When most people think about Washington, D.C., the commercial real estate office market is what comes to mind. However, at a recent Marcus & Millichap event, mixed-use assets and multifamily were strong topics. GRS Group’s Justin Cook was there and told us the main topics of discussion by D.C. commercial real estate professionals.
What property sector was discussed the most at the conference?
There was a lot of focus on mixed-use development projects and innovations in office development in the urban core. However, property values have pushed many buyers out into secondary locations for their 2015 acquisitions.
Does the office market seem to be picking up there?
Developers completed 4.1 million square feet of office in 2014 with approximately 1.6 million square feet scheduled for delivery in 2015. This year will have many opportunities for yield-driven and opportunistic investors who have a tenant in line.
Where are the majority of transactions taking place?
While the event wasn’t related to multifamily, the market segment it made its way into the conference. The majority of transactions in the D.C. Metro area have been multifamily deals. If you want to relate this to the office market, office tenants are looking for locations in the urban core that provide a lifestyle for their employees. They are looking for office space in an area where their employees can work, live and enjoy local amenities that a city has to offer.
Who is financing the deals?
Local, regional and national banks are competing to provide funding for office and retail acquisitions in the D.C. market and leaving the larger asset transactions to the life companies. The credit unions in the area are more focused on transaction funding on a very selective basis. CMBS is returning as a conduit for office-property financing as well.
What services can GRS Group provide in the region?
The GRS Group family of companies is a national provider of commercial real estate services. We provide our clients a full suite of services including Phase Is, property Condition reports, appraisals and construction services–as well as title insurance and financial advisory services.