Commercial Real Estate News Brief: March 2015

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In the latest edition of our monthly news brief, JLL’s regional team curates the top industry articles to keep you in-the-know. In this month’s edition, JLL spotlights industrial growth in downtown Columbus, best practices for real estate investors, and the value of hiring a project manager.

Keep up with Spaces’ monthly recaps, and subscribe to JLL Spaces today.

Downtown Columbus Characterized by Strong Industrial Demand

JLL CRE News Brief

Newspaper image via NS Newsflash.

For both office and industrial space, Columbus is undergoing resurgence. On the industrial side, JLL’s Dan Wendorf told The Columbus Dispatch, “All the groundwork Columbus has laid the past few years is really coming to fruition.”

Thanks to consumers’ online shopping preferences, more and more warehouses are coming to central Ohio. According to JLL’s Columbus industrial report, industrial vacancy dropped from 12.4 to 6.1 percent.

You might be thinking, ‘Why Columbus?’ When it comes to transportation of goods, you can reach 47 percent of the national population within a ten-hour drive. Another big benefit: The low cost of doing business makes Columbus very professional-friendly. With 2.5 million square feet added during the fourth quarter of last year, Ohio’s capitol city can anticipate continued growth.

Download the full report for more information, Columbus: The Nation’s Industrial Hot Spot.

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Repetition Is Good When It Comes To Ethics

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By: Anne Browning, Marketing Director, JLL

For the eigth-straight year, JLL has been named one of the World’s Most Ethical Companies by the Ethisphere Institute. This award is particularly meaningful to me for two reasons:

1. What Future Employees Think

When I was interviewing with JLL over three years ago, I combed the corporate website for facts, figures and information to determine if there was a fit with my career aspirations and desired corporate culture. There, I discovered JLL has a 250-year history presented in a very cool timeline video. Impressive.

And globally, the firm is committed to sustainability both for itself and its clients. Even more impressive. Then I landed on an awards page. What caught my attention: JLL’s fifth straight year of winning the World’s Most Ethical Companies award. I paused for a good long while.

How could such a large, global organization with offices and employees on every continent speaking a multitude of languages and employing different lifestyles and customs maintain such an achievement year after year? To me that was most impressive, and honestly was a substantial factor in bringing me to the next phase of the interviewing process.


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Calling All Business Owners & Tenants: Should You Own or Lease?

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By: Rob Roe, Managing Director, JLL

JLL_Invest_Spend

There is no blanket response to the question, “Which is better for business, owning or leasing property?” Every business’ unique structure and qualities must be assessed to determine the right path.

What’s more, the decision has potential to have a disastrous (or extraordinary) effect on bottom-line business success.

Traditionally, business executives, like CEOs, CFOs or treasurers, made the own/lease decision. In recent years, however, corporate real estate directors have played a larger role in the process. Regardless of point person, expert insight is a must when it comes to one of the largest expenses within your budget.

Are you at the crossroads of purchase or lease? Read on for more insight on smart decision-making.

Starting Point: 3 Business Benchmarks

As you begin the process, there are three key benchmarks to consider. Ignore your initial preference, and keep an open mind. The following factors may sway your line of thinking and lead to a smarter decision-making in the long run.

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JLL Puts Culture & Philanthropy First

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By: Don Bain Jr., Executive Vice President, JLL

Check out the Cleveland team in action!

Check out the Cleveland team in action!

Every quarter, JLL’s Cleveland team takes time away from the office to give back to the community. Our latest philanthropic adventure: 20 JLL team members volunteered at the Cleveland Food Bank on February 12. The Food Bank fights hunger and seeks to “bridge the meal gap, connecting individuals with nutritious meals they need to succeed.”

The group dedicated their time to learning about the Food Bank’s mission and packaging 20-pound boxes of frozen meat to be distributed to local food purveyors for those in need. JLL also participated in “Adopt a Family” through Open Doors Academy during the 2014 holiday season.

Here at JLL, we are keen on culture and community. Giving back and getting out of the office together helps shape who we are as a team.

Plan Your Corporate Cleveland Volunteer Project—5 Ideas

There are a host of non-profit organizations in the Northeast Ohio region that welcome corporate groups for projects that are easy to coordinate with your busy office schedule. Below are a few ideas to get you started, many of which can be adopted no matter where you reside.

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JLL Makes Fortune’s 2015 Most Admired Companies

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By: JC Pelusi, Market Leader, Managing Director, JLL 

WMAC2014

A reflection on our internal culture, JLL was recently included in FORTUNE Magazine’s 2015 Most Admired Companies List. Apple ranked first overall, but many companies ranked just as high within their own respective categories. Experts in business, rather than the general public, provide their council to devise what has become known as the definitive corporate reputation report card.

JLL ranked first in the real estate industry for its global competitiveness and people management. FORTUNE also recognized JLL for industry leadership and strength in the following areas:

  • Innovation
  • Use of corporate assets
  • Social responsibility
  • Financial soundness
  • Long-term investment value

In the words of my colleague, Executive Vice President, Paul Tingley:

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Commercial Real Estate News Brief: February 2015

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In the latest edition of our monthly news brief, JLL’s regional team curates the top industry articles to keep you in-the-know. In this month’s edition, JLL examines global CRE investment, workplace strategy tips, and the revitalization happening in Detroit.

Keep up with Spaces’ monthly recaps, and subscribe to JLL Spaces today.

The State of Global Real Estate Investing

JLL CRE News Brief

Newspaper image via NS Newsflash.

Many were apprehensive to invest in commercial real estate after the recession. But, according to an The New York Times, it still makes sense to own properties through real estate investment trusts, called REITs, and exchange-traded funds.”

Why? Global REITs performed extremely well in 2014—setting the stage for success in 2015.

In other global news, Chinese buyers have been pouring money into U.S. properties.” Major deals include a $120 million investment from the Bank of China in a Chicago property (i.e. the future home of Google), as well as $296 million sale in San Francisco to a Chinese real estate firm. National Real Estate Investor has the details.

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Why Investors Look to Ohio for Industrial Real Estate (REPORTS)

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By: Robert Kramp, Senior Vice President and Director of Research, JLL, Midwest and Great Lakes Region

Ohio is a hot spot for industrial investors across the nation. In May 2014, a Minneapolis-based real estate investment group bought a $43 million, 767,000-square-foot portfolio in Northeast Ohio. Another example: A Chicago-based company purchased a 465,000-square-foot Columbus warehouse for $8.5 million in September.

The list of similar, out-of-state investors goes on. It’s more than a trend; Ohio has become an industrial hub. JLL research released three reports, spotlighting related activity in three of the nation’s most active cities—Cincinnati, Cleveland and Columbus.

Why Ohio?

  • The Heart of It All: Ohio is America’s heartland. When it comes to location, it has set up shop right on the nation’s metaphorical Main Street. With major airports, highways and rail lines intersecting throughout the state, Ohio is nationally and internationally accessible. Ohio’s transportation infrastructure is ideal for convenient and cost effective delivery.
  • Affordability: The Midwest, overall, dominates when it comes to cost-friendly living. A whopping five cities in Ohio made Forbes’ America’s Most Affordable Cities list, including Cincinnati and Columbus, as well as Dayton, Akron and Toledo. Housing affordability, cost-of-living index, and the methodology the Bureau of Labor Statistics uses for rankings of the Consumer Price Index were used to determine which cities made the cut.
  • Nurtures Business Success: From Cardinal Health and Google, to Kroger and The Limited Brands, many of America’s top Fortune 500 companies are already doing business in Ohio’s major cities.

In terms of industrial focus, three Ohio cities stand out among the rest, offering cost effective and opportunistic landscapes.

Cincinnati: Industrial and Logistics Hot Spot 

When it comes to local Fortune 500 companies (per million residents), Cincinnati beats out New York, Boston, Chicago and Los Angeles. Thanks to the low cost of business and favorable tax structure, Cincinnati’s environment is highly competitive, and therefore, has attracted both local and foreign investors. Currently, more than 50,000 Cincinnatians are employed by foreign-owned businesses.

Cincinnati_Cover

Over the past year, Cincinnati experienced increased commercial real estate activity from the e-commerce and manufacturing sectors. eBay is a key example, which recently pre-leased a 631,000-square-foot warehouse. Additional big-name manufacturing companies doing business in Cincinnati include GE and Proctor and Gamble.

  • More than 3 million square feet of space under construction.
  • 70% of space under construction is speculative.
  • More than 4 million square feet absorbed in 2014.

Check out JLL’s full report for more insight and statistics on Cincinnati’s emerging industrial scene.

Columbus-industiral

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Making Global Connections: Six JLL Leaders Attend the World Economic Forum’s Annual Meeting

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By: JC Pelusi, Market Leader, Managing Director, JLL 

WEF DavosLast month, global leaders in business, government, international organizations and academics gathered at the Annual WEF in Davos-Klosters, Switzerland to discuss major issues and themes around the global economy. High-profile speakers at the symposium included Al Gore, Bill Gates, the Prime Minister of Italy, professors from Harvard and MIT, bankers from Russia and China, among others.

Honored among 100 organizations as a WEF Strategic Partner, JLL also sent six global leaders to participate in the event, including:

In Davos, JLL led the conversation around the most impactful international commercial real estate trends. Below, I’ve included a snapshot of key topics for discussion at the event.

  • The top 30 cities for real estate investment. Half of the world’s real estate investments take place in 30 cities worldwide. Take a look at the full list.
  • The latest City Momentum Index (CMI) tracks the rate at which key cities are evolving. JLL ranked the top 20 cities that are changing at the most accelerated pace, with London coming in at number one. See the full CMI for details.
  • Real estate’s role in the market cycle. Real estate plays a key role in financial cycles, and can impact both their frequency and severity. Check out the full release for details to read up on real estate’s cyclical nature.

From snapping a selfie with a princess to evaluating how India’s emerging economy could someday outpace that of China, JLL’s thought leaders recapped their personal experiences on the JLL blog, Notes from Davos.

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Big Data Meets Commercial Real Estate (INFOGRAPHIC)

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By: JC Pelusi, Market Leader, Managing Director, JLL 

According to JLL research, only 28 percent of commercial real estate companies heavily rely on data usage. But, change is coming. In just two years, more than half of corporate real estate decisions will be made using data and analytics.

Data and Future CREThanks to new technologies, building data can give executives invaluable insight into how the office is actually utilized by employees. For example, building sensors can detect when rooms are busiest or when meeting rooms are empty for extended periods. Simple insights like these can help guide more informed decision-making.

Big Data, Bigger Benefits

Whether related to energy consumption or office utilization, data can play a leading role in cutting costs. So what’s keeping executives from drilling into data?

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Commercial Real Estate News Brief: January 2015

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Commercial real estate is a dynamic industry. Keep up with Spaces’ monthly recaps of the most valuable industry articles we’ve recently come across, focused on news in Ohio, Michigan and Pennsylvania.  

Global CRE Investment Volumes Signal Continued Uptick for 2015  

In the final quarter of last year, global commercial real estate capital markets reached new heights “at near-record levels,” according to JLL.

JLL CRE News Brief

Newspaper image via NS Newsflash.

  • Investment Volumes: +9% YOY
  • Office Vacancy Rates: 12.7%
  • Capital Value Growth: +8.3% YOY

In addition to movement in capital markets, occupier demand continues at a healthy pace, with more activity expected from traditional markets in 2015. Thanks to higher levels of demand and a shortage of supply, experts foresee new development.

Another trend: investors are noticing secondary markets. In fact, JLL experts say, “There is a notable growing interest in higher-yielding assets in smaller and second-tier locations, particularly in the U.S. and Europe…”

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