Commercial Investment Real Estate is the magazine of the CCIM Institute, the leading provider of commercial real estate education. CIRE covers market trends, current developments, and business strategies within the commercial real estate field.
Issue link: http://cire.epubxp.com/i/143044
MARKE T TREND S 2013–14 Brick-and-Mortar Retail Forecast planned units 15,439 Restaurant chains Briefly Noted 1,244 Home-related stores Sporting goods 348 Pet and farm products 382 1,858 Dollar/discount stores Industrial — E-commerce, expected to increase 62 500 1000 1500 2000 Source: Cassidy Turley "Industrial rents have passed the inflection point…effective rents are forecasted to rise 25 percent during the next four years (2013–2016)." — Prologis Research Corporate Conundrum Corporate real estate executives are f nding new challenges in today's post-recession climate, according to a new Jones Lang LaSalle survey on today's corporate realities. How commercial real estate performs is now under greater scrutiny by chief executives, according to the 600 global executives surveyed. Te top demands being placed on commercial real estate execs include • reducing direct real estate costs; • increasing use of existing building portfolios; • reducing portfolio operational costs; and • challenging presumed space needs. But continuing to deliver cost savings through building portfolio management is a difcult task. In the coming years, commercial real estate teams will require new skills to meet new C-suite expectations: • challenging the status quo through forward thinking; • presenting real estate options and scenarios; • understanding of the broader business climate; and • providing data and insights. Tis focus on broader business skills "will need to be addressed through a … fundamental rethinking of the form and function of the CRE team," the report says. To read more, download "Risks Ahead," at joneslanglasalle.com. 8 July | August | 2013 percent by 2016, is affecting the industrial market in a positive way, according to CBRE. Same-day pickup and online delivery options are requiring more urban infill industrial development and more e-commerce distribution centers in UPS and FedEx hub markets. Many e-commerce industrial users are choosing build-to-suit over leasing existing facilities. Hospitality — Secondary markets are underserved by boutique hotels, both chain and independent properties, said a panel of hospitality experts at the Bisnow Lodging Investment Summit. Markets such as Pittsburgh and Cleveland "have every full-service brand there, but what's really missing is a boutique hotel to play off of that," said Tom Riley, a Kimpton Hotels vice president. Multifamily — Institutional investors are seeking three locales for new multifamily acquisitions: "downtown urban, inter-urban in the 7- to 10-mile range from CBDs, and suburban," according to Jack Kern, chief investment research officer at Continental Realty Advisors, at the NMHC's 2013 Apartment Strategies/Finance Conference. Kern suggests watching occupancy patterns, which indicate where opportunities exist, according to a report in MHNonline. Office — Private investors account for more than half of the medical office investment transactions in the last 12 months, dominating the $1 million to $10 million MOB segment, according to Marcus & Millichap. Cap rates for these deals average 8.2 percent. REITs dominate the higher-priced arena of better-located, hospital-affiliated MOBs, with cap rates ranging from 6 to 7 percent. Retail — Bank ground leases maintained a 225-basispoint premium over general retail net leased properties in the past year and cap rates have compressed 85 bps to 5 percent, the lowest level since 2004, according to the Boulder Group. Low prices, low default rates, and no landlord duties make these assets popular with 1031 and fixed-income investors. Commercial Investment Real Estate Windu/Veer 0