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Time For Trophy Office Development

July 1, 2024/in News, Trends/by SFOBA STAFF

Call it prime, trophy, and Class-A+, such offices have outperformed other classes and there isn’t going to be enough to meet future demand.

Colliers Names Former Tricera Capital Exec Brokerage Market Leader For South Florida

June 23, 2024/in News/by SFOBA STAFF

During his tenure as President and Head of Leasing at Tricera Capital, he was instrumental in developing and implementing the company’s institutional leasing platform, a testament to his ability to drive growth.

Time For Trophy Office Development

July 1, 2024/in News, Trends/by SFOBA STAFF

Call it prime, trophy, and Class-A+, such offices have outperformed other classes and there isn’t going to be enough to meet future demand.

Colliers Names Former Tricera Capital Exec Brokerage Market Leader For South Florida

June 23, 2024/in News/by SFOBA STAFF

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Time For Trophy Office Development

July 1, 2024/in News, Trends/by SFOBA STAFF

If investors and developers are going to get into or stay in office, the best move is probably prime or Class A, according to CBRE.

They examined the top 2% to 4% of office properties — their definition of prime or Class A — across different metro markets in the U.S. That was in the context of the flight-to-quality many in the industry think is happening.

One of the difficulties in understanding the office marketplace is what one might call the tyranny of the average and advertised. First, there are distributions in all data; not everything experiences the same conditions. Second, when some story lines get broadly publicized, they can take on lives of their own.

“The growth in vacant space from Q1 2020 to Q2 2022 was entirely driven by the 10% of hardest hit buildings,” they wrote. “In fact, excluding the bottom 10% of properties that experienced the most vacant square footage increase, net absorption has been positive since 2020.”

About 70% of the hardest-hit buildings were actually Class A-, particularly the lowest tier, built in the 1980s and 1990s.

If Class A- might extend into B and lower, these observations, while not exactly the same, are similar in concept to those from other experts. Back in February, Brookfield argued that 90% of all office vacancies are in the bottom 30% of buildings, “largely characterized by older offices with limited amenities and reduced functionality.” The top 25% of buildings, in comparison, see stable vacancy rates and record-high rents.

CBRE modeled the attractiveness of “new best-in-class” office buildings across 16 different markets. “The fraction of a market made up of prime space is an important variable in determining attractiveness of development,” they wrote.

“Markets with a low fraction of prime space, such as Boston or Miami, may be good candidates for new development due to relatively fewer competitors for top tenants,” they said. “Markets such as Seattle, with a high fraction of prime space already, may be over served.”

But a “high fraction” is relative. Seattle’s percentage of price was a hair over 18%. On the low end, Washington, D.C. barely cracked 4%.

Also, prime properties don’t outperform in every market. Take Austin, with about 11% prime. The city faces the high amounts of new delivered properties, and some of them aren’t in the hottest submarkets, so they remain relatively vacant. Or there can be imbalances of supply and demand.

There’s a natural question coming out of the above. If companies are moving upscale, can they all? Is there enough prime or A+ — or even plain old A — to satisfy everyone? At the beginning of the year, Cushman & Wakefield answered yes, but not for long.

The most attractive and desirable office space is only between 10% and 15% of total inventory, the firm said at the time. Demand for the buildings is high. Top-tier space in gateway markets enjoys vacancy rates that are 700 basis points lower than the remaining market. “Direct vacancy in the best buildings is sub-11%,” an impressive number in relative comparison.

Investors and developers then have to look for the right balance, availability of prime properties, yes, but ones where conditions keep them wanted.

Source: GlobeSt.

Colliers Names Former Tricera Capital Exec Brokerage Market Leader For South Florida

June 23, 2024/in News/by SFOBA STAFF

Colliers | U.S. announced that Dustin Ballard has joined the company as Managing Director and Brokerage Market Leader for South Florida.

In his new role, Ballard will oversee all brokerage operations, recruitment, retention, and business development for the Colliers’ West Palm Beach, Fort Lauderdale, Boca Raton and Miami/Brickell offices. He will report to Stephanie Rodriguez, National Director, Industrial Services | U.S. and Executive Managing Director | Florida. Ballard replaces Rodriguez, who was serving as the interim Market Leader.

“I am very pleased to welcome Dustin to our team,” said Rodriguez. “Under his leadership, we are poised to further enhance our market leading position and accelerate opportunities for our clients and professionals alike.”

An experienced real estate executive, Ballard has spent more than 15 years in the public and private sector in significant markets such as South Florida, Nashville, Silicon Valley and Los Angeles. His expertise spans a variety of asset types, including office, retail and mixed-use. During his tenure as President and Head of Leasing at Tricera Capital, a Miami-based real estate investment firm, Ballard was instrumental in developing and implementing the company’s institutional leasing platform, a testament to his ability to drive growth.

“I am thrilled about my new role,” said Ballard. “An organization’s strength lies in its people, and having previously been a client of Colliers, I have seen first-hand its ability to attract and retain top talent that ensures we deliver best-in-class service to our clients. I am eager to leverage my experience to contribute significantly to the growth of our brokerage business in South Florida.”

Half Sized Blog Element (Single Author Style)

Half Sized Blog Element (Multi Author Style)

Time For Trophy Office Development

Colliers Names Former Tricera Capital Exec Brokerage Market Leader For South Florida

Time For Trophy Office Development

Colliers Names Former Tricera Capital Exec Brokerage Market Leader For South Florida

Full Sized Blog Element (Big Preview Pic)

Time For Trophy Office Development

Colliers Names Former Tricera Capital Exec Brokerage Market Leader For South Florida

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