OK, so that how's the market question gets more difficult to answer every day. Yesterday I learned that another large office/retail building was foreclosed on. Hoping to find out more on this later, but for now, just disturbed. That's two large buildings right here in town.
Many of the companies we all thought had it all going on, are falling under these times. Mainly, they were over-leveraged and had over-estimated the tenant strength.
My theory is that we are feeling a combination of the vacating of office buildings by the State a few years back plus the economic downturn/recession. The state laid waste to many older buildings that are still standing empty. They built or had built all these new shiny buildings with little thought to what damage they would cause to local building owners and the real estate market in general.
This is a harsh judgment, but shame on them. Same thing for the city of Olympia building a new building instead of renovating an older one. I sometimes feel like our local government presence act as if they have no responsibility as citizens of our local area.
And then the icing on the cake is when they go and hire out-of-town contractors to do all the work. Not only do they trash our local buildings and abandon them, but they send the money out of the area to enrich the coffers of other cities, counties and companies.
Tuesday, June 22, 2010
Saturday, June 19, 2010
Commercial real estate market remains muted
(This article was published by the Puget Sound Business Examiner on line edition Friday June 18, 2010)
Commercial real estate investors reveal both frustration and disappointment at the lack of quality buying opportunities that many expected would have materialized by now, according to the second quarter 2010 findings of PricewaterhouseCoopers' Korpacz Real Estate Investor Survey.
The report notes that the unknown speed and strength of the economic recovery has many investors anxious, with the uncertainty surrounding the large debt volume coming due during 2011 and 2012 amplifying the angst.
The report finds that despite encouraging economic data reports for retail sales and job growth, the retail sector continues to struggle and present challenges to property owners.
In the office sector, overall vacancy rates show some signs of improvement as the rate at which space is being returned to the national central business district office market has slowed dramatically over the past year.
In the industrial sector, the report notes that market conditions continue to soften, but at a slower pace than in months past.
The report also finds that the apartment sector is continuing to lead the recovery with investment appetite for high-quality assets in first-tier markets showing an uptick in transactions in the national apartment market.
Commercial real estate investors reveal both frustration and disappointment at the lack of quality buying opportunities that many expected would have materialized by now, according to the second quarter 2010 findings of PricewaterhouseCoopers' Korpacz Real Estate Investor Survey.
The report notes that the unknown speed and strength of the economic recovery has many investors anxious, with the uncertainty surrounding the large debt volume coming due during 2011 and 2012 amplifying the angst.
The report finds that despite encouraging economic data reports for retail sales and job growth, the retail sector continues to struggle and present challenges to property owners.
In the office sector, overall vacancy rates show some signs of improvement as the rate at which space is being returned to the national central business district office market has slowed dramatically over the past year.
In the industrial sector, the report notes that market conditions continue to soften, but at a slower pace than in months past.
The report also finds that the apartment sector is continuing to lead the recovery with investment appetite for high-quality assets in first-tier markets showing an uptick in transactions in the national apartment market.
Thursday, June 10, 2010
PASSED!!!!
Last week, I passed my Washington State Broker's Exam. For those of you who think all agents are created equal. We are. But some of us choose to take on more education and responsibility. The state likes us to take tests, and then we get to change our titles. So today I am an Associate Broker. The irony is that the state is changing the licensing law July 1, 2010, so all agents will then be called "Brokers" and all associate brokers will be called "Managing Brokers." So keep your eyes open for a lot of title changes coming!!!
Wednesday, June 9, 2010
The crazy wide gulf between buyers and sellers
I am in the process of trying to personally figure out how to bridge the commercial real estate gulf between buyers and sellers.
Our market (Thurston County) does not suffer from the same issues as non-government towns, so we do not ride a pricing roller coaster, it is pretty steady, but even we've seen a drop in prices in this recent downturn... but not as large a one as buyers want it to be.
Because most of our commercial property holders here are pretty steady, and our market reflects this, we are not seeing desperate sellers.
But buyers are out there thinking it's low-ball season.
When you're a buyer's rep, it is always low-ball season in some ways, but now everyone is jumping in the game, and the balls are not just low, they're subterranean, and sellers just aren't THAT desperate... dare I say yet? I don't know if they ever will be around here.
I think a few will go through the ringer, but all?...naw....
Anyway, it's a buyer's market, but we have to be realistic and know that some sellers are pricing their properties to sell. If you aren't sure what the price you are asking or looking at is where it should be, get a professional agent to do an analysis for you.
We look at a myriad of elements -- especially in a market that is volatile like this one.
Our market (Thurston County) does not suffer from the same issues as non-government towns, so we do not ride a pricing roller coaster, it is pretty steady, but even we've seen a drop in prices in this recent downturn... but not as large a one as buyers want it to be.
Because most of our commercial property holders here are pretty steady, and our market reflects this, we are not seeing desperate sellers.
But buyers are out there thinking it's low-ball season.
When you're a buyer's rep, it is always low-ball season in some ways, but now everyone is jumping in the game, and the balls are not just low, they're subterranean, and sellers just aren't THAT desperate... dare I say yet? I don't know if they ever will be around here.
I think a few will go through the ringer, but all?...naw....
Anyway, it's a buyer's market, but we have to be realistic and know that some sellers are pricing their properties to sell. If you aren't sure what the price you are asking or looking at is where it should be, get a professional agent to do an analysis for you.
We look at a myriad of elements -- especially in a market that is volatile like this one.
Wednesday, May 26, 2010
REALTOR® Magazine-Daily News-Commercial Vacancies to Peak Near Early 2011
REALTOR® Magazine-Daily News-Commercial Vacancies to Peak Near Early 2011
This article is predicting more downside in the next 6-9 months.
Here in Thurston County, I dare say I think we are at the bottom.
I know that sounds pretty gloomy and intense, but if we're hitting bottom, the only direction is up.
We are seeing investors beginning to come out of the woodwork, but the prices they're willing to pay and the cap rates they desire are prohibitive. Folks who used to be thrilled by a 7 cap are going for 10 caps, and they want an upside even then.
Owner user buyers are also trying to get in on the buyer's market, so I'm guessing we'll never go as low as some of the other cities across the country. The Thurston County magical government influence continues to be effective in keeping prices above the median.
That said, still not the best time to sell, but a great time to buy (if you can find a property!!!)
Wednesday, April 21, 2010
Thursday, April 15, 2010
Report: Revitalize Commercial Real Estate
Very interesting article from the National Association of Realtors:
High unemployment rates and tight credit conditions were just some of the challenges that REALTORS® who practice commercial real estate faced last year, as data from the 2010 National Association of REALTORS® Commercial Member Profileshow. Despite current obstacles, NAR remains committed to restoring a strong and robust commercial real estate market.
“Commercial real estate is the basis for much of the growth in the American industry and economy,” said NAR President Vicki Cox Golder. “Because of its vital role, commercial real estate must have access to adequate capital resources. NAR is continuing to work with legislators and regulators to increase market liquidity and promote national interest in a healthy commercial sector.”
According to NAR’s 2010 Commercial Member Profile, commercial members completed a median of five sales transactions in 2009, down from eight in 2008. The median sale volume was $1,767,900 among those engaged in sales transactions – 14 percent of NAR’s commercial members did not complete a sales transaction in 2009. The median leasing volume was $330,200 in 2009 among those engaged in leasing business; 42 percent of commercial members had no leasing transactions in 2009.
Median gross annual income for REALTORS® practicing commercial real estate has been declining since 2006, when it was $115,600. In 2009 the median income was $68,600. Commercial practitioners with less than two years experience earned a lower median income than those with more than 26 years experience – $35,300 versus $112,500.
Land sales were cited as the primary specialty for commercial practitioners, which is consistent with past years. Investment sales and multifamily building sales were cited as the next two most popular specialties.
More women are entering the commercial real estate field. Although still in the minority – women comprise 26 percent of REALTOR® commercial practitioners compared with 18 percent last year – 37 percent of commercial members with two years or less experience are women. Nineteen percent of REALTORS® in commercial real estate who have more than 26 years experience are women.
Commercial practitioners account for more than 80,000 of NAR’s 1.2 million members. Fifty-seven percent of commercial members have a broker’s license, and 28 percent have a sales agent’s license. More than half of NAR’s commercial members – 56 percent – work for a local commercial real estate firm. The typical commercial member has been in real estate for 20 years, has practiced commercial real estate for 12 years, and has been a member of NAR for 15 years.
“REALTORS® who practice commercial real estate help build communities by facilitating investment and promoting the sale and lease of commercial space, which supports millions of jobs nationwide,” said Golder. “REALTORS® are optimistic that the latter half of 2010 will bring improvements in credit availability to get the commercial real estate market moving again."
Source: NAR
High unemployment rates and tight credit conditions were just some of the challenges that REALTORS® who practice commercial real estate faced last year, as data from the 2010 National Association of REALTORS® Commercial Member Profileshow. Despite current obstacles, NAR remains committed to restoring a strong and robust commercial real estate market.
“Commercial real estate is the basis for much of the growth in the American industry and economy,” said NAR President Vicki Cox Golder. “Because of its vital role, commercial real estate must have access to adequate capital resources. NAR is continuing to work with legislators and regulators to increase market liquidity and promote national interest in a healthy commercial sector.”
According to NAR’s 2010 Commercial Member Profile, commercial members completed a median of five sales transactions in 2009, down from eight in 2008. The median sale volume was $1,767,900 among those engaged in sales transactions – 14 percent of NAR’s commercial members did not complete a sales transaction in 2009. The median leasing volume was $330,200 in 2009 among those engaged in leasing business; 42 percent of commercial members had no leasing transactions in 2009.
Median gross annual income for REALTORS® practicing commercial real estate has been declining since 2006, when it was $115,600. In 2009 the median income was $68,600. Commercial practitioners with less than two years experience earned a lower median income than those with more than 26 years experience – $35,300 versus $112,500.
Land sales were cited as the primary specialty for commercial practitioners, which is consistent with past years. Investment sales and multifamily building sales were cited as the next two most popular specialties.
More women are entering the commercial real estate field. Although still in the minority – women comprise 26 percent of REALTOR® commercial practitioners compared with 18 percent last year – 37 percent of commercial members with two years or less experience are women. Nineteen percent of REALTORS® in commercial real estate who have more than 26 years experience are women.
Commercial practitioners account for more than 80,000 of NAR’s 1.2 million members. Fifty-seven percent of commercial members have a broker’s license, and 28 percent have a sales agent’s license. More than half of NAR’s commercial members – 56 percent – work for a local commercial real estate firm. The typical commercial member has been in real estate for 20 years, has practiced commercial real estate for 12 years, and has been a member of NAR for 15 years.
“REALTORS® who practice commercial real estate help build communities by facilitating investment and promoting the sale and lease of commercial space, which supports millions of jobs nationwide,” said Golder. “REALTORS® are optimistic that the latter half of 2010 will bring improvements in credit availability to get the commercial real estate market moving again."
Source: NAR
Subscribe to:
Posts (Atom)
