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Are we there yet? 2014 Mid Year Office Market Trends

Commercial Real Estate 2014 Mid Year Office Market Trends

By there I mean where the real estate values are increasing at a point above the measurement of the annual rate of inflation. The Consumer Price Index (CPI-U) has increased 2% for the past 12 months through July 2014. This percentage change year or year is a key indicator for the economy. By analyzing the national data – YES, we are there!  Keeping in mind the real estate trends vary regionally and with the quality of the product. Looking at the global market and the Vacancy Rate – the CRE industry uses this to track trends and an indicator of the balance of supply and demand for office space. Here are a few of the findings in the national vs local office markets for Vacancy Rates and rent trends.

Based on the Costar’s mid year review the national vacancy rates for leased and owner occupied buildings up to the first half of 2014 is at 11.8% as compared to 2013 which was 12.2% vacancy rates. This is a reduction of almost a half a percent in available office space. The national rent increase year to date in 2014 increased 3.7% as compared to 2013 with only a 1.9%.


cre 2014 trends (more…)

Posted in: Commercial Real Estate, Corporate Office Space, Philadelphia

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Finding Office Space in Philadelphia

Finding Office Space in Philadelphia

Whether you are from the Philadelphia region, or not, when it comes to searching for commercial real estate office space it is not as easy as hopping on the web to do a search.  Leasing or purchasing space needs to be seen as an investment with the opportunity for your business to grow, or make changes, without having to sell/move again for maybe a 3,5, 7+ year period.  Some of the obvious options for leasing commercial offices space are located in Center City Philadelphia, which is well known for its skyscrapers with amazing views. But what about finding the right solution for your actual needs long term. How do you know you are seeing all the opportunities that can meet your criteria? How do you know which Landlord’s are a little more motivated, maybe due to a higher vacancy, or another project they want to start? Sometimes the property is off the beaten path, or in a location you would not have thought of on your own, or there is a sublease space with little market exposure. That is where your commercial real estate agent comes to the rescue!  With access to information on the agents for the buildings and data on what is available, but an understanding of regulations, and extras you may not consider. (more…)

Posted in: Commercial Real Estate, Corporate Office Space, Philadelphia

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LaSalle University Economic Outlook Luncheon in January

Monday, January 20, 2014

Do you take it for granted like I do, that we have such a stable banking system in the United States? I was reminded why we have such a stable banking system by Dr. Plosser when I heard him speak at LaSalle University’s Economic Outlook luncheon on 1/14/2014.

Dr. Plosser gave us his Perspective on the Economy and Monetary Policy…. He made a point that he was giving us his opinion and not the opinion of the Open Market Committee which he serves on.

We were refreshed on the  history of the Federal Reserve which was created by Woodrow Wilson in 1913. Congress sets its goals, and the last time the goals were set was 1978.  One thing unique about our central bank is that it is comprised of12 regional banks for diversity.  There were over 400 + people there and a reporter from Wall Street Journal, and one reporter from Bloomberg News.

After  insights into the History of the Federal Reserve he shared his opinion on Monetary Policy such as our 3rd round, QE3.  It was reassuring to hear that he thinks the economy has already met the criteria of substantial improvement, and we should conclude the asset purchases. And then we should plan policy for after QE3.. It was interesting to hear his list of Objectives.   A question he raises with reference to the Objectives outlined is  “Do we have the will to do it?”  You can read the details here.

Here are some interesting and reassuring comments from the Question and Answer period.


Posted in: Commercial Real Estate, Peggy's Travels

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How are CRE professionals paid for their services?

How are CRE professionals paid for their services?

Whether it is a sale/equity transaction, or a lease between owner and tenant, CRE agents receive a commission at settlement, or upon the signing of the lease.  The amount of commission is often calculated as a percentage of the lease, or sale value, which often ranges from four to six percent, more or less. For example if a tenant signs a lease for a 2,000 square foot office at $21 per square foot, a 4% commission to the real estate agent would amount to $5,040.00 (3 years X 2,000 SF x $21 x 4%). The owner of the leased building pays the agent’s commission: typically one –half on the signing of the lease and the remaining one half when the tenant begins occupying the building. In many lease, transactions there are two CRE firms involved, both could represent the owner of the building (sub agent and agent), or one could represent the Tenant or Buyer, while the other represents the Owner.

Posted in: Commercial Real Estate

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2013 Commercial Real Estate Year End Report by PGCRE

What is happening with the Office Market after the 2008 – 2009 drop in Value and Demand, and being out of favor with investors? 

Whether your business leases offices, or directly owns the building, you may find value in news on the status of trends in the Commercial real estate market in the Philadelphia region, and nationally.  There is so much to say and so many statistics to reference. But, here is a quick short synopsis to give you a feel for the direction of market trends for planning purposes.

Click here to download my free 2013 report for our region!

Rental Rates

Posted in: Commercial Real Estate, Corporate Office Space, Philadelphia

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How does the Commercial Real Estate Industry WorK?

Do you know how the Commercial Real Estate industry works, aka CRE? Here is a quick education if you are considering to rent, lease or purchase an office space or office/industrial building. Most owners of a commercial real estate property will engage in a contract with a commercial real estate agent, much like a residential realtor. This engagement would be for the sale, lease or renting of the  property.  In this scenario the real estate agent is responsible to represent the building owner and the property during the sale or lease and responsible for marketing the availability of the space.

There are many segments in the Commercial Real Estate industry based on the types of property. Here are the 4 main categories you will find among commercial real estate agents.

  1. Retail
  2. Office
  3. Industrial
  4. Multi-family

2 Subcategories: Hospitality and Medical. Most represent the seller or landlord during the transaction.

If you are looking to buy or lease one of these spaces finding a Tenant Representative that specializes in your area of interest is strongly recommended to help guide you through the process and assist in setting expectations. To learn more about the Tenant Representations’ role in the transaction read more here or contact Peggy to represent you.

Posted in: Commercial Real Estate, Newsletter Articles

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