real estate firms and one of the largest commercial real estate service providers worldwide. NAI Global manages a network of 5,000 professionals and 325 offices in 55 countries throughout the world. NAI professionals work together with our global management team to help our clients strategically optimize their real estate assets. NAI offices around the world complete over $45 billion in transactions in a typical year. We also manage over 200 million square feet of commercial space. In 2009-2010, NAI Global received top industry rankings and honors: Named Global Broker of the Year by Private Equity Real Estate magazine Ranked # 1 Network and #3 Overall Corporate Services Provider in Watkins Research Group Survey of Corporate Real Estate Executives Ranked #4 on Lipsey’s Top 25 Real Estate Brands Ranked #6 on National Real Estate Investor magazine’s Top 25 Brokerage Organizations NAI Global is based in Princeton, New Jersey. A dedicated 70-person staff, strategically positioned around the world, provides management, technology, marketing and corporate services support to its network of real estate offices.

Valuing Vacant Space

Has the market returned to valuing vacant space?  If so, is it because investors are more confident that the commercial rest estate (CRE) market has reached the bottom and is on the uptick or is it because buyers, frustrated by the bid/ask gap and sellers seeming unwillingness to reduce the asking price, are being forced to rationalize higher prices therefore positioning themselves to do deals?

Amid signs that the CRE market continues to languish including CMBS default rates projected to hit 12% this year, lack of available credit, the on-going weak job market and the lack of both investor and consumer confidence, the fact that investors have of recent been willing to assign some value to vacant space is a hopeful sign that a bullish view of the CRE market, albeit tepid at best, has returned.

Less than a year ago, we saw offers for CRE, where there was an above market level of vacancy, based on a cap rate applied to existing NOI (trailing 12 months) only.  In some cases, particularly for retail properties, the value for occupied space was arrived at by applying a discount rate only to the remaining lease terms of the existing leases.  More recently however, we have seen buyers willing to accept a below market initial return, say 5-6%, and given their return criteria of 9% or more, recognize that the “up” can only be achieved through leasing vacant space.

The market has effectively given the vacant space value, assumed the lease-up risk and exhibited some level of confidence that a higher occupancy level can be achieved.  Only time will tell whether the assumptions and risk are justified or whether it’s simply a reality that buyers have been forced to accept in order to satisfy their need to do deals.

Source: Tim Buss, CCIM is Senior Vice President-Special Asset Solutions at NAI Global.