Commercial Real Estate News Brief: January 2016

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CRE Industry UpdateIn the latest edition of our monthly news brief, JLL’s regional team curates the top industry articles from December to keep you in-the-know. In this month’s edition, JLL spotlights tech innovation in commercial real estate (CRE), the energy industry’s impact on CRE, and Columbus’ economic success in 2015—plus your latest headlines across the region. 

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CRE Tech Evolution: From Pen & Paper to Real-Time, Cloud-Hosted Data

Startups are revolutionizing CRE operations—from the slow-to-adapt, to the tech savvy.

And it’s about time, considering CRE is a major, $12 trillion information business according to a recent article via TechCrunch. With automation supporting the transactional side, brokers can sharpen focus to building lasting relationships.

Plus, real-time information and cloud-hosted databases allow for greater collaboration across teams and more streamlined workflows.

“Ultimately, these tools save agents time and their parent firms money, leading to leaner and more profitable businesses.” – TechCrunch

Across the industry, brokers with access to fast and accurate data will ultimately manage expensive commercial assets with greater ease and success. 

Energy Market Conditions Require Companies to Reevaluate Space Needs

Amidst a struggling U.S. energy industry, a handful of markets—including Pittsburgh—show favorable potential for 2016.

The downturn in oil costs has magnified disparities between real estate and energy-intensive markets. To thrive, each energy market needs its own strategy. According to JLL’s newly released 2015 Energy Outlook, energy companies must align real estate portfolios with long-term business goals to succeed in 2016. .

Closer to home, Pittsburgh has largely survived the energy downturn. How? Two core elements: an influx in tech companies and increased manufacturing demand caused by low oil costs.

Download the full report to review how the energy industry’s influence impacts CRE across U.S. markets.

Columbus Pushes Goals to the Next Level

In 2010, The Columbus Region (@CBUSRegion) announced some aggressive goals for 2020:

  • Create 150,000 net new jobs;
  • Generate $8 billion of capital investment;
  • Raise personal per capita income by 30%; and
  • Earn recognition as a leader in economic development.

Also according to The Columbus Region, just halfway through the decade, Columbus “is on pace to exceed all goals.”

At this point, Columbus has created 109,993 net new jobs, generated $6.32 billion in capital investment, and experienced a 14% increase in per capita income. An added bonus: the capital city has already earned recognition from Site Selection and the Mid-America Economic Development Council.

We’ll look forward to seeing Columbus surpass its expectations in 2020.

CRE News Wrap-Up in Our Region 

Cincinnati

  • Robert Bosch Automotive Steering LLC plans to invest $84.5 million in an expansion next year. The company will set up additional production lines, but it will not construct new buildings.
  • The Kenwood Collection landed a deal with Merrill Lynch, its largest office tenant so far. The company signed a long-term lease for more than 50,200-square-feet at the Sycamore Township mixed-use development, and will have signage on the south side of the building.

Columbus

  • MedVet Associates LLC purchased the 40,000-square-foot building next door, located at 350 E. Wilson Bridge Road, as part of an ongoing $1.65 million expansion. MedVet plans to create 99 new jobs in the next five years.
  • Food packaging and service company Pactiv LLC will create dozens of new jobs in Central Ohio in its plan to add two new production lines to the region. The $4.5 million manufacturing investment will focus on paper products to complement the company’s current offerings. 

Cleveland

  • Flashstarts, a startup accelerator in Cleveland still remains amidst tough competition—and its CEO, Charles Stack, says, “It’s not going anywhere.” Stack says the company’s annual program produces high potential businesses, some of which have raised additional capital since its start in 2012.
  • Flack Steel Ltd. purchased “selected assets” from Consolidated Systems Inc. to expand its product offerings and market opportunities. The metal service center has now raised its consolidated annual revenue above $300 million.

Detroit

  • As part of a tax relief deal announced recently, General Motors announced that it will invest $1 billion in cities across Michigan by 2030. This investment will create more than 50 jobs and retain nearly 500 others in Flint, Saginaw and Grand Rapids.
  • Amidst a wide network of options, Detroit’s riverfront “lost out” on Dan Gilbert’s Quicken Loans Inc. headquarters in 2006. Gilbert traded a 300,000-square-foot project at 665 Atwater for a space in the Compuware Corp. headquarters building in 2010.

Pittsburgh 

  • Tower Two-Sixty, an 18-story-high-rise overlooking Market Square in downtown Pittsburgh, is almost complete. Parts of the $107 million building, which features hotel, office, retail and garage space, will debut as early as February 2016. This high-rise will soon be the new home to the JLL Pittsburgh office.
  • The Duquesne council approved preliminary plans for a 50-acre parcel in the City Center of Duquesne industrial park. The land will house the Uber Advanced Technologies Center research facility, which will be built in partnership with Carnegie Mellon University.

Keep up with trends and relevant commercial real estate news throughout the Midwest on Twitter at @JLL_Spaces!

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