Commercial Real Estate News Wrap Up From Liberty SBF

September 20, 2016

Increased consumer focus on value and experience has reduced overall store size, trimmed prices, and is instead injecting fun into traditional brick-and-mortar retailers. Chris Mailing, Colliers International Los Angeles Retail EVP, stated in an interview with Bisnow, “This is why outlet malls are proliferating,” and then noting that there are six times as many outlet malls today as before the 2008 recession. Mailing says that retailers growing in today’s environment ought to downsize stores and beef up online marketing, with a strategy of buying online for free store pickup or offer free shipping, which is in line with retailers such as Amazon or Target.

US Tech has remained vibrant and continues to provide resilience to top commercial real estate markets. In JLL’s latest Tech Office Outlook report, data showed that the technology sector drove nearly 25% of large office leasing activity within the 45 top US metro areas over the past two years, with 63% of these tech leases involving expansions as compared to the 48% of leases overall. In response to this increase in demand, landlords have raised their rates. Steffen Kammerer, SVP of JLL’s technology group says, “A healthy tech sector, particularly a ‘hub’ that anchors a vibrant tech ecosystem, has become the hallmark of a strong local economy.”

According to Real Capital Analytics, regional and local banks have moved to the top rung among commercial property lending classes, accounting for 21% of all commercial mortgage originations. The firm’s analysis believes that these lenders are stepping up in order to fill a critical gap as CMBS lenders have pulled back from lending. During this year’s first half, the Southeast and Midwest have especially rapid growth in lending activity by smaller banks, most likely due to these regions’ previous reliance on CMBS financing.

8+1 (That’s 9) Things You Need To Know

  1. CRE transactions in all sectors surpassed $100B in Q2 despite declining deal volume
  2. Chicago is highly desired by Middle Eastern investors
  3. These are the 26 major drivers reshaping real estate
  4. Airbnb: A risky situation for building owners
  5. How the CRE technology story will be continued
  6. All about the CRE information overload available to investors
  7. 15 years later, lower Manhattan has risen like a phoenix
  8. How to evaluate CRE investment opportunities with online lenders
  9. Big-box warehouse sector breaks records in demand and new construction