I'm continuing my review of Louisville Commercial Real Estate for 2011. Today, I am looking at the Office Market. Here is what I found -
The Numbers -
According to KCREA (Kentucky Commercial Real Estate Alliance), the Louisville metro area had 141 Leases for approximately 504,846 SF of Office space. The median lease space was 1746 SF. The largest Office Lease reported for 2011 was 101,000 SF at the call center on Lakefront Place. The smallest lease reported was 150 SF.
Regarding Office Sales, KCREA reported 46 Office Buildings / Condos sold in 2011 consisting of 352,687 SF selling for $18,092,309. The median building size was 2782 SF while the median transaction size was $195,000. The average selling price per square foot was $49.47. (note: if you are checking my math, to get this figure, I had to make some adjustments because some transactions did not disclose the square footage of the property.)
The largest transaction in both size of building and dollar value was a 140,826 SF office building in the Louisville CBD. The smallest unit sold was a 1000 SF Office Condo. The smallest transaction was a 2942 SF Office building in Henry Co which sold for $31,000.
What this says to me -
At 141 leases and 46 sales for the year, we are seeing about 2.7 leases and 0.9 sales per week. It is interesting to note that 50% of the leases are for space less than 1800 SF. Also, one single lease (the call center mentioned above) comprised 20% of the leased space reported for the year.
Given the number of showings I had for companies looking for 30,000 SF and up last year, it is telling that of all of the leases reported on KCREA, there were only 2 recorded for more than 20,000 SF. That seems to validate the feeling that many of my colleagues and I shared that there was a lot of activity looking at space but not nearly as much actually going to lease. Most of the space being leased, continues to be smaller space.
For Office Sales, the activity remains somewhat light. Things being sold are tending to be smaller properties at lower price points. Like the leasing, it is interesting to note that the one 140,826 SF building sold comprised approximately 40% of the Square Footage of Office property sold.
Recommendations -
My recommendations remain the same. While I would say that things are looking better - number of calls and showing are up and unemployment is improving, I would also have to say that we continue to have a lot of inventory and downward pressure on pricing. Successful Landlords and Sellers will keep their properties in top condition and price them competitively.
Notes, Disclaimers and Such -
BTW - If you would like me to evaluate your particular property, give me a call. Also if you need any help on any real estate needs, I would love to help. I am licensed in Kentucky and Indiana and specialize in Commercial Real Estate. I work with Buyers, Sellers, Landlords, Tenants and Investors. I handle Office, Industrial, Land, Retail and Investment properties. Heck, I can even set you up if you need help with residential property.
ALSO - I am sure that my broker would appreciate me clarifying that the views here are my own and do not necessarily represent those of Commonwealth Commercial Real Estate, its brokers, agents or employees (other than me, of course) If you would like to make a comment or offer another opinion, you may feel free to do so in the comments sections. What you should not feel free to do though is make comments which are inappropriate or offensive. Should I see any such comments, I will delete them.
Finally - The information gathered for this analysis comes from KCREA (Kentucky Commercial Real Estate Alliance). This information reflects the activity of the members and participants of KCREA and therefore should not be considered a complete census of commercial activity. It is also dependent on the individual brokers to enter and maintain their information. As such it is subject to some error. Never-the-less, it presents a picture of the commercial real estate activity and I believe it is useful for review and analysis.
Let me know if you have any questions or if I can be of some help. Thanks for reading. Hope you have a good day.
David
David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY 40299
ofc: (502) 379-6005
cel: (502) 905-5274
e-mail: DMcCoy@ccre.biz
Tuesday, January 17, 2012
Monday, January 16, 2012
2011 Review of Louisville Commercial Land Sales
As I begin my planning for 2012, I am taking a final look at 2011. Today, I analyzed Commercial Land Sales for last year. Here is what I found:
The Numbers
For all of 2011, KCREA recorded 30 land sales for a total of 1020.25 Acres selling at $9,811,546. The average parcel size was 34 acres and average sales price per acre was $9,683. The average transaction size was $338,329. Median parcel size was 4.86 acres and median dollar value of a transaction was $226,250.
The largest transaction in terms of dollar value and also tract size was a 410 acre parcel in New Washington, Indiana which sold for $1,300,000. The smallest transaction in terms of dollar value and tract size was a 0.06 acre tract in downtown Louisville which sold for $10,000.
This amounts to 8 transactions totaling $1,990,000 in 4th Quarter 2011 for an average transaction of $248,750.
What this means
If you are looking at the numbers alone, 2011 was another draught for Commercial Land and Development, in general. With only 30 total transactions recorded for the year, one would expect only 2.5 land sales in any given month. Looking at the average price of property sold, you would also conclude that the vast majority of the land sold was unimproved land which was not ready for development.
Development is a highly leveraged business so that when it goes well, the payoff is great but if it doesn't go well, the possibility of loss is also magnified. It is well known that many Developers went out of business in this recession and that many remain under water. The Developers remaining are far more cautious, both because of their risk aversion as well as that of their lenders. In this environment, we should expect the recovery for Land to progress slowly.
Still, as I mention in November, there are beginning to be some encouraging signs. The number of calls on land is up. And although these transactions did not go through, I had respectable offers on three separate parcels of land I have listed in the last quarter of 2011. I am also aware of some new plans for some decent sized developments that are in the works for 2012.
The things that I expect to move in 2012 are parcels that are competitively priced, already zoned properly and have infrastructure in place.
Anyway, I am looking forward to a good year in 2012. Have a great day, everyone. Thanks for reading.
Notes and Disclaimers and such -
If you know of anyone who would like help with real estate, give me a call. I am licensed in Kentucky and Indiana. I specialize in Commercial Real Estate and handle Office, Industrial, Land, Investment and Retail properties. I work with Buyers, Sellers, Landlords, Tenants and Investors. Heck, I can even set you up with some help for residential property if you need it.
The Information presented here comes from KCREA (Kentucky Commercial Real Estate Alliance) data base. This information is dependent on the individual members keeping it current and accurate. It is not a census of all commercial transactions. It contains only the information of the members of KCREA and other who contribute. As such, I cannot guarantee its accuracy. Still I believe that it is a good indicator of activity and is useful to examine.Also, I am sure that my broker would appreciate me clarifying that the views represented here are my own and do not necessarily represent the views of Commonwealth Commercial Real Estate, its brokers, agents, or employees (other than me of course). Should you wish to comment on this post or to offer another opinion, you may feel free to do so in the comments section. What you should not feel free to do however, is to make any inappropriate or offensive comments. Should I encounter any such comments, I will exercise my right to delete them.
Have a great day!
David
David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY 40299
ofc: (502) 379-6005
cel: (502) 905-5274
e-mail: DMcCoy@ccre.biz
www.ccre.biz
The Numbers
For all of 2011, KCREA recorded 30 land sales for a total of 1020.25 Acres selling at $9,811,546. The average parcel size was 34 acres and average sales price per acre was $9,683. The average transaction size was $338,329. Median parcel size was 4.86 acres and median dollar value of a transaction was $226,250.
The largest transaction in terms of dollar value and also tract size was a 410 acre parcel in New Washington, Indiana which sold for $1,300,000. The smallest transaction in terms of dollar value and tract size was a 0.06 acre tract in downtown Louisville which sold for $10,000.
This amounts to 8 transactions totaling $1,990,000 in 4th Quarter 2011 for an average transaction of $248,750.
What this means
If you are looking at the numbers alone, 2011 was another draught for Commercial Land and Development, in general. With only 30 total transactions recorded for the year, one would expect only 2.5 land sales in any given month. Looking at the average price of property sold, you would also conclude that the vast majority of the land sold was unimproved land which was not ready for development.
Development is a highly leveraged business so that when it goes well, the payoff is great but if it doesn't go well, the possibility of loss is also magnified. It is well known that many Developers went out of business in this recession and that many remain under water. The Developers remaining are far more cautious, both because of their risk aversion as well as that of their lenders. In this environment, we should expect the recovery for Land to progress slowly.
Still, as I mention in November, there are beginning to be some encouraging signs. The number of calls on land is up. And although these transactions did not go through, I had respectable offers on three separate parcels of land I have listed in the last quarter of 2011. I am also aware of some new plans for some decent sized developments that are in the works for 2012.
The things that I expect to move in 2012 are parcels that are competitively priced, already zoned properly and have infrastructure in place.
Anyway, I am looking forward to a good year in 2012. Have a great day, everyone. Thanks for reading.
Notes and Disclaimers and such -
If you know of anyone who would like help with real estate, give me a call. I am licensed in Kentucky and Indiana. I specialize in Commercial Real Estate and handle Office, Industrial, Land, Investment and Retail properties. I work with Buyers, Sellers, Landlords, Tenants and Investors. Heck, I can even set you up with some help for residential property if you need it.
The Information presented here comes from KCREA (Kentucky Commercial Real Estate Alliance) data base. This information is dependent on the individual members keeping it current and accurate. It is not a census of all commercial transactions. It contains only the information of the members of KCREA and other who contribute. As such, I cannot guarantee its accuracy. Still I believe that it is a good indicator of activity and is useful to examine.Also, I am sure that my broker would appreciate me clarifying that the views represented here are my own and do not necessarily represent the views of Commonwealth Commercial Real Estate, its brokers, agents, or employees (other than me of course). Should you wish to comment on this post or to offer another opinion, you may feel free to do so in the comments section. What you should not feel free to do however, is to make any inappropriate or offensive comments. Should I encounter any such comments, I will exercise my right to delete them.
Have a great day!
David
David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY 40299
ofc: (502) 379-6005
cel: (502) 905-5274
e-mail: DMcCoy@ccre.biz
www.ccre.biz
Sunday, January 8, 2012
Delivering Bad News
Unfortunately for the last few years, I have had to deliver a lot of bad news to property owners. With the economy in a deep recession, I have often had to tell people that there property has declined in value often as much as 40%. Sometimes, however I get a little help.
A property owner recently contacted me to ask about some property he has had leased for several years. The present lessee has struggled to pay the rent and a potential buyer of the lessee's company contacted the owner to discuss a new lease.
After reviewing the market around this property, I concluded that the market rent had declined by nearly 33% since the last lease on this property. Although he would have liked to have heard that the market rate had not declined, actually the property owner was pretty happy with the news. It turns out that the new prospective tenants had asked him to reduce the rent by 70%.
The advice for this property owner was to try to hold onto the tenant if possible but to target the new rent at the current market conditions. Since the tenant was having problems paying the rent, I suggested that part of the rent could be done as a percentage of sales. By setting a floor and a percentage of sales, the owners does share some of the risk however, the owners can expect to get near market rates and perhaps better than market rates if the store can increase its sales.
Sometimes, fate steps in and makes things a little easier.
Have a great day, all.
Notes and Disclaimers and such -
BTW - If you know of anyone needing assistance with Real Estate, have them give me a call. I specialize in Commercial Real Estate and handle Office, Industrial, Land, Retail and Investment properties. I work with Buyers, Sellers, Landlords, Tenants and Investors. Heck I can even find you help with residential real estate.
ALSO - I am sure that my managing broker would appreciate me clarifying that the views expressed here are my own and do not necessarily represent the view of Commonwealth Commercial Real Estate, its brokers, agents or employees (other than me, of course.) If you have a question or a comment on anything here, you are free to make a comment. However, you are not free to make inappropriate or offensive comments. Should I find any such comments, I will exercise my right to delete them.
David
David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY 40299
ofc: (502) 379-6005
cel: (502) 905-5274
mailto:DMcCoy@ccre.biz
www.ccre.biz
A property owner recently contacted me to ask about some property he has had leased for several years. The present lessee has struggled to pay the rent and a potential buyer of the lessee's company contacted the owner to discuss a new lease.
After reviewing the market around this property, I concluded that the market rent had declined by nearly 33% since the last lease on this property. Although he would have liked to have heard that the market rate had not declined, actually the property owner was pretty happy with the news. It turns out that the new prospective tenants had asked him to reduce the rent by 70%.
The advice for this property owner was to try to hold onto the tenant if possible but to target the new rent at the current market conditions. Since the tenant was having problems paying the rent, I suggested that part of the rent could be done as a percentage of sales. By setting a floor and a percentage of sales, the owners does share some of the risk however, the owners can expect to get near market rates and perhaps better than market rates if the store can increase its sales.
Sometimes, fate steps in and makes things a little easier.
Have a great day, all.
Notes and Disclaimers and such -
BTW - If you know of anyone needing assistance with Real Estate, have them give me a call. I specialize in Commercial Real Estate and handle Office, Industrial, Land, Retail and Investment properties. I work with Buyers, Sellers, Landlords, Tenants and Investors. Heck I can even find you help with residential real estate.
ALSO - I am sure that my managing broker would appreciate me clarifying that the views expressed here are my own and do not necessarily represent the view of Commonwealth Commercial Real Estate, its brokers, agents or employees (other than me, of course.) If you have a question or a comment on anything here, you are free to make a comment. However, you are not free to make inappropriate or offensive comments. Should I find any such comments, I will exercise my right to delete them.
David
David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY 40299
ofc: (502) 379-6005
cel: (502) 905-5274
mailto:DMcCoy@ccre.biz
www.ccre.biz
Price Reduced on Southern Indiana Car Shop
1414 Spring Street - Jeffersonville, IN
I am looking for some help finding a buyer for a property in Southern Indiana adjacent to Clark Memorial Hosptial in Jeffersonville.
This property, formerly Nationwide Auto Restoration, has approximately 7,700 square feet with nearly 4,000 additional square feet of storage in the basement. There is an office on Spring Street and an industrial shop with 3 drive in doors in the rear. It would be a great spot for a small auto shop or contractor's office and it is easily accessible from I-65. There is parking in front and in the rear.
The industrial part of the building has 16 foot ceilings and has 2 Ingersol Rand compressors running in tandem as well as air lines through out. The building has heavy power and there is a paint booth which can stay with the building.
The building was originally priced at $320,000. The owner is anxious to sell and has now lowered the asking price to $234,000.
If you know of anyone who might have an interest, give me a call.
Thanks for your help! Have a great day.
David
David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY 40299
ofc: (502) 379-6005
cel: (502) 905-5274
mailto:DMcCoy@ccre.biz
www.ccre.biz
I am looking for some help finding a buyer for a property in Southern Indiana adjacent to Clark Memorial Hosptial in Jeffersonville.
This property, formerly Nationwide Auto Restoration, has approximately 7,700 square feet with nearly 4,000 additional square feet of storage in the basement. There is an office on Spring Street and an industrial shop with 3 drive in doors in the rear. It would be a great spot for a small auto shop or contractor's office and it is easily accessible from I-65. There is parking in front and in the rear.
The industrial part of the building has 16 foot ceilings and has 2 Ingersol Rand compressors running in tandem as well as air lines through out. The building has heavy power and there is a paint booth which can stay with the building.
The building was originally priced at $320,000. The owner is anxious to sell and has now lowered the asking price to $234,000.
If you know of anyone who might have an interest, give me a call.
Thanks for your help! Have a great day.
David
David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY 40299
ofc: (502) 379-6005
cel: (502) 905-5274
mailto:DMcCoy@ccre.biz
www.ccre.biz
Friday, December 30, 2011
Marriage and Real Estate
You might be surprised to know that in about half of the states, marriage
provides a special kind of real estate ownership known as Tenancy by the
Entirety. This type of ownership is unique in that the law in essence treats
the married couple as though they were one unit. The interest in the property
cannot be severed without the consent of both or the death of either. Upon
death of one, the surviving spouse remains as sole owner.
In other states, married couple may own property according to the legal concept of Community Property. These laws treat the married couple as though they are business partners. States recognizing the concept of Community Property consider property acquired during the marriage to be equally co-owned by husband and wife. Each has a one half interest in property acquired by either during the marriage no matter how the title of the property is held.
This is not to say that spouses cannot have individual title to property, however. Even in Community Property states, there is a concept of Separate Property which separates property as belonging specifically to one spouse if it was acquired prior to their marriage or if it was acquired during the marriage by gift or inheritance.
While these may seem like bland concepts, this information will become very important to you IF you have a real estate deal go bad, you find yourself in the unfortunate position of facing divorce, or someone wants to collect some debts by foreclosing on real estate.
Especially in Commercial Real Estate, it is commonly assumed that these laws do not apply. And in practice, the majority of commercial real estate deals occur without a hitch. But it is a mistake to think they do not apply. Kentucky real estate law requires a listing contract to be written and signed by all owners. Likewise, real estate contracts must have the signatures of all of the owners. Also, you may not be able to borrow money without your spouse's approval.
If you are married, your spouse may well be partial owner of the property. The net effect here is that in Kentucky you cannot legally sell your property without your spouse's consent, nor can you legally buy property using borrowed money without your spouse's consent. You can purchase property for cash without your spouse's approval however you may well share ownership with your spouse in that transaction.
An agent friend of mine recently discovered the difficulties that these laws can cause when he sold an office condo. He had a signed listing agreement from the owner of the condo, received an offer on the condo which the owner of the condo accepted. He had a contract signed by both buyer and seller. Unfortunately, the Seller got cold feet and decided he did not want to sell after all. None of the contingencies of the contract would allow him to renege on the offer. The Seller relied on Kentucky State law to declare that the listing contract and the purchase and sales contract were both invalid because they did not have the signatures of his wife, a partial owner by Kentucky State law. Since state law requires a written contract with signatures of all of the owners of the property, the contract was not valid.
These kinds of problems can sometimes be avoided with a little foresight. If a property is held in a company name, I like to ask for a copy of a company resolution which states that the signing party has the authority to bind the company. If the property is held individually or jointly with individuals, the best practice is to have all parties sign, including spouses even if they are not listed on the deed. If for some reason, it is not practical for all parties to sign, I like to ask that the signing party have an executed power of attorney to demonstrate that he / she has the authority to sign for all parties. These documents can then be added as exhibits to the contracts.
Let me know if you have any questions or comments. Thanks for reading.
Notes, Disclaimers and such -
BTW - If you need any help with real estate, give me a call. I specialize in Commercial Real Estate and work with Buyers, Sellers, Landlords, Tenants and Investors. I handle Office, Industrial, Land, Investment and Retail properties. Heck, I can even set you up with a residential specialist if you need help there.
ALSO - I am sure that my managing broker would appreciate me clarifying that the view expressed here are my own and not necessarily those of Commonwealth Commercial Real Estate, its brokers, agents, or employees (other than me, of course). If you have a question, comment or opinion you would like to express, you are free to add one in the comments sections. What you are not free to do, is to make inappropriate, or offensive remarks. Should I see any such remarks, I will exercise my right to delete them.
David
David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY 40299
ofc: (502) 379-6005
cel: (502) 905-5274
www.ccre.biz
In other states, married couple may own property according to the legal concept of Community Property. These laws treat the married couple as though they are business partners. States recognizing the concept of Community Property consider property acquired during the marriage to be equally co-owned by husband and wife. Each has a one half interest in property acquired by either during the marriage no matter how the title of the property is held.
This is not to say that spouses cannot have individual title to property, however. Even in Community Property states, there is a concept of Separate Property which separates property as belonging specifically to one spouse if it was acquired prior to their marriage or if it was acquired during the marriage by gift or inheritance.
While these may seem like bland concepts, this information will become very important to you IF you have a real estate deal go bad, you find yourself in the unfortunate position of facing divorce, or someone wants to collect some debts by foreclosing on real estate.
Especially in Commercial Real Estate, it is commonly assumed that these laws do not apply. And in practice, the majority of commercial real estate deals occur without a hitch. But it is a mistake to think they do not apply. Kentucky real estate law requires a listing contract to be written and signed by all owners. Likewise, real estate contracts must have the signatures of all of the owners. Also, you may not be able to borrow money without your spouse's approval.
If you are married, your spouse may well be partial owner of the property. The net effect here is that in Kentucky you cannot legally sell your property without your spouse's consent, nor can you legally buy property using borrowed money without your spouse's consent. You can purchase property for cash without your spouse's approval however you may well share ownership with your spouse in that transaction.
An agent friend of mine recently discovered the difficulties that these laws can cause when he sold an office condo. He had a signed listing agreement from the owner of the condo, received an offer on the condo which the owner of the condo accepted. He had a contract signed by both buyer and seller. Unfortunately, the Seller got cold feet and decided he did not want to sell after all. None of the contingencies of the contract would allow him to renege on the offer. The Seller relied on Kentucky State law to declare that the listing contract and the purchase and sales contract were both invalid because they did not have the signatures of his wife, a partial owner by Kentucky State law. Since state law requires a written contract with signatures of all of the owners of the property, the contract was not valid.
These kinds of problems can sometimes be avoided with a little foresight. If a property is held in a company name, I like to ask for a copy of a company resolution which states that the signing party has the authority to bind the company. If the property is held individually or jointly with individuals, the best practice is to have all parties sign, including spouses even if they are not listed on the deed. If for some reason, it is not practical for all parties to sign, I like to ask that the signing party have an executed power of attorney to demonstrate that he / she has the authority to sign for all parties. These documents can then be added as exhibits to the contracts.
Let me know if you have any questions or comments. Thanks for reading.
Notes, Disclaimers and such -
BTW - If you need any help with real estate, give me a call. I specialize in Commercial Real Estate and work with Buyers, Sellers, Landlords, Tenants and Investors. I handle Office, Industrial, Land, Investment and Retail properties. Heck, I can even set you up with a residential specialist if you need help there.
ALSO - I am sure that my managing broker would appreciate me clarifying that the view expressed here are my own and not necessarily those of Commonwealth Commercial Real Estate, its brokers, agents, or employees (other than me, of course). If you have a question, comment or opinion you would like to express, you are free to add one in the comments sections. What you are not free to do, is to make inappropriate, or offensive remarks. Should I see any such remarks, I will exercise my right to delete them.
David
David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY 40299
ofc: (502) 379-6005
cel: (502) 905-5274
www.ccre.biz
Tuesday, December 27, 2011
Positive Outlook for Commercial Real Estate?
If you have been reading along for a while, you know that I think a lot about the economy and taxes. Commercial Real Estate activity is obviously dependent on how well the economy is doing. The last few years, we have had several fits and starts where it appeared that the economy was trying to improve. And while I have analyzed inflation, taxes, international trade, consumer confidence, and other economic indicators, the fact is that one of the best predicters of real estate activity is unemployment.
It's really obvious when you think about it. When people have jobs, they can afford to buy a house, goods or services. If they do not have jobs, they have to cut back on purchases and maybe have to sell a house. Likewise for businesses, if they are hiring more people, they will at some point need more space for them to work, whether in a warehouse or an office. If on the other hand they have to lay people off, they need less space.
The last couple of months, we have been getting good reports on the jobs front. While there are many pundits telling us that the improvement is not nearly good enough, the fact is that unemployment has decreased. Certainly, I would like it to decrease faster but as long as it is decreasing, we can expect there to be an improvement in the commercial AND residential real estate markets.
So, keep your fingers crosssed for continued improvement in 2012 and have a great day.
Thanks for reading.
Notes, Disclaimers, and such -
I am sure that my managing broker would appreciate me clarifying that the views expressed here are my own and do not necessarily represent the opinions of Commonwealth Commercial Real Estate, it's brokers, agents, and employees (other than me, of course.) If you have a comment or another opinion, you are welcome to make a comment. However, you are not welcome to make inappropriate, inconsiderate or hateful comments. Should I see any such comments, I will exercise my right to delete them.
BTW - If you know someone in need of help with real estate, give me a call. I specialize in commercial real estate and I work with Buyers, Sellers, Landlords, Tenants and Investors. I handle Office, Industrial, Land, Investment and Retail properties. Heck, I can even set you up with someone to help with residential property.
David
David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY 40299
ofc: (502) 379-6005
cel: (502) 905-5274
DMcCoy@ccre.biz
www.ccre.biz
It's really obvious when you think about it. When people have jobs, they can afford to buy a house, goods or services. If they do not have jobs, they have to cut back on purchases and maybe have to sell a house. Likewise for businesses, if they are hiring more people, they will at some point need more space for them to work, whether in a warehouse or an office. If on the other hand they have to lay people off, they need less space.
The last couple of months, we have been getting good reports on the jobs front. While there are many pundits telling us that the improvement is not nearly good enough, the fact is that unemployment has decreased. Certainly, I would like it to decrease faster but as long as it is decreasing, we can expect there to be an improvement in the commercial AND residential real estate markets.
So, keep your fingers crosssed for continued improvement in 2012 and have a great day.
Thanks for reading.
Notes, Disclaimers, and such -
I am sure that my managing broker would appreciate me clarifying that the views expressed here are my own and do not necessarily represent the opinions of Commonwealth Commercial Real Estate, it's brokers, agents, and employees (other than me, of course.) If you have a comment or another opinion, you are welcome to make a comment. However, you are not welcome to make inappropriate, inconsiderate or hateful comments. Should I see any such comments, I will exercise my right to delete them.
BTW - If you know someone in need of help with real estate, give me a call. I specialize in commercial real estate and I work with Buyers, Sellers, Landlords, Tenants and Investors. I handle Office, Industrial, Land, Investment and Retail properties. Heck, I can even set you up with someone to help with residential property.
David
David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY 40299
ofc: (502) 379-6005
cel: (502) 905-5274
DMcCoy@ccre.biz
www.ccre.biz
Wednesday, December 21, 2011
Retail Surprise at Springhurst Towne Center
It would appear that Santa came early for our friends in the Hocker Group. The Hocker Group was until recently the owners of Springhurst Towne Center shopping center on Westport Rd, which almost everyone seems to associate primarily as the home of Tinseltown Cinema. The Hocker Group bought this center about 2 years ago for about $42.4 Million from the Centro Properties Group, which was a Real Estate Investment Trust out of Australia which was having financial difficulties due to the world wide recession and real estate crash. It was announced last week that the center had been sold on December 7th to the California State Teachers Retirement System for $78 Million.
The obvious question now is, does this indicate a big turning point in retail property values in Louisville? Since the financial crash in 2008, property values of retail properties have been hard hit. Although this is a very encouraging sign, I am not ready to declare an end to the difficulties in the retail market. When you look around the city, there is still a lot of vacancy and until we begin to see occupancy levels returning to pre-recession levels, I don't think we can begin to celebrate.
For our friends with leases in Springhurst Towne Center, they can expect to get a different kind of surprise next year. Most retail leases require the tenant to pay their pro-rata share of the real estate taxes on a property. With a sale at nearly double the price of the previous sale, they can expect those taxes to also double next year when the property is re-assessed due to the sale.
In any case, Kudos to our friends at the Hocker Group. They obviously hit a home run with this one.
Have a great day everybody!
BTW - If you have a real estate question or problem, give me a call. I work with Landlords, Tenants, Buyers, Sellers and Investors. I handle Office, Industrial, Land, Investment and Retail properties. Heck, I can even hook you up with a residential broker if you need one. I would love to help
ALSO - I am sure that my managing broker would appreciate me clarifying that the views expressed are my own and do not necessarily represent the views of Commonwealth Commercial Real Estate, its brokers, agents, or employees (other than me, of course). If you have a question or a different opinion, you are welcome to express it in the comments, or give me a call. However, you are not welcome to make inappropriate or offensive remarks. Should I encounter any, I will exercise my right to delete them.
David
David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY 40299
www.ccre.biz
ofc: 502-379-6005
cel: 502-905-5274
The obvious question now is, does this indicate a big turning point in retail property values in Louisville? Since the financial crash in 2008, property values of retail properties have been hard hit. Although this is a very encouraging sign, I am not ready to declare an end to the difficulties in the retail market. When you look around the city, there is still a lot of vacancy and until we begin to see occupancy levels returning to pre-recession levels, I don't think we can begin to celebrate.
For our friends with leases in Springhurst Towne Center, they can expect to get a different kind of surprise next year. Most retail leases require the tenant to pay their pro-rata share of the real estate taxes on a property. With a sale at nearly double the price of the previous sale, they can expect those taxes to also double next year when the property is re-assessed due to the sale.
In any case, Kudos to our friends at the Hocker Group. They obviously hit a home run with this one.
Have a great day everybody!
BTW - If you have a real estate question or problem, give me a call. I work with Landlords, Tenants, Buyers, Sellers and Investors. I handle Office, Industrial, Land, Investment and Retail properties. Heck, I can even hook you up with a residential broker if you need one. I would love to help
ALSO - I am sure that my managing broker would appreciate me clarifying that the views expressed are my own and do not necessarily represent the views of Commonwealth Commercial Real Estate, its brokers, agents, or employees (other than me, of course). If you have a question or a different opinion, you are welcome to express it in the comments, or give me a call. However, you are not welcome to make inappropriate or offensive remarks. Should I encounter any, I will exercise my right to delete them.
David
David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY 40299
www.ccre.biz
ofc: 502-379-6005
cel: 502-905-5274
Subscribe to:
Posts (Atom)