Commercial appraisals tricky in a down market

February 4, 2011

February 4th, 2011
Charlotte Observer

Mecklenburg County tax appraisers will start revaluating local commercial real estate next week – a task that could produce unwelcome surprises for both property owners and local government. Property owners have been paying taxes based on values set in 2003. State law requires revaluation every eight years – leaving officials wrestling with setting values in one of the worst markets in decades….

Calculating rental income could also prove tricky, said Andrew Jenkins, analyst and managing partner with Karnes, a real estate research firm. Actual lease rates are often lower than advertised asking rates because landlords are granting concessions to lure tenants during the downturn…

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Crown Realty adds to Imperial Center portfolio

July 12, 2010

July 12th, 2010
News & Observer .biz

After selling a distribution facility last fall, Crown Realty and Development has added to its portfolio in the Imperial Center business park near Research Triangle Park.

The Irvine, Calif. company paid $7.475 million for a 182,000-square-foot warehouse at 4400 Emperor Boulevard. The property is fully leased to Phoenix Telecom Solutions, which moved in in March.

The warehouse vacancy rate in the Interstate 40/RTP submarket was 11.4 percent at the end of the first quarter, according to Karnes Research of Raleigh, up from 9.9 percent during the first quarter of 2009.

The warehouse vacancy rate for the entire Triangle was 15.3 percent in the first quarter.  The I-40/RTP submarket contains about 50 percent of all in the industrial space in the Triangle.

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NY firm buys Research Tri-Center warehouses for $76.95 million

June 7, 2010

June 7th, 2010
News & Observer .biz

In the latest sign of investors strong appetite for high-profile commercial real estate in the Triangle, a private New York real estate investment firm has paid $76.95 million for the Research Tri-Center buildings in Durham, according to Durham County property records.
The Triangle warehouse vacancy rate was 15.3 percent in the first quarter, up from 9.8 percent during the same quarter a year ago, according to Karnes Research.
The warehouse vacancy rate in the I-40/RTP submarket stood at 11.4 percent in the first quarter, up from 9.9 percent a year ago.

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Spaced out: Triad’s industrial market saturated, with Dell-uge to come

April 23, 2010

April 23rd, 2010
The Business Journal of the Greater Triad Area

When it comes to industrial space, the Triad is seriously overstocked. And things will likely get worse before they get better, with the potential for more than 1 million square feet of space to be vacated by year’s end as Dell Inc. closes its Winston-Salem plant and the ripples spread to its suppliers. At the end of 2009, the overall industrial vacancy for the Triad was 21.7 percent, up slightly from 21.2 percent a year earlier, according to the Karnes Industrial Report, compiled on behalf of the local Realtors associations. Brokers generally consider the market to be in fair balance when vacancy is between 8 percent and 12 percent.
Average rental rates slipped from $3.96 a square foot at the end of 2008 to $3.93 at the end of 2009, falling for the second straight quarter. Rates were at $4 a square foot before the recession.
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Industrial sector builds despite high vacancies

October 17, 2009

Among Charlotte-area warehouses and distribution centers, vacancy rates are rising. Rents are falling. Yet two local developers are betting now is the time to build more than 300,000 square feet of new industrial space…Charlotte’s industrial market has fared relatively well during the recession compared with the office and retail markets because developers didn’t overbuild, said Karnes analyst Andrew Jenkins. One reason is developers grew cautious when industrial vacancy rates peaked at 19.2 percent in 2003, Jenkins said, “scaring everyone into being careful where they built.”
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Sales of office, retail and industrial property plunge in Charlotte

August 14, 2009

August 14, 2009
Charlotte Observer
Two reports on Charlotte’s commercial real estate market released this week show a continued decline in demand for commercial space as employers contract and retailers close up shop amid weak consumer spending….Net absorption, or the amount of space occupied minus the space vacated, was negative 134,800 square feet during the first half of this year for Charlotte-area office space, according to Karnes Research. Last year, net absorption was a positive 670,800 square feet. The two years prior it was around 1.4 million per year. “Demand is down, a lot,” said Karnes analyst Andrew Jenkins.

Also noteworthy: No new buildings were completed in the suburbs during the first half of this year. That hasn’t happened since 1992, Jenkins said. Last year, developers put 2 million square feet of new space on the market, all of it in the suburbs, according to Karnes. “It’s a good sign the developers have pulled back and are aware of what was going on,” Jenkins said. “They’re tightening belts, and it’s hard to find financing to build new buildings. At least they recognize this is not a good time to be delivering speculative space.”
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Some see promise in industrial real estate

March 6, 2009

March 6, 2009
Charlotte Observer
….The warehouse vacancy rate rose to 11.8 percent at the end of last year after starting the first part of the year at 11.2 percent, according to Karnes Research Co…..Only one warehouse project – Sykes Industrial Park West’s two buildings totaling 250,000 square feet – was completed in the fourth quarter. That’s a good thing, according to Karnes Research’s fourth-quarter market analysis, because it means landlords won’t have to compete with a slew of new space….
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Warehouse demand slows in Triangle

December 18, 2008

December 18, 2008
The News & Observer
Most people would probably agree that the pain and turmoil of today’s economy is hurting more than the technology bust during the early years…
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Posted by karnes

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