Each Wednesday, The Wrap presents a compilation of recent noteworthy commercial real estate stories from a variety of publications. Below are links to five stories that caught our eyes in recent days.
•Builders Debate Merits of Raising Ceilings for Warehouses by Erica E. Phillips of The Wall Street Journal.
Key Excerpt:
“Jeffrey Phelan, president of DCT Industrial, said higher ceilings are ‘the future,’ but that future might not have arrived just yet. In 36-foot buildings, for example, the column spacing is several feet wider than in 32-foot buildings, and some tenants compensate by making their aisles wider. ‘It’s a tremendous hit upon your rent because they can’t use the space,’ Mr. Phelan said. ‘There’s probably anywhere from 10 percent to 15 percent inefficiency in that building.’”
•Growth in Commercial Real Estate Prices Levels Off After First Quarter Surge by Randyl Drummer of CoStar.
Key Excerpt:
“Commercial property prices leveled off in April, like a jet reaching cruising altitude, after sales volume and property prices took off in the first three months of the year, gaining more than 5 percent in the first quarter of 2015. The U.S. Composite Index in the latest CoStar Commercial Repeat Sale Indices (CCRSI) report found that prices dipped slightly in April as price gains paused from its recent robust pace.”
•Colliers Predicts 'Strong 2015' for Office Market by Sharon O’Malley of Construction Dive.
Key Excerpt:
“Investor demand for U.S. and Canadian office buildings is expected to ‘remain robust,’ according to the report, which said construction activity is greatest in markets that have led the U.S. economic recovery.”
•Multifamily Developers Counting on Demand Through 2017 by Bendix Anderson of NREI.
Key Excerpt:
“The vacancy rate won’t be higher in 2017 because strong demand for apartments is likely to help fill the many new apartments that developers plan to build. ‘The problem is going to be on the supply side of the ledger not the demand side,’ says [Ryan] Severino.”
•An Inside Look at the Retail Sector by Dees Stribling of Multi-Housing News.
Key Excerpt:
“Any impact the increase in household net worth has on retail sales is indirect, but the ‘wealth effect’ does seem to be a real motivator in spending. When people have more in terms of assets, not all of which are liquid, they still tend to spend more of their liquid assets.”