In the News—Week of July 17, 2023
Deal of the Week
A Phoenix based investment company sold a 37 unit apartment complex in Central Phoenix to an Arizona non-profit for $7.6 million. The transaction was handled by Bryan Selna, Senior Escrow Officer.
Los Angeles trails only NYC when it comes to CMBS debt nearing maturity
Los Angeles is the market with the second highest amount of commercial-mortgage-backed securities debt that will be reaching maturity in the next 18 months, The Real Deal reports. The area faces $17.9 billion of debt that will be due in the next year and a half. About $800 million of that shows signs of distress, The San Francisco Business Times reports. New York tops the list with $39.8 billion. Miami ($12.6 billion), San Francisco ($11.4 billion) and Las Vegas ($10.6 billion) also carry substantial CMBS liabilities.
Denver home to some greenest office buildings in the United States
Denver’s central business district has yet to recover from the pandemic, but the workers who are staying home don’t know what they’re missing. Denver’s buildings are among the most eco-friendly in the country, KDVR reports. The commercial real estate listing firm 42Floors looked at various factors, including CO2 emissions, space design, electric vehicle use, LEED and other certifications, in cities and ranked them. Denver was eighth, scoring high in building certification. Washington, D.C. topped the list.
Will bot-makers pull San Francisco office market out of the trash bin?
San Francisco has millions of square feet of vacant office space, but the artificial intelligence boom may bring some relief, CNN reports. Alexander Quinn, senior director of research at commercial real estate company JLL, says AI companies are beginning to drive office leasing demand. “San Francisco has just been a series of gold rushes,” Quinn says. “We’ve known ourselves to be an up and down type of economy historically, and that really manifested over the pandemic, and now we’re just starting to see that recovery.” For one AI company co-founder who lives in Southern California, there was no question where the new enterprise would be located. “The talent is unparalleled,” MosaicML co-founder Naveen Rao says. “There’s just no other place in the world that’s even close.”
Los Angeles planning board gives OK to 50-story residential tower
Los Angeles Planning Commission has approved a 50-story apartment building, known as the 8th Grand & Hope project for its location, Urbanize LA reports. The project, developed by Japan’s Mitsui Fudosan, would offer 580 units, a mix of studio, one-, two-, and three-bedroom residences. The City Council still must vote on the building.
Retail continues its strong rebound in Greater Phoenix area
Retail development in the Valley of the Sun continued its strong recovery from the pandemic during the first quarter of 2023, AZ Big Media reports. Figures from Avison Young show that the market recorded 1.24 million square feet of net absorption in the first quarter, an 11.2 % increase from the fourth quarter of 2022. The vacancy rate is 5.6% “I’ve been doing this for 20 years, and I’ve never seen a lower vacancy rate,” Avison Young’s principal, James DeCremer, says. “It suggests that (the Greater Phoenix retail sector) is underbuilt, which supports the recent uptick in development. If construction costs were lower, we’d see even more being built.”.
Meanwhile back at The Ranch: Gilbert approves $1 billion mixed-use project
After 18 months of negotiations, the Town of Gilbert has approved zoning for The Ranch, a mixed-use project that will include light industrial, shopping and restaurants, and residential, AZ Big Media reports. IndiCap, Colmena Group, and Langley Properties are the developers behind the $1 billion, 311-acre project, located near the Loop 202 freeway. “We are incredibly excited and grateful for the Town of Gilbert’s zoning approval, which solidifies our vision for this groundbreaking project,” says Todd Ostransky, Regional Vice President of Development for IndiCap.