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A better economy means people buying more stuff--a lot of which will be passing through OC industrial space on its way to all those eager consumers. (If your kids ask you where iPods come from, tell them a stork-like drone picks them up from a warehouse.) Lee & Associates SVP Kurt Bruggeman tells us what to look for in '14 for the industrial market. 1) Large blocks will be scarce.  "We're seeing that it's increasingly difficult to find larger blocks of industrial space," Kurt tells us (snapped with colleague Ryan Swanson, left). That's been the case since vacancy rates dipped down into the 4% to 5% range, and the situation isn't likely to change anytime soon. (It's like the late rounds of musical chairs.) Also, a lot of large, older industrial buildings are being repositioned into higher and better uses, such as new industrial, but also retail and apartments, taking that space off the market. 2) New space goes fast.  Because of the lack of high-quality industrial product in Orange County, the new developments completed in 2013 have been well received, Kurt says. (They fly off the shelf like Cronuts.) So well, in fact, that their space has been leased up fast. About 500k SF of new product was delivered to the market this year, but that didn't keep pace with the net absorption, which has totaled over 2M SF in the first three quarters of 2013. The pattern could well continue into 2014. 3) Investments sales might slow.  Rents are going up, and so are values for quality industrial in Orange County in 2014. But that doesn't mean investment sales volume will, too. Low interest rates spurred much of the for-sale activity in 2013, but if the economy continues to improve, and rates rise in 2014, that'll have a negative impact on sales volume. Pictured: 1683 Sunflower Ave in Costa Mesa, which recently sold for $37M. Kurt and Ryan repped the buyer, a private investor, while Voit Real Estate Services' Mike Hartel, Mitch Zehner, and Seth Davenport repped the seller, a partnership of Voit Development and Penwood Real Estate Investments. |
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A Bisnow Education Video! |
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 We're often asked after our events, what's a cap rate, a 1031 exchange, a REIT, mezz debt, NOI, CMBS, loan-to-value, "core," etc. Well, we're the wrong people to ask, because we don't know either. BUT, we know someone who does! So we made a video. It's 90 minutes, broken into 19 different 5-minute segments on these different issues. Never be intimidated again! And dazzle the world with your use of highfalutin' acronyms. |
 Peter Linneman is really smart. He started the Wharton School's Real Estate Department, and he's been Chairman of Rockefeller Center Properties, and on the Executive Committee of Equity Office Properties. He's widely considered the top real estate professor in the United States. So try out the trailer above. And if you like it, for $59 you can stream it as much as you like. And you, too, can get really smart. More info and purchase. |
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Chinese Keen on OCAnother prediction for '14: Goods aren't all that's coming from China. Chinese investors are bringing their capital, game for acquiring more OC properties. "Orange County is particularly attractive to Chinese investors because of the existing Chinese population throughout Southern California," says Cox, Castle & Nicholson partner Greg Karns (the one with the black pants), a real estate attorney who's brokered deals in China and across the US. "Chinese real estate developers and investors are drawn to luxury homes in cities like Newport Beach and Irvine," he tells us, adding that SoCal has always been alluring for Chinese commercial investment. "We expect to see even more investment throughout 2014 and 2015." |
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Movember! Movember! Movember! The results are in, and OC real estate firms turned in some good showings for Movember, the moustache-oriented fundraising effort on behalf of fighting men's cancer. Hanley Investment Group raised more than $22k for the cause, and grew some mighty fine 'staches, too.  Brower, Miller, Cole sent us this video--in which you'll see 'staches in unusual places--and tells us that the company was inspired by Bisnow (more specifically, by our handsome mustachio'd staff) to participate in Movember for the first time. They're going to do it every year from now on. |
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