Category: News & Market Reports

Yesway Real Estate Strategy Goes Big in Rural Markets

Posted on by Sarah

FORT WORTH, Texas — Yesway’s current focus on rural site selections goes all the way back to knowledge shared by the late Lonnie Allsup, founder of the Allsup’s convenience store chain, which Yesway acquired in 2019.

Allsup scouted new sites by flying his airplane over highways in Oklahoma, west Texas and his home state of New Mexico, looking for clusters of motor traffic surrounded by wide open spaces, according to Tom Brown, director of real estate acquisitions for Yesway

“Lonnie would put his store at the intersection of the Interstate and the state highway and buy all the open land surrounding the store for defensive purposes,” Brown said. “He was one of the first people in the convenience store business to build larger stores with food and grocery items. In recent years, it was easy for him to build a bigger store because he owned all the land around it.” Click to read more at www.csnews.com.

Milrose Acquires Texas-based Land Use Consultancy Masterplan

Posted on by Sarah

Milrose Consultants, the country’s largest provider of building code consulting and municipal compliance services, has acquired Masterplan, a Dallas-based full-service land use and planning consultancy.

Founded in 1981, Masterplan is the largest land use firm in the Texas region specializing in zoning, permitting, and community engagement. The firm has more than 40 employees across offices in Austin, Dallas, Frisco, Houston, and Fort Worth, and has obtained thousands of government approvals for clients in the development industry.

Milrose’s acquisition of Masterplan will expand the consulting firm’s presence into Texas and strengthen its ability to provide full-spectrum services.

“Texas is one of the fastest growing national real estate markets and has some of the more stringent and complex land-use, building code and zoning, and municipal permitting regulations and processes. As more of our clients and companies across the country continue to invest in and grow their presence in Dallas-Fort Worth, Austin, Houston, and the surrounding cities, we are excited to have Masterplan as part of our team and be able to offer our combined suite of specialized services to all existing and new clients across Texas,” said Dominic Maurillo, CEO of Milrose. Click to read more at www.consulting.us/news.

Acquisition of Future Houston-area cGMP Life Science Facility Closes

Posted on by Sarah

JLL Capital Markets announced today that it has closed the acquisition of 9501 Lakeside, a future 76,000-square-foot, cell therapy manufacturing facility located in The Woodlands within Houston, Texas.

JLL represented the tenant, Cellipont Bioservices, and procured the buyer, Vitrian, a fully integrated biomanufacturing and cGMP real estate company.

9501 Lakeside will feature state-of-the-art manufacturing, process development, assay development and testing capabilities and is scheduled to open within the first half of 2023. The opening of this site will expand upon Cellipont’s existing location in San Diego.

The property sits in Research Forest Lakeside (RFL) in The Woodlands, Texas. RFL is a planned development uniquely located on 77-wooded acres overlooking Lake Woodlands that features six office and four retail buildings, with future development of up to three additional class A office buildings totaling 760,000 square feet. The mixed-use site is home to a diverse line up of tenants including chemical, financial services, logistics, oil and gas exploration, LNG shipping and integrated energy companies. RFL’s location provides easy access to all of The Woodlands’ amenities, such as Market Street, The Woodlands Mall and The Woodlands Waterway Marriott Hotel and Convention Center. Additionally, I-45 is less than a five-minute drive away.

The JLL Capital Markets Investment Advisory team representing the tenant was led by Directors Dave Baker and Brian Buglione and Managing Director Kevin McConn.

“JLL is honored to have represented Cellipont, a best-in-class cell therapy CDMO, in achieving this critical milestone in their growth trajectory,” said Baker. “Strong investor interest in this opportunity reflected the strength of Cellipont as a tenant, as well as projected growth in the cell therapy manufacturing space, and investors’ positive reception of the growing Houston life science market. We are excited to watch the future successes of Cellipont and Vitrian together.”

California Real Estate Firm Acquires Fort Worth Apartment Complexes, Plans to Renovate

Posted on by Sarah

A California real estate company has a new stake in Fort Worth apartment property. Los Angeles-based Cottonwood Group acquired the Woodstone Apartments, 6051 Bridge St., and Bridge Hollow Apartments, 5801 Bridge St. The apartment portfolio in east Fort Worth is made up of 480 multifamily units.

“Given supply and demand dynamics, Cottonwood remains bullish on the multifamily sector overall, especially in markets that offer a combination of job growth, an attractive climate, and relatively low living costs like Fort Worth,” Cottonwood’s chief investment officer Mark Green said. “Cottonwood Group’s multi-strategy approach means the firm will look at any primary or growth market inside and outside of Texas.” Cottonwood acquired the property in partnership with Dallas-based Texsun Holdings. Earlier this year, Cottonwood partnered with the private equity firm for two multifamily assets in San Antonio.

“We are thrilled to complete another transaction with Texsun and to add such a high-quality asset to our Texas portfolio,” Green said in a release. “While other traditional investors may be pulling back due to economic and market uncertainty, we remain bullish on the multifamily sector.” Both firms budgeted $5 million for renovation and repositioning of the Fort Worth properties, which total 342,000 square feet of real estate. The renovation investment will go towards interior and amenity upgrades, according to Cottonwood. Click to read more at www.star-telegram.com.

Most New Units Since 1972: Developers Building Apartment Units at a Record-Setting Pace

Posted on by Sarah

A building boom. That’s what the U.S. apartment market is seeing this year, according to the latest research from Yardi Matrix.

In a report released in late August, Yardi Matrix said that construction crews will bring 420,000 new apartment units to the United States this year. That’s a 50-year high. According to Yardi, the last time apartment completions surpassed the 400,000-unit mark was in 1972.

And three Midwest markets are expected to rank among the busiest 20 major metropolitan areas this year when it comes to new apartment units: Nashville, Chicago and Minneapolis-St. Paul.

The New York metropolitan area is projected to deliver the most apartment units in 2022, beating out Dallas-Fort Worth for the top position for the first time since 2018. Overall, developers in half of the country’s top-20 metropolitan areas are now on an apartment building spree, with these metros expected to hit their five-year highs in new multifamily construction this year.

“The construction industry is finally returning to pre-pandemic levels of activity but is still being hampered by three familiar challenges: labor shortages; material costs and availability; and supply chain issues,” said Doug Ressler, manager of business intelligence at Yardi Matrix, in a written statement.

What’s behind this construction boom? Yardi Matrix points to pent-up demand for multifamily units across the country. This demand has only risen as many renters hold off on buying homes as inflation and interest rates rise.

In the Midwest, Nashville ranks as the hottest market for new apartment construction. Yardi Matrix says that this Tennessee city will deliver 9,620 new aparment units in 2022, ranking it as the 13th busiest new-construction market.

Chicago will see 8,573 new apartment units by the end of this year. That places the city as the 16th busiest in terms of new multifamily construction. Expect 6,266 new apartment units in the Minneapolis-St. Paul market, making it the 19th busiest new-construction market in the country.

Texas, as usual, was well-represented. Yardi Matrix reported that the Dallas market will see 23,571 new apartment units in 2022, placing it second only to the New York metro market. Austin ranked fourth on Yardi Matrix’s list, with 18,288 new apartment units projected to be delivered here during the year, while Houston ranked fifth with an expected 17,759 new apartment units.

Yardi Matrix said that the Houston market will see the highest number of apartment completions that it has seen in the last five years. Austin climbed three positions on the Yardi Matrix list this year to inch past Houston.

Thanks to Office, DFW to Hit Third Consecutive Quarter of Positive Net Absorption

Posted on by Sarah

Dallas-Fort Worth is proving itself to be one of the hottest markets in all areas of CRE. And right now, the numbers are pointing toward a third consecutive quarter of positive net absorption for the first time since 2018.

That’s according to CBRE’s DFW Q2 Office Market Report. In fact, Dallas’ numbers are trending up in nearly every regard.

The Bureau of Labor Statistics, as of May 2022, reported the national unemployment rate as 3.6%, maintaining the same level in April 2022. DFW’s unemployment rate during the same period was 3.3%, and Dallas has increased its number of non-farm jobs by 7.7% — nearly 300,000 — year-over-year.

Vacancy continued to drop and stood at 24.4%, down by 70 basis points from Q1 2022, marking yet another decline in vacancy and the longest streak since 2019, Deliveries were up 76.1% from 327,400 square feet to 576,550 square feet in Q2 2022 due to the recent completion of The Epic — Phase II and the PGA of America HQ.

Office in and around DFW continues to show signs of recovery, comparable to that of Boston, Manhattan and Houston due to ever-growing tenant requirements and competitive leasing activity, based on the report. The submarket has seen many new projects this year and quite a few are expected to break ground in the coming months.

One of the largest projects to break ground in Q2 was 2323Springs in Uptown for 622,452 square feet. Quoted face rates increased from $30.93 gross per square foot to $31.23 gross per square foot with Far North Dallas and Richardson/Plano leading the charge. Sublease availability rose to 9.4 million square feet, representing over 4% of total inventory and 14.7% of total availability with Class-A properties, making up roughly 72% of all sublease listings.

Simply, DFW’s office rebound is one of the best in the U.S. This much is clear. Still, CBRE Econometric Advisors have expressed concern about the current effects of inflation on the real estate market and advise businesses to tread, still, with caution.

“Our baseline view expects the Fed will be able to restrain inflation to roughly seven percent by year-end,” CBRE stated. “The labor market will also soften, with the unemployment rate increasing to the mid-four-percent range. Once inflation is tamed, both capital and real estate markets should become more predictable again.”

There will continue to be a flight to quality where newer, highly amenitized renovated buildings will have the most activity. Other projects will continue experiencing lower rent growth and shorter lease terms for new and renewing tenants. That said, CBRE said DFW should be able to sustain healthy fundamentals due to its stable local economy and unwavering demand.