Each Wednesday, The Wrap
presents a compilation of recent noteworthy commercial real estate stories from
a variety of publications. Below are five stories that caught our eyes in
recent days.
• “The
Rising Cost of Prescription Real Estate” by Mark Heschmeyer of CoStar.
Drugstores continue to be sold at record-high prices, Heschmeyer
reports.
Walgreens stores are particularly popular with investors
right now, showing a significant increase in per-square-foot sale prices since late
last year, according to CoStar data. Walgreens were going for an average of
$374 per square foot in the fourth quarter of 2011, and now are selling for
$419 per square foot, Heschmeyer reports. That’s a 12 percent increase.
CVS is also seeing a 12 percent increase in per-square-foot sales
prices over the same timeframe. Rite Aid stores are experiencing a 7 percent increase.
• “Skyscraper?
Value of New York Tower is High” by Craig Karmin of The Wall Street Journal.
TIAA-CREF, one of the largest pension fund managers in the United
States, has agreed to pay about $250 million to developer Forest City Ratner
Cos. for a stake in a Manhattan apartment building currently valued at a record
$1 billion.
The 850-foot-tall tower at 8 Spruce St. in lower Manhattan
features penthouse apartments with asking rents of up to $60,000 a month.
TIAA-CRE’s stake will cover 49 percent of the building’s equity, according to
Karmin.
Even though momentum in the apartment sector is slowing,
investor demand remains strong for high-end apartment buildings, Karmin notes.
• “Will
Shipping Containers Catch On as Building Products?” by Anna Spiewak of
Commercial Property Executive.
As the construction industry is becoming “greener,” shipping
containers are now being looked at in a new way: as building material for
residential and commercial properties, according to Spiewak.
Shipping containers are strong structurally, said engineer
Patrick Beville, who has built six homes out of the containers. Containers also
tend to produce small homes that are faster to build, more sustainable and
cheaper, Spiewak notes.
Worldwide, shipping containers are being used more
frequently in construction, such as in the case of an entire block of
apartments in Johannesburg, South Africa. A 36-room hotel made of containers is
planned in Detroit, Spiewak notes.
Public acceptance is slow as people wait to see more
contemporary designs that don’t have a “trailer-home” feel, Spiewak reports.
• “French
Software Maker Arkadin Puts North American HQ in Atlanta” by Urvaksh
Karkaria of the Atlanta Business Chronicle.
Paris-based Arkadin, a communications software maker, has
moved its North America headquarters from New York to Atlanta, Karkaria
reports.
Arkadin President Mark Alexander told Karkaria that being in
the fast-growing Southeast will provide the company significant advantages for
long-term growth. Atlanta provides Arkadin better coverage of the United States
and better access to skilled talent, according to a company spokeswoman.
Arkadin has leased more than 10,000 square feet in the
“Queen Building” located at 5 Concourse Parkway in the Central Perimeter
submarket, according to Karkaria.
• “Bank
CRE Lending Slows to a Crawl” by Mark Heschmeyer of CoStar.
The third quarter had banks retreating from commercial real
estate lending, Heschmeyer reports.
Lending for multifamily properties was up just 1 percent,
and investment property lending was up about one-quarter of a percent.
Construction and development loans were down 3.3 percent in the third quarter.
Bank lending for refinancing or buying owner-occupied commercial
real estate properties dropped two-tenths of a percent in the third quarter,
making it the second quarter in a row that the statistic has declined,
according to Heschmeyer.
Residential mortgage demand was mostly flat, whereas
small-business-loan demand experienced modest growth, Heschmeyer reports.