The Good News Report

[KJHburg]

CBRE looked at 16 major markets in the southeast all the big ones and the smaller metros too.  

Guess what city is #2 in job rate growth behind only Nashville and #2 in job growth over 10 years in actual job numbers after only the ATL ?   You guessed it #4th largest metro in the south east:   Charlotte.  

Here is my literal screen shot and the link to this 2019 reports for office market, economy, retail growth etc.  Lots of info here but very interesting. 

https://www.cbre.us/research-and-reports/Southeast-U-S--Office-Market-Outlook-2019-SEOR

#1 in projected growth in the next 5 years? Raleigh Durham, most educated Raleigh Durham and highest office employment again Raleigh Durham.  

 

Edited January 3, 2019 by KJHburg

[KJHburg]

3 major Charlotte financial firms announced $70 Million in affordable housing money.  Bank of America, Ally Bank and Barings all committed. 

https://www.bizjournals.com/charlotte/news/2019/01/15/bofa-ally-financial-and-barings-to-invest-70m-plus.html?ana=e_me_set1&s=newsletter&ed=2019-01-15&u=oAaDx%2B74FoP4qOJ%2By4AU6dhJPpc&t=1547563488&j=86059101

Note from Bank of America

""A spokeswoman for Bank of America declined to comment on specifics about the land earmarked for donation, except that it will be in the North Tryon district to support affordable housing in uptown. BofA has land holdings along North Tryon and is a stakeholder in redevelopment projects on that corridor, including the Seventh and Tryon plan, which calls for affordable units.""

Edited January 15, 2019 by KJHburg

[KJHburg]

Josh Sims‏Verified account @JoshFox46 9m9 minutes ago

The 2019 @MLL_Lacrosse collegiate draft will be held at the @NASCARHall March 9th. Hear from MLL commissioner Alexander Brown on the decision tonight at 6 on @FOX46News

[sparkytheincredible]

On 1/15/2019 at 9:48 AM, KJHburg said:

3 major Charlotte financial firms announced $70 Million in affordable housing money.  Bank of America, Ally Bank and Barings all committed. 

https://www.bizjournals.com/charlotte/news/2019/01/15/bofa-ally-financial-and-barings-to-invest-70m-plus.html?ana=e_me_set1&s=newsletter&ed=2019-01-15&u=oAaDx%2B74FoP4qOJ%2By4AU6dhJPpc&t=1547563488&j=86059101

Note from Bank of America

""A spokeswoman for Bank of America declined to comment on specifics about the land earmarked for donation, except that it will be in the North Tryon district to support affordable housing in uptown. BofA has land holdings along North Tryon and is a stakeholder in redevelopment projects on that corridor, including the Seventh and Tryon plan, which calls for affordable units.""

Looks like the other North Tryon donation will be the lot next to the Ballet and the McColl Center: https://www.wfae.org/post/bofa-donate-uptown-land-worth-7m-affordable-housing#stream/0

With Edwin Towers, Booth Gardens and Tryon House Apartments, it seems like this little area will have quite a concentration of below-market housing in a putatively high-income area by Charlotte standards. 

[atlrvr]

Doing some rough math, I suspect that the N Church land donation supports 50-75 units depending in they are targeting 60% or 80% AMI..... would guess that it's rolled into a 15-20 story building with 250 units, with the rest market rate, but that's just a hunch.

[KJHburg]

Office market reports are out with end of year stats from JLL  More office space absorbed means more new office towers. 

Which city of these 3 had more office space absorption?  Atlanta, Charlotte or Nashville???   Charlotte of course was just a few square feet ahead of Atlanta an office market 3 TIMES the size of Charlotte market  

However guess what metro beat all the above??  Our own NC Raleigh Durham area with almost 2x the office space absorbed as Charlotte metro!

Charlotte:   51,003,234 sq ft total market size  480,566 sq ft net positive absorption  0.9% f occupied this year  12.9%  total vacancy rate  3,337,970 sq ft under construction

Raleigh Durham 49,764,904 sq ft total market size 902,519  sq ft net positive absorption 1.8% occupied this year 11.1%  total vacancy rate 2,090,730 sq ft under construction

download your own reports here

https://www.us.jll.com/en/locations/southeast

 

[KJHburg]

One more thing from the Charlotte report JLL states this:

""As a result, 65% of the 3.2 million square feet of new construction is preleased, in one of the largest concentrations of construction of any CBD in the United States.""

[KJHburg]

Here is another year end office market report from Savilis Studley commercial brokers.

Summary is the same Charlotte's office market is doing great.

download your report from here

http://www.savills-studley.com/contact/research-results.aspx?currentSitePageId=66425&keyword=Charlotte&date=&country=3198

They did confirm that Allstate took the entire North Tower of Railyard at 140,000 sq ft. 

another thing noted all submarkets of the Charlotte office market have a lower sq ft lease cost than the national average and all are below the national vacancy average.  That is very good news. 

Edited January 24, 2019 by KJHburg

[GeauxCLT]

On 1/23/2019 at 5:59 PM, KJHburg said:

One more thing from the Charlotte report JLL states this:

""As a result, 65% of the 3.2 million square feet of new construction is preleased, in one of the largest concentrations of construction of any CBD in the United States.""

Preleased is great. Period. But I do worry about all the space that will free up from those moving from other uptown office towers. Will that be harder to lease/absorb? I know it is not as simple as 3.2 million under construction which is 65% leased. A lot of that pre-leased space will open up elsewhere. 

[KJHburg]

27 minutes ago, GeauxCLT said:

Preleased is great. Period. But I do worry about all the space that will free up from those moving from other uptown office towers. Will that be harder to lease/absorb? I know it is not as simple as 3.2 million under construction which is 65% leased. A lot of that pre-leased space will open up elsewhere. 

Some space for sure will open up for sure but it will be more value space cheaper rent than these new buildings.  Just as WeWork backfilled over 100K sq ft of space in First Citizens Bank other tenants will slowly absorb this space.  Plus these towers are spaced out in delivery times too Legacy this year, Tryon Place late 2020 same as Legacy 2.  However we also have growing banks and other firms that take a floor here and there like Wells which is quietly backfilling quite a bit of space in Duke Energy Center.  

[lancer22]

3 hours ago, GeauxCLT said:

Preleased is great. Period. But I do worry about all the space that will free up from those moving from other uptown office towers. Will that be harder to lease/absorb? I know it is not as simple as 3.2 million under construction which is 65% leased. A lot of that pre-leased space will open up elsewhere. 

The straight answer to your question is that Class B office, especially in the CBD, is about to get real ugly real quick. By my count, over 1M sq ft of B space coming open through 2020. No idea how it will be absorbed. The Class B market in Uptown has essentially 0 absorption over the past several years. Would not want to own several buildings, 400 S Tryon being the most obvious.

 

[southslider]

^but all those FinTech startups and support firms need to rent somewhere

[CarolinaDaydreamin]

10 hours ago, lancer22 said:

The straight answer to your question is that Class B office, especially in the CBD, is about to get real ugly real quick. By my count, over 1M sq ft of B space coming open through 2020. No idea how it will be absorbed. The Class B market in Uptown has essentially 0 absorption over the past several years. Would not want to own several buildings, 400 S Tryon being the most obvious.

 

400S Tryon was just purchased this year. I wouldn't be shocked if there were plans to gut the interior. 

[lancer22]

3 hours ago, CarolinaDaydreamin said:

400S Tryon was just purchased this year. I wouldn't be shocked if there were plans to gut the interior. 

It was purchased before they knew that Duke was going to blow out. Trust me, at the price it sold for, makes no sense to buy if you know there is a hole that big coming open.

 

[Guest]

9 minutes ago, lancer22 said:

It was purchased before they knew that Duke was going to blow out. Trust me, at the price it sold for, makes no sense to buy if you know there is a hole that big coming open.

 

They must not have been doing their homework. If they just read Urban Planet, they'd have known Duke has been exploring its options since 2012

Edited January 25, 2019 by Guest

[KJHburg]

I have long proposed the lower floors of 400 South Tryon be converted into a hotel and the upper floors renovated of course for office space.  It might be a class B office space but it is located in AAA location.  

[kermit]

IMO large amounts of vacant Class B space uptown is an asset for the city, not a liability.  Particularly since most of the new A space appears to be getting filled before its built.

The worst thing that can happen to Charlotte's urbanization is for it to price out everybody/every non Fortune 1000 firm, this space will make it possible for smaller firms to find space uptown.

Edited January 26, 2019 by kermit

[KJHburg]

US Bank bases another unit in Charlotte and their total employee count in Charlotte is up to 800!

""The bank now offers asset-backed securitization lending to its corporate clients. Asset-backed securities are bonds backed by financial assets, such as auto loans, student loans or home-equity loans. Securitization refers to the process of pooling financial assets to create a marketable security.   Charlotte was an attractive market to build an ABSL team because of the available talent here, notes Stephen Philipson, head of fixed income and capital markets.  "It increases the critical nature of our presence here," Philipson says of adding the ABSL team. "That'll be an important source of growth for us with our clients, and adding one more product that's centered in Charlotte is just another example of how critical this marketplace is for us, overall as a bank and also as a fixed income and capital markets group."  U.S. Bank entered the Charlotte market when it acquired Wachovia Corp.'s corporate trust business in 2006. Its presence here has grown to more than 800 employees.""

from a subscriber article in Business Journal https://www.bizjournals.com/charlotte/news/2019/01/25/why-us-banks-charlotte-office-is-building-a-new.html?iana=hpmvp_clt_news_headline

[Guest]

1 minute ago, KJHburg said:

US Bank bases another unit in Charlotte and their total employee count in Charlotte is up to 800!

""The bank now offers asset-backed securitization lending to its corporate clients. Asset-backed securities are bonds backed by financial assets, such as auto loans, student loans or home-equity loans. Securitization refers to the process of pooling financial assets to create a marketable security.   Charlotte was an attractive market to build an ABSL team because of the available talent here, notes Stephen Philipson, head of fixed income and capital markets.  "It increases the critical nature of our presence here," Philipson says of adding the ABSL team. "That'll be an important source of growth for us with our clients, and adding one more product that's centered in Charlotte is just another example of how critical this marketplace is for us, overall as a bank and also as a fixed income and capital markets group."  U.S. Bank entered the Charlotte market when it acquired Wachovia Corp.'s corporate trust business in 2006. Its presence here has grown to more than 800 employees.""

from a subscriber article in Business Journal https://www.bizjournals.com/charlotte/news/2019/01/25/why-us-banks-charlotte-office-is-building-a-new.html?iana=hpmvp_clt_news_headline

well I no longer am betting big that they land at 6th and Tryon. 

[J-Rob]

Does that mean you think they land elsewhere, or stay put?


Sent from my iPhone using Tapatalk

[Guest]

Just now, J-Rob said:

Does that mean you think they land elsewhere, or stay put?


Sent from my iPhone using Tapatalk

I just think they are back on the drawing board. Honeywell is only going to land one place, so US Bank, and otheres will land at one of the many places vying for Honeywell's attention

[KJHburg]

there will be a US Bank tower somewhere someday. They are in 2 locations now 201 S Tryon and Hearst.   They will probably want a Tryon St address I would think.  My guess is Legacy 3 

The great thing about US Bank is that they have never asked for any incentives and they have grown their operation here at least 8 fold  from the old Wachovia operation.  I predict one day I KJ will be able to walk in a US Bank branch and pay my credit card bill. 

Edited January 25, 2019 by KJHburg

[lancer22]

54 minutes ago, KJHburg said:

there will be a US Bank tower somewhere someday. They are in 2 locations now 201 S Tryon and Hearst.   They will probably want a Tryon St address I would think.  My guess is Legacy 3 

The great thing about US Bank is that they have never asked for any incentives and they have grown their operation here at least 8 found from the old Wachovia operation.  I predict one day I KJ will be able to walk in a US Bank branch and pay my credit card bill. 

KJ, I KNOW your prediction will come true within the next month, provided you work in Uptown of course

 

[Popsickle]

1 hour ago, KJHburg said:

there will be a US Bank tower somewhere someday. They are in 2 locations now 201 S Tryon and Hearst.   They will probably want a Tryon St address I would think.  My guess is Legacy 3 

The great thing about US Bank is that they have never asked for any incentives and they have grown their operation here at least 8 found from the old Wachovia operation.  I predict one day I KJ will be able to walk in a US Bank branch and pay my credit card bill.

But will you be able to buy Krispy Kreme in the lobby?

[KJHburg]

8 minutes ago, Popsickle said:

But will you be able to buy Krispy Kreme in the lobby?

Probably not but hopefully soon in SouthEnd.