Tag Archives: Commercial property

Goodbye Austin, Hello Albany

College of Nanoscale Science and Engineering a...

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The Business Review reports that International Sematech will be moving their headquarters and more than 100 jobs to Albany in January.

International Sematech’s headquarters and all operations will move in January 2011 to the the University at Albany’s College of Nanoscale Science and Engineering.

Gov. David Paterson said International Sematech was “picking up [its] stakes and moving its operations in Texas” and relocating to New York.

International Sematech and private partners will invest a combined $80 million, officials said. In addition, $20 million in state money will be contributed through the state Assembly and Empire State Development Corp.

International Sematech used to be based in Austin, Texas. The consortium has had a presence on the Albany NanoTech campus since 2003.

Read more: Int’l Sematech moving operations, 100 jobs to Albany – The Business Review (Albany)

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U.S. Commercial Real Estate Suffers Worst Fall on Record

From DSNews.com:

Commercial real estate in the United States has suffered its worst annual capital return on record, according to Investment Property Databank (IPD), whose data stretches back to 1978.

The global real estate analysis firm, headquartered in London, reported this week that the IPD U.S. Quarterly Property Indicator fell 23.9 percent in 2009. That dive pushes the total capital decline to 33.4 percent from December 2007, when commercial real estate values were at their peak.

While the pace of market value decline eased over the final quarter, IPD says continued cap rate pressure together with weakening rental fundamentals is curbing optimism that 2010 is the year of recovery for the commercial sector.

Read the entire story at:

U.S. Commercial Real Estate Suffers Worst Fall on Record: IPD.

U.S. CRE Falls to Lowest in 7 Years

I spy empty office buildings
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Bloomberg.com reports:

Dec. 21 Bloomberg — Commercial property values in the U.S. declined in October to the lowest level in more than seven years as unemployment reduced demand for apartments, offices and retail space.

The Moody’s/REAL Commercial Property Price Indices fell 1.5 percent in October from September to the lowest since August 2002. Prices were down 36 percent from a year earlier and are 44 percent below the peak in October 2007, Moody’s Investors Service Inc. said in a statement.

Read the rest at: U.S. Commercial Property Falls to Lowest in 7 Years Update3 – Bloomberg.com.

Korpacz Survey Projects 2012 U.S. Comm Market Recovery

According to an Appraisal Institute newsletter, the latest PricewaterhouseCoopers Korpacz Real Estate Investors Survey anticipates further deterioration in the U.S. commercial real estate market through the remainder of 2009 and into 2010 before recovering in 2012.

The biggest problem is that commercial real estate lags what happens in the economy,” Susan Smith, director of PricewaterhouseCoopers’ real estate advisory service, told Bloomberg. “Companies are looking for ways to cut costs; many are continuing to reduce workers and are continuing to reduce their space needs.”

Survey respondents indicated that a wave of foreclosures and distressed sales may jump-start buying activity with investors seeking to purchase quality assets at cut-rate prices. “Some investors sense that near-term defaults with commercial banks will allow them to acquire quality assets at steep discounts, as banks may no longer be able to continue to ‘pretend and extend’ troubled loans and would be forced to place assets up for sale,” Smith said.

The 115 surveyed real estate firms noted that they expect commercial real estate prices to continue to fall or remain at their current level for at least the next six months. Respondents indicated that office rents in Manhattan and San Francisco, as well as suburban office rents across the country, may drop as much as 20 percent through 2010.

Office rents in Phoenix may drop 15 percent while rents in Boston, Chicago, Denver, Los Angeles and San Diego may drop as much as 10 percent. Strip malls built around big-box stores could see rent declines of as much as 10 percent, with regional mall rents falling by as much as 5 percent.

According to the survey, rental apartments are expected to lead the commercial market recovery starting in 2010 followed by the industrial and office sectors, which are expected to begin recovering in 2011 with a notable uptake in 2012. The retail sector, struggling in last place, is expected to lag behind with a slight recovery beginning in 2012.

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Moodys/REAL CPPI July 2009

Monthly National All Properties Index

Monthly National All Properties Index

July 22 , 2009 update:  The latest results of the Moodys/REAL CPPI show a return of negative 7.6% in May for the all properties national index.

Read the full story about the national and regional indexes:  MIT CRE : Moodys/REAL Commercial Property Price Index (CPPI).

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Falling Commercial Rents

Falling Leaves
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Boxwood Means released their national rent study:

Rents at small industrial and office properties continued to fall last month, according to Boxwood Means Inc.

But the rate of decline has not increased, according to the Stamford, Conn., research company that specializes in small-capitalization properties. And that could signal that the market might be close to reaching its cyclical bottom.

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