Dave Mazurek

Our Industrial Construction Cost Guide below offers insight into the factors driving the #industrial real estate market in 45 key cities which can affect capital planning and budgeting. 

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CBRE's 2024 U.S. Life Sciences Talent Trend report highlights The Columbus Region as a top R&D market. Notably, Ohio stands out with three or more life sciences labor clusters nationwide, showcasing a strong ecosystem. Eddie Pauline, Ohio Life Sciences attributes this success to strategic investments in talent and the overall life sciences landscape. Dive deeper into the insights in Carrie Ghose's article on Columbus Business First & explore the full report here: https://lnkd.in/gVaZS85v

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Family offices are making waves in the CRE capital markets! This article by Brian Pascus gives the most thorough snapshot of the recent and current activity of family offices in CRE. I strongly urge my network to read the entirety of the article which includes contributions from a fantastic group of experts. “Every time the market is bottoming out, it would appear to be the most opportune time to buy, and the buying wave is always started by high-net-worth individuals and families,” said Bob Knakal. “What we’re seeing today is that the investment wave is, yet again, being led by high-net-worth families.” Since March of 2022 (the start of interest rate hikes), the majority of my team's deals have been bought by family offices with either 100% cash or bank financing from a bank where they have deposits. #InvestmentSales, #CapitalMarkets, #CommercialRealEstate, #CRE, #RealEstateInvestment; Brian C. Adams, Kevin Aussef, Zach Redding, Nicco Lupo, David Perlman, Jay Neveloff, Dan Berman, Ran Eliasaf, Richard Byrne https://lnkd.in/egMJRSc3

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While a pullback in tenant demand will increase the vacancy rate as new industrial developments are delivered to the market in the short-term, the lack of new supply coming to the market beyond 2024 will drive increased competition for available space in the long-term. Additionally, less competition from developers will present more opportunities for build-to-suit developments.   What does this mean for occupiers of industrial real estate?   In the attached Bisnow article, it mentions, “Space was just flying off the shelves. It was really a ‘if you build it, they will come’ mentality (over the past 3-4 years).” Occupiers of real estate certainly have more leverage in this market than in recent years, but the important question is:    How long is this going to last? Is this going to be short-lived?    #industrialrealestate #businessowners #entrepreneurs #tenantrep #buyerrep

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In 2021, Chicago's industrial sales volume surged to $9+B as 700+ properties and 103M SF traded. This spike was driven by a favorable lending environment and increased investor confidence post-COVID, marked by high demand, low vacancy, and strong rental growth. Then we saw investment activity slow by nearly 50% in 2023 compared to the previous year. Despite the overall slowdown in investment, the average price per square foot for industrial properties has remained stable and even increased due to strong demand, highlighting the industrial sector's continued health. #chicago #industrialrealestate https://lnkd.in/gycgXD3U

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While a pullback in tenant demand will increase the vacancy rate as new industrial developments are delivered to the market in the short-term, the lack of new supply coming to the market beyond 2024 will drive increased competition for available space in the long-term. Additionally, less competition from developers will present more opportunities for build-to-suit developments. What does this mean for occupiers of industrial real estate? In the attached Bisnow article, it mentions, “Space was just flying off the shelves. It was really a ‘if you build it, they will come’ mentality (over the past 3-4 years).” Occupiers of real estate certainly have more leverage in this market than in recent years, but the important question is:    How long is this going to last? Is this going to be short-lived?    #industrialrealestate #businessowners #entrepreneurs #tenantrep #buyerrep

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Cincinnati Healthcare Real Estate Market Surges in Q2 2024 The Healthcare Commercial Real Estate Market in Cincinnati continues to see growth in Q2 2024. The occupancy rate rose to 93.7%, up from 93.1% in Q2 2023, with total square footage expanding to 11,897,905 SF. Despite a decrease in average lease rates to $16.40 per SF (compared to the national average of $24.63), the market shows strong demand and utilization. Our Colliers Healthcare Experts expect to see the growth continue through the back half of 2024 and into 2025! Read the full report by clicking the link below. https://lnkd.in/g-JvH3NX #Colliers #ColliersResearch #IndustryLeaders | Sloane Nichols, CCIM, Elaine Gillespie, Sarah Higgins, Jeremy R. Jacobs, JD, MBA, Cristian Arenas, Catherine Williams, CPMC

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As we head for the back half of the year, it will be very interesting to keep a close eye on ‘higher for longer’ interest rate notion via the lens of Apollo’s dubbed “CRE maturity wall.” Sharing this infographic that illustrates the amount of assets within CRE (by property type) that face re-fi risk in 2024 and beyond. #JLL #Apollo #NNN #Interestrates #CRE #RealEstate

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As the industrial market slows down it isn't surprising to see Prologis forecast less demand as vacancy rates begin climbing nationally. The industrial market saw unprecedented rent growth since the start of the pandemic but that was an unusual set of circumstances unlikely to be completed. Overall, the industrial market is healthy and not overbuilt in most markets. Here in South Florida we have a wave of new product delivering over the next few quarters which will push the average vacancy rate a little higher and even though deal velocity has slowed, the long term demand for industrial space is more than likely. #JLLindustrial #warehousing #logisticsproperties

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The CRE precipice and the personal guarantee. 🍀 Investors could be on the precipice “of one of the most significant real estate distressed investment cycles of the last 40 years.” John Brady global head of real estate Oaktree Capital Management, L.P. Yahoo Finance / Bloomberg 🍀 “Trillions of dollars of problematic commercial real estate will have to be worked out over the next two to three years, creating an “amazing amount of opportunity” for investors, according to Marathon Asset Management Chief Executive Officer Bruce Richards.” 👉👉 https://lnkd.in/gV5K9cxz 🍀 But for every investor who makes money buying distressed CRE loans or foreclosed properties, there’s usually a borrower and/or a lender losing money. Which brings us to the dreaded borrower personal guarantee or PG. Banks will need to start collecting on loan deficiencies as loan extensions increasingly turn into foreclosures. And unlike CMBS and CLO loans, many banks require borrowers to provide personal guarantees on CRE loans, particularly on higher leverage and construction loans. But, as every banker knows, the personal guarantee is the weapon of ‘borrower relationship destruction’ that lenders are loathe to pursue - and by all accounts have largely avoided so far. But that may be changing. For banks in particular, as regulators get tougher on iffy bank balace sheets as nonperforming CRE loans continue to pile up, collecting on borrower PG’s is an approaching reality in order to limit capital infusions or worse, be forced by regulators to merge or be acquired by other stronger banks. But bank profits are driven by loan origination which is in-turn driven by relationships with borrowers. After nurturing and building relationships with CRE borrowers for years, a banker’s worst nightmare is to then turn on that relationship and sue them personally for the amount of the shortfall in the loan. And this will spawn a whole lot of borrower / lender litigation. Not a fun time to be a banker. And not a fun time to be a borrower who’s personally guaranteed CRE loans. 🍀 Chart by CRED iQ® 🍀🍀🍀

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The medical office building (MOB) investment market faced significant challenges in Q1 2024, with a 21% drop in investment volume quarter-over-quarter and a 7% decline year-over-year, as reported by CBRE. Despite demographic trends driving demand for outpatient care, high interest rates and inflation have constrained investment activity. Cap rates and vacancy rates have also risen, reflecting the broader struggles in commercial real estate. However, MOBs still command higher prices per square foot compared to traditional offices, indicating resilience. Read this article to learn more! #oregonrealestate #portlandrealestate #oregon #oregonrealtor #portlandrealtor #portlandoregon #pnw #commercialrealestateagent #portland #commercialrealestateagent #pdxrealestate #pdx #pdxrealtor #CRE #pnwcommercialrealestate #officespace #warehouse #realestateinvesting #industrialspace #flexspace #commercialproperty #business #land #portlandrealestateagent

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Some Investors Say CRE Could Be Close To Bottom: 1Q 2024 ValTrends Report   Adversity continues to buffet commercial real estate (CRE), including high interest rates, constrained capital availability, conservative underwriting standards, low deal volume and negative returns. But some investors believe CRE is close to the bottom, according to the latest ValTrends report, “In the Crosscurrents,” SitusAMC’s quarterly analysis of important trends in the economy, CRE sectors, capital markets and the investment environment. Download free, 28-page report for 1Q 2024 now. https://lnkd.in/gQCr-bsn

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NEPI Rockcastle has reported double digit growth in net operating income (NOI), up 9.4% on a like-for-like basis, with tenant sales having increased by 10% during Q1 2024 versus Q1 2023. All product categories recorded higher sales, except ‘Sporting Goods’ (-2.3%) with the best performing categories ‘Health & Beauty’ (+19%) and ‘Services’ (+18%). Fashion, the largest segment, saw sales increase by 9%: https://bit.ly/3UFjiMx #nepirockcastle #commercialrealestate #europe #realestateinvestment #propertyfund #realestatenews #propertydevelopment #propertyowners #landlords #retailrealestate #assetmanagement #shareholders #investorrelations #propertynews #poland #listedcompanies #JSE

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Key Takeaways from the Walker & Dunlop April 2024 MIG deck, supporting a "sell-now" bias. This bias is further supported by a dramatic oversupply of capital flows pursuing an inadequate supply of actionable, investment grade, multifamily offerings in the Midwest. #WalkerDunlop #MidwestMultifamily #Indianapolis #InvestmentSales

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Medical device companies: Choosing a site for a manufacturing facility is one of the most important business decisions leadership can make. Follow these tips to mitigate risks, save on operating costs, find the right talent and more. #JLLlifesciences #medtech #medicaldevices

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👀 In The Know 👀 "Easing Inflation Boosts Odds of Two Fed Rate Cuts This Year" Great insights from CBRE Research, Here's what we learned. Key Takeaways: ↗ Energy Dip: Continued decline in energy prices for the 2nd month. ⛽️🔻 ↗ Shelter & Insurance Hike: Increases in shelter costs and motor vehicle insurance remain areas of concern. 🏠💸 ↗ Core Inflation Cools: Core inflation (excluding food and energy) rose by just 0.1% for the month, marking the lowest annual increase in three years. 🌡️👇 What’s Next? ↗ The Fed is likely gearing up to lower interest rates, starting with a 25-basis-point cut in September, which could invigorate real estate investments and broader economic recovery later this year. 🏗️📈 ↗ Market Outlook: Shelter Costs: Expected to ease later this year despite a significant impact on inflation currently. ↗Service Sector: Likely to remain sticky, but overall inflation is projected to align closer to the Fed's 2% target. 🎯 ↗Treasury Yield Prediction: Anticipated to drop to 4.1% by year-end, boosting investment opportunities. 💹 Read Full Article Here: https://lnkd.in/gWqRcJCS Let's discuss in the comments below how these changes might impact our strategies and decisions moving forward! 💬🔄 Flores | Gomez | Kaye Arthur Flores, Jay Gomez, James Kaye, Kyle Kaye, Darren Fitch #FGKRetail #CBRE #CBRERetail #InflationUpdate #EconomicTrends #RealEstateInvestment #FinanceProfessionals #MarketInsights

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When I saw the headline that Prologis was warning of slowing industrial leasing, my first thought was, "Uh oh, now what?" But in reality, PLD is just saying what we already know. The market isn't in any danger whatsoever. The process is just slowing. This statement sort of sums up what is obvious on the ground. "While operating conditions are healthy in the majority of our markets, customers remain focused on controlling costs, which is weighing on decision making and the pace of leasing," Prologis CEO Hamid Moghadam said in a statement. That phrase - the pace of leasing - is the key. As someone who has made it thru a number of recessions, including the "great one", I can remember days of going to work with little hope of finding any real deals to work on. Atlanta was smaller then, with about 20 industrial developers/owners. When the market slowed, it wasn't the process. It was projects. Companies were either closing or holding on. No one was looking to do real estate deals. We're in a very different climate today. Every real estate broker I speak to is busy. Atlanta is a much larger economy, not just focused on the industry of growth, but a diverse number of industries we never saw before. These include energy, entertainment, bio sciences, automotive and food processing/distribution. With such diversity, someone is always growing no matter what's going on in the economy at large. Put simply, there are plenty of deals out there. But I will agree with Mr. Moghadam that deals are taking a lot longer due to caution among the users who are no doubt concerned about the headlines they read each day. That sentiment has been guiding deal velocity for some time now, and today I believe we are starting to move past it. Our team is seeing more tours, more RFPs, more deals getting into legal than we have for some time. The wheels are moving again. Let's keep up the hard work!

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REITs Posted Their Strongest Returns of the Year in May The FTSE Nareit All Equity REITs Index posted a total return of 5.3% in May, marking the strongest monthly performance of 2024 and outperforming broader equity markets. The Russell 1000 and Dow Jones U.S. Total Stock Market both rose 4.7%. Through June 12, the All Equity REITs rose 0.5%, while the Russell 1000 was up 2.6% and the Dow Jones U.S. Total Stock Market was up 2.5%. Inflationary measures remain higher than the Federal Reserve’s target, leading most investors to expect that if there are rate cuts this year, they will occur toward the end of the year. As of May 31, the dividend yield on the FTSE Nareit All Equity REITs index was 4.19% and the FTSE Nareit Mortgage REITs Index yielded 12.48%, compared to 1.32% for the S&P 500. The yield on the 10-Year Treasury fell 19 basis points to end the month at 4.49%. https://lnkd.in/gZ2SM59Z

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From CRE DAILY: Private Equity Seeks Bargains in US Real Estate Distressed investors are seizing a rare chance to buy troubled US CRE assets, with private equity firms leading the charge. Betting on distress: Private equity firms are circling the distressed US property market like sharks sensing blood in the water. According to Preqin data, approximately 64% of the $400 billion earmarked for property investments is focused on North America, marking the highest allocation in two decades. Filling the gap: The US CRE market is on sale, with office values dropping nearly 25% last year due to remote work. This year, $1 trillion in CRE debt will mature, leading to a surge in defaults as borrowers struggle to repay. PGIM reports a $150 billion gap between maturing loans and new credit availability, creating prime opportunities for patient investors. Shrinking pool: While the US attracts private equity buyers, the global pool of PE capital for CRE has shrunk. The amount set aside for real estate debt strategies dropped 26% to $56.1 billion by May 2023, per Preqin. This decline could limit interest in non-performing CRE loans worldwide. Charles McGrath of Preqin notes, “Dry powder is declining” due to higher borrowing costs affecting fundraising and transactions. This comes as European CRE debt, with LTV ratios over 100%, nears €160 billion, highlighting severe financial strain. The looming crisis: US banks, heavily exposed to real estate, face severe risks, highlighted by NYCB’s and First Foundation's recent capital injection. Oaktree’s analysis suggests that a 20% drop in CRE values could put more US banks at risk than during the 2008 crisis. Barry Sternlicht of Starwood Capital Group has also noted ongoing lender challenges, with Starwood’s income trust tightening withdrawal limits to maintain liquidity. ➥ THE TAKEAWAY What experts think: While the US presents a fertile ground for distressed asset buyers, the global CRE market faces prolonged recovery challenges. The global pool of PE capital for CRE has decreased by 26% to $56.1 billion through May 2023. This decline could limit interest in non-performing CRE loans globally, as higher borrowing costs deter fundraising and transactions.

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