The dwindling inventory is causing rental rates to inch upward, according to Newmark Grubb Wilson Kibler’s report.
In March, Mercedes-Benz Vans announced an expansion of its Lowcountry footprint with a $500 million investment in a new van plant in Palmetto Commerce Parkway in North Charleston. Roughly 1,300 employees will be hired to manufacture the vans from start to finish, rather than the current assembly-only operation.
Volvo Cars announced plans in May to build an automotive campus on a site in Berkeley County. Construction will begin on the $500 million plant this year. Roughly 2,000 employees will be producing cars by 2018, according to Volvo officials.
The dearth of inventory means new development is required, as large manufacturers and their suppliers are in need of industrial spaces, Lee and Associates reports.
And in its report, Avison Young said roughly 1 million square feet of much-anticipated speculative space is now being built.
Fundamentals in the multifamily space should continue their golden trajectory for several more years, based on the latest numbers about US homeownership from the US Census Bureau. Indeed, coupled with other recent reports on multifamily dynamics, it is safe to call the asset class bullet proof, at least for the medium term.
US home ownership, of course, has been steadily falling since the Great Recession. On Tuesday, though, it hit a low that gives one pause — to say nothing of putting it within spitting distance of awe-inspiring benchmark.
US homeownership is now at 63.4%, which is the lowest level of home ownership in this country since 1967. There is little to suggest it won’t stop falling: in Q1 it was at 63.7%. In 1965, when the government started tracking home ownership the level was 63% — a percentage that seems like it is but a few quarters away again.
The second quarter of 2015 continued the streak of positive absorption at eight consecutive quarters, with rental rates reaching unprecedented levels in the Columbia, S.C. office market. Overall, net absorption has also continued, quarter over quarter, for the last four quarters.
The Q1 2015 average direct (exclusive of sublet space) rental rate for the overall Columbia, S.C. off market was $16.08 per rentable square feet (RSF), an increase of $0.29 per over Q1, 2015. The Q2 2015 average direct vacancy market-wide was 10.5%.
Landlords, especially in the Class-A Market, are finally in a position to reverse the blood-letting trend of compressed rental rates, unprecedented leasing concessions, and elevated Tenant Improvement Allowances they experienced during the Great Recession. To this end, most owners of quality product are now in a position to reduce leasing incentives previously available during the deep economic downturn as well as realize rental rates that in some cases, are now nudging all-time highs.
The Killian Crossing development off Interstate 77 near Blythewood will break ground next week on its first major project. Kroger officials have announced construction will begin on The Kroger Marketplace at Killian Crossing on July 21.
The new location is a unique concept for the grocery retailer. The Marketplace will be a 124,000-square-foot multi-department store that is new to the Columbia market, and the store is expected to create nearly 300 jobs.
Customers will have access to a Starbucks Coffee, Chef on the Run buffet with prepared foods and The Little Clinic, which offers medical care to shoppers.
The store also will offer Fred Meyer Jewelry, an apparel department, a drive-through pharmacy and a fuel center. The only other fuel center in Columbia is at Kroger’s Irmo location off St. Andrews Road.
Greenville, South Carolina: Hunter Garrett, CCIM, SIOR and John Staunton of NAI Earle Furman represented the landlord, Piedmont Saco, LLC in the leasing of a 92,000 SF industrial property at 141 Old Mill Road to Faurecia Interior Systems.
Greenville, South Carolina: Keith Jones, CCIM of NAI Earle Furman represented the landlord in the leasing of a 3,198 SF office property at 119 Manly Street to GIFT Counseling Center for Wellness, LLC.
Greenville, South Carolina: Glenn Batson of NAI Earle Furman represented the landlord, CMH Homes, Inc. in the leasing of an 8 acre land property at 804 Mauldin Road to Lead Academy Public Charter School.
Greenville, South Carolina: Alexi Papapieris, Stuart Wyeth, SIOR and Taylor Allen of NAI Earle Furman represented the landlord, Terra Parkgreen, LLC in the leasing of a 10,790 SF office space at 150 Executive Center Drive, Suite 101 to Southern Wesleyan University.
Spartanburg, South Carolina: Dan Dunn of NAI Earle Furman represented seller, Neuburger Management Inc., in the sale of a 7,000 SF office property at 170 Metro Drive to Mezger Investment Properties.
Greenville, South Carolina: Jake Van Gieson, Bill Sims, and Gaston Albergotti of NAI Earle Furman represented the buyer, Victor Street Properties, LLC, in the purchase of a 24,000 SF Industrial property at 14 Victor Street.
Simpsonville, South Carolina: John Gray, CCIM and Drew Stamm of NAI Earle Furman represented the seller in the sale of a 6,600 SF retail property at 891 NE. Main Street to Moneyline Properties, LLC.
Spartanburg, South Carolina: Bill Sims and Jake Van Gieson of NAI Earle Furman represented the seller in the sale of a 64,519 retail property at 1600 John B. White Sr. Boulevard. Peter Couchell, CCIM and Robert Schmidt, also of NAI Earle Furman represented the buyer.
Honea Path, South Carolina: Rusty Hamrick of NAI Earle Furman represented the seller in the sale of a 218.04 acre land property at 1535 Dunklin Bridge Road.
Piedmont, South Carolina: John Gray, CCIM and Drew Stamm of NAI Earle Furman represented the seller, Dunn-Goodwin, in the sale of a nine building office complex totaling 41,117 SF at the 153 Commons Professional Office Park. Peter Couchell, CCIM and Robert Schmidt, also of NAI Earle Furman, represented the buyer.
Lowcountry commercial brokers and agents are currently using an MLS platform built for residential real estate. The existing platform, which had 830 commercial users as of June 30, allows users to list properties and exchange information, according to the association.
The new S.C. Commercial Multiple Listing Service, built by the Catylist platform, will be tailored to commercial sales and include custom reports, listing presentations, market statistics and mobile access, in addition to searching and mapping tools, the association said.
It will be owned by the Charleston Trident Association of Realtors but will be a separate company with its own board of directors.
The new MLS is scheduled to launch Oct. 1 in Charleston, Berkeley and Dorchester counties and expand to other S.C. markets within a year to 18 months, the association said.
- The Charleston, SC office market continues to tighten with occupancy and asking rental rates reaching record-highs. Occupancy was over 90.0% for the first time in over a decade .
- Asking rental rates in Charleston, averaging $22.59 per square foot, are among the top rates in the Southeast, surpassing those of Atlanta, GA and Charlotte, NC.
- Construction activity is at its highest point since the recent recession with several office buildings under construction throughout the market.
- Office-using employment in the Charleston-N. Charleston, SC MSA is at an all-time high with 70,700 jobs.
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According to a report from multifamily market tracker Real Data, of the 34,132 units in May 2014, 2,334 were vacant. In May 2015 there were 34,402 units with 2,008 vacant. The vacancy rate has steadily declined over the past 18 months. Absorption was positive with the gain of 365 renters over the past six months.
The area’s occupancy rate likely will rise over the next year. According to the report, supply will exceed demand throughout 2016 as a large number of new units are completed. Rent growth will be positive, but slow at 1% to 2% over the next 12 months.
The report also shows there are 2,771 units under construction in the Greenville area, which is the highest level ever recorded. There are 3,130 units proposed in the overall area. Downtown Greenville accounted for nearly all of the new units delivered in the past six months.
NAI Avant has announced the sale of ±19.5 acres of land on Sunset Blvd at Laurel Ridge Road next to the Golden Hills Golf & Country Club in Lexington, SC. Wellmore, a senior living facility developer, purchased the land for $2,300,000 and plans to build an approximately 200,000 square foot, $47 million premier retirement community offering a continuum of care options to include independent living, skilled nursing, assisted living and Alzheimer’s. The Wellmore of Lexington facilities are expected to open in the spring of 2017 and bring nearly 140 jobs to the local community.
NAI Avant senior brokers, Patrick Chambers and Ben Kelly, CCIM, recently represented the buyer.
Lowes Foods, a family-owned supermarket chain based in Winston-Salem, N.C., plans to open a nearly 50,000-square-foot store at S.C. Highway 41 and Wood Park Drive near The Gates at Dunes West subdivision. With more than 100 stores, the chain operates in the Carolinas, with five supermarkets along the Grand Strand. The nearest is on U.S. Highway 17 near Pawleys Island.
The store, including a 12-pump gas station, is planned as part of a nearly 78,000-square-foot shopping center called The Market at Mill Creek. Adams Development Co. of Charleston plans the structure on a 12-acre site across from the entrance to the Planters Pointe subdivision.
The shopping center will include five smaller stores, a gas station kiosk and a 4,500-square-foot building on an outparcel. The parking lot will not be visible from nearby roads because it will be placed in the center of the property with separate buildings and tree buffers surrounding it.
The 6.5-acre vacant lot sits at the corner of Huger and Gervais streets and was site of the former Kline Iron and Steel. That company was founded in 1923 and primarily was known for building broadcast towers.
Columbia’s Design Development Review Commission reviewed initial plans that include multi-building property with a mix of apartments, townhomes and a large number of restaurant spaces.
Developer Russ Davis Jr. of Homes Urban Property Co. said up to 306 apartments will be available. A national brand hotel will be situated at the corner of Gervais and Huger streets, though Davis could not reveal which hotel.
The plan calls for an extension of Lady Street into the property and the addition of a new road off the side of Gervais Street that is tentatively called Kline Drive.
Steadfast Apartment REIT has acquired Arbors at Brookfield, a 702-unit apartment community located in Mauldin, roughly eight miles from Greenville’s central business district. The $66.8 million purchase marks Steadfast’s entry into South Carolina. Constructed in four phases between 1989 and 1997 on 50 acres, Arbors at Brookfield comprises 35 two- and three-story buildings, in addition to multiple clubhouses, a fitness center, three swimming pools, sand volleyball court, business center, tennis courts, dog park and a media room.
The apartment community is currently 94.9 percent occupied with an average rent of $766 per month. Steadfast plans to upgrade the units with new appliances, countertops, flooring, plumbing fixtures, hardware and new doors and cabinet boxes. In addition to interior upgrades, moderate enhancements will be made to the model unit, leasing office, volleyball court, tennis courts and fitness center. The REIT will also convert one of the clubhouses into a resident relations center. With this transaction, Steadfast has invested more than $687 million in 18 apartment communities in nine states.
The Charlotte Business Journal reports the real estate firm plans to build a 50,400 square-foot speculative, or ready-to-suit, building on eight acres adjacent to the Shutterfly, Inc. facility near Interstate 77 and S.C. 160.
This is Beacon’s second speculative site in York County. In 2014, Beacon built a speculative building in the Riverwalk Business Park nearly five times the size of the planned Fort Mill building at 277,000 square feet.
Beacon has already leased a portion of the Rock Hill property to logistics firm Exel Holdings.
Speculative buildings are popular among developers and are built as ‘shell’ buildings designed to fit a buyer’s needs quickly.