In the News—Week of June 24, 2024

 In The Title Trove

Deal of the Week

A Newport Beach, CA-based industrial real estate investment group sold a 156,154 square foot business park in Mesa, AZ to a joint venture of two Southern California investment groups for $32.9 million. The business park consists of eight freestanding buildings, three of which are multi-tenant, and is located in a prime industrial area near the Phoenix-Mesa Gateway Airport. The transaction was closed by Shelia Hunter, Vice President and Senior Commercial Escrow Officer in our Scottsdale, Arizona office.

National

Larger units in Sun Belt behind rise in size of average apartment in U.S.

The average size of new apartments in the U.S. increased significantly in 2023 because of an increase in two- and three-bedroom units on the market, Building Design and Construction reports. Figures from RentCafe show the average apartment was 916 square feet, an increase of 27 square feet over last year’s survey. During the past decade, the average size of multifamily housing units has been decreasing, mostly due to one-bedroom apartments that dominate the market. An increase of multifamily construction in the Sunbelt paved the way for the increase. Led by Florida, the Sunbelt is that section with the largest apartments.

National

Blackstone honcho says now is good time to invest as market nears bottom

Blackstone’s COO Jonathan Gray says now is a good time to invest in commercial real estate as the market shows early recovery signs, MarketWatch reports. Despite ongoing negative headlines, Gray encourages buying at this stage. Blackstone has been actively investing in the sector, including a recent $1 billion portfolio acquisition of assets across the UK and U.S.

National

Demand for office in NYC down 22% since March; still better than 2021-23

NYC office demand dropped 22% since March, equivalent to 3 million square feet, but remains above the 2021-2023 monthly average, Connect Real Estate reports. The Green Street Commercial Property Price Index shows small tenants are showing positive momentum, while tech and legal sectors are seeing declines. The average size of tenants who are leasing for 2027-2028 is larger than those leasing in the near term. Trophy assets experienced the largest rent increase in April, followed by Class A and Class B properties.

National

Projection shows CRE market in SF may not recover until 2042

San Francisco’s office space recovery following the pandemic may take up to a decade, The San Francisco Standard reports. Real estate firm Avison Young projects a return to normalcy could happen by 2033, but a slower recovery rate could push this date back to 2042. San Francisco’s office vacancy rate exceeds 30% — the highest among major markets in the U.S.

Arizona

State cancels auction of land where Coyotes owner planned to build arena

The Arizona State Land Department has canceled an auction for a tract of land where Arizona Coyotes owner Alex Meruelo planned to build a new arena, The Associated Press reports via TheScore.com. This decision has cast doubt on the future of the Arizona Coyotes. The original Coyotes are relocating to Salt Lake City. The NHL has promised a replacement franchise if Meruelo can get an arena built. The cancellation of the land auction puts the return of NHL hockey to Arizona in jeopardy.

Arizona

Bowling center and arcade to fill vacant Sears slot at Chandler mall

The vacant Sears location at Chandler Fashion Center in Arizona has found a new tenant, Round1 Bowling & Arcade, The Daily Independent reports. This will be the company’s third location in Arizona and second in the Valley. The other locations are in Glendale and Tucson. The 65,000 square foot space will include bowling, arcade games, billiards and karaoke. An official opening date has yet to be announced. “We want to provide endless fun and help our guests create special memories. With all of our different activities, there is something for everyone in the (Chandler) community,” Shane Kaji, Round1’s executive vice president, says.

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