Commercial Real Estate News Brief: February 2014

0 CommentsBy

Commercial real estate is a dynamic industry. Keep up with Spaces’ monthly recaps of the most valuable industry articles we’ve recently come across, focused on news in Ohio, Michigan and Pennsylvania. 

Real Estate is Top Investment for Millionaires in 2014

According to Morgan Stanley, millionaires in the U.S. claim that residential and commercial properties are the top “alternative-asset class” to own in 2014.

JLL_Feb-NBBloomberg reports that, “wealthy investors are turning to a rebounding real estate market as fixed-income yields remain historically low and equities surge.” This trend attracts U.S. millionaires as well as foreign investors, who are purchasing high-profile U.S. buildings as a safety net because of the dollar denomination. 

Secondary Markets Driving New Industrial Demand

Modern space with proximity to population centers and a robust logistics infrastructure will dominate the industrial real estate sector in 2014,” said Craig Meyer, President of Industrial Brokerage at JLL, in a recent article in REJournals.com.

According to JLL researchers, for more than four years, industrial markets across the U.S. have been trying to revive. In 2013, the industrial market experienced a slight upswing with 168 million square feet of net absorption. Secondary markets are also seeing increased demand for industrial space, while developers and investors turn to markets, such as Columbus, that have solid intermodal infrastructure in place,” according to REJournals.com.

Detroit Job Market Continues to Recover

Detroit has experienced a continuously high unemployment rate for the past last decade. Fortunately, thanks to more jobs in the manufacturing, office and high-tech markets, the region’s economy is slowing becoming stronger.

In a recent article in GlobeSt.com, Robert Kramp, Vice President and Director of Research for the Midwest and Great Lakes regions for JLL, said, “The auto industry, as well as its suppliers, is now operating at near-full capacity.” This employment pickup has also allowed the industrial vacancy rate in the area shrink to 11.2%, “putting Detroit in the top quartile of U.S. cities.

News Wrap-Up in Our Region

Cincinnati 

  • Cincinnati Bell, Inc. may be in the market for a larger office. According to sources, the company is searching for a space that is roughly 200,000 to 250,000-square-feet.
  • Beckman Coulter, Inc. plans to expand its distribution center in Northern Kentucky. The 73,000-square-foot expansion will cost roughly $10 million, and bring 43 jobs to the area.

Cleveland

  • Westlake City Council passed legislation to move forward with the expansion project in Crocker Park, which includes a new space for American Greetings Corp. The mixed-use complex will also have three parking garages to fit more than 1,500 cars.
  • Remedi SeniorCare of Ohio-Northeast LLC is the first tenant in the Bluestone Business Center 1 building. The pharmaceutical distribution company will occupy nearly 31% of the building. 

Columbus

  • New tenants are calling the 175 on the Park office tower home. The office complex next to Columbus Commons signed leases with Finance Fund and Tucker Ellis.
  • Daimler Group, Inc. will build its premier speculative project at Port Columbus International Airport for $6 million. The 100,000-square-foot flex office and warehouse project will be next to a 130,000-square-foot light industrial building.

Detroit 

  • Southfield’s Towne Square complex may be receiving a third tower. The new tower would make the existing 670,000-square-foot complex among the largest office complexes in Detroit.
  • Schostak Bros. & Co. bought the 1.2 million-square-foot General Motors Co. Powertrain Engine Plant in Livonia. Bay Logistics, Inc. is the complex’s only tenant, and occupies roughly 130,000 square feet.

Pittsburgh 

  • The Union Trust building is now owned by Boston-based Davis Cos. The building, which is one of downtown’s most architecturally significant buildings, was purchased for $14 million.
  • The oil and gas industry face limited real estate space options in the area. Despite this, other industries, mainly the technology industry, is showing signs of growth.

Newspaper image via NS Newsflash

 Subscribe-button