Commercial Real Estate

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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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