Commercial Real Estate News Brief: February 2015

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In the latest edition of our monthly news brief, JLL’s regional team curates the top industry articles to keep you in-the-know. In this month’s edition, JLL examines global CRE investment, workplace strategy tips, and the revitalization happening in Detroit.

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The State of Global Real Estate Investing

JLL CRE News Brief

Newspaper image via NS Newsflash.

Many were apprehensive to invest in commercial real estate after the recession. But, according to an The New York Times, it still makes sense to own properties through real estate investment trusts, called REITs, and exchange-traded funds.”

Why? Global REITs performed extremely well in 2014—setting the stage for success in 2015.

In other global news, Chinese buyers have been pouring money into U.S. properties.” Major deals include a $120 million investment from the Bank of China in a Chicago property (i.e. the future home of Google), as well as $296 million sale in San Francisco to a Chinese real estate firm. National Real Estate Investor has the details.

Striking a Balance in the Office: Focus-Friendly Space

Has the open office concept gone to far? Managing Director in JLL’s Strategic Consulting group, Bernice Boucher (@berniceboucher), shared four, focus-friendly office strategies in a recent article for Work Design Magazine. Boucher emphasizes the power of choice to let employees select where and how they work best.

Below are four tips from Boucher to strike the perfect balance with open and closed space.

  • Mitigate noise. Open layouts can be noisy and distracting, so providing small, private spaces for individuals to work is key.
  • Promote “membership” over “ownership.” Change the dynamic from assigned desks to non-territorial workspace options. This allows workers to select space according to activity.
  • Mix up communal space offerings, too. Offer flexible community areas with sections designated to both formal and informal meetings, allowing for solo work to informal networking or group brainstorming sessions.
  • Reinforce workspace design strategy with policy. Thoughtful policies and culture behind smart layout will make for a focused office. Some ideas include mobile phone-free zones or creating a reservation system for private rooms.

There’s no perfect formula to the perfect floor plan, and businesses can incorporate “modern, dynamic activity-based workspace that fosters collaboration and concentration,” in the hopes of cultivating happier and more productive employees.

All Eyes on Detroit

A new series from Re/code is asking, “What’s Driving the Next Detroit?” Despite bankruptcy resulting from many years of economic, moral and population decline, hope has returned to Detroit.

The city is in the midst of transformation, quickly becoming an accessible destination for young professionals. Between real estate, renovation and business startups, billions of dollars are flowing into the city. Exciting redevelopment projects, like the Tiger Stadium renewal, are underway. What’s cool about the new stadium project: The developer will use crowd-funding to encourage community involvement, according to the Wall Street Journal.

From Dan Gilbert’s numerous investments, to 100 new technology startups, the auto industry’s resurgence and restoration projects for dilapidated historical buildings, all signs point to Detroit making a comeback.

News Wrap-Up in Our Region  

Cincinnati

  • Pennsylvania-based pharmaceutical company Aprecia Pharmaceuticals Co. plans to invest $25 million in a manufacturing facility, creating 150 new jobs in Blue Ash.
  • The Mayfield Clinic will move its headquarters and consolidate three of its medical offices to a 45,00-square-foot space in Norwood.

Columbus

  • Coyote Logistics, LLC, has plans to spend $480,000 to move into a larger space space downtown. In the process, the logistics firm will create about 50 new office jobs.
  • Gas compressor maker Ariel Corp. purchased an industrial 50,000-square-foot building for $3.3 million at Health Aerospace Park.

Cleveland

  • Brennan Holdings LLC and Ray Fogg Corporate Properties have partnered to construct a 108,000-square-foot warehouse in Stow this year.
  • Rockside Magnolia SCC LLC, affiliated with New York-based Time Equities Inc., purchased six office buildings from Duke Realty Corp. for $20 million, all located in Northeast Ohio.

Detroit

 

  • Accretive Health Inc. has plans to lease space at the Travelers Tower II office in Southfield, occupying 107,000 square feet.
  • Industrial vacancy in Detroit lowered to about seven percent during the fourth quarter, the lowest in years. Demand and construction have been heating up alongside the resurgence of the auto industry.

Pittsburgh

 

  • Russian-owned steelmaker TMK Ipsco signed a lease for 60,000 square feet at the Ambridge Regional Distribution & Manufacturing Center for ten years. The company also recently announced plans to lay off ten percent of its local staff.
  • Westpointe Corporate Center Four, located in Moon Township, is now home to the world headquarters of Calgon Carbon. The company will lease more than 75,000 square feet for 15 years.

What major commercial real estate moves in the Midwest caught your attention last month? Share in the comments below!

Newspaper image via NS Newsflash.

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