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.
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.
JaxPort’s Blount Island facility just received 3 new container cranes last Friday, after a 2.5 month long trip, traveling 17,000 miles from China. The cranes will allow the port to service wider vessels that are becoming more prevalent since the opening of the newly expanded Panama Canal. As explained in the article, the existing cranes can reach across 16 containers, while the new cranes can reach across 22.
A 1M SF distribution center appears to be in the works at Cecil Commerce Center on Jacksonville’s Westside. Similar to the Amazon distribution center that was recently announced, at this point the company has not being identified. What we do know is that the proposed facility would serve as a packaging distribution center for a national company and would employ about 1,000 people. Some people are hypothesizing that the building could be an additional Amazon facility…. We will have to wait and see.
EverBank Financial Corp. announced on Monday (8/8) that the Jacksonville HQ’d bank would be bought by TIAA for $2.5B, or $19.50 per share. For several weeks there has been much talk and speculation surrounding the potential sale. TIAA, a financial services firm that was formed in 1918 by the Carnegie Foundation, also has a banking arm, which will soon be combined with EverBank. The company has stated that Jacksonville will serve as the headquarters for the combined bank, however further details regarding the new operations are unknown, including the new name of the combined entities. Additionally, many locals wonder if the Jaguars stadium will remain EverBank Field, or if it will be re-branded.
The Apple store located within the St. Johns Town Center is relocating to a larger space just down the street, and will be updated with the “next generation” Apple store design. The new store will be located in the higher end section of the outdoor mall, near restaurants J. Alexander’s, Capital Grill and Cantina Laredo, next door to the new Tesla showroom and across the street from Mayors, Tiffany & Co. and Louis Vuitton stores. The new location, which will be double the size of their existing store, will also be much closer to parking, making a trip to the store much more convenient for shoppers. The “next generation” store design proves that Apple thinks highly of the Jacksonville market and that its a strong performing store for them. As of May, there were only 4 locations open with this new store design, including San Francisco, Memphis, Guilderland (NY) and Brussels, and one planned in Oklahoma City.
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.
After much speculation, Amazon has made it official- they will be opening a 800,000 SF + distribution/fulfillment center in Jacksonville, which will create more than 1,500 full time jobs. The site, which was sold by Colliers International, is at Duval and Pecan Park roads, visible from I-295. For several months, there has been speculation surrounding a project being referred to as “Project Rex” which was seeking city and state incentives, and described a company that sounded very much like Amazon, without actually naming them.
Lingerfelt CommonWealth Realty Partners recently purchased the Stein Mart building for $23.7M from Parkway Properties. The 10-story building is about 197K SF and is located in the downtown CBD (on the Southbank). The building was about 97% occupied at the time of the sale, and anchored by Stein Mart, who occupies about half of the building and has naming rights to the building. Lingerfelt also owns the Riverplace Tower across the street, which they bought from Gate in 2014 for $29M .
The 2016 Mid-Year Investment Market Report is here! The report covers investment activity that occurred in Northeast Florida during the first half of the year and includes all asset classes. The report is published semi-annually, and c0-authored by Ernie Saltmarsh and Scott Rogers, investment specialists with Colliers International Northeast Florida.
To view/download the report, click HERE