Gary Richetelli

Commercial Real Estate

Category: commercial real estate

Real Estate in Cairo

In recent global real estate news, sectors of the Cairo market have shown a positive increase performance-wise upon analysis during the first three months of 2015.  This improvement in their market lead to a stronger confidence and investment inclination, helping increase political and economic stability for the country.

gary richetelli cairo real estate

According to an article published in Property Wire, “A new analysis from international real estate firm JLL says that this confidence is most clearly illustrated by the recent announcement of the mega real estate project Cairo Capital which will serve as an extension for New Cairo and will draw the centre of gravity further to the East of the existing city,” (Improved Economy and Political Stability Boost Cairo Property Markets). Data confirmed that residential sale prices increased across Cairo over the first quarter of the year. In addition, the hotel real estate market has also shown an increase in performance with the amount of tourists and occupancy rates rising.

Improved sales figures within the residential market in Cairo are also showing an increase. According to Property Wire, “Apartment and villa sale prices increased during 2015 across all the areas monitored by JLL as many residential developments have few units left and have increased prices accordingly,” (Improved Economy and Political Stability Boost Cairo Property Markets).

Even better news is that this positive economic outlook is expected to continue to increase investment in the residential sector throughout the year. Cairo is undoubtedly a city to keep an eye on for the entirety of 2015. For more information about Africa’s real estate market, read this article published by Property Wire.

 

Global Real Estate Trends

According to an article published by Carisa Chappell on REIT.com, foreign real estate investors have been favoring commercial real estate in the United States for quite some time now.  Chappell explains, “Markets in the United States dominate as the top global cities for real estate investment, according to participants in the Association of Foreign Investors in Real Estate’s (AFIRE) annual survey,” (Chappell, Survey Shows Internationals Investors Favor U.S. Commercial Real Estate). The top global cities that have been favored for investment were: New York, London, San Francisco, Washington, and Houston – with the United States representing four of top five.

gary richetelliBut what is the reasoning for this?  Chief executive of AFIRE discussed with REIT.com why the U.S. is preferred to all other countries in the world.  In Chappell’s article, Fetgatter says, “‘I think non U.S. investors have some faith that the U.S. is coming out of the recession.  The recovery may be slow, but I think they feel like it’s a definite recovery and we’re not falling back down into another recession,’” (Chappell, Survey Shows Internationals Investors Favor U.S. Commercial Real Estate).  In addition, Fetgatter noted noted that commercial real estate in the U.S. is one of the most stable, secure investments that people can rely on.

Apart from the United States, Turkey was also noted as being a country that contained an increase of renewed interest in AFIRE’s survey.  Turkey was ranked number three for the top emerging countries to invest in this past year and has been on the rise in previous ones.  With Turkey’s location, “Fetgatter attributed the renewed interest to Turkey being the logical place for companies looking to establish a foothold in the Middle East,” (Chappell, Survey Shows Internationals Investors Favor U.S. Commercial Real Estate).

In terms of the latest global trends for commercial real estate, it looks like America and Turkey are up there on the list, but if you want more information on this topic, check out REIT.com’s article here.

 

Georgetown University’s New Global Real Estate Center

In recent real estate news, two Georgetown University McDonough School of Business alumnus are donating $10 million for the school to build a global real estate center. Robert Steers and his wife, Lauren, want this center to help both undergraduates and MBA students prepare for global real estate careers by offering various career planning strategies and consulting projects.

gary richetelli

Georgetown’s new Steers Center for Global Real Estate

Mr. Steers is the current CEO of the global investment manager Cohen and Steers in New York City, which focuses on real estate innovation, along with infrastructure and commodities and income solutions. Mr. Steers commented on his excitement of the new building to the Washington Business Journal, stating, “‘It was important to me to see Georgetown McDonough create a formal real estate center with the financing to be permanent and to think and plan strategically,’” (Clabaugh, Georgetown Biz School Alum’s $10M Gift Funds Center for Gloal Real Estate).

The Steers Center for Global Real Estate, which was once the school’s Real Estate Finance Initiative will implement individualized career planning with experienced professors and mentors, helping the school become one of the primary destinations for global business education.

For more information about the new Steers Center for Global Real Estate, please read the Washington Business Journal’s article here.

Is Greece’s Real Estate Market Recovering?

Real Estate Market in Greece

Signs point to a gradual Greek real estate recovery.

While the country is still certainly facing challenges, the recent upswing in the Greek economy has been attracting more real estate investment since before the global financial crisis began in 2008.  The Wall Street Journal has the full story here.

Tourism is one of the major factors that seems to be contributing to the country’s gradual but consistent recovery over the past year and a half.  According to the Wall Street Journal piece, Greek Real Estate experts, like George Kintis of Alcimos, have compared the situation in Greece to that of Florida in the United States.  Florida’s affordable real estate prices and perpetually warm weather have attracted not only vacationers from out of state but foreigners looking to purchase a second home.  Kintis feels that European and Asian buyers in the market for a vacation home would find Greece attractive for several reasons.  The Mediterranean’s consistently temperate climate makes it an ideal location for a second home.  Coming off one of the worst economic crises in its history, Greece has an extremely affordable real estate market.

Though the Greek residential market has failed to recover as of yet, analysts believe the bounceback could follow on the heels of what is perceived as a modest but growing commercial recovery.  Major deals have been taking place across Greece over the past 18 months.  The uptick is largely being driven by the fact that European countries that underwent similar financial turmoil are beginning to recover in their real estate sectors.  Hard-hit nations like Spain, and Ireland have received influxes of real estate investment over the past few years and while neither experienced the same kind of economic downturn that Greece did, the recovery of the real estate market in those countries has made real estate holding groups more optimistic about Greece’s future prospects.  International real estate investors would be smart to keep a close eye on the Greek market which could be poised for a boom.

NYC Real Estate Watch: Cooper’s Moves to Open Second Location

Craft Beer

Cooper’s is banking on the tech sector being thirsty for craft beer after their recent 10-year lease signing for a second location.

How do you catch a Silicon Alley tech executive with money to burn on food and drinks?  You bait him with 24 types of craft beer.

A recent real estate deal watch in Crain’s New York profiles Tom O’Byrne, the owner of New York’s LES Cooper’s Craft and Kitchen.  O’Byrne recently made a splash by inking a deal for a 2,000 square foot space on 8th avenue in New York’s hip Chelsea neighborhood.  By moving to open a second location with a 10-year lease in one of NYC’s most expensive neighborhoods, it’s clear the O’Byrne doesn’t believe the craft beer trend is going anywhere any time soon.

According to reports, rent for the space comes in at around $150 per square foot.  So why is O’Byrne confident enough to pay such a steep price?  One of the reasons is the flourishing tech community in the Chelsea area.  As expensive as the neighborhood has been over the last several years, rent continues to rise on a regular basis.  For example, similar ground-floor retail spaces on 8th Ave. skyrocketed nearly 70% in the last year alone.  The spike is most likely due to the proximity to major tech players like Google and Twitter who have offices in the area.

The original Cooper’s has been operating in the Lower East Side for about three years and O’Byrne clearly feels it’s time to strike while the iron is hot.  He’s clearly banking on craft beer becoming a staple rather than a fad.  While unique microbrews don’t seem to be going anywhere any time soon, those in the business should take note of another niche gastronomical trend’s death knell.  Just as Cooper’s announced a new craft beer centered bar, the NYC based cupcake bakery, Crumbs shuttered its doors.  It seems no food or drink fad is safe from falling out of favor with fickle New Yorkers.

Commercial Real Estate Spotlight: Nashville Commercial Real Estate Market

Downown Nashville

Nashville, TN has one of the fastest recovering commercial real estate markets in the country.

When national real estate market trends are published it’s easy to get lost in the numbers.  Vacancies are down.  Rents are up.  But what does this mean on a more granular level?  To analyze these numbers in a qualitative way, the savvy commercial real estate investor should also put faces to the numbers so to speak, by researching what’s going on in individual real estate markets throughout the country.

Today we’ll take a look at Nashville’s booming commercial real estate market for a bit of local context which can help explain national trends.  The Tennessean Online recently published an article discussing the continued strength of Nashville’s real estate market in 2014.

After two quarters, the vacancy rate for Nashville’s industrial and office space was down to an almost seven year low.  Coming in at just 9.8%, more office spaces are being leased than any point since the second half of 2007.

Not only are businesses new and old signing leases at a higher rate, there is a renewed investor interest in Nashville’s commercial market.

As far as specific highlights, Fifth Third Center was sold to Lincoln Property Company out of Dallas for $90 million, while Fourth & Church went for just under $34 million to property company, Albany Road.  The fact that large scale deals with management companies as well as individual leases with companies continue to be strong are both signals that the market will remain strong throughout the year and beyond.

Chris Gear, a partner at Colliers believes that this increased growth will lead to new office construction and rising rent sooner rather than later.

If you are a real estate investor looking to expand out of your market, Nashville, Tennessee might be worth a second look.

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