Browse Tag: apartment

Where Is Commercial Real Estate Oversupply?

English: Welsh Assembly Office Construction De...

The national market for commercial real estate is a massive thing, a meta-market encompassing tens of thousands of localities, each with their own economies and histories, subject to their own internal logic — and illogic. When trying to take all of these in as a whole, it’s important to remember that the local stories always loom larger than might be apparent, and that effects are overwhelmingly driven by local needs, wants and preferences.

That said, some indicators are more easily acquired nationally than others. Construction delivery is one. More inventory arriving may influence performance for existing, surrounding inventory, but delivered construction always opens the door (when taken as an aggregate) to the possibility of overbuilding.

With that indicator’s strength in mind, Susan Persin’s piece in REITCafe (registration required) looks at national construction deliveries in the major sectors of CRE and finds where the numbers suggest demand and supply are growing out of balance, tipping toward supply.

In apartments, the high end of the market in NYC and SF get a jaundiced eye from Persin:

[…]REITs with significant investments in markets like Manhattan and San Francisco, such as Avalon Bay (AVB) and Equity Residential (EQR) have cut their revenue forecasts several times this year, citing weakness in these markets.[…]

Persin also noticed some developments in office markets in Dallas, Houston and New York that have the “o” word — overbuilding — rearing its ugly head. Quoting Sam Zell’s recent Bloomberg interview — a chipper affair otherwise — shows Zell concurring about a situation in NYC office that sees new construction as outpacing demand there.

Get the full article — with commentary on all the major CRE sectors of retail, hospitality, industrial  — at Trepp REITCafe for a free registration.

Photo credit: Wikipedia

Bell Apartment Fund V Announces $425 Million of Total Equity Commitments

 

Private equity real estate fund, Bell Partners, Inc. Fund V will invest in quality apartment complexes in highly desirable locations with value-add potential in the Western United States, across the East Coast and in the Southwest.

Bell Partners, Inc. founded in 1977 is now the 11th largest apartment operator and 7th largest apartment renovator in the United States according to the National Multi-Housing Council.

Bell Partners, Inc. has completed their final round of funding for $425 million total equity commitments.  Bell Partners is considered to be one of the highest “top performing, consistent” real estate fund managers for the second year in a row by the 2015 Preqin Global Real Estate Report.

Jon Bell, president of Bell Partners, Inc. said in a press release, “We are very pleased with the reception that Fund V received from domestic and international investors.  The positive investor response to the Fund demonstrates confidence in Bell’s strategy, management team, and vertically integrated operating platform, as well as recognition of our strong track record.  We are confident that this investment opportunity will generate attractive current income and provide strong total returns.”

Since 2002, Bell Partners Inc. has invested $10 billion of apartment investments on behalf of its investors. Bell invests in multifamily properties in targeted areas and some transitioning areas that can through renovation create high-quality communities in supply-constrained submarkets near major employment centers and other amenities.

National Association of Realtors’ latest Commercial Real Estate Outlook offers overall projections for four major commercial sectors: multifamily markets, industrial, retail and office developments. Historic data for several metro areas were provided by REIS, Inc., a source of commercial real estate performance information.

 

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