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.
Midwest Millennials Fuel Workforce Urbanization
In a recent article for REBusiness Online, JLL’s Great Lakes Market Director JC Pelusi discusses how Midwest millennials are driving big changes in the commercial real estate sector. According to Pelusi, “…millennial lifestyle preferences and work habits will continue to transform economic activity and, more specifically, shape commercial real estate demand.”
In result of millennial lifestyle preferences, experts are seeing a trend toward workforce urbanization. As the demand for downtown office space increases, the demand for downtown living is also growing. According to Pelusi, millennials will continue to look to downtown spaces for working, living and shopping. He said, “With limited space available across the region, we expect to see elevated interest in new development this year.”
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New Opportunities for Economic Growth in Shale Zone Communities
Energy companies, local decision makers and real estate developers need to work together to maximize economic growth in shale regions, according to JLL in a recent Area Development article. Energy companies, for example, are partnering with third-party consultants to address community concerns, such as roads, schools and utilities, and connect with local decision makers and developers to cultivate a resolution.
Case in point: the Pittsburgh real estate market recently experienced a revival driven by energy companies. According to the article author, Bruce Rutherford, “several million square feet of additional space has been leased since 2009 and is directly attributable to the energy industry.”
Demand for Industrial Space Boosted by Lower Natural Gas Costs
National Real Estate Investor (NREI) reported that the industrial market can expect to benefit from fracking, “as access to natural gas will make it cheaper to make products.” Industry experts at JLL agree, citing that natural gas is cheaper than gasoline fuel, so it “…should save enough capital to boost demand for manufacturing jobs and new distribution hubs throughout the country.”
According to NREI, spending less on energy will ultimately lead to the U.S. increasing its market share in the world economy. Real estate markets in the Midwest are expected to benefit from this overall growth.
News Wrap-Up in Our Region
- Land owned by the historic U.S. Playing Card was purchased by a group of national and local developers in January. Construction to renovate 470,000 square feet of industrial space into Class A office space is projected to cost between $45 and $60 million.
- Paul Hemmer Co. is busy constructing a 650,000-square-foot industrial distribution facility in Monroe, known as Park North Building 4. The project is slated for completion in April 2014.
- The former Cleveland Metropolitan School District building, located at 1380 E. Sixth St, will eventually be home to a new Drury Plaza Hotel. Construction for the project has already started, and completion date is slated for the summer of 2015.
- Euclid Hotel Associates, LLC, plans to convert the former Cleveland Athletic Club building in downtown Cleveland into a Crowne Plaza Hotel and apartments. The project will bring 195 hotel rooms and nearly 30 apartments to the area.
- Daimler Group, Inc., an office developer in Columbus, plans to build a four-story, 110,000-square-foot building in Westerville. The building will be the company’s fifth speculative office property and is slated for completion in late 2014.
- Three companies seeking tax incentives through the Ohio Tax Credit Authority, Gwynnie Bee, Inc., Bon-Ton Stores, Inc. and S&T Motiv Company Ltd., could bring as many as 620 jobs to the Columbus area within a few years.
- After two acquisitions in early January, auto supplier Federal-Mogul Corp. announced plans to move into the former Blue Cross Blue Shield of Michigan headquarters in Southfield.
- Denso International America, Inc. purchased an 81,000-square-foot building to expand its North American headquarters in Southfield. The new expansion will bring more than 170 new jobs to the region.
- As part of its expansion of Bakery Square 2.0, Walnut Capital Partners plans to begin building a new 216,000-square-foot office space. The project will begin in March 2014 and is expected to be the first of two, 200,000-plus-square-foot structures on the site.
- Noise Solutions, Inc. opened a new 55,000-square-foot manufacturing facility in Sharon, Pa., marking the company’s first expansion into the U.S. The expansion has already brought 30 jobs to the region, and the company expects to hire between 125 and 200 additional employees.
Newspaper image via NS Newsflash