Author Archives: scottrogersjax

Another Industrial Portfolio Trades; this one at $59/SF

For the third time recently, an industrial portfolio has traded in JAX.  The latest was Cabot Properties’ exit of the market with the sale to NY-based DRA Advisors of about 924k SF of warehouse-distribution space in five buildings around town, four up at Alta Lakes and one at Flagler Center, plus some 16 acres at Alta Lakes.

Earlier in January, MDH Partners of Atlanta paid $54.6M, or $42/SF for seven buildings and 1.3MSF of warehouse space around Imeson Park on the north side of town and Boston-based STAG Partners paid $34.3M of about $34/SF for seven area buildings.

Karen Brune Mathis of The JAX Daily Record has the article on all three here.

Strong Job Growth Continues

Metro JAX’ 5-county employment has added some 24,900 jobs in the 12 months’ ended in August 2016.  That’s a 3.8% growth ranks 3rd amongst its peers in the Southeast, just behind Savannah at 4.0% and still well behind Orlando at 4.4%, but well ahead of Tampa, Atlanta, Charlotte, Charleston, and Miami – and substantially better than the nation at about 2.0%.  According to the U.S. Bureau of Labor Statistics, every employment category had gains in JAX except one (Information, which lost 400 jobs or down 4.3%); increases were widely dispersed, with the biggest gains being in Construction (+12.1%), Leisure/Hospitality (+5.9%) and Education and Health Services (+5.2%).

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A Bubble in The Making ?

Colliers International Research Department, led by Pete Culliney, Director of Research in New York, and Andrew Nelson, Chief Economist in San Francisco, have published their Mid-Year 2016 U.S. Capital Flows Research and Market Report for the national capital markets.  One of their many nuggets of information:

  • Repeat sales (of the same property/ies), the best indicator of price movements, are, overall for the four major food groups (CBD office, retail, multifamily, and industrial) up 12% over the prior peak of 2008 in the top six metro markets, admittedly a far cry from our local market. But…
  • The same property types outside the top six metro markets are still, on average, down 16% from the prior peak, but it is a mixed bag, with multi-family and CBD office higher than the prior peak while retail and industrial lag.  See the chart below, thanks to the Colliers International report.  If you would like a copy of it, please email us.Screen Shot 2016-09-13 at 4.12.41 PM.png

Transaction Flow in US Property Markets Down 16% But Pricing Firm

Colliers International’s outstanding research team has analyzed Real Capital Market trends for the first half of 2016 vs prior year’s and found:

  • Investment sale transactions nationwide were down 16% from the first half of 2015, with much of the decline in portfolio purchases.
  • Investment capital remains robust with volume up 15% from the 2014 level, which was the high watermark until last year.
  • Composition of transactions has changed significantly from the first half of 2015 to midway in 2016, with only multi-family (apartment) sales up (+9.7%) and the other major categories all down, led by hotels (-55%), Industrial (-31%), Retail (-20%), and Office (-12%).
  • Despite the slowdown, pricing remains firm, even rising, led by office product (+13.6%), then industrial (+7.6%) then hotels (+4.5%), while apartments (+2.7%)and shopping centers (-0.5%) lagged.  My own editorial – less volume, but higher prices; hmmm, makes one wonder about the quality of the product being traded or external influences such as a bottoming of interest rates…
  • Through 2017, the Colliers mothership expects prices to continue rising and investor interest to remain strong as transaction volumes regain traction as a reflection of the strength and stability of the U.S. economy and remarkably low interest rates, with a warning:  keep an eye on risks and avoid chasing yields as the growth cycle continues.

If you would like the entire article, please email me at scott.rogers at colliers.com.

More Jobs, Jobs, Jobs

Citibank announced hiring of 800 new jobs in JAX; that’s after 500 announced last summer that they have already filled at their offices in South JAX.  Roger Bull has the announcement here for The Florida Times-Union.

+22,800 Jobs In Past 12 Months

The US. Bureau of Labor Statistics had April 2016 total non-farm employment in the JAX area at 668,200, that’s 22,800 more than April 2015, or a 3.5% increase, that’s DOUBLE the rate of increase for the nation, as shown below.  The areas of the strongest growth – Leisure and Hospitality (+7.9%), Construction (+6.6%), and Education and Health Services (+5.1%).  The only area showing a loss was Information (-1.1%).

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Jobs, Jobs, Jobs !!!

If you are wondering who is buying all the new houses around town or you’ve been thinking that I-95 traffic is a little heavier than usual, your gut is spot on.  The JAX region’s economy continues to build steam and create more and more jobs as shown in the table below from the US Bureau of Labor Statistics.  From the economic trough in 2010 – where we were at 580k jobs – that increased a anemic 6k to 8k jobs in 2011 and 2012, respectively, and then 13k to 14k the next two years, but much stronger last year with almost 24k jobs in 2015, or a fairly robust 3.8% increase.  Also interesting to note that we eclipsed the pre-Great Recession peak of 631k jobs during 2015 and are approaching 5% higher than that high watermark.

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Think Twice Before Buying/Leasing to a For Profit College

A very interesting article from a fellow blogger Andre Cuadrado of Rhenium Capital on FPC’s – For Profit Colleges – that suggests lenders have caught on and FPCs are having an impact on the CMBS debt markets.

 

Florida Leads Nation in Job Growth in January – +32,200 Jobs

According to the U.S. Department of Labor and Wells Fargo Securities, LLC, Florida led the nation in job creation in January, with other 36,000 private jobs.  In terms of total jobs, government and private, the state added a net of 32,200 new jobs in January, the highest gain in any month since April 2011.  The biggest winners in the state – construction, professional and business services, and then leisure and hospitality.  The state’s payrolls gained 3.4%, and Jacksonville was second best, at +4.5%, behind only Orlando at +4.9%, as shown below.  Over the past year, Florida non-farm employment added a net of 269,200 jobs with every major industry category posting gains.  The state’s unemployment rate is at 5.0%, and would be dramatically less but for Florida’s civilian labor force grew at more than twice that of the nation over the past year.

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Chart courtesy of Wells Fargo Securities, LLC

 

Snapshot of JAX Employment – Up 16,300 Jobs in Last 12 Months!

Below is a simple graph of the percent changes in employment in JAX and the U.S. – and JAX is out consistently out-performing the nation.  And the results in the table suggest a strong (and sustainable) 2.6% job growth over the past 12 months, now at 650,200 jobs in the region, 102.2% of the prior peak of 2006.  The biggest gainers over the past year – Leisure and Hospitality (+6.2%), Education and Health Services (+5.2%) and +3.2% for Trade, Transportation and Utilities.  The only loser – Information Services, down 3.3%, but also the smallest employer in the region at less than 9k total jobs.  Overall, the JAX economy created some 16,300 jobs in the past year, up 2.6%.  Courtesy of US Bureau of Labor Statistics.

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