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Tag Archives: Philadelphia commercial real estate


Midsize Tenants Dominate Demand for Industrial Space

E-commerce and last-mile logistics tenants in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – are fueling additional demand for expansion in the U.S. and spurring midsize space users to dominate the industrial market.

Midsize industrial tenants – those who occupy 50,000-sq.-ft. to 300,000-sq.-ft. boxes – are driving industrial demand in various segments of the national and Philadelphia commercial real estate market, according to a report from real estate services firm Avison Young in a recent issue of National Real Estate Investor magazine.

For example, between January 2017 to June 2019, tenants in Chicago signed 872 industrial leases totaling 97.3 million sq. ft., with an average size of 111,629 sq. ft. Tenants in Atlanta signed 320 industrial leases totaling 36.2 million sq. ft., with an average size of 113,243 sq. ft. Dallas tenants signed 490 leases totaling 52.5 million sq. ft., with an average size of 107,265 sq. ft. Tenants in Indianapolis signed 41 leases totaling 52.5 million sq. ft., with an average size of 146,341 sq. ft., according to Avison Young.

This CoStar Realty Information Inc. report involving U.S. and Philadelphia commercial properties is being made through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

“[Midsize users] do dominate the market,” says Brooks Staley, senior consultant with The CoStar Group, a research firm dealing with market metrics dealing with U.S. and Philadelphia commercial real estate listings. “There are a lot more users who are looking for space in that kind of sweet spot than those who are looking for big boxes.”

For example, in Indiana, demand for midsize industrial space is booming, but the supply is scarce. As of mid-June 2019, there were 12 speculative industrial buildings of 250,000 sq. ft. or less being developed in Central Indiana, totaling 2.1 million sq. ft. In the state’s southern submarket, there is, however, only one midsize space available, a 70,400-sq.-ft. property in Greenwood.

Florida’s industrial markets also are showing growth among midsize users. Orlando tenants signed 68 industrial leases totaling 7.3 million sq. ft., with an average deal size of 108,095 sq. ft. Tampa Bay tenants signed 53 industrial leases totaling 5.0 million sq. ft., with an average deal size of 94,333 sq. ft. Jacksonville tenants signed 61 leases totaling 7.0 million sq. ft., with an average deal size of 114,590 sq. ft.

The growth in e-commerce and the need for last-mile delivery throughout national and Philadelphia commercial real estate properties has only strengthened the demand for midsize industrial boxes. At the end of June 2019, pricing for these types of assets averaged $68.71 per sq. ft., with around $4.7 billion in sales volume, according to CoStar data. At the end of June 2018, prices averaged $59.08 per sq. ft., with $7.7 billion in sales volume. In June 2017, pricing in the sector was at $59.56 per sq. ft., with $7.3 billion in sales volume.

“You can see that there’s been a pretty steady acceleration of pricing at 300,000 square feet and below. The same goes for larger sizes as well,” says Staley. “Industrial is the hot property type to be in right now, and that makes sense because of the tailwinds we’re seeing from e-commerce, from how all sorts of retailers are looking at their supply chain. We’re going to see pricing boosts for both midsize and large boxes.”

But despite strong demand and rising prices for midsize industrial facilities, investment sales activity in in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – is decelerating. In June 2019, there were 639 deals closed in the sector. In June 2017 and 2018, there were 1,121 and 1,197 deals, respectively. Staley says this drop stems from investors choosing to invest in ground-up construction to dodge rising prices on existing properties.

“We’ve done analysis that shows a lot more players in the industrial space actually are turning to development rather than acquisition in order to make returns,” says Staley. “[Pricing has] gotten so frothy in the marketplace that players are backing off or they’re saying, ‘We can develop. We can scrape a site and develop something.’ That would be the best shot at getting good returns.”

The same story is happening for large industrial facilities, or boxes with more than 300,000 sq. ft. In June 2017, pricing among such national and Philadelphia commercial real estate listings reached $48.18 per sq. ft., with around $3.2 billion in sales volume. By June 2019, prices climbed to an average of $76.20 per sq. ft., but with around $3.9 billion in sales volume.

“We would expect at the moment, because of pricing trends among all size ranges, that price appreciation will maybe stagnate a little bit as deals begin to dry up,” says Staley. “People are little bit leery of overpaying this late cycle.” – By Sebastian Obando; CoStar Realty Information Inc.

For more information about Philly office space, Philly retail space, and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need – a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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Philadelphia’s Unemployment Rate Falls to 30-Year Low

After another month of job growth, the Philadelphia market has reached an important milestone: The metro area’s unemployment rate fell to 3.1 percent in May, the lowest level of unemployment recorded in Philadelphia since the Bureau of Labor Statistics (BLS) began publishing the figure in 1990.

This CoStar Realty Information Inc. report involving Philadelphia commercial properties and employment is being made through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

For the Philadelphia commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – current record-low unemployment represents both a blessing and a potential risk.

On the positive side, it reflects how the local economy and Philadelphia commercial real estate listings are clearly stronger than they were 10, 20, or even 30 years ago. The healthcare sector has powered this transformation, growing its employee count by 25 percent – or more than 100,000 local jobs – since the end of the last recession 10 years ago.

With available workers in short supply, competition for new job recruits across all industries operating out of Philadelphia commercial real estate properties is forcing companies to raise wages across industries and not just for the highest paid positions.

At least five local health systems have announced plans to raise their minimum wage since late 2018. The BLS also reported that average hourly wages across businesses contributing to the local commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – sectors grew by 3.6 percent last year. Pay increases such as these have supported rent growth over 3 percent among Philadelphia’s workforce housing rentals.

But the lower Philadelphia’s unemployment rate goes, the harder it will become for local companies to find the employees they need, making it more difficult for businesses to grow and less likely that they will expand their real estate footprints.

At 1.2 percent year-over-year, Philadelphia’s pace of job growth has already slowed to about two-thirds of the pace recorded in 2014 to 2015, when available workers were easier for companies to find. In line with that trend, the pace at which local office tenants looking for Philadelphia commercial real estate listings are expanding their square footage has also slowed in the past three to four years.

Philadelphia’s tight labor market will likely persist into next year. Under this scenario, wage gains should continue to support accelerated rent growth in workforce housing rentals while slowing job gains keep a lid on office tenant expansions.

Office tenants in Philadelphia commercial real estate markets may not be growing aggressively, but they will likely continue to put increased emphasis on leasing high-end space to help recruit and retain employees, as it is becoming increasingly costly to lose them. – By Adrian Ponsen; CoStar Realty Information Inc.

For more information about Philly office space, Philly retail space, and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need – a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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Property Investors Increasingly Prefer the Flavor of Fast-Casual Restaurants

Sit-down, full-service restaurant chains operating in national and Philadelphia commercial real estate markets continue to face pressure from fast-casual competitors, and not just in the competition to woo diners.

Investors also appear to be losing some of their appetite for real estate in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – that has been leased to such “casual dining” chains such as Hooters, Outback Steakhouse, Red Lobster, Chili’s and Texas Roadhouse.

This CoStar Realty Information Inc. report involving U.S. and Philadelphia commercial properties is being made through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

Cap rates, the annual yield for U.S. and Philadelphia commercial real estate listings, jumped up in the first quarter for so-called “net lease” properties tied to casual dining restaurants.

According to a report from Wilmette, Illinois-based real estate firm The Boulder Group, “cap rates in the net lease casual dining sector increased to 6.32%” in the first quarter, up from 6.05% a year ago. The firm noted that the rate of increase among national and Philadelphia commercial real estate properties was wider than other types of net lease investment properties.

Net lease properties involve leases in which the landlord has little to no responsibility for managing the real estate beyond collecting a rent check. An increasing cap rate in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – can reflect the greater risk that a tenant might struggle or fail to renew at the end of its lease. The length of the term left on a lease is one of several factors used in determining the cap rate. The more years left on a lease tends to attract better prices for the property and lowers cap rates.

Many investors looking for lower risk among national and Philadelphia commercial real estate listings have targeted fast-casual properties, or restaurants that typically do not offer table service. Earlier this month, the dirt underneath a Portillo’s in Normal, Illinois, sold for $4.4 million and is expected to produce an annual yield of 5% for the private investor. – By Richard Lawson; CoStar Realty Information Inc.

For more information about Philly office space, Philly retail space, and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need – a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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May Retail Sales Data Shows Strength in Consumer Spending

May retail sales numbers reported throughout businesses operating in national and Philadelphia commercial real estate markets did not disappoint, suggesting a rebound in consumer spending from a slow start to the year. And that’s good news for commercial real estate.

First-quarter consumption related to the U.S. commercial real estate market – including such action taking place involving Philly office space, Philly retail space and Philly industrial space – was relatively weak and volatile, as consumer spending declined on durable goods, such as cars and furniture.

This CoStar Realty Information Inc. report involving U.S. and Philadelphia commercial properties is being made through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

The consumption slowdown raised concerns about the health of the U.S. economy, which relies heavily on Americans’ willingness to consume. Despite the choppy retail sales data at the start of the year involving businesses in U.S. and Philadelphia commercial real estate listings, CoStar economists expected consumer spending to rebound. Those expectations were based on the continued strength of consumer fundamentals, including healthy income growth, subdued inflation, rising wealth and access to credit.

May retail sales data from the Census Bureau was in line with those expectations. Retail sales among businesses operating in national and Philadelphia commercial real estate properties grew 0.5 percent compared from the previous month, and the April data was revised higher. Compared to a year ago, retail sales were up a solid 3 percent.

Sales at warehouse clubs and superstores throughout the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – were especially strong in May, as were food sales at supermarkets and other grocery stores. Food services continued to do well, with especially robust growth at limited-service restaurants. By contrast, sales at department stores declined over the past year, dragged down by double-digit declines in conventional chain stores; sales at discount stores, however, have held up better.

While the American consumers who interact with businesses dealing with national and Philadelphia commercial real estate listings appear happy to spend, all this consumption does not translate into demand for physical retail space. The May retail sales data was in line with the ongoing shift in buying preferences. E-commerce continued to grow at roughly four times the pace of total sales – up 12 percent in May on a year-over-year basis. — By Galina Alexeenko; CoStar Realty Information Inc.

For more information about Philly office space, Philly retail space, and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need – a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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Tips for Investors Entering the Cannabis Real Estate Market

With 10 states plus the District of Columbia legalizing cannabis for recreational use and medical marijuana legal in another 23 states across the national and Philadelphia commercial real estate markets, cannabis sales are projected to grow from $10.8 billion today to about $100 billion over the next five years, according to the National Institute for Cannabis Investors.

As a result, investors in cannabis-related industrial real estate can expect exceptional returns on investment (ROI) throughout the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space. In a 2018 survey by Denver-based PropTech developer Apto, 76 percent of commercial real estate brokers handling cannabis deals in all states where the drug is legal in some form reported cannabis deals pricing above market.

This National Real Estate Investor report involving U.S. and Philadelphia commercial properties is being made through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

Cannabis property deals may be more lucrative than other industrial transactions, but they are also more complicated, according to survey respondents. When asked to compare the difficulty of cannabis transactions involving U.S. and Philadelphia commercial real estate listings with traditional industrial deals, they answered with an average of eight on a scale of one to 10, with 10 being “most difficult.” Even so, 85 percent of brokers surveyed said they are willing to do more cannabis deals.

Investors willing to take a property through local licensing and entitlement processes for national and Philadelphia commercial real estate properties prior to leasing space or putting it on the block will realize the greatest boon in value, however, because there are limited number in any location, according to Rick Frimmer, managing director and head of the national cannabis advisory group at EisnerAmper, an accounting and advisory firm based in New York City.

Cannabis real estate values are likely to continue rising due to the supply-demand imbalance, says Clint Callan, a San Francisco Bay Area-based partner at the national law firm of Duane Morris LLP. “With cannabis, there are only so many spaces and opportunities available, which runs up the price,” he adds.

When asked how well the supply of industrial cannabis real estate in their market aligns with demand for space, respondents in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – answered with an average of four on a scale of one to 10, with one being “not in balance” and 10 being “in perfect balance.”

Commenting on survey results, Apto founder Tanner McGraw says that legalization of marijuana across more states is beginning to impact real estate markets, as local jurisdictions grapple with zoning and other issues that affect availability of sites. “Survey results suggest there is somewhat of a shortage of sites available, likely because allowable zoning has not caught up with demand,” he notes.

Local jurisdictions dealing with national and Philadelphia commercial real estate listings may limit zoning for cannabis uses to specific industrial areas and impose strict security, fire, and safety requirements for cannabis operations because cannabis products are at high risk for theft and manufacturing processes use chemicals to extract compounds, such as THC and CBD oil, according to Frimmer.

For more information about Philly office space, Philly retail space, and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need – a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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Mall Outlook Darkens as Online Sales Surge

A couple of the more than 2,200 numbers buried deep in this month’s Census Bureau report on retail sales in the national and Philadelphia commercial real estate markets may add to mounting concerns for U.S. shopping mall investors about the growing threat from e-commerce.

The report shows that for the first time, non-store retail sales (including e-commerce sales) in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – totaled more than those for the department stores that anchor most traditional Class B and Class C malls.

This Co-Star report involving U.S. and Philadelphia commercial properties is being made through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

Non-store retail sales in February, the most recent month reported, totaled $59.77 billion involving U.S. and Philadelphia commercial real estate listings. E-commerce sales account for about 88 percent of that volume.

The total for general merchandise national and Philadelphia commercial real estate properties housing retailers, the category that includes department stores, totaled $59.74 billion. Ten years ago, general merchandise store sales outpaced non-store sales by 47 percent.

The figures contribute more gust to the intensifying headwinds for shopping mall investors in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – whether they are property owners, lenders or real estate investment trust and commercial mortgage investors.

“Class B and C malls in particular are driving weaker loan performance as they generally have less favorable locations, weaker anchor profiles and are particularly vulnerable to competition, both from other malls and internet sales,” Fitch analysts said in a recent report. “Losses of foot traffic and sales have led to additional store closures with increasing mall vacancies affecting property-level cash flow, thus putting pressure on loan performance.”

Overall, there have been more than 5,800 store closings reported this year among national and Philadelphia commercial real estate listings. That elevated level of closings could lead to a widening gap in performance between property owners with more Class A malls than those with more Class B and Class C malls, Morgan Stanley & Co. analysts reported this week in their outlook for upcoming REIT first quarter earnings results.

For more information about Philly office space, Philly retail space, and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need – a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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Baby Boomers, Retailers Could Change Commercial Lending

Some of the industry’s top commercial real estate mortgage bankers expect business to stay just as strong in the national and Philadelphia commercial real estate markets in 2019 as it was in the past two years even as the economy shows signs of slowing.

The Mortgage Bankers Association predicts loan origination in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – will only reach $530 billion in 2019, essentially on par with 2017 and 2018.

This report involving U.S. and Philadelphia commercial properties is being made through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

The amount of financing in the fourth quarter of 2018 beat the year-earlier period by 14 percent, the group said. It suggests that commercial and apartment lenders apparently have not been scared off by government shutdowns, stock market volatility, looming global trade wars and other headline events. And this follows almost a decade of recovery involving U.S. and Philadelphia commercial real estate listings tipped from one of the nation’s worst real estate collapses, as analysts and economists wonder how long this recuperation can last.

Indications for the immediate future of both national and Philadelphia commercial real estate properties are for steady lending activity, bankers agree.

For 2018, “the market as a whole ended the year roughly flat compared to 2017, continuing a plateau we’ve seen in mortgage borrowing and lending since 2015,” said Jamie Woodwell, vice president of commercial research for the mortgage bankers’ group.

These were among the key points from the Washington, D.C.-based trade group, which represents lenders, investors, developers, and others involved in commercial real estate financing.

Financiers avoid retail: Blame the rise of ecommerce and retail chain store closings, but MBA figures show loans in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – posting relatively anemic growth in the past year. They were up 1 percent in the fourth quarter from a year earlier in 2017, compared with 32 percent growth for apartment loans and 28 percent growth for industrial loans.

Aging boomers haven’t yet spurred a healthcare lending boom: US. growth for healthcare and senior-housing-related lending was up 61 percent year-over-year for the fourth quarter, but analysts said aging baby boomers still comprise only a fraction of development and lending activity.

As banks get queasy, others stand by: Even if banks dealing with national and Philadelphia commercial real estate listings are getting skittish about how long the good times can last, a multitude of other financiers stand ready to step in, and the fastest growing contingent includes debt funds. Numerous prominent firms in financial management and private equity have established funds geared primarily to lending to third-party commercial investors and developers, and they are finding rewards even in a tight interest rate environment.

For more information about Philly office space, Philly retail space, and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need – a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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Analysts See Strong Warehouse Demand Despite Varied Concerns

Leasing and sales of distribution centers and other industrial properties reached records across the country last year, signaling strengthening demand in the national and Philadelphia commercial real estate markets as shoppers accelerate their shift to buying online.

Industrial activity was robust for a ninth-straight year in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – as overall economic growth and goods consumption drove unprecedented warehouse sales and leasing across the United States in 2018. The data, however, shows some signs pointing to slower growth this year.

This Co-Star report involving U.S. and Philadelphia commercial properties is being made through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

Investors, meanwhile, continue to pile into industrial space given its strong and consistent occupancy, rent growth, and return on investment. Total sales volume involving U.S. and Philadelphia commercial real estate listings tipped the $100 billion mark in 2018, the highest on record, and industrial sale prices rose about 10 percent over the prior year, an impressive feat this late in the economic cycle and easily the largest increase of all the major property types.

CoStar’s forecast expects new logistics buildings will be completed at a record pace this year as developers try to capture the demand. The research firm is tracking about 275 million square feet of industrial space under construction, equal to about 1.7 percent of the nation’s total supply. That amount of development among national and Philadelphia commercial real estate properties translates into what’s likely to be a high-water mark for new warehouse and distribution building this year to support the delivery of goods to households shopping online.

That’s a change from last year when the amount of new industrial space in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – dipped 11 percent in 2018 from the prior year. Construction finished the year on the upswing, but even that still may be insufficient to meet demand as more retailers move onto online platforms that require more warehouse space.

White demand remains robust, CoStar predicts the vacancy rate among national and Philadelphia commercial real estate listings will gradually rise and rent growth will slow as developers finish new buildings, more space hits the market, and the beneficial effects of tax cuts and fiscal stimulus begin to diminish and cool the economy.

For more information about Philly office space, Philly retail space and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need — a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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Rising Interest Rates Change the Makeup of Securitized Loans

Headwinds from rising interest rates and investor caution as U.S. economic growth approaches a record stretch are likely to lead to less traditional lending terms for commercial real estate loan securitization in 2019 throughout the national and Philadelphia commercial real estate markets.

While the Federal Reserve’s rate increases appear to be having little meaningful economic impact on the U.S. commercial real estate market, including Philly office space, Philly retail space and Philly industrial space, they do seem to be influencing a preference for commercial mortgage-backed securities with shorter-term floating-rate debt or interest-only payments, a survey of credit rating agencies said.

This Co-Star Research report involving U.S. and Philadelphia commercial properties is being made through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

Full or partial interest-only loans among U.S. and Philadelphia commercial real estate listings made up 87 percent of the commercial mortgage securitization market last year and, according to CoStar analysts, this trend is continuing in early 2019.

These loan dynamics have contributed to single-borrower deals and commercial real estate collateralized loan obligations among national and Philadelphia commercial real estate properties having a very good year in 2018. Those two types of securitizations accounted for $52 billion in deals in 2018, up from $42 billion in 2017, said CoStar analysts.

While the Kroll Bond Rating Agency is forecasting up to $55 billion in these types of issuances in 2019, traditional commercial mortgage-backed deals with longer-term loans in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – started out the first half of 2018 with a solid increase in activity. These deals, however, slowed noticeably in the second half as annual volume in 2018 decreased to $41 billion as compared to $44 billion in 2017.

Overall issuances of this type among national and Philadelphia commercial real estate listings could fall a bit more next year. One of the main factors that could drag down lending volume is a shrinking pipeline of loans coming due for repayment. With fewer loans maturing, there is less demand for borrowing. Loan maturity volume dropped from highs of about $83 billion in 2016 and 2017 to about $34.65 billion in combined maturities over the next two years.

For more information about Philly office space, Philly retail space and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need — a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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Philadelphia Employers, Economy Positioned for Growth In 2019

With trade tensions escalating and interest rates in the national and Philadelphia commercial real estate market on an upward path, economists are increasingly warning the U.S. economy is in danger of slipping into recession in 2020.

While risks of an eventual national economic slowdown in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – are real and should not be ignored, Philadelphia-focused real estate investors can take comfort the region’s economic indicators are flashing positive signs for 2019 as the Philadelphia-Camden-Wilmington metropolitan area’s job gains have strengthened in recent months to a rate of 1.4 percent year-over-year.

This Co-Star Research report involving U.S. and Philadelphia commercial properties is being made through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

The industries powering Philadelphia’s recent job gains are:

Healthcare: In University City, Penn Medicine is now wrapping up construction on the first phase of its 540,000-sf Center for Healthcare Technology. Meanwhile, work continues at the healthcare giant’s largest capital project ever, the 1.5 million-sf Pavilion Hospital, which is expected to be completed in 2021. AmeriHealth Caritas, AmerisourceBergen and Sparks Therapeutics have all recently announced major Philadelphia-area expansion plans.

Information Technology: Philadelphia-based Comcast is in the process of hiring roughly 1,500 new employees as it staffs its recently completed Comcast Technology Center.

Distribution: Retailers and e-commerce firms have been on a tear building new distribution facilities in the region to expedite delivery times for their East Coast customers. Just weeks ago, Amazon completed a major distribution center in Burlington New Jersey expected to employ 600 people, one of five massive distribution centers Amazon has opened in the metropolitan area since 2013.

Many of Philadelphia’s largest publicly traded companies are flush with cash following the passage of the Tax Cuts and Jobs Act of 2017, which sliced the U.S. corporate tax rate almost in half. Over the most recent four quarters of business among some of the leading national and Philadelphia commercial real estate properties, top local employers – including AmerisourceBergen, Aramark, Comcast, and FMC – reported all-time highs in net operating incomes that more than doubled what had been collected during the preceding four quarters.

While the recent tax cuts affecting U.S. and Philadelphia commercial real estate listings are expected to add at least $1.9 trillion to the federal debt by 2028, according to the Congressional Budget Office, they clearly have boosted companies’ willingness to expand payrolls.

According to data from the world’s third-largest staffing firm, Manpower, the percentage of companies in the Philadelphia-Camden-Wilmington metropolitan area planning to increase staffing levels is at the highest levels recorded during this economic expansion. Meanwhile, the percentage of firms in the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – planning to reduce their staff is near rock bottom.

Philadelphia’s employment growth could still decelerate in the quarters ahead despite local companies’ aggressive hiring plans. With the unemployment rate among national and Philadelphia commercial real estate listings now well below 5 percent, employers will likely find it increasingly difficult to fill many open positions.

On the spectrum of economic challenges, this is one of the less-threatening problems to face, in part because a tight labor market also supports above-average wage growth. Still, the dwindling supply of available workers was likely a driving force behind the brief slowdown in job growth that took hold here in 2017.

The stage is set for total employment to continue rising in Philadelphia through 2019. The question is how strong and how sustainable these job gains will be.

For more information about Philly office space, Philly retail space and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need — a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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Life in the Fast-Food Lane: Restaurants Add Drive-Thrus Across the Country

Jack in the Box Chief Executive Leonard Comma knows his fast-food chain’s sales are dependent on drive-thru lanes. That’s why he said his company is investing as much as $45 million the next three years on digital menu boards and canopies to make the experience faster and more personal.

Quick-service purveyors across the national and Philadelphia commercial real estate market such as Starbucks Corp. and Dunkin’ Brands Group Inc. are also changing how they view their real estate by collectively spending tens of millions of dollars to let people eat in their cars as customers increasingly demand speed and convenience.

This Co-Star Research report involving U.S. and Philadelphia commercial properties is being made through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

Drive-thru lanes contribute more than 70 percent of San Diego-based Jack in the Box’s sales, Comma said during a recent earnings call concerning the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space. “They represent a sizable sales opportunity,” he said.

Modern drive-thru technology has been around since the 1940s but came of age in “car-crazy California” in the 1950s, according to the National Museum of American History, which noted that by the 1970s “major fast-food franchises nationwide began to install drive-thru windows.”

The concept has never been more popular.

A study by trade publication QSR Magazine found that most fast-food chains among national and Philadelphia commercial real estate properties report about 70 percent of their sales happen at a drive-thru window, saying “the outdoor lane is just as important today to quick-service business as ever before – if not more so.”

Starbucks, which said in its Nov. 1 earnings call that it plans to build 600 new locations across North America in 2019, adding to its roster U.S. and Philadelphia commercial real estate listings, is expanding a push it began last summer to equip about 80 percent of all new stores with a drive-thru lane. Many of those won’t have interior seating, resulting in a much smaller store footprint.

Drive-thru, out-the-window and mobile-order-and-pay combined accounted for more than 50 percent of all orders in the U.S. commercial real estate market, including Philly office space, Philly retail space and Philly industrial space, in the past three months, up more than 10 percentage points in two years, Starbucks Chief Financial Officer Rosalind Brewer said.

“Last quarter, our stores with drive-thru well outperformed our café comp,” Brewer said. “This format will be a continued focus into 2019.”

Last summer, Seattle-based Starbucks said sales were 25 percent to 30 percent higher at stores with drive-thru lanes. Competitor Dunkin’ Brands Group, based in Canton, Massachusetts, said the drive-thru restaurants among its national and Philadelphia commercial real estate listings boast 40 percent higher sales volume.

For more information about Philly office space, Philly retail space and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need — a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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Opportunity Zone Property Sales Up 8 Percent Over Last Year

Investors pumped $2.6 billion more into properties covered by the federal Opportunity Zone tax incentive initiative — an 8 percent increase from the same time last year — even before the Treasury Department released guidelines on the program.

Almost 40,000 properties in the more than 8,760 zones in the national and Philadelphia commercial real estate market have sold this year, according to CoStar data. More than 51,400 properties are being actively marketed for sale, and the release this month of the first round of regulations is expected to amplify that flow of money through the next couple of years.

This report involving U.S. and Philadelphia commercial properties is being made through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

Opportunity Zone investments are a provision of the Tax Cuts and Jobs Act signed into law last December, deferring or eliminating capital gains taxes for new investments throughout the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – in communities that state and federal officials define as economically distressed. The Treasury worked into October this year to provide regulatory guidelines for the program.

Estimates range widely for the amount of capital that could flow into national and Philadelphia commercial real estate properties to take advantage of the tax benefits from investing in properties in these zones and holding onto them for at least 10 years. The federal government calculates the capital flow at $100 billion, while some industry estimates reach as high as $250 billion — and it could go higher if all benefits are factored in.

Not every property in a zone is eligible for tax benefits. To qualify, investment buyers must double the value of the investment in a specific time frame. Many zone properties among U.S. and Philadelphia commercial real estate listings, however, are newly constructed or not in need of new development or redevelopment. Nonetheless, these properties could also see an upswing in investment.

Other investors in the U.S. commercial real estate market, including Philly office space, Philly retail space and Philly industrial space, will be pumping money directly into businesses in the opportunity zones –- investments that are also eligible for the tax benefits.

This early activity this year tallied by CoStar may provide a clue to where the expected surge of money could flow into national and Philadelphia commercial real estate listings and for what property types. In CoStar’s analysis of this year’s opportunity zone sales, it excluded properties that were part of portfolio sales of $100 million or more, and that were targeting large national or regional portfolios and not specifically opportunity zone properties.

For more information about Philly office space, Philly retail space and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need — a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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