Commercial Real Estate News Brief: March 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 spotlights industrial growth in downtown Columbus, best practices for real estate investors, and the value of hiring a project manager.

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Downtown Columbus Characterized by Strong Industrial Demand

JLL CRE News Brief

Newspaper image via NS Newsflash.

For both office and industrial space, Columbus is undergoing resurgence. On the industrial side, JLL’s Dan Wendorf told The Columbus Dispatch, “All the groundwork Columbus has laid the past few years is really coming to fruition.”

Thanks to consumers’ online shopping preferences, more and more warehouses are coming to central Ohio. According to JLL’s Columbus industrial report, industrial vacancy dropped from 12.4 to 6.1 percent.

You might be thinking, ‘Why Columbus?’ When it comes to transportation of goods, you can reach 47 percent of the national population within a ten-hour drive. Another big benefit: The low cost of doing business makes Columbus very professional-friendly. With 2.5 million square feet added during the fourth quarter of last year, Ohio’s capitol city can anticipate continued growth.

Download the full report for more information, Columbus: The Nation’s Industrial Hot Spot.

What Not To Do (Tips for CRE Investors)

Investors involved in competitive bidding, or new to CRE investment, are susceptible to making mistakes. According to National Real Estate Investor, there are eight pitfalls CRE investors frequently make. Below we’ve listed the top three; check out the full list for more.

  1. Cutting it short. When investors feel pressed for time, they may not take all necessary steps. This leads to “inadequate level of due diligence,” and mistakes that could have been avoided with more time and attention to details—are made.
  2. Making assumptions. Don’t assume a brand new building is always perfect. Rushed or inexperienced building techniques can lead to problems.
  3. Not seeking council. For newbies, it’s especially important to reach out to those with previous CRE investment experience. If you’re considering a new property type or a new geographical market, seek out professional advice.

How & Why You Should Hire a Project Manager

Between scope-creep, over-spending and schedule interruptions, there’s plenty of room for mishaps in construction. To help businesses gain perspective on the value of a good project manager (PM), JLL developed the free e-guide: Why hire a project manager?

A PM’s main purpose is to align all essentials of a building project: planning, design, engineering, construction and commissioning. With a birds-eye view of all moving pieces, your PM will deliver value that internal staff, architects and contractors alone cannot.

According to the e-guide, organizations that used best project management practices met their goals at a 90 percent rate as compared to those without (at 36 percent). The bottom line: A PM’s value is in helping owners “avoid redundancies, rework and costly mistakes.” Download the full e-guide for more on hiring the right project manager.

News Wrap-Up in Our Region  

Cincinnati

Columbus

  • German auto supplier Hirschvogel has plans for a 65,000-square-foot expansion that will cost roughly $50 million.
  • Daimler Group Inc. and Kaufman Development will build a 17-story high-rise at Third and Rich streets, in addition to a 12-story high-rise already in the works on High street.

Cleveland

  • K&D Groups’ downtown Cleveland portfolio has grown to include the 21-story Keith Building, sold for $5.2 million. The Keith Building will be used only as office space.
  • Ray Fogg Corporate Properties plans to add a 127,000-square-foot building at Bluestone Business Center in Euclid this spring, a $6 million construction project.

Detroit

  • Ally Financial is going to consolidate into 321,000 square feet in the renamed Ally Detroit Center (formerly One Detroit Center) from five locations in Southeast Michigan. The 957,000-square-foot building was recently acquired by Dan Gilbert’s Bedrock Real Estate Services. JP Champine and Dave MacDonald of JLL represented Ally in the transaction.
  • Penske Logistics will acquire supply-chain management and logistics company Transfreight North America. Transfreight North America locations across the Midwest, Canada and Mexico.

Pittsburgh

  • JLL’s Pittsburgh office is on the market for new space, as the firm’s lease located at 525 William Penn Place will expire in 2016.
  • Drager Safety Inc. announced that its facility at 101 Technology Drive, which employs about 150 people, will close this summer. The company also plans to sell its property.

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

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