Abbey Business Centres just inked a high profile serviced office deal. The British executive suites company is leasing 1,250 square feet of office space at the iconic Gherkin building to Sky News for two years.
Sky News will use the office space as a studio to air “Jeff Randall Live,” the broadcaster’s flagship business program. Julie Calder, managing director at Abbey Business Centers, explains that Sky News’ non-traditional use of serviced office space is a prime illustration of just how flexible business centers can be in the quest to provide commercial solutions.
“Sky News was particularly impressed by The Gherkin itself and the view from its base on the 15th floor. I think this gives out a message that there is a place for the serviced office package within iconic structures,” Calder says. “We are absolutely delighted to welcome Sky News and hope to regularly bump into celebrities from the world of business.”
Read the rest of my story on aBetterOffice.com.
March 2nd, 2010
The Internet is gaining momentum among news consumers — but 92 percent of Americans use multiple platforms to get their daily fix of news, sports and weather. So says a new survey by the Pew Research Center’s Internet & American Life Project and the Project for Excellence in Journalism.
The survey found the Internet is the third most popular news platform, behind local and national television news and ahead of national print newspapers, local print newspapers, and radio. Reading news online fits into a broad pattern of news consumption by Americans, the survey reported, with 59 percent getting news from a combination of online and off-line sources on a typical day.
“People are not replacing traditional media sources with the Internet — at least not right now,” said Kristin Purcell, an associate director for research at the Pew project. “The Internet is just another platform they turn to. People use the combination of platforms that’s available and convenient for them.”
Read the rest of my story on NewsFactor.
March 2nd, 2010
Freescale Semiconductor on Monday announced a new processor that could help make the next generation of e-readers more affordable. Freescale’s i.MX508 applications processor relies on ARM Cortex-A8 technology and a hardware-based display controller from E Ink to drive costs down.
With the ARM core running at 800 MHz, the i.MX508 provides twice the rendering speed of Freescale’s last round of e-reader processors. That means faster page turns for consumers, more speed for value-added applications, and advanced touch solutions for manufacturers.
“DisplaySearch forecasts that the worldwide e-book/e-reader device shipment will triple that of 2009, increasing to over 14 million units in 2010,” said Dr. Jennifer Colegrove, director of display technologies at DisplaySearch. “Key to this growth will be improving the quality of the digital reading experience while simultaneously making it affordable. The results coming from the Freescale and E Ink collaboration are very encouraging.”
Read the rest of my story on NewsFactor.
March 2nd, 2010
The notion of costly deleveraging and growing numbers of distressed properties make for a grim outlook for access to capital for South Florida commercial deals in 2010.
Most analysts predict commercial real estate vacancies will continue to rise while rents decrease across South Florida. Many expect the market to hit bottom this year.
According to a 2010 emerging trends in real estate report by PricewaterhouseCoopers and the Urban Land Institute, 2010 and 2011 will present generational opportunities for investors to buy at near cyclical lows, nationally and in South Florida. Access to capital remains a critical factor.
Vanessa Grout is vice president for acquisitions at New Valley, a Miami-based subsidiary of Vector Group with $250 million ready to spend on South Florida distressed properties. She said she expects banks to loosen up in 2010.
“I see an opportunity to fill in some of the gaps in the capital structure that are created by stricter lending requirements when the debt matures or becomes troubled,” Grout said. “In situations where the borrowers are still in the project, the debt coverage is thin and very close to triggering lock box covenants.”
In that scenario, the lender would require that all property revenue be directed to [the lenders'] control. Grout said current property owners in this situation remain concerned about the near future.
“Investors will urge more deals to close if they are able to structure a deal with low interest rates and a purchase price just below book value while allowing the bank to have a limited equity position once the asset is sold,” Grout said. “Land will continue to decline in value but most banks with the ability will hold the prime pieces.”
Gavin Campbell, managing principal of Steelbridge Capital, a privately-held, real estate investment company in Miami, said most markets are at or near bottom from an operational perspective. Still, sales values are not fully at bottom. He expects prices to continue sliding in many submarkets and subsectors in the face of extremely limited debt.
Read the rest of my story on The Real Deal.
February 26th, 2010
When it comes to maintaining troubled assets, vulture investors are circling South Florida properties.
And there are a number opportunities out there. The area is currently home to $12.4 billion in troubled commercial real estate assets, according to data analysis firm Real Capital Analytics, and more lenders are foreclosing with the goal of reselling the properties to willing buyers.
That spells big business for distressed asset and receivership specialists, workout pros and other commercial real estate experts who can navigate the troubled waters of these property types.
“The Chinese word for crisis is opportunity and the future for seasoned commercial brokers with workout experience has never been brighter,” said Miami real estate consultant Jack Studnicky, vice president at International Sales Group. “Lenders will have to sort out the real and reputable from the promoters who launched their firms in the last two years.”
Studnicky said brokers who see the long term value in protecting assets, banks and their own reputations will emerge as winners in the current cycle. He warned against “fire sale” pricing that ultimately harms the entire market.
Warren Weiser, principal of Continental Real Estate Companies, agreed.
So far the market isn’t reproducing the fire sales that characterized the savings and loan crisis of the 1980s and 1990s. That, he said, is because there is more than enough capital chasing distressed deals to encourage some level of bidding to maintain fair market value rates.
“We don’t necessarily need to push real estate out the door to anyone willing to buy it,” Weiser said. “Rather, we need to understand the real value and see if we can create more value. If it’s right to sell it today, we’ll sell it. But if it will appreciate over time, we’ll hold on to it.”
Continental has been managing receiverships and distressed assets for 20 years, taking on 29 Florida projects in the past year alone, including Parc Central East in Aventura. Studnicky has, too.
“The proper value is derived by analyzing today’s market value as well as replacement cost and projected value,” Studnicky said. “Taking the opinion of local brokers on property value will generally lead to fire sale pricing. Unfortunately, I’ve seen lenders leave millions on the table for lack of the right advice.”
Distressed properties abound in South Florida’s commercial real estate market. If 2009 was a year of workouts between gun-shy lenders and defaulted borrowers, then 2010 could very well be remembered as a record year for commercial foreclosures. The question is, how long will the opportunities last?
“This opportunity is going to be here throughout 2010 and 2011 but I think the market will slowly get better over time,” Weiser said. “I don’t think anyone can give a real accurate projection of when it’s going to change. How robust our recovery is going to be — and when that happens — is largely tied to the general economy.”
Read the rest of my story on The Real Deal.
February 26th, 2010
The bleak outlook for Miami’s commercial real estate market is not confined to the downtown core. Even in the formerly robust Airport West submarket, marquee projects like One Park Doral are flagging.
One Park Doral, which opened October 2009, is Miami’s newest Class A office building. The project is the first phase of Park Square at Doral, a 51-acre mixed-use development with office, retail, hotel and multi-family residential properties. As 2010 progresses, its only tenants are its developer, Shoma Group along with Alcora Group and Visit Us, which signed a lease earlier this month.
Blanca Commercial Real Estate took on the task of filling the building in a down market. It’s one that offers landlords far fewer prospects, as businesses fail or stay put in a weak economy, providing prospective tenants with ample negotiating power. Still, Blanca believes One Park Doral’s strategic location near the airport, Class A facilities, amenities, and prime position in a suburban mixed-use project will woo commercial tenants.
“There is no new supply of office space in Coral Gables, which represents an opportunity for both Brickell and Doral to attract tenants,” said Tere Blanca, a principal at Blanca Commercial Real Estate. “Airport West has historically been one of the best performing markets in Miami-Dade from a net absorption standpoint. This market should perform well in 2010.”
Jose Juncadella, principal of Miami-based Fairchild Partners, has been working in the Doral part of the Airport West market for 28 years.
He’s witnessed the growth of Doral as one of the most successful industrial markets in the nation.
But Doral has not fared well in recent months. Last October, BankUnited filed a $10 million foreclosure suit against commercial condominiums inside the Point at Doral, a 31-unit condo with no recorded sales. Boston Scientific announced its planned departure from its 14-acre Doral office space in November. Also, Executive National Bank closed its doors at the end of 2009, citing declining balances from real estate industry clients. All this is in addition to recent multimillion-dollar multi-family property foreclosures.
Read the rest of my story on The Real Deal.
February 26th, 2010
The economic downturn has all but crippled the commercial real estate market, leaving private equity groups and other strategic buyers to begin exploring the advantages of purchasing commercial properties out of bankruptcy.
The opportunities are plentiful, though the market is still establishing its pricing scale, and few buyers want to tip their hands about how much they would pay. But the bankruptcy filing rate for South Florida businesses increased 28 percent in 2009, according to statistics reported by the U.S. Bankruptcy Court for the Southern District of Florida.
No company wants to file for bankruptcy, but there is a silver lining for strategic buyers, according to Kevin Lamb, a corporate attorney and shareholder at the Gunster law firm in West Palm Beach. Strategic buyers with funds at the ready in mergers and acquisitions, he said, can cherry-pick the company’s real estate assets while leaving the liabilities behind.
“In a down economy, a substantial portion of [mergers and acquisitions] activity takes place in a bankruptcy setting. Buyers familiar with the process can reap substantial value,” Lamb said. “A bankruptcy sale can also benefit the bankrupt company’s employees, who often find a home with the buyer.”
Lamb said he helped close three deals for strategic buyers at the end of last year, but declined to disclose any details. Private equity firms are getting more aggressive about making bids for real estate in bankruptcy, he said. At the same time, lenders are looking to sell properties on which they foreclosed and strategic investors are preparing to build their portfolios.
“Strategic buyers and hedge funds with large cash reserves are finding opportunities in commercial bankruptcy cases,” said Jack Williams, southeast regional director of business restructuring at BDO Consulting in Atlanta. “The trick is wading through the bankruptcy sale without tripping any mines. The lack of publication in local papers works to the advantage of those playing in the market.”
For all the deals that haven’t been publicized, there are some high-profile South Florida companies selling real estate out of bankruptcy that are well-documented.
Read the rest of my story on The Real Deal.
February 26th, 2010
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