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/206598
MARKE T TREND S Net Lease Cap Rates 3Q13 Median asking cap rates by year built TENANT 2010–13 2005–09 2000–04 PRE–2000 Walgreens 5.58 5.80 6.50 7.50 Advanced Auto Parts 6.75 6.90 7.50 8.80 Dollar General 6.50 8.00 8.63 8.88 Source: The Boulder Group "The pendulum is slowly shifting from a tenant's market to a landlord's market. Supply/demand fundamentals suggest the bulk of the country will be pushing office rents upward by this time next year." — Kevin Torpe, Chief Economist at Cassidy Turley, 3Q13 Ofce Market Report Briefly Noted Hospitality — Fifteen of the top 25 hotel markets tracked have recovered their prerecession peak revenue per available room rate as of August, according to STR. Two more markets are expected to recover by year-end, with four more recovering in 2014 and the final four in 2015. San Francisco tops the list with a $148.60 RevPAR, a 20 percent increase over its prerecession peak. Industrial — No one is sure how etailing will change U.S. logistics, but CBRE suggests that a combination of large national or regional distribution centers and local or urban parcel hubs will be the norm going forward. Online retailing will support "a substantial expansion in leasing demand for smaller cross-docked parcel delivery centers that are close to major urban areas, with parcel courier companies accounting for a growing proportion of demand," says Richard Holberton, director of CBRE Econometrics. Multifamily — The average overall apartment capitalization rate is at 5.6 percent, according to the 3Q13 PwC Real Estate Investor Survey, the lowest cap rate in five years. Investors surveyed for the report see cap rates holding steady for the next six months. Holiday Hiring Trends, 2013 # of workers eBay plans to hire # of workers Target plans to hire Source: Challenger, Gray & Christmas 8 November | December | 2013 2,000 70,000 Retail — Is it time for new big-box development? Perhaps says Marcus & Millichap's 3Q13 NetLeased Report. While big-box retailers are downsizing to smaller formats in urban areas, elsewhere the infill inventory is shrinking due to re-leasing during the recession. Net lease sales of big-box product increased 16 percent YOY, as appliance, furniture, and DIY enjoyed brisk sales, spurred by a stronger housing market. Commercial Investment Real Estate Maksym Yemelynov/Thinkstock Office — Nine of the 13 largest markets issued declining office vacancy rates in 3Q13, according to CBRE. Dallas showed the largest decline — 100 bps — followed by Phoenix, Washington, D.C., and Seattle.