Monthly Archives: July 2011
Kidder Mathews Peninsula/San Mateo County Office Q2 Report
The San Mateo County office market ended the second quarter of the year with 464,077 square feet of net absorption, marking the fifth consecutive quarter of positive occupancy growth. While the larger technology companies are leading the surge in demand, activity among small to mid-size companies continues to rise as overall economic conditions improve. Rental rates on the Peninsula once again displayed signs of steady elevation
rising to an overall average rate of $2.68/square foot, full service.
Venture Capital funding continues to increase quarter-over-quarter in the area with the software, energy, and biotechnology sectors receiving the most money. While the technology sector is expected to continue to increase demand and economic activity in the upcoming quarters, overall leasing activity is expected to steadily increase from a broad range of tenants.
Read the entire report here: office-market-research-peninsula-2011-Q2
Kidder Mathews Peninsula/San Mateo County Industrial Q2 Report
After careful research and thoughtful analysis, we are happy to bring you the 2011 Second Quarter Market Report for the San Francisco Peninsula. Although not all of the news was positive, there is still a sense of optimism on the street that industrial is making positive gains. We are seeing many businesses upgrade their current facilities either due to growing out of their existing space or taking advantage of the competitive rates. Anyway, here’s the report:
“The San Mateo County industrial market finished the second quarter of the year with -8,447 square feet of net absorption. This is roughly a 50,000 square foot decrease from the first quarter. This marks the first quarter in the last four that net absorption has been in negative territory. The second quarter finished with an availability rate of 10.2%, down slightly from the first three months of the year. The industrial market is expected to see users slowly enter back into the marketplace in the second half of the year and into 2012.”
Read all of the report by clicking here: industrial-market-research-peninsula-2011-Q2
Swift Buys 1 Million Square Foot Bank of America Campus in Concord
By Natalie Dolce
Swift Realty Partners, an investment firm headed by former Equity Office Properties exec Christopher Peatross, has acquired the four-building, 1.1-million-square-foot Bank of America Technology Center in Concord, a source tells GlobeSt.com. The sale, terms of which were undisclosed, is believed to be the largest single office property sold in the San Francisco Bay area in the last three or four years. The property includes buildings of 380,000, 310,000, 210,000 and 200,000 square feet, with Bank of America occupying all of them except the 200,000-square-foot building, which is vacant.
The complex of buildings is known as Concord Technology Center, according to press reports from several years ago that said BofA was in the market to sell the property. Those reports said that BofA was looking to execute a sale-leaseback of the buildings.
Read the rest of the Globe Street article here.
Third Party Logistics company leases up 151,000 SF
Details:
Address: 3525 Arden Road, Hayward, CA
Tenant: nal.syncreon
Owner: DCT Industrial
Actual Price: Contact us
Bldg Type: Industrial
Total Leased SF: 151,389
Terms: 60 months
Rising Sales Volume, Deal Value Show Continued Investor Faith In CRE
Led by a near doubling in the average dollar size of transactions, year-over-year commercial real estate sales volume rose more than 150% in May, according to the latest release of the CoStar Commercial Repeat Sale Indices (CCRSI).
The average price of an investment-grade transaction was $33.2 million in May — nearly double the average of $16.9 million in April — while the average dollar size for general commercial property deals was $1.7 million, up slightly from $1.65 million the previous month.
The dollar volume of investment-grade sales also continued to rise significantly in May, jumping more than 191% on a year-over-year basis. Consequently, investment-grade sales comprised nearly four-fifths of the total CRE sales volume pie, jumping to 79.2% in May from 61.9% the previous month. General-grade property sales volume rose 62% in May from a year ago.
“The May pricing increase reported this week, combined with the robust increase in monthly sales volume, shows that investors continue to seek out commercial real estate during uncertain times,” said Chris Macke, senior real estate strategist for CoStar Group, Inc.
Macke said a number of large recapitalizations in New York City helped drive up the average dollar size of May sales transactions.
“This is good because it signals a matching up of the money on the sidelines with those who need it, but for whatever reason haven’t been attracting that capital to date,” Macke said.
Investment-grade property sales volume in the 10 largest U.S. markets decreased to 38.7% of total commercial sales in May, falling below the two-year average of 45.8%, CCRSI data showed. Yield-hungry institutional investors have extended their searches for deal beyond the major metro areas as bidding for top-tier properties has driven up pricing in the most coveted U.S. markets.
Read more of the report here.
CoStar Reports Commercial RE Recovery Underway Nationally
As second quarter reports begin to come out, many are predicting the overall commercial real estate industry to show positive signs. According to CoStar, they show a general recovery underway although the story is slightly different depending upon the property type. The Bay Area is showing signs of life, especially in the office and apartment sectors, but as the story reveals, industrial has been lagging behind, albeit modestly. We are seeing inventory at moderate levels, with certain areas being difficult to find although the rates continue to bounce along the bottom with rates staying very competitive and landlords offering concessions. Here’s the story, but make sure to check back for our local quarterly report due out in the next week or so.
Commercial real estate fundamentals continued to strengthen in the second quarter of 2011, albeit at a much more moderate pace than the end of last year. The temperate recovery is consistent with global economic trends, which softened in the first half of the year in the face of the Japanese earthquake and the oil-price shock.
While the economy continues to face challenges – including a struggling housing market, anemic job growth, and federal and state fiscal pressures – economic growth is expected to pick up in the second half of the year as energy prices ease and global supply chains are restored. As the economy gathers momentum, the CRE recovery should also accelerate, according to Kevin White, a real estate strategist with CoStar.
Read more of the story here.
