www.REBusinessOnline.com July 2020 • Volume 16, Issue 5 WAREHOUSING PROJECTS REACH NEW HEIGHTS By Nazir Khalfe, Principal, Powers Brown Architecture Vertical construction is a foregone conclusion in industrial development as land prices rise and tenants use more sophisticated equipment. H Developers of new industrial facilities, such as this one in Denver that was designed by Powers Brown Architecture, are increasingly fielding requirements for higher clear heights to support multi-story racks and storage spaces. aving designed multiple mil-lions of square feet of specu-lative and build-to-suit in-dustrial buildings in my career, I’ve witnessed some striking trends over the past two decades, especially with the advancements made in tilt-wall construction. The ability to go higher and ship more with today’s technology is cre-ating an ever-changing landscape for industrial product. We have wit-nessed the boom of e-commerce, ad-vancements in logistics and automa-tion, and all the while tried to keep up with the dynamic market forces that produce a successful industrial park. Since the Great Recession, demand for industrial space has been at a pre-mium, not only in Texas but also in most markets throughout the United States. Out of necessity for how our lives are changing, the industrial market has become the darling of the real estate industry. In 2020, thanks to the exponential growth of e-com-merce activity and manufacturing jobs, we are breaking new ground on how a standard industrial park looks, feels and operates. While COVID-19 has not changed SEE DESIGN page 20 LENDERS EXPRESS OPTIMISM FOR SECOND HALF A sense of urgency to execute deals is building on both the lending and borrowing fronts as the third quarter gets underway. D By Taylor Williams others. Social distancing mandates and stay-at-home orders, while disastrous for retail and hotel properties, have ele-vated demand for e-commerce, as well as manufacturing of essential goods and services. The latter trend ensures that for many industrial owners, rent collection is not a major concern. But current and future economic un-certainty are causing investors across the board to pause new acquisitions. “We saw a significant decline in de -mand for acquisition financing when the pandemic began,” says Jeff Erx -leben, executive vice president and regional managing director of North-Marq’s Dallas office. “There were ma -jor unknown factors coming in all at SEE CAPITAL page 22 ecreased acquisition activity across virtually all asset classes is among the most visible im-pacts that COVID-19 has had on com-mercial real estate, but capital markets professionals say there’s reason to be-lieve deal volume will rebound sharply toward the end of the year. According to data from Real Capital Analytics (RCA), the total sales volume of commercial properties in the coun-try was approximately $44.7 billion during the second quarter. This figure represents a staggering year-over-year decrease of 68 percent and the lowest quarterly total in more than a decade. In terms of income streams, some as-set classes are faring much better than Newmark Knight Frank recently provided a $54.8 million Freddie Mac loan for the refinancing of Nob Hill Apartments, a 1,326-unit community in Houston. With acquisition activity largely muted in the first half of the year, refinancings, especially for agency deals, are comprising a large share of lenders’ deal volumes. INSIDE THIS ISSUE Which Commercial Real Estate Professionals in Texas Are on the Move? page 7 COVID-19 and the Resiliency of Coworking Office Space page 16 Texas Real Estate Business ’ Annual Lenders Resource Directory pages 18-19
Texas Real Estate Business July 2020: Page 1
