Well, it’s that time of year to reflect on the previous twelve months that passed so quickly and to ponder what’s to come in the New Year. 2010 was definitely better than 2009, with some light appearing at the end of the proverbial tunnel. Many economists are forecasting 2011 to be slightly better than 2010, with the majority of the recovery to take place in 2012. I am still trying to figure out where it’s going to come from, but maybe that will be next month’s topic???
Getting back to this year, many sources speculated that the commercial real estate industry was to be the next “shoe to drop”; however, in Jacksonville, as in may other markets around the country, brokers with whom I have spoken confirm that never happened. The struggling financial industry also figured out how to rework many of the loans that were in foreclosure/default. Companies battled through tough times and are still standing, with many owners now telling me the worst is behind them, and they are stabilizing. Even so, those companies that are once again becoming profitable are not predicting any sizable expansion until 2012 or later. Now, let’s not confuse 2010’s definition of “profitable” with 2006’s definition, because they are worlds apart, but it is nice to hear that word again!
What does 2011 hold for the business world? Probably much of the same as in 2010, with a little more good news sprinkled in - except for the NFL lockout that seems inevitable! I believe in 2011, we will see more companies make a “leap of faith” and expand their businesses and/or go from leasing to owning. I am already speaking with several companies that, because they wanted to wait and see what was going to happen in 2009 and 2010, did a typical short-term, 12-month lease renewal, but are now ready to go to the market and shop the availabilities to purchase a facility. I think we, in the commercial real estate world, will see more companies exploring this option in 2011 than in the past couple years. The investor appetite has been - and continues to be - strong, but all seem to have a similar complaint - they have money to spend but cannot find the quality product they would like to spend it on. Citing a “poor tenant mix” or “outdated building standards”, they chase only 3-5% of the deals that come across their desk. I am not sure if that percentage will change next year, but I do know investors can’t hold on to their cash forever. They are too smart to let it sit in an account collecting minimal interest when it can be working for them through real estate at a much higher rate of return.
As a final note, I will be helping out at the Pine Castle Christmas Party (www.pinecastle.org) this Friday, December 17, 2010, with our Northeast Florida NAIOP group. Last year was a blast, and I expect more of the same this year. I hope everyone has a Merry Christmas and safe travels to wherever you may be going this year and I will be back next year… I hope you will too!
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
Tuesday, December 14, 2010
Wednesday, November 10, 2010
Market Update
Well, I have heard the “good, the bad, and the ugly” from businesses and building owners here in the last couple months. Several groups with whom I am currently working for are considering adding to the capacity of their respective warehouses, and they have mentioned to me that substantial growth is predicted for the coming months and into 2011. On the other hand, I spoke with a company today that is closing its doors in Jacksonville, as well as many others who are holding on for dear life. I believe we will continue to hear about a mixed bag of results for many companies and industries over the next 12-18 months, as the economy makes a slow turn for the better. Now, I don’t believe we will see the heights of 2006-2007 anytime soon, but maybe in 2012, we will start to see small, but steady, growth in our economy.
During a recent conversation with the owners of a local transportation company that ships goods predominantly by rail, they told me that rail activity is picking up, and more freight is being transported. They also said they have seen four straight months of positive growth and believe in 2011, there will be more of the same. The freight increases aren’t huge - and not even close to the market highs, but they do believe the worst of times are behind them. Only time will tell, but if freight is moving, someone is buying and someone is selling, and that is a positive fact to report.
Currently, most building owners are still not ready to part with properties at prices buyers are willing to pay, but the bid-ask gap is narrowing. Most sales and leasing activity has involved industrial buildings smaller than 20,000 SF, with a few larger users poking around the market. Leasing activity was fairly strong in the last two quarters, which was a direct result of landlords’ willingness to do almost anything to fill vacant space, from providing free rent and extensive tenant improvements to offering significant rent reductions. If only sellers would be this realistic!
To summarize… the market is tough but slowly rebounding, and while the economy has taken a beating, business owners are fighting back and will come out of this recession smarter and stronger than before it began. I hope that everyone has a great Thanksgiving and safe travels to wherever their holiday destination may be. Until next time, have fun out there!
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
During a recent conversation with the owners of a local transportation company that ships goods predominantly by rail, they told me that rail activity is picking up, and more freight is being transported. They also said they have seen four straight months of positive growth and believe in 2011, there will be more of the same. The freight increases aren’t huge - and not even close to the market highs, but they do believe the worst of times are behind them. Only time will tell, but if freight is moving, someone is buying and someone is selling, and that is a positive fact to report.
Currently, most building owners are still not ready to part with properties at prices buyers are willing to pay, but the bid-ask gap is narrowing. Most sales and leasing activity has involved industrial buildings smaller than 20,000 SF, with a few larger users poking around the market. Leasing activity was fairly strong in the last two quarters, which was a direct result of landlords’ willingness to do almost anything to fill vacant space, from providing free rent and extensive tenant improvements to offering significant rent reductions. If only sellers would be this realistic!
To summarize… the market is tough but slowly rebounding, and while the economy has taken a beating, business owners are fighting back and will come out of this recession smarter and stronger than before it began. I hope that everyone has a great Thanksgiving and safe travels to wherever their holiday destination may be. Until next time, have fun out there!
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
Thursday, October 14, 2010
The Recession Has Ended???
So, The National Bureau of Economic Research says that the recession ended in June of 2009??? The title from our featured article says that someone should send the tenants a memo. Someone should send the consumers a memo… I understand the NBER has its own valuation criteria as to what designates a recession and recovery, but from the companies I have spoken with over the last 6 months, they all tell me the same thing. They are all trying to stay alive to “fight again another day”. They are all still trying to figure out more ways to cut costs and do more with less. Some have mentioned to me that a small level of consistency has come back into their market, but actual growth is little to none.
Personally, I believe that this pattern of little-to-no-growth is what this country will face over the next year and maybe two or even three years. A newly-elected Congress and House of Representatives may be a perceived “ray of hope” in the eyes of some Americans, but, unfortunately, I don’t believe it will be the “be all and end all” to solve all our problems. I think we need to give our small-to-medium-sized businesses some relief and consistency with their business taxes, healthcare, and insurance and provide incentives for them to grow and hire more employees. Most companies I have spoken with have made comments similar to those in our featured article. They state they have no idea what hiring a new employee is going to cost them, so they simply are not planning any new hires.
Jobs are the key to economic recovery, and right now, there seems to be only talk about how high the unemployment rate is and little action is being taken to reduce it. It is very clear that another government bailout is not the solution, but providing tax incentives to small-to-medium-sized businesses so they can hire more Americans and start chipping away at that high unemployment rate will definitely help. Then, with just a few more Americans working, maybe we will see an increase in consumer spending and jumpstart a supply-and-demand “circle of life” to get out of this recession!
Now, that all the business is out of the way… if you live in northern Florida, this is the best time of the year. The tourists have all gone home, our beaches are wide open, and the sun and water is still warm. It’s a “perfect storm” of fun in the sun with some close friends and ice cold beverages! I thank everyone for reading and until next time, have fun out there!
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
Personally, I believe that this pattern of little-to-no-growth is what this country will face over the next year and maybe two or even three years. A newly-elected Congress and House of Representatives may be a perceived “ray of hope” in the eyes of some Americans, but, unfortunately, I don’t believe it will be the “be all and end all” to solve all our problems. I think we need to give our small-to-medium-sized businesses some relief and consistency with their business taxes, healthcare, and insurance and provide incentives for them to grow and hire more employees. Most companies I have spoken with have made comments similar to those in our featured article. They state they have no idea what hiring a new employee is going to cost them, so they simply are not planning any new hires.
Jobs are the key to economic recovery, and right now, there seems to be only talk about how high the unemployment rate is and little action is being taken to reduce it. It is very clear that another government bailout is not the solution, but providing tax incentives to small-to-medium-sized businesses so they can hire more Americans and start chipping away at that high unemployment rate will definitely help. Then, with just a few more Americans working, maybe we will see an increase in consumer spending and jumpstart a supply-and-demand “circle of life” to get out of this recession!
Now, that all the business is out of the way… if you live in northern Florida, this is the best time of the year. The tourists have all gone home, our beaches are wide open, and the sun and water is still warm. It’s a “perfect storm” of fun in the sun with some close friends and ice cold beverages! I thank everyone for reading and until next time, have fun out there!
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
Friday, September 10, 2010
Distressed Assets
There has been a lot of talk recently over distressed and REO sales, as well as the CMBS delinquency rate during past year or more. I have spoken firsthand with several CMBS servicers and have learned that most of the delinquent notes will get worked out with a blend-and-extend model that has been a successful workout method so far. Using this method, the due date on the note is extended (balloon payment) , the interest rate is reduced, and everyone just keeps on trucking. Sometimes, a capital infusion is required to make the workout more successful, but it’s not always needed. This tells me that a small portion of the CMBS distressed product will actually come to market over the next several years. Now, when it comes to the bank-owned/REO sales being transacted by smaller local banks, my experience has been that they are a little less likely to workout deals for the borrower and may opt to bring the asset to market instead. What I have seen lately, is that, in most cases, the product that comes to market from these REO/bank-owned sales, is your typical bottom-of-the-barrel-type building. Regardless of the product type (office, retail, industrial, etc.) the building is in extremely poor condition and has not been taken care of in the past 6, 12, 18 months. In these cases, regardless of how cheap the price is, you are going to have a tough time finding a buyer that wants to spend the time cleaning up the facility and getting it ready to occupy or lease out. Now, every once in awhile, there is “diamond in the rough” and you’ll find a great deal, but it’s kind of like shopping at Ross Dress-for-Less. You have to spend most of the day looking through all the junk to find the one pair of pants that actually fit, but when you do find them, it was worth the effort because they’re only $18.95! That might actually be the best way to describe this distressed market... there are some good deals out there, but you need to be patient and widen your geographic parameters.
Well, on the lighter side of things, my Labor Day weekend was exciting, and I hope everyone else’s was, too. I visited with some friends and spent some time on the golf course. The golf adventure was not pretty this time around, but that always leaves room for improvement for next week. To all those reading, I thank you for taking the time, and until next time… have fun out there!
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
Well, on the lighter side of things, my Labor Day weekend was exciting, and I hope everyone else’s was, too. I visited with some friends and spent some time on the golf course. The golf adventure was not pretty this time around, but that always leaves room for improvement for next week. To all those reading, I thank you for taking the time, and until next time… have fun out there!
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
Tuesday, August 3, 2010
The Deal of the Century!
Throughout these difficult economic times, I have come across deals I have felt were unbelievable, and I would never have told my client the owner would sell/lease for that low of a price. Many times, my clients were very happy with the terms of these deals, and a couple times they felt we could do even better.
Lately, I seem to be coming across many prospects who feel, because the economy is poor, and there is a lot of vacant space on the market, that the owners should basically give the space away. They give me a number they are willing to pay for their respective space and often, their expectations of the market are simply unrealistic. I must admit that I admire their motives and would be trying a similar tactic if I were in their shoes. However, any prospect looking at industrial, office, retail, or multi-family acquisitions in today’s market is shopping at the K-Mart of real estate during a “blue-light special” and is already getting the “deal of the decade”, if not the “deal of the century”! I mean come on people – we’re talking about asking rates starting at 30-40% less than at the height of the market in 2007. Personally, I think that’s a great start, especially considering the fact that every time I negotiate a deal, the owner/landlord takes an additional 15-25% off the asking price - many times even more - depending on the deal.
The bottom line is these are great times to be a buyer/tenant in the market, and just like the good times for sellers/landlords from 2005-2007, they will not last forever. Activity has begun to pick up in Jacksonville, and from what brokers across the country are telling me, the same thing is happening in their markets. In Jacksonville, more deals closed in July, 2010, than during any other period in the last 18 months. Call your broker, analyze your needs, and find yourself a deal! These are times to be taken advantage of! Listen to your advisors - they are in the market all day, every day, and they will lead you to that great deal.
Jacob Horsley
NAI Commercial Jacksonville, Inc.
Industrial Group
Lately, I seem to be coming across many prospects who feel, because the economy is poor, and there is a lot of vacant space on the market, that the owners should basically give the space away. They give me a number they are willing to pay for their respective space and often, their expectations of the market are simply unrealistic. I must admit that I admire their motives and would be trying a similar tactic if I were in their shoes. However, any prospect looking at industrial, office, retail, or multi-family acquisitions in today’s market is shopping at the K-Mart of real estate during a “blue-light special” and is already getting the “deal of the decade”, if not the “deal of the century”! I mean come on people – we’re talking about asking rates starting at 30-40% less than at the height of the market in 2007. Personally, I think that’s a great start, especially considering the fact that every time I negotiate a deal, the owner/landlord takes an additional 15-25% off the asking price - many times even more - depending on the deal.
The bottom line is these are great times to be a buyer/tenant in the market, and just like the good times for sellers/landlords from 2005-2007, they will not last forever. Activity has begun to pick up in Jacksonville, and from what brokers across the country are telling me, the same thing is happening in their markets. In Jacksonville, more deals closed in July, 2010, than during any other period in the last 18 months. Call your broker, analyze your needs, and find yourself a deal! These are times to be taken advantage of! Listen to your advisors - they are in the market all day, every day, and they will lead you to that great deal.
Jacob Horsley
NAI Commercial Jacksonville, Inc.
Industrial Group
Friday, July 9, 2010
Jacksonville, FL - Market Update
Well, I hope everyone had a great July 4th weekend and a few days off to cut loose. Now that the BBQ’s are over and the fireworks have stopped going off in the neighborhoods, it’s time to get back to business!
A couple months ago, I would have told you that our market had hit bottom and we would see an elongated “U”-shaped recovery here in Jacksonville, but after seeing some recent sales comps and a couple new industrial buildings hit the market I don’t believe we have hit bottom yet!?!?! I have started to see a couple banked-owned properties hit the market near the beaches and on Jacksonville’s northside, but I have also been told directly by a couple local and national banks that the industrial delinquency rate is very limited compared to the other food groups in commercial real estate (retail, office, & apartments). There has been an uptick in activity over the last 6 months, but the uptick in closed transactions hasn’t happened yet. There’s a whole lot of talk and very little action, which may not be a terrible thing. I figure as long as businesses are willing to look at the market and see their options, some of them will come off the sidelines and complete a deal.
Most of the industrial activity has been under 20,000 SF, with the majority under 10,000 SF. When I shared this information with a colleague, he shed some light on the subject by saying that if smaller companies have money to relocate and better their situation, larger companies do, too. They may just not be reacting to their needs at this time, but will soon be back in the game. It made a lot of sense to me, but we will have to wait and see if it happens.
Recently, Rob and I have seen some more investors come off the sidelines and start making offers on Jacksonville’s high-quality industrial facilities in the “A”-rated locations around town. I believe this is an indicator of good things to come and says a lot for our city. Jacksonville has a lot of potential, and I believe that in 10 to 20 years, it will be one of the great industrial towns on the East Coast. It has the makings of a great city - an educated work force, plenty of available land, some of the best infrastructure in the U.S., major rail intermodal yards, an international airport, and deep-water shipping ports. The only thing it needs is economic/job growth… well, maybe not the only thing, but I think you get the picture. We will all survive this difficult time and become better people for it, I believe.
Until next time, I wish everyone well, and I look forward to listening to any and all of your comments or questions.
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
A couple months ago, I would have told you that our market had hit bottom and we would see an elongated “U”-shaped recovery here in Jacksonville, but after seeing some recent sales comps and a couple new industrial buildings hit the market I don’t believe we have hit bottom yet!?!?! I have started to see a couple banked-owned properties hit the market near the beaches and on Jacksonville’s northside, but I have also been told directly by a couple local and national banks that the industrial delinquency rate is very limited compared to the other food groups in commercial real estate (retail, office, & apartments). There has been an uptick in activity over the last 6 months, but the uptick in closed transactions hasn’t happened yet. There’s a whole lot of talk and very little action, which may not be a terrible thing. I figure as long as businesses are willing to look at the market and see their options, some of them will come off the sidelines and complete a deal.
Most of the industrial activity has been under 20,000 SF, with the majority under 10,000 SF. When I shared this information with a colleague, he shed some light on the subject by saying that if smaller companies have money to relocate and better their situation, larger companies do, too. They may just not be reacting to their needs at this time, but will soon be back in the game. It made a lot of sense to me, but we will have to wait and see if it happens.
Recently, Rob and I have seen some more investors come off the sidelines and start making offers on Jacksonville’s high-quality industrial facilities in the “A”-rated locations around town. I believe this is an indicator of good things to come and says a lot for our city. Jacksonville has a lot of potential, and I believe that in 10 to 20 years, it will be one of the great industrial towns on the East Coast. It has the makings of a great city - an educated work force, plenty of available land, some of the best infrastructure in the U.S., major rail intermodal yards, an international airport, and deep-water shipping ports. The only thing it needs is economic/job growth… well, maybe not the only thing, but I think you get the picture. We will all survive this difficult time and become better people for it, I believe.
Until next time, I wish everyone well, and I look forward to listening to any and all of your comments or questions.
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
Monday, June 14, 2010
To Default or Not to Default... That is the Question???
Well, good day to all and what a topic of discussion! The article in our current NewsBriefs, brings an interesting negotiating strategy to the table. Should you default on your mortgage to get your bank’s attention? Is that the only way you will get your bank’s attention these days? I have heard from few people close to me that have done this with their mortgages, and they have seen varying degrees of success in getting a response from the bank. Will this strategy work for them, in the long run, and get them what they want- a reduced mortgage payment so they can keep their house??? I think the more I go on, the more questions I will raise, and rightfully so, since this is an entirely new negotiation method that has not been proven. Of course, you will get your bank’s attention by not paying your mortgage, but if you choose to go this route, keep in mind that the bank can easily audit your records and figure out if you can or cannot pay your existing mortgage. So, if you just want attention, film yourself crying about some pop star, like Chris Crocker did, and put it on YouTube! If you want a reduced mortgage payment… get in line… everyone does! This may sound cold-hearted, but when life throws you curve balls, you need to learn to deal with them and move on. What doesn’t kill you will only make you stronger, right!? Don’t get me wrong - I sympathize with those who made a bet on the real estate market and lost, those who lost their jobs and cannot pay their mortgages, and those who have children and cannot provide for them the way they used to. I also believe that they all will find the proverbial “light at the end of the tunnel” and be just fine in the end – but, if we start giving handouts to everyone in need, we will be doomed! Through this lingering financial recession, a better and stronger economy will rise from the ashes. We will be a country of smarter, stronger, and better-prepared Americans ready to grow this economy to never-before-seen heights! It will not be easy or quick, but over the next 10 years, I think you will see a much stronger America. This country was built on a free enterprise, and it has made us the strongest and most-admired country in the world. You’re not alone out there America - don’t give up! Work hard, figure out your problems, work through them, and you will be rewarded!
Enough about financial turmoil and on to something more uplifting… this week is one of the greatest golf tournaments of the year, The U.S. Open will take place - and to make it even better, it’s at one of the greatest golf courses in America… Pebble Beach! As always, I will be pulling for Tiger and Phil. I know they are supposed to be “mortal enemies”, so how can I pull for both of them? They are the “best show” in golf in my opinion. We will wrap up the week with Father’s Day, which always seems to get too little press and appreciation in my mind. So, don’t forget to call your Dad and tell him how much he means to you! Until next time, have fun out there!
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
Enough about financial turmoil and on to something more uplifting… this week is one of the greatest golf tournaments of the year, The U.S. Open will take place - and to make it even better, it’s at one of the greatest golf courses in America… Pebble Beach! As always, I will be pulling for Tiger and Phil. I know they are supposed to be “mortal enemies”, so how can I pull for both of them? They are the “best show” in golf in my opinion. We will wrap up the week with Father’s Day, which always seems to get too little press and appreciation in my mind. So, don’t forget to call your Dad and tell him how much he means to you! Until next time, have fun out there!
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
Friday, May 14, 2010
The Bottom; Will We Ever Get There?
Will we ever hit the bottom?!?! So many different reports are floating around these days - some say the commercial markets have “bottomed out”, and others say they haven’t reached it yet. A recently-completed report by The University of Florida stated that the fundamentals of the Florida real estate markets are showing signs of improvement, and we will begin to see more sale and lease closings in the near future. I hope they’re right!
I have been working several deals across the country during the last few months, and in my discussions with other brokers, there is a consensus that there is a lot of activity, and we are all very busy, but closing a deal is like trying to get your two year-old to eat asparagus. It will happen, but only after a long, hard fight-to-the-finish, where you’ll have to leverage every incentive under the sun! Personally, I think we are very close to the bottom, if not already there, but, unfortunately, we will remain in this position for the rest of 2010, perhaps longer. You might see a slight uptick here and there, only to be followed by a drop off in production across the board. With that being said, I believe more and more investors will come off the “sidelines” and jump into this market, and more and more sellers will “get real” about sales prices, the bid/ask gap will narrow and deals will close. Sooner or later, sellers and buyers will wake up and realize that the deals being offered will not get any sweeter in the near future.
Now that I’m done with all the maybe’s and hope-so’s, I can share some good news with you - the weather here in Jacksonville is about as good as it can get! The ocean is getting warm, and the girls are out in full force at the beaches. The Players Championship was held here last weekend, and you can bet I was in attendance cheering on the players. I had so much fun I almost broke my arm walking in between holes… there was a pesky root that I did not agree with, and the trip-and-fall was not fun! Luckily, the x-ray came back negative, and it’s still attached, so all is well. Until next time… have fun out there.
Jacob Horsley
NAI Commercial Jacksonville
I have been working several deals across the country during the last few months, and in my discussions with other brokers, there is a consensus that there is a lot of activity, and we are all very busy, but closing a deal is like trying to get your two year-old to eat asparagus. It will happen, but only after a long, hard fight-to-the-finish, where you’ll have to leverage every incentive under the sun! Personally, I think we are very close to the bottom, if not already there, but, unfortunately, we will remain in this position for the rest of 2010, perhaps longer. You might see a slight uptick here and there, only to be followed by a drop off in production across the board. With that being said, I believe more and more investors will come off the “sidelines” and jump into this market, and more and more sellers will “get real” about sales prices, the bid/ask gap will narrow and deals will close. Sooner or later, sellers and buyers will wake up and realize that the deals being offered will not get any sweeter in the near future.
Now that I’m done with all the maybe’s and hope-so’s, I can share some good news with you - the weather here in Jacksonville is about as good as it can get! The ocean is getting warm, and the girls are out in full force at the beaches. The Players Championship was held here last weekend, and you can bet I was in attendance cheering on the players. I had so much fun I almost broke my arm walking in between holes… there was a pesky root that I did not agree with, and the trip-and-fall was not fun! Luckily, the x-ray came back negative, and it’s still attached, so all is well. Until next time… have fun out there.
Jacob Horsley
NAI Commercial Jacksonville
Monday, April 19, 2010
Hillwood Development & Market Update
If you subscribe to our newsletter, you may have read a recent article about the Hillwood Development deal going on in Jacksonville. The proposed master development contract between the City of Jacksonville and Hillwood at the Cecil Field DRI (Development of Regional Impact) has been the “talk of the town” of late, as local developers and followers of the local commercial marketplace debate the merits of this lucrative deal. Many believe it is a great thing and will be very beneficial for the city. On the other hand, there are many local interests that feel “robbed” and believe it will be detrimental to the city and, in effect, create a development monopoly for Hillwood. At this time, I am not sure what the best move is. Cecil Field has been aggressively marketed by the City for several years with little to no success, and a change is needed to kick start new possibilities.
Updated Jacksonville market statistics reflect more outside interest from investors, and there are some off-market deals floating around town that will benefit those who have the cash to pull them off. The leasing market is starting to pick up a little steam, and I am personally involved in several deals at the moment. This activity is still on the smaller side (20,000 SF and under), but more business owners seem to be ready to take advantage of the cheap rents and other concessions landlords are offering to get a deal completed. Lately, I have even come across Landlords who are so eager to do a deal that as soon as they get wind of one, they are ready to submit a proposal whether the tenant has any interest or not! As you can see, it’s a great market in which to be a buyer or tenant shopping for new space. In 2010, our typical client is upgrading their space and location and paying similar or cheaper rents than they are paying at their current location. As for owner/user sales, the bid-ask gap is still too wide and completed deals are few and far between. There appears to be some buyer interest, but sellers are just not ready to accept today’s depressed values. However, I believe it won’t be too much longer before this gap starts to narrow and sellers in this market start to make some deals. Personally, I think later this year - in Q4 2010 and definitely by Q2 2011 - you will see several owner/user sales completed and the sales market, in general, picking up steam.
The past weekend’s weather wasn’t ideal, but I still managed to get sunburned at the beach on Sunday. The Players Championship is coming up in the next couple weeks, and locally, we are all looking forward to getting out and enjoying the tourney. I hope Tiger decides to make the trip, because if you haven’t seen him play in person, it’s a real treat regardless of how many mistresses he has following him around. I’m going to call it a day after that politically incorrect comment…and until next time, thanks for reading!
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
Updated Jacksonville market statistics reflect more outside interest from investors, and there are some off-market deals floating around town that will benefit those who have the cash to pull them off. The leasing market is starting to pick up a little steam, and I am personally involved in several deals at the moment. This activity is still on the smaller side (20,000 SF and under), but more business owners seem to be ready to take advantage of the cheap rents and other concessions landlords are offering to get a deal completed. Lately, I have even come across Landlords who are so eager to do a deal that as soon as they get wind of one, they are ready to submit a proposal whether the tenant has any interest or not! As you can see, it’s a great market in which to be a buyer or tenant shopping for new space. In 2010, our typical client is upgrading their space and location and paying similar or cheaper rents than they are paying at their current location. As for owner/user sales, the bid-ask gap is still too wide and completed deals are few and far between. There appears to be some buyer interest, but sellers are just not ready to accept today’s depressed values. However, I believe it won’t be too much longer before this gap starts to narrow and sellers in this market start to make some deals. Personally, I think later this year - in Q4 2010 and definitely by Q2 2011 - you will see several owner/user sales completed and the sales market, in general, picking up steam.
The past weekend’s weather wasn’t ideal, but I still managed to get sunburned at the beach on Sunday. The Players Championship is coming up in the next couple weeks, and locally, we are all looking forward to getting out and enjoying the tourney. I hope Tiger decides to make the trip, because if you haven’t seen him play in person, it’s a real treat regardless of how many mistresses he has following him around. I’m going to call it a day after that politically incorrect comment…and until next time, thanks for reading!
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
Friday, March 19, 2010
Welcome to The NAICJ Industrial Group Blog!
Welcome to the NAI Commercial Jacksonville Industrial Group Blog! Since this is my first entry, I want to explain a little about the purpose of this particular blog. I plan to use this forum in multiple ways. First, I would like those reading my newsletter to be able to comment on the articles posted in it; second, I want to encourage the Blog’s readers to discuss their interests, deals, and questions surrounding the commercial real estate industry in today’s economic climate; and finally, I will post my thoughts and opinions, as well as some pertinent facts about the industry and deals I am completing.
Now, getting down to business, I want to comment on something that has been bothering me over the last several months. Why are all these different news articles in the paper and industry-related publications one week talking about how business is picking up and signs of recovery are on the way, and the next week predicting doom and gloom in big bold headings? Why doesn’t someone just come out and say they have no freaking clue what’s going on, and the turmoil we are in today has never been seen by anyone before?! I have to admit I’m guilty of posting some of these contradicting news stories in my newsletters for the simple reason that they’re interesting and contain some factual information. Sometimes I find them very funny, and other times they’re just downright frustrating to read.
My advice is… business is slow, and times are tough… quit trying to predict the future, put your nose to the grindstone and work through it! Be creative, be better than your competition, and forget the rest. It doesn’t do any good to dwell on what may or may not happen 6, 12, or 24 months in the future. Take care of today, and plan for tomorrow.
Now that I’m done venting for today, it’s Friday afternoon, I am in Jacksonville, and the NCAA Tournament in town! I will be at the evening session watching Duke vs. Ark-Pine Bluff and the grand finally Louisville vs. Cal… have a great weekend everyone and until next time.
Jacob Horsley
Now, getting down to business, I want to comment on something that has been bothering me over the last several months. Why are all these different news articles in the paper and industry-related publications one week talking about how business is picking up and signs of recovery are on the way, and the next week predicting doom and gloom in big bold headings? Why doesn’t someone just come out and say they have no freaking clue what’s going on, and the turmoil we are in today has never been seen by anyone before?! I have to admit I’m guilty of posting some of these contradicting news stories in my newsletters for the simple reason that they’re interesting and contain some factual information. Sometimes I find them very funny, and other times they’re just downright frustrating to read.
My advice is… business is slow, and times are tough… quit trying to predict the future, put your nose to the grindstone and work through it! Be creative, be better than your competition, and forget the rest. It doesn’t do any good to dwell on what may or may not happen 6, 12, or 24 months in the future. Take care of today, and plan for tomorrow.
Now that I’m done venting for today, it’s Friday afternoon, I am in Jacksonville, and the NCAA Tournament in town! I will be at the evening session watching Duke vs. Ark-Pine Bluff and the grand finally Louisville vs. Cal… have a great weekend everyone and until next time.
Jacob Horsley
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