2013 Q4 Commercial Market Update Report

Turning Point Commercial 2013 Q4  Commercial Real Estate Market Report

Although the leasing activity in the local markets had maintain relatively flat, the sales findings in 2013 are lower than expected in transactions across the board.  The reports show a decline in sales over the second half of 2013 after an increase in transactions in the fourth quarter of 2012.  This shift could indicate that the level of distressed assets in both Frederick and the I-270 Corridor market has declined in 2013 giving proof that banks were successful in releasing many of their distressed assets before the end of 2012, leading 2013 to a more normal commercial real estate sales market.

To read our complete report Click Here to download the 2013 Q4 Market Report or visit our website to view a list of all recent Market Reports.

Commercial Real Estate

Week One has Come and Gone – Have you set your New Year’s Resolutions?

NewYearResolutionsBesides the freezing and below freezing temperatures that swept across the nation last week, this should have been a rather productive week to get started on those New Year’s resolutions, both personal and business related.  However, some of us may be ready to give up, some might still be facing the dilemma of reviewing the past year and establishing new goals, while others made immediate changes January 1st and are ready for what 2014 has to offer.  No matter what category you might fall in, don’t give up!

According to the University of Scranton Journal of Clinical Psychology only 8% of people reach their goals or resolutions each year.  This is an upsetting number considering how many times do you hear, “The new year will be different.”   So why do only 8% of people reach their resolutions, and how can the other 92% reach or at least attempt to reach their goals for 2014? Maybe we are setting unrealistic goals, or maybe we are not taking the time to review our goals on a regular basis to keep ourselves on track.

In 2014 let’s take a realistic approach to our New Year’s Resolutions by taking small steps to reach our overall goal.  By breaking down our goals into smaller steps, when we are not able to reach one of those steps we can get past it and move to the next or try again.  Always realize that failure, recovery, and improvement are a part in any process.

Goals , ,

2014 CRE Trend #1 – Gen Y Impacts Commercial Real Estate for Years to Come

Gen Y Impacts Commercial Real Estate for Years to come

There has been some buzz over the last couple of months about Gen Y and its impact on commercial real estate in 2014.  Some feel this impact could be a dominant trend for many years to come on all segments of commercial real estate.

GEN Y: TECHNO-SAVVY AND DOMINATING THE WORKFORCE

Gen Y is a generation of techno-savvy, digitally sophisticated twenty and thirty year olds that are beginning to dominate the workforce.  According to a 2012 estimate from the U.S. Bureau of Labor Statistics, Gen Y employees are expected make up 40 percent of the U.S. workforce by 2020.  This shift will dramatically change the way we work since Gen Y will significantly outnumber other generations in the workforce.

GEN Y: THE FUTURE OF OFFICE

One of the largest segments of commercial real estate that will be affected by Generation Y will be the orientation of office space, from the amount of space used by an individual to the conference rooms and social space.  The use of technology with this generation and their willingness to work in collaborative and fun environments, without having ties to a particular desk or space within the office, will force businesses to re-evaluate the cost of space needed per person and put more emphasis on new technology.  The use of open collaborative space is not something new for 2014, but we will begin to see more adaption to the concept along with “green” practices in office design.

GEN Y: THE CITY SLICKERS

Gen Y is an urban generation.  They have abandoned their family homes in the suburbs and set out for life in the city.  This influx of Gen Y employees living in urban environments encourages more companies to locate to larger cities or higher-density locations to attract the workers they need.  If employers are not currently located within these urban locations, companies often provide luxury buses to transport their employees to and from their more distant office locations.  This impact could mean that companies will begin to search for space closer to city in order to take advantage of the large pool of Gen Y employees located in that area.

HOW CAN TURNING POINT HELP?

Turning Point Real Estate is always looking into the future, if you are interested in what this may mean for your portfolio than feel free to contact us.  We can offer a range of consulting services to clients.

Asset Services, Commercial Property Management, Commercial Real Estate, Emerging Trends, Property Owners , , , , ,

8 Reasons Sustainability Trends Are Driving Commercial Real Estate Value

Turning Point Commercial Sustainability ServicesMore than ever, investors and tenants are seeking energy efficiency, green building attributes, and greater disclosure of environmental, social and governance (ESG) performance.  By applying ESG, the three main areas of concern that have developed as central factors in measuring the sustainability and ethical impact of an investment in a company, building owners are able to cut cost by reducing energy and water use while improving their market competitiveness among tenants and investors.  This trend in sustainability efforts is creating value for real estate portfolios.  Here are eight reasons we are seeing this trend driving commercial real estate value:

1. Institutional Investors

Institutional investors are adopting ESG practices and insisting that ESG considerations are part of the investment decision.

2. Real Estate Funds

ESG performance through research analysts and ratings groups are triggering real estate funds to seek rank or rate funds.

3. State and Municipal Laws

Frequently state and municipal laws are requiring disclosure of benchmark building energy performance. Buildings with poor energy performance are associated with higher operating cost for prospective tenants or buyers.  This may increase lease-up times, reduce effective rental rates, and lower asset values.

4. Commercial Tenants’ Demands

Green building features are in high demand for corporate and government tenants who often have policies for minimum LEED or other green building standards to qualify for leasing. This trend has made LEED a baseline standard for new development in the office market of many metro markets.

5. ESG Reporting Strategies

More recently, real estate funds are developing ESG reporting strategies and participating in voluntary sustainability reporting forums and the Global Real Estate Sustainability Benchmark to proactively communicate their sustainability activities and enhance their reputation on ESG issues.

6. Federal, State, and Local Tax Credits and Incentives

Federal, state, and local tax credits and incentives are providing a catalyst for energy efficiency and renewable energy investments. Other incentives in the form of income tax credits, property tax abatements, bond financing, grants, and rebates are often available through states, municipalities, and local utilities.

7. Asset Managers

Tenants are increasingly paying attention to the total cost of ownership, including energy costs. Relying on an asset manager to target energy efficiency improvements as part of larger renovation projects, attracts and retains tenants as well as increases asset value.

8. Green Building Studies

Well-respected green commercial building studies are still somewhat limited, but a number of them provide genuine evidence of the improved value of green commercial buildings.

Asset Services, Commercial Property Management, Commercial Real Estate, Emerging Trends, Property Owners, Sustainability , , , , ,

Emerging Trends in Commercial Real Estate – Does your Commercial Real Estate have what it takes?

the Commercial POINT Emerging Trends in Commercial Real EstateThere has been a shift in commercial real estate lately that could make property owners think about making changes to their own properties in order to stay on top of their competitors.  An emerging trend over the last year that needs some attention is the increased amount of tenants continuing to shrink space requirements to improve efficiency; tenants are relying on technology rather than extra square footage.  What does this mean for landlords/owners?  It might be the time to consider embracing flexible design features, green technologies, and Leadership in Energy and Environmental Design (LEED) systems, or face the consequences.  Tenants want vibrant and innovative work spaces and are leaning to Class A buildings over Class B and C.

Commercial Real Estate, Emerging Trends, Property Owners , , , ,