LoopNet and CBRE ink agreement

Jul 29th

Posted by Anthony in Sarasota Real Estate

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The San Francisco-based online commercial real estate marketplace LoopNet has signed a long-term search agreement with CB Richard Ellis, the world’s largest commercial real estate services firm.

Under the agreement CBRE employees will have access to LoopNet’s 766,000 listings, 7.5 million property records, and 1.1 million recent sales comparables.

In a press release, LoopNet said the deal “marks a milestone in LoopNet’s expansion from the industry’s leading marketplace, connecting brokers with other brokers, buyers and tenants of commercial real estate, into a leading information services provider.”

“We are extremely pleased to have CB Richard Ellis, the largest commercial real estate services firm, choose us as a key property information resource,” said Thomas Byrne, LoopNet’s President and COO. “By choosing to make all of LoopNet’s information services available to all of their brokerage, appraisal, and research professionals, CBRE is recognizing the extraordinary value that LoopNet’s information solution platform delivers.”

This agreement provides CBRE professionals with a single source to identify available listings and research building ownership, tenant, lender, tax and assessed values, and other data on over 7.5 million properties, and search for recently completed transactions.

Terms of this agreement were not been disclosed. Revenue for the second quarter of 2010 was $19.4 million, compared to $18.8 million in the first quarter of 2010 and $19.2 million in the second quarter of 2009.

LoopNet is based in Mission Bay at 185 Berry St. in the China Basin complex.

Read more: LoopNet and CBRE ink agreement – San Francisco Business Times

New CMBS Deal in the Works

Jul 29th

Posted by Anthony in Sarasota Real Estate

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Good news for commercial real estate borrowers: there is another CMBS issue in the works. Put together by Goldman Sachs and Citigroup, the new issue will mark the third multi-borrower CMBS deal this year after the industry saw zero multi-borrower deals in 2009. Industry sources have toldRetail Traffic, however, that the banks are being extremely careful about these new issues. Rather than putting them together and then selling the bonds, the banks secure the bond buyers ahead of time. So while things are improving on the CMBS front, the market is still very, very shaky. For this and other stories on retail and retail real estate, follow the links below:


New CMBS Deal in the Works (Wednesday’s News & Notes)

Economist says the real estate market has bottomed, but it will take a while for the local economy to recover

Jul 28th

Posted by Anthony in Sarasota Real Estate

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University of Central Florida Economics Professor Sean Snaith recently completed an economic analysis of Sarasota County.

In it, he used charts and graphs to show that prices of single-family homes, and to a lesser extent condos, have stabilized.

“You can see the building momentum of the housing boom starting in 2003, and watch as it roars to its apex in 2006,” Snaith writes in his report. “From that point, the fall is steep and prolonged, but recent trends in the data give hope that the worst may be behind us as signs of an improving housing market have appeared.”

“The clear surge in transactions is an important step toward absorbing the surplus of housing and the recent signs that prices are stabilizing,” Snaith continued. “This may be an indication that even if the supply of housing is rising due to high unemployment and continued foreclosure related activity, demand may also be rising by at least enough to keep prices from dropping further. The 12-month moving average for median prices appears to have flattened out, and if this trend persists, it may represent the bottom of the market as far as median prices are concerned.”

Snaith also shows that new home construction is starting to pick up in the region.

“The bottom as far as housing starts in the Sarasota MSA are concerned appears to have been reached in 2009, and 2010 is the start of an economic recovery after a three year long recession,” Snaith wrote.

He then tagged the total economic output for the Sarasota-Bradenton area at $2.8 billion and said that number rose very slowly during the first two quarters of 2010, but would speed up in the second half of the year and into 2011.

Much of the stimulus will come from an increasing population, Snaith said.

“As the economy, housing and stock markets continue to recover, population growth will once again be the order of the day for Sarasota and Florida as a whole,” he wrote. “The rate of population growth going forward will not be as high as historically has been the case. Statewide population growth rates in excess of 2 percent are most likely gone. They will be replaced with something, which after several years of slow acceleration, will settle in the 1.5 percent range over the long run.”

Economist says the real estate market has bottomed, but it will take a while for the local economy to recover

Signs of Life in Commercial Property Sales

Jul 26th

Posted by Anthony in Sarasota Real Estate

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Signs of Life in Commercial Property Sales

For several months now, the perception, at least, is that the frozen commercial property sales market is thawing. Now there is some basis for that notion grounded in reality.
Some $9.7 billion in properties valued over $5 million traded in June, according to New York-based researcher Real Capital Analytics. That’s the highest volume since September 2008.
So what’s happening exactly?
RCA notes that U.S. investors brushed off concerns about the sputtering economic recovery and its potential impact on the commercial real estate sector.
Certainly despite more recent fears of a “double dip” recession, sales velocity has increased of late, pushing total volume for the second quarter to $20.6 billion, up by 32% from the first quarter.
Sales in the first half of the year totaled $36.2 billion, which is an 11% improvement over the second half of 2009. It’s also a huge 67.1% gain over the first half of 2009. The gain is smaller when measured by the total number of transactions, up just 6% between the first half of last year and the first half of 2010, at a total of 1,790 properties. That means the average transaction size has increased.
According to RCA, several large corporate portfolios sales accounted for a disproportionate share of total volume in the first half of 2010, particularly in June, when volume was up significantly across the core sectors.
The 31-property iStar Financial portfolio, purchased by Dividend Capital Trust for $1.3 billion, accounted for 14% of June’s total closed volume. Other large June sales included several high-profile office buildings such as 300 N. LaSalle in Chicago ($655 million), 340 Madison in New York ($570 million), and the Wells Fargo Building in San Francisco ($333 million).
Generally speaking, the trendline shows that larger properties are trading at lower cap rates, which have seen their largest declines on apartment, industrial and retail properties.
Nationally, average apartment cap rates fell by approximately 25 basis points between the first and second quarters, to an average of 6.8%. Over the same period, average industrial and retail cap rates fell by approximately 35 basis points and 20 basis points, respectively.
Office cap rates, which had fallen by more than 100 basis points in Q1’10 from their peak in Q4’09, held steady in the latest quarter, declining by less than 10 basis points to 7.9%.
It’s perhaps not surprising, given the slower pace of economic recovery, that most deals are being done in so-called “top tier” coastal markets, including Washington, D.C., New York and Boston. There, investors are bidding up the few top-shelf investment-grade properties that have come to market.
Washington, D.C. reported an average office cap rate of 6.4% for the first half of 2010, while Baltimore, just to the north, saw an average office cap rate of 9.0%.
The New York and Boston metros each reported over $1.5 billion in total volume in the first half of 2010, corresponding with year-over-year sales increases in excess of 100%. At least one inland Midwest market, Chicago, posted similar results as these two coastal cities.
When it comes to pricing, the picture was mixed. Here are a few tidbits to consider, according to the most recent (June) Moody’s/REAL Commercial Property Price Index report:
  • The All Property Type Aggregate Index increased by 3.6% between March and April, down by 6.3% from one year ago, and 33% from April 2008.
  • Over the first half of 2010, four of five property types posted increases in average price-per-unit.
  • Hotel lead this group, rising by 68%
  • In the core sectors, industrial rose the most, by 29%.
  • Average per-unit pricing fell in the retail sector by 4%.
  • The average size of single property deals fell in both the retail and apartment sectors by over 30%, while in the office sector it fell by 77%.
  • In the hotel sector deal size increased by 50% in spite of a drop in per-unit price, because of large resolved and restructured volume in that sector.
Still, one of the biggest question marks overhanging the commercial property sector has not materialized. Where is the tsunami of distressed sales (nearly) everyone has been expecting? Simply put, it’s not here just yet.
As a share of total volume, sales of distressed properties slipped in the first six months of 2010, from 21% in the first quarter to 10% in the second quarter. In June, distressed sales accounted for less than 10% of all sales activity. The higher volumes of distressed sales in the first quarter reflected several large corporate portfolio workouts.
On a “positive” note, more than 25% of all apartment sales in June were classified as distress, the highest share for any property type. This is good news in the sense as fundamentals for both apartments and hotels are showing early signs of stabilizing, lenders may loosen their grip on these assets over the coming quarters.

Canada’s economic boom sends investments Miami’s way

Jul 26th

Posted by Anthony in Sarasota Real Estate

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Canada’s economic boom sends investments Miami’s way

By Yudislaidy Fernandez
The sale of a 30,527-square-foot retail and office building in Key Biscayne announced Tuesday is an early sign of a wave of Canadian investment, as good times in the sister country equals good times for Canadian investors in Miami.
The strength of the Canadian dollar and booming economy, coupled with South Florida’s assortment of attractively-priced properties, is an appealing combination for Canadians, realty professionals and investors say.
This is an ideal time for commercial and residential real estate investors, said Albert Bolter, vice president and broker of Colliers International in Toronto.
“There’s interest for Canadians to go to the states to purchase real estate,” he said, especially with the distressed products available and, in their corner, they have the stronger value of the Canadian currency.
“It’s an ideal time, whether buying office or industrial,” he said. “Typically, they are looking for well-leased buildings.”
An undisclosed Canadian investor bought Key Biscayne’s Key Colony Plaza at 200 Crandon Blvd., which consists of 12,000 square feet of retail, 12,000 square feet of office and 6,000 square feet of storage. The property, boasting 96% occupancy, has as lead tenants Starbucks, Mount Sinai Medical and Asian Origins Bistro. Christian Johannsen, senior vice president of Colliers International’s Coral Gables office, represented seller Tesaurus Holdings in the all-cash transaction.
Mr. Bolter, who previously worked in Colliers’ Gables office, said Miami appeals to investors because of its cultural diversity, international business concentration and warm weather.
For example, he noted South Florida is a prime target for hotel investors.
On the down side, the multi-cultural metropolitan area has high insurance rates on real estate and the realty taxes are higher for non-residents, he noted.
Mr. Bolter listed Washington, DC, New York City and Boston as other desirable markets because today these are “recession-proof.”
“I have no doubt you will see more Canadian investment,” he said, “more Canadians wanting to go south of the border, especially with the situation with the dollar.”
The loonie — the Canadian currency’s nickname because of the aquatic bird that appears on one face of the coin — was C$1.0537 per US dollar on Tuesday.
Since the beginning of the year the Canadian dollar has remained strong overall. But it weakened last week as US consumer sales reports suggested a possible slowdown in economic recovery, which affects Canada because the US is its largest trading partner.
Commercial buyers want safe investments, such as shopping centers, that have strong anchor tenants and “a strong corporate presence already in there,” said Michael Falsetto, a local realty professional. “Those are going to have the most interest and be worth more.”
The types of Canadian investors interested in the South Florida market, he said, are “predominantly Canadian investments groups, companies that own these types of products in Canada, and private investors who already have residences here and are looking for business opportunities and to make investments here since they are spending time here.”
Toronto-based Christian Strauch said his investor group is seeking properties with stable returns.
The target is investments in major markets such as Miami, New York City and Washington, DC, said Mr. Strauch, managing director at KGAL-Group’s North America office. The Munich investment firm has offices in the US and Canada.
These have to be commercial properties, such as downtown office buildings and neighborhood shopping centers, with long leases in place and in a good location that can attract future buyers, Mr. Strauch explained.
The assets are generally held five to 10 years, he added.
When cherry-picking their investments, he said “it’s all about the long-term stability of the income stream.”
Mr. Strauch agrees the value correction in many top US markets, coupled with a stronger Canadian currency, is fueling investors’ interest to buy real estate now.
But competition is stiff for class A properties, he said, because there are too few to meet the demand of well-capitalized investors.
“We as buyers and, I hear from other buyers in Canada and abroad, have a bit of frustration because in this top bracket there’s not too many assets to buy and those to buy are expensive,” Mr. Strauch said. “There’s more wealth globally looking to buy these top-tier assets, so there’s great competition for these assets.”
Canadian buyers who now have significant purchasing power, many from Quebec, are making all-cash transactions, said realty attorney Louis Archambault, adding that that’s very good for this market, where credit is tight.
Mr. Archambault, a real estate partner with Miami law firm Pathman Lewis, works with international buyers, primarily Canadians and Italians.
Many of the Canadians interested in buying here, Mr. Archambault said, are seeking commercial spaces such as retail, restaurant, warehouse or industrial space.
“A more established investor looking for business opportunities in trading,” he said, “would look for properties to suit their needs in commercial or industrial areas.”
Canada and Miami have strong trade ties, Mr. Archambault said, in part, because of the similarities in language and Miami’s tropical weather.
Canada serves as Florida’s leading international economic partner and No. 1 source of international tourism, with bilateral trade in merchandise totaling $7.8 billion in 2008, according to the most recent data from the Canadian Consulate here.
“Estimates of the total number of Canadians who own residential real estate in Florida range as high as 450,000, and while that data is impressive, it is only one part of the extensive Canada-Florida real estate picture,” said Canada’s Consul General Louise Léger. “Canadian foreign-direct investment in commercial ventures is equally vital and should not be overlooked…”
Ms. Léger noted that Canadian holdings in Florida were estimated at $3 billion in 2008 and contribute to the estimated 400,000-plus Florida jobs generated by the relationship. That’s in addition to an estimated $5 billion invested in real estate, the consulate says.
The baby boomers — those born from 1946 to 1964 and approaching retirement — are actively looking for “a place to retire and spend a significant amount of time,” said Mr. Falsetto, president and broker of The Grand & Associates Realty, a firm that specializes in the Canadian and European markets.
And many are finding it here.
“Canada has a lot of things going for it, but not a lot of warm weather in months like January and February,” Mr. Falsetto said.
Canadian law allows citizens to have residency outside for up to six months without interrupting residency benefits like health care, he explained.
Visit Florida, the state’s tourism promotion agency, released 2009 tourism figures showing that, despite a drop in visitors earlier in the year, Canadian travel to Florida during the fourth quarter rose 10.3%, according to the Canadian consulate.
In 2008, more than 2.8 million Canadian “snowbirds” flocked to the Sunshine State, the consulate says, making this group a loyal and important tourism segment for the state because they are choosing to vacation here over other international destinations.
Residents, especially from Toronto and Montreal, are shopping for post-retirement homes in areas like Miami and Fort Lauderdale.
All the stars are aligned for Canadian homebuyers and commercial investors, Mr. Falsetto said, as he foresees this attractive investment climate to continue.
“The conditions we have now will last into the foreseeable future because Canada has raised interested rates already twice this year,” he said. “There’s a good year and a half to two years of real good conditions for them [investors] to come here and do business.”

Canada’s economic boom sends investments Miami’s way.

Office Transaction Volume Heating Up

Jul 23rd

Posted by Anthony in Commercial Investment

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PPR DAILY UPDATE – July 22, 2010

“Transaction Activity Heating Up“
Author: Aaron Jodka (aaron.jodka@pprglobal.com)

June was a big month for commercial real estate: It marked the first time since the Lehman implosion that sales topped $10 billion. For deals of at least $1 million, total sales hit $11.3 billion – $4.9 billion of which were office deals (see Exhibit 1). The flurry of core office deals in markets like New York and Washington, D.C., propelled the strong monthly volume. To be sure, sales have not returned to pre-crisis levels (around $20 billion monthly), but they are well off the lows ($4 billion) of early 2009.

Psychological price and volume barriers aren’t as talked about in commercial real estate as they are in the stock market. But nonetheless, crossing a volume threshold that has eluded the market for 21 straight months is certainly a good sign.

Sarasota Florida is the best buy in the Western World!

Jul 22nd

Posted by Anthony in Sarasota Real Estate

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Sarasota Florida is the best buy in the Western World!

sarasota

Reports show that Sarasota Florida is the best buy in the Western World!

The report, published today in www.GlobalEdge.co.uk ranks popular resort and second home locations around the world reveals the cheapest western holiday home destination is Sarasota, Florida, which is little surprise given how much the market has fallen over the past two years and the number of agents currently selling distressed property to foreigners in the sunshine state.

Among the surprises: Apartments in Warsaw, Poland are selling for higher prices than Dubai.

Manhattan and Paris are running neck in neck, but Moscow makes them both look cheap. Little wonder that the Russians are on an international buying spree, with Hong Kong residents close behind them. With China now officially the hottest residential market in the world, US properties are practically an impulse buy.

International estate agency group Savills has published a list of best-value destinations in 35 countries across the globe.

Best Buys Internationally.

U.S. Industrial Real Estate Markets Now In Recovery – CoStar Group

Jul 22nd

Posted by Anthony in Sarasota Real Estate

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The U.S. industrial real estate market now appears to be headed into recovery after several quarters of negative absorption. 

With the economy sending out mixed signals but generally gaining strength, absorption of industrial buildings turned positive in the second quarter following six consecutive quarters of net loss, CoStar Group reported in its State of the Commercial Real Estate Industry Mid-Year 2010 Industrial Review & Outlook. The national industrial vacancy rate declined for the first time in two years, according to the company’s most recent analysis of industrial property markets. 

For owners, the warehouse sector is still working through some significant market turbulence. Broad-based growth in rental rates probably won’t resume until 2011, and the investment sales market remains choppy, with total transaction volume still well below the historical average. Liquidity hasn’t yet returned for owners and industrial capitalization rates and pricing, though improving, still show a mixed picture. 

But overall, “we think the outlook is better than it has been in a few years,” said Jay Spivey, CoStar Director of Analytics, who teamed with CoStar Director of Advisory Services Hans Nordby earlier this week to present the findings and forecast to CoStar clients.

U.S. Industrial Real Estate Markets Now In Recovery – CoStar Group.

Moody’s: CRE Prices Rose 3.6% in May

Jul 20th

Posted by Anthony in Sarasota Real Estate

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The latest numbers from the Moody’s/REAL Commercial Property Price Index (CPPI) show that prices bounced up for the second straight month as CRE values slowly recover. The results have not yet been posted to the MIT site linked above. Moody’s put out a press release this morning with the advance results of the index. The Wall Street Journal has a brief write-up on the results. The forecast remains choppy. So don’t expect the index to repeat the pattern of growth exhibited from 2001 through 2007. It seems more likely we’ll see fits and starts as values bounce along near the bottom that has now formed in prices barring some cataclysm that perpetuates a new drop.


U.S. commercial real estate prices rose 3.6% from a month earlier in May, the second-straight increase, but prices are expected to remain “choppy” near-term, according to Moody’s Investors Service.

Prices in the sector have stabilized somewhat after slumping nearly 40% from the highs of several years ago as the credit crunch and falling occupancy rates and rents hurt the ability of property owners to deal with their mortgages. Meanwhile, demand for space in offices and malls and rooms in hotels and apartment complexes remains far below pre-recession levels.

“The positive news of increasing prices over the past two months is tempered by low transaction volumes, forecasts for slowing macroeconomic growth and the rising risk of a double dip recession,” said Moody’s managing director Nick Levidy.

Transaction volume nearly doubled from a month earlier in May to $1.5 billion, but the number of sales was 6.1% lower.


Click for larger image.

moody’s july 2010

800-home project unveiled for Lakewood Ranch

Jul 20th

Posted by Anthony in Sarasota Real Estate

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STAFF PHOTO / THOMAS BENDER
Buy photo
Central Park homes will be built around a common area that includes dog parks, play fields and a splash park.
By HALLE STOCKTON
Published: Friday, July 16, 2010 at 1:00 a.m.
Last Modified: Friday, July 16, 2010 at 12:44 a.m.

LAKEWOOD RANCH – Developers of Lakewood Ranch are so confident in their location and a housing market rebound that they unveiled a new housing project Thursday that will add 800 new homes to the sprawling master-planned community in East Manatee County.

800-home project unveiled for Lakewood Ranch | HeraldTribune.com.

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