Industrial Trends – Q1 2011

As is typical, the industrial segment will lead the industry out of the real estate doldrums. The asset class is fairly less sophisticated then multi-family and office and retail remains a conundrum.

B-class assets and incubator vintage infill will be the first to lease as service companies and ancillary support companies will be buoyed by the improving economy.

Retailers, in anticipation of a recovery, albeit a marginal one, are currently analyzing and re-engineering their logistical schemes.  Supply chains are being closely monitored to determine where economic buying trends might break first. The larger retailers will continue to have the strength to locate distribution centers where ever they want. 

However, the discount stores and the dollar stores will be under pressure to determine best locations for replenishment, which are more costly, versus several small supply depots closer to store density.

About the author

Scope of Service Experience As Executive Vice President-The Americas, Paul Waters is responsible for business development and client relationships among major corporate end users of office and industrial space. He works with clients to identify opportunities to achieve significant cost savings through strategic occupancy programs and portfolio optimization. Education Bachelor of Science, Boston College Master of Business Administration, University of Phoenix, Background & Experience Mr. Waters possesses more than 20 years of experience across multiple disciplines within the commercial real estate industry, with extensive expertise in the industrial and office representation sector. Prior to joining NAI Global, he was a Senior Managing Director of CB Richard Ellis’ (CBRE) North American Industrial Services and was responsible for the direction, development and operations of CBRE’s national industrial tenant representation practice.

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Real Estate Investing is All the Rage Again. Should You Cash In?

Forbes / September 13, 2010

By: Francesca Levy

I wrote last weekabout the housing markets that were the best bets for residential real estate investors, suggesting that home buyers could use the advice as a clue to which markets would turn around soonest.

The top picks were Raleigh, N.C., McAllen, Texas and Austin, thanks to their strong  

pre-recession population growth, slowing home-price drops and a mix of jobs that’s weighted toward growth industries like government and education (the entire top ten list is past the jump).

Our list, compiled by Cary, N.C. real estate research firm Local Market Monitor, wasn’t looking at the markets that were currently the healthiest, but rather which had the greatest chance for price appreciation.

You can, of course, invest in real estate without buying a home. Commercial real estate investment has also picked up dramatically. Real estate funds and companies brought in $9.18 billion for all types of property acquisitions in August — more than double what they raised in July, according to real estate investment adviser CoStar.

Of course, $63.26 billion raised this year is pocket change compared to the
industry’s pre-2007 heyday, when REITs took in $200 billion annually, but there is money to be made in careful commercial investing.

Investors looking for a way into the market should seek an adviser with low fees, who can acquire nimbly and quickly, and has a multi-year track record in the industry, says CoStar consultant Norm Miller, but they should closely watch commercial market conditions.
“It’s not a bad time to buy, but I’m not going to tell you we’re at the bottom on prices,” he says.

If, however, you’re looking at the investing trees (individual housing markets) rather than the investing forest (pension funds, mutual funds, REITs, hedge funds and other companies that put money into all types of real estate classes, but mainly commercial), here are the top markets for conservative investors (see the article for more detail on why):

1.

Metropolitan Statistical Area: Raleigh-Cary, N.C.

Q2 2010 Home Price Change: -3%

Three- year home price forecast: 0%

Population Growth, 2000-2005: 18%

2.

Metropolitan Statistical Area: McAllen-Edinburg-Mission, Texas

Q2 2010 Home Price Change: 1%

Three- year home price forecast: 7%

Population Growth, 2000-2005: 16%

3.

Metropolitan Statistical Area: Austin-Round Rock, Texas

Q2 2010 Home Price Change: ...


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Why should I locate my business in a business park? | 495 Commerce Center McAllen, TX in the Rio Grande Valley | NAI Rio Grande Valley

When looking for a location for the life of your business considering a business park may be the way to go. Business Parks offer its residents flexibity, growth opportunities and development standards that ensure the value of their investment. To better understand the benefits of locating your business in a business park I have shared an excerpt from Business Park and Industrial Development Handbook by Anne Frej.

“The business parks of today are the product of an evolutionary process. From their antecedents in the manufacturing-oriented industrial estates and parks of the early 20th century, they have become dynamic workplace settings for business, incubators for new technologies, and employment centers that contribute to the economic life of many communities.

Flexibility is key to their success. Business parks not only accommodate a mix of activities such as storage, light manufacturing, research, and office functions, all in a planned and controlled setting; they also can be adapted in form and function to meet changes in the market. This attribute has been critical in recent years, as rapid technological innovation has created new requirements for the industrial sector. The growth of e-commerce and just-in-time distribution systems has led to the transformation of warehouses into sophisticated logistics centers. The need for flexible work spaces that can house office and industrial activities under one roof has resulted in new hybrid buildings known as flex space. The growth of employee-intensive operations such as call centers and data processing centers at business parks has increased population densities there and resulted in requirements for more parking and better on-site amenities and services.

For occupiers, business parks offer the capacity to grow and expand at the same location. With multiple buildings of different types, sizes, and prices to choose from, all in one business park, startup companies can bring operations in small-scale incubator space and eventually move to more prestigious headquarters without ever changing their operations, from high visibility corporate headquarters to inexpensive back-office or flex space. Leasing space, buying a facility, or having it built to specifications are also possible options for occupiers in modern multiphase business parks.

For developers, business parks offer flexibility as well. Despite business parks’ being long-term investments with large budgets because of their size and infrastructure requirements, developers have the benefit of deciding whether to sell unimproved land parcels or completed buildings in a business park. Risk is also minimized by the opportunity to phase development, relying on positive market conditions or formal lease or sale agreements before proceeding with construction. Many developers will not initiate a project until a formal commitment has been received to lease or buy a major portion of the project.

Communities reap potential benefits from business parks. In an era of increasing competition to attract new businesses and jobs, many governments see business parks as a tool to stimulate economic development. In some cases, the agreement is strong enough to warrant the public sector’s active participation in the formation of business parks and the provision of tax incentives or financing assistance to developers.” Read more

In most cases land or building space within a business park is going to come with a higher price tag. But when determining the right location for the life of your business it is important to consider the price verses your cost. Price is a one time thing, and usually cheaper on the on set, but cost is over the lifetime of your investment. A lot of locations can beat business parks on price, but very rarely can they beat on cost. Since cost is lifetime thing, don’t you want the best possible location for your investment?

495 Commerce Center in McAllen, TX located in the Rio Grande Valley is an excellent example of a business park development done right. The 110 acre master-planned business and professional community offers a strategic location in an ideal setting that has proven to be a sound investment. Two government agencies, call center, and several professional buildings already call 495 Commerce Center home. Take a video tour to see first hand what a true business park is all about.

The Right Location for the Life of Your Business | 495 Commerce Center McAllen, South Texas in the Rio Grande Valley

Strategic Location
495 Commerce Center is a mixed-use development, planned to put your business on the fast track to success. This Class-A business park is strategically located in McAllen, TX in the Rio Grande Valley. View video tour and property photos.

495 Commerce Center provides excellent access to nearby international bridges and is only minutes from the McAllen Miller International Airport. 495 is less than 60 miles from a deep port, 240 miles from San Antonio and 120 miles from Monterrey, Mexico.

495 Commerce Center is also close to business services and community support viable for any business. Whether your business is professional, retail, manufacturing, showroom, distribution or service-oriented, 495 Commerce Center puts you in the right place at the right time. At 495 Commerce Center you will enjoy direct access & close proximity to:
Regional transportation
Future Interstate I-69
McAllen’s main post office
Fed-Ex & UPS hubs
Hospitals & medical support services
National retailers
International airport
2 international bridges
Federal, State & County courts

Wise Investment
Your location in 495 Commerce Center will be a secure investment. Architectural and development standards, an owner’s association and a common area maintenance program will promote enduring property values. Development standards control permitted building types, uses and mix, as well as quality of construction, parking, landscaping and the architectural character of the project.

Location
495 Commerce Center is situated on FM 495 (Pecan Blvd.), a prominent thoroughfare that offers high visibility and easy access to major transportation arteries. Thoughtfully designed landscaping elements, including a lake and jogging trails, enhance the campus like quality of this business park.

Ideal location for:
Call centers
Manufacturer showrooms
Distribution centers
Warehousing
Professional offices
Retail
Government buildings

For more information and prices about 495 Commerce Center please contact Charles D. Mueller with NAI Rio Grande Valley