Commercial Real Estate News Brief: September 2013

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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. 

Empire State Building Shares For Sale

Controller of the Empire State Building, the Malkin family, officially began marketing the building in September – making the effort one of the “largest real-estate initial public offerings,” according to The Wall Street Journal.

As a prominent building in the U.S. (and worldwide), the Empire State Realty portfolio, which also includes an additional 18 properties, is expected to generate a great deal of attention. In the midst of a massive marketing initiative, the Empire State Building is undergoing upwards of $550 million in renovations. The floors that have been renovated thus far, which include the lower 20 floors, “have seen their revenue more than double,” also according to The Wall Street Journal.

JLL Lists Most Expensive Streets (for Office Rent) in the U.S.

What is the priciest street in the U.S. (in terms of office space)? JLL research analysts took inventory of the 40 U.S. office markets to find out. In September, JLL released the 2013 list of most expensive streets for office space. The cities that topped the list include: Menlo, CA; Manhattan, NY; and Silicon Valley, CA.

JLL_Most Expensive Streets graphic

JLL Lists Most Expensive Streets (for Office Rent) in the U.S.

Also revealed in this year’s findings, markets that were notoriously damaged by the recession are seeing a decrease in vacancy rates. This points to a continued upturn in the national economy. Prime examples include: Brickell Avenue (Miami), Peachtree Street (Atlanta) and Fayetteville Street (Raleigh).

Regionally, the Midwest continues to be the “most affordable” market, according to the experts. This trend is reflected in regional street rankings; Midwest cities ranked lower on the list (included below for reference).

  • Old Woodward Avenue (Detroit) ranked 26
  • Grant Street (Pittsburgh) ranked 31
  • Nationwide Boulevard (Columbus) ranked 35
  • Montgomery Road (Cincinnati) ranked 37
  • Public Square (Cleveland) ranked 38

Visit the full list for more information.

Green Building Incentive Deadline is Quickly Approaching

Only three months remain to cash in on the Energy Efficient Commercial Building Tax Deduction, according to National Real Estate Investor (NREI).  Under this particular tax incentive, commercial real estate owners were given the opportunity to save $1.80 per square foot by implementing certain “energy-saving improvements,” said NREI.

The tax code (Sec. 179d) is set to expire on December 31; however, according to NREI, “…advocates for the commercial real estate advocates are pressing Congress to renew the tax benefit and even expand it.” 

To help debunk the most popular misconceptions associated with energy-saving improvements, check out Sustainable Industries’ recent piece on the “smart building myths.” One of the most common myths includes “smart building technologies are expensive.” Because of subsequent energy savings, that’s not always the case. Visit the full post to read up on all ten myths.

News Wrap-Up In Our Region

Cincinnati

  • Chris Cicchinelli, CEO of Pure Romance, announced this month that his $100 million company would remain in Ohio, thanks to “the allure of downtown Cincinnati and its resurgence.”
  • Industrial Development International is expanding its presence throughout the region. Currently, three of the most sizable Tri-State industrial parks are owned by IDI. Other projects in the works include development at Park North in Monroe and Park South in Northern Kentucky.

Cleveland

  • K&D Group is converting the empty, 21-story office building at 1717 East Ninth Street into apartments. The building was formerly home to East Ohio Gas Co. The new building, which will house 223 apartments, is forecasted to be complete by the end of next summer.
  • The 290,000 square foot shopping center – University Square – will be put up for auction on the internet. Currently, only about 24% of the building is occupied.

Columbus

  • The Shoppes at Wedgewood, as well as the nearby Mount Carmel Health System, was originally zoned in Liberty Township; however, the city of Powell has plans to annex the space.
  • American Howa, a maker of interior auto parts for Honda of America Manufacturing Inc., has plans to expand in Columbus. American Howa has forecasted the addition of about 60 jobs.

Detroit

  • Meridian Health Plan has intentions to occupy about 300,000 square feet in a 320,000 square foot office tower, yet to be constructed. The new tower was proposed by Livonia based Schostak Bros & Co. and is forecasted to cost $111,000 million.
  • Walbridge Development LLC has plans to develop a vehicle research center, connected to the Willow Run Powertrain Plant – the original home to General Motors Co.

Pittsburgh

  • PPG Industries Inc. is consolidating its offices in Louisville, KY and Strongsville, OH to a new headquarters location in Butler County. The new location is expected to generate about 300 new jobs.
  • Gordon Food Service started construction on a new distribution center at The Findlay Industrial Park. The new center will span 420,000 square feet on 62 acres (newly purchased by Gordon Food Service).

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