Sean Kessel’s Post

Keeping a close watch on Orange County projects extends beyond local insights—it's about grasping the broader implications. At CGX, we delve into OC developments to foresee their effects on neighboring regions like the Inland Empire, as trends there often signal shifts in surrounding markets. Whether it's industrial conversions, commercial ventures, or residential expansions, these initiatives provide crucial insights into future opportunities and challenges in the Inland Empire. In the IE, there's an ongoing debate over whether there should be a moratorium on warehouse development - the I.E. is the smoggiest place in the U.S., there's a lack of housing, low-skilled jobs & wages - and I'm sure the replacement of property in favor of industrial will draw even more scorn. With an abundance of C-class office properties in the region, the question is: What's next? By proactively tracking these trends, we're better positioned to advise clients and adjust strategies accordingly. This ensures our agility and foresight in navigating the ever-evolving Southern California real estate landscape. #inlandempirerealestate #sanbernardinorealestate #carrillogroupcany #cgxrealestate #predictiveanalysis #strategicplanning

With increasing signs that the office occupier market is on the cusp of a broad recovery, some segments of the market are poised to surpass pre-pandemic performance more quickly than others. Tenants have shown strong desire for locations within mixed-use neighborhoods: often peripheral urban submarkets with a greater diversity of uses that achieve a "cool" factor--and because of this, those submarkets have gained over 15 million s.f. (5.5% of inventory) of net new demand since the outset of the pandemic. The success of these types of regions has given rise to more horizontal mixed-use development projects in the past decade - large-scale master-planned developments which often encompass several property types and attempt to recreate the ecosystems of mixed-use markets on a smaller scale. Projects like Hudson Yards, The Battery, Cambridge Crossing, MidTown Tampa, The Wharf, have all leased up well and at rent premiums even to new construction, as a result of the symbiotic benefits mixed-use regions spread among real estate assets. In the first 7-8 weeks of the year, this trend continues to be very evident: MSC Group purchased the entire office component (130k s.f.) of Sawyer Walk in Miami, Vestis signed a lease for 45k s.f. at Southern Post in Atlanta, and Duane Morris will relocate into roughly 10k feet at Baltimore's Wills Wharf. https://lnkd.in/d3SShbUj #USofficechartoftheweek #JLLresearch #mixeduse

Shout-out to my former colleague Jacob Rowden on these insights. Overall across the U.S., net occupancy of office space in mixed-use places has actually increased since the pandemic, while office stock outside of mixed-use areas has lost a quarter BILLION square feet of occupiers. Notable in both categories - and of relevance to Center City Philadelphia - is that all of the positive absorption is happening in buildings built since 2015. In a market like ours with limited supply of shiny new space, the flight to quality has looked a little different, though 2222 Market and 2000 Arch are examples of how top-tier tenants are opting for brand new builds even in Philly. These data demonstrate the enduring value and appeal of cities, walkability, and density of talent and economic activity.

Great news! 🌞 Last quarter, Philadelphia surged 130 places to claim the 52nd spot among top-performing U.S. cities, fueled by robust #job and #wage recovery, particularly in professional, business services, and high-tech sectors, as noted by the Philadelphia Business Journal. Despite challenges, Philadelphia thrives as the ninth-largest U.S. office market, boasting a 15.4 percent availability rate, below the national average of 16.7 percent, underscoring its resilience. Tenants may stand to gain from generous concession packages, including rent-free periods, improvement allowances, and furnished sublease options, amidst escalating construction costs. Moreover, ample class A sublease space presents occupants with diverse choices and opportunities to secure #advantageous lease terms at competitive rates. Explore our report below for further insights into the benefits and opportunities awaiting businesses in Philadelphia: https://lnkd.in/gcFH2fEg #CresaPhiladelphia #Q1MarketOfficeHighlights #PhiladelphiaOfficeMarket #CommercialRealEstate #OfficeSpace #TenantSolutions #OfficeSublease #MarketResilience #StrategicLeasing #CRE #ConstructionCosts #ClassASpace #CREPhiladelphia

Q3 2024 was the first quarter in over a decade where there was not a single major construction start for office product in Dallas-Fort Worth. This tapering supply of new space is seeing robust demand. Of the 4.5 million s.f. under development in D-FW, 78% is pre-leased. With little space remaining within under construction product, recently delivered spaces could benefit from the scarcity as occupiers continue to search for newer, well-located and well-amenitized options. Product built since the pandemic is seeing the largest availability, with the total occupancy of buildings built between 2020 and 2024 currently sitting at 64%. This is a noticeable difference versus product built 2015-2019, which is currently 90% occupied. As construction pipelines wind down, expect heightened interest in those remaining vacancies, especially large blocks in desirable locations. #jll #cre #dallas #dfw #fortworth #office #construction

🌴 San Diego Q1 Office Insights 📊 $3.26 FSG - Monthly average asking rent (-4.4% YoY rent growth) 🏢 11.6% Direct vacancy 📈 -543,193 s.f. - 2024 YTD total net absorption 🏗️ 0 s.f. - 2024 YTD completions 🚧 1,276,093 s.f. - Total under construction The San Diego office market has seen three consecutive quarters of negative net absorption, driven by financial services and life science companies returning space. However, this has prompted some exciting changes as many buildings are converted into lab spaces or apartments, reducing vacancy and transforming the market. While the suburban market thrives and is supported by innovative industries, we are experiencing fluctuations in the downtown submarket, resulting in softened rents. Message me to uncover more insightful details about the San Diego office market! #SanDiego #OfficeInsights #CommercialRealEstate #MarketAnalysis #DowntownSD #JLL

Property pivots are becoming increasingly common as the demand for industrial space rises. The latest example of this trend is this #office-to-#industrial conversion happening in Santa Ana, California. The property was already zoned for industrial use, and the city has been supportive of the plan. Might we see some pivots here in the Triangle? And if so, where would it be? #realestate #industrial #propertyconversion

𝐃𝐨𝐰𝐧𝐭𝐨𝐰𝐧 𝐀𝐝𝐚𝐩𝐭𝐢𝐯𝐞 𝐑𝐞𝐮𝐬𝐞 𝐑𝐨𝐮𝐧𝐝𝐮𝐩 𝐉𝐔𝐋𝐘 𝟐𝟎𝟐𝟒 According to the office of the Denver County Assessor, between 2021 and 2023, the median assessed value of all Denver residences (single-family, townhomes, and condos) increased by 33%. In contrast, Downtown Denver (or more specifically the Central Business District) is in a tough spot. In that same time period, the median change in assessed value of downtown office space increased by half a percent. To speak plainly, downtown Denver is among the worst downtowns in North America for foot traffic recovery and return to the office, and the firm Cushman and Wakefield projects that the Denver metro is on pace for a net increase in office vacancy by the end of this year. This dismal state of affairs have many people asking, “Why don’t we just turn the Downtown offices into housing?” Read more: https://lnkd.in/ggFDFuRB #denvercounty #downtowndenver #cushman #Wakefield #newdevelopment

In regards to real estate investing, I have said more times than I could possibly count: "Find a market or a point in the cycle where there is no new development". Over and over again, it is over-development that takes down an otherwise healthy market, with too many people focusing on demand rather than the intersection of demand and supply. The following article by Ralph Bivins in RealtyNewsReport is exactly what we need to hear these days (note I have only included highlights for brevity). "Rarer than the Eclipse: No New Office Construction in Houston" "The pipeline of new office-tower construction has dried up in Houston, hitting a lull that has hasn’t been seen in years. For at least a week in February 2024, Houston’s total office construction stood at ground zero – absolutely no new office building was under construction. It’s a rarity in Houston, maybe the first time in the modern-day history of the city’s office market. In slow times, Houston often had about 2 or 3 million SF of office space under construction. In the go-go days powered by tax shelters and S&L excesses in the early 1980s, the annual construction level surpassed 25 million SF. Hundreds of new office buildings of various sorts were completed in Houston before the great crash hit in the late 1980s.   Houston’s office market has a boom-and-bust reputation. With slightly fewer red-tape hassles, new projects can be launched in Space City more quickly than in most markets. Houston can go from boom to bust in a flash. On the other hand, Houston can accelerate from bust to boom faster than lightning. Houston’s no-construction zone ended on Feb. 23 when Midway announced the groundbreaking for the 19-story City Centre Six building in West Houston. The building will have 308,000 SF of office space, plus retail. Dow chemical has leased 210,000 SF at City Centre Six. This leaves the city of Houston with only 98,000 SF of unleased space under construction today. Prior to Midway’s groundbreaking, Houston had no new office building construction.   The construction pause makes Houston real estate history. And maybe it allows the office market to catch its breath and it could be a turning point resulting in a much-needed halt to the steady climb of vacancy rates." Goodwin Advisors Richard Stevenson #cre #houston #office

🍁 As we dive into the vibrant colors of fall here in Central Ohio, the commercial real estate market is just as dynamic as the autumn foliage around us. The crisp air and amazing weather make it a perfect time to get outdoors and explore the opportunities this market has to offer. With a steady demand across both office and industrial sectors, Central Ohio remains a prime location for business expansion and investment. The combination of competitive pricing, strategic location, and supportive local government continues to attract new businesses and drive growth. As we head into the final quarter of the year, we’re seeing particular interest in properties that offer flexibility and adaptability—whether that's through modern office spaces that cater to hybrid work models or versatile industrial properties suited for logistics and manufacturing. Now is a fantastic time to capitalize on these trends, especially as the year comes to a close and businesses finalize their strategic planning for the next fiscal year. Let’s connect and discuss how you can leverage this vibrant market to your advantage. Enjoy the beautiful weather, and let's talk commercial real estate! 🍂 #CentralOhioCRE #MarketTrends #BusinessGrowth #CommercialRealEstate #Fall2024