{"id":1004073247,"date":"2013-05-15T11:48:42","date_gmt":"2013-05-15T19:48:42","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004073247"},"modified":"2022-12-02T21:33:55","modified_gmt":"2022-12-03T05:33:55","slug":"cre-investors-turning-to-secondary-markets","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/cre-investors-turning-to-secondary-markets\/","title":{"rendered":"CRE Investors Turning to Secondary Markets"},"content":{"rendered":"<p><em style=\"font-size: 13px;line-height: 19px\">By Keith Loria, Contributing Editor<\/em><\/p>\n<p><a href=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2013\/05\/PAGE.jpg\"><img loading=\"lazy\" decoding=\"async\" data-attachment-id=\"1004073401\" data-permalink=\"https:\/\/www.commercialsearch.com\/news\/cre-investors-turning-to-secondary-markets\/page\/\" data-orig-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2013\/05\/PAGE.jpg\" data-orig-size=\"385,336\" data-comments-opened=\"1\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;}\" data-image-title=\"PAGE\" data-image-description=\"\" data-image-caption=\"\" data-large-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2013\/05\/PAGE.jpg?w=385\" class=\"alignleft size-thumbnail wp-image-1004073401\" title=\"PAGE\" src=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2013\/05\/PAGE.jpg\" alt=\"\" width=\"150\" height=\"150\" \/><\/a><span style=\"font-size: 13px;line-height: 19px\">The investment sales market for commercial real estate is shifting away from the major markets of New York City, Washington, D.C. and Los Angeles, and moving towards second-tier markets like Austin, Texas, Charlotte, N.C., and Seattle, Wash.<\/span><\/p>\n<p><span style=\"font-size: 13px;line-height: 19px\">These markets, according to recent analysis by the CoStar Group, which shows how, due to geographic pricing disparities, investors believe are the smarter moves heading out of the recession.<\/span><\/p>\n<p>\u201cWhat we see across the country is investors are searching for yields. They are willing to take lower risks as they search for yield and are now shifting from primary markets to secondary markets,\u201d Walter Page, CoStar\u2019s director of research for Office, told\u00a0<em>Commercial Property Executive<\/em>. \u201cFor example, total sales growth for Austin increased 350 percent over the past two years.\u201d<\/p>\n<p>During that same period, sales in New York dropped by 10 percent, D.C. by approximately 12 percent, and Denver and Boston by 25 percent.<span style=\"font-size: 13px;line-height: 19px\">\u00a0<\/span><\/p>\n<p>Following Austin in terms of growth, Charlotte saw increases of 310 percent, Seattle of nearly 150 percent and East Bay at 130 percent, as investors are feeling safer now than they were two years ago.<\/p>\n<p>According to Page, the core markets are cooling, but it\u2019s the same thing you see following any economic downturn.<\/p>\n<p>\u201cIn these secondary markets, there\u2019s no construction of any significance as 60 percent of office construction is focused in five markets\u2014Boston, New York, Houston, San Jose and Washington, D.C.,\u201d he said. \u201cThe other 40 percent have very little so the risk is removed. People want to go to secondary markets as they see a lot of upside in rents and values relative to long-term trends and replacement costs.\u201d<\/p>\n<p>The CoStar report further predicted that people can\u2019t expect big returns out of the Northeast markets because they have been priced up so much in the past, so a common theme among investors is, \u201cWhere can I go next?\u201d<span style=\"font-size: 13px;line-height: 19px\">\u00a0<\/span><\/p>\n<p>Significant portfolio sales in Austin and Seattle over the last 12 months are indicators of that answer. Investors looking for a bit higher yield are starting to\u00a0feel that, in these secondary markets, the recovery is far enough along that it makes sense to take business here.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The investment sales market for commercial real estate is shifting away from the major markets of New York City, Washington, D.C. and Los Angeles, and moving towards second-tier markets like Austin, Texas, Charlotte, N.C., and Seattle.<\/p>\n","protected":false},"author":451,"featured_media":1004073401,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[37301],"tags":[],"class_list":["post-1004073247","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v28.0 (Yoast SEO v28.0) - 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