How Low Gas Prices will Impact the Office Market (SLIDESHARE)

By: Dan Adamski, Managing Director, JLL

For the first time in years, filling up isn’t getting us down.

Diesel prices sitting below $3 are welcomed by consumers, especially as the holidays arrive. In June of this year, gas prices reached $3.68. Now, they’re as low as $2.73, according to AAA. The drop in gas costs hit quickly, and its impact on multiple industries varies.

The Situation: Oil Prices Fall Worldwide

For the first time in five years, the price of one barrel has dipped below $70, which is down from more than $100 per barrel in the last five months. Causes for the drop in costs include:

  • Excess supply and little slow down in production
  • Drop in overall demand, due to slower economic growth in China and lower levels of oil consumption in Europe
  • Strict fuel standards (good news for the environment) and a sharper focus on energy efficient practices

The biggest cause, however, is supply. There are three million more barrels a day in the global market now than there was in 2011. Combined with a new focus on sustainability and weaker demand, it’s no wonder that prices have decreased.

(more…)

Commercial Real Estate News Brief: November 2014

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.  

Calling All Brick & Mortar Retailers: Tips to Stay Competitive (VIDEO)

E-commerce has forever changed the face of retail. So much so, in fact, that many brick and mortar retailers are asking, ‘What is the modern role of physical retail space?’ 

With more and more choices available to consumers online, retailers will need to bet on a brand experience (online and in-person) that differentiates against the competition. JLL research suggests retailers also maximize in-store value through innovative architecture, strong brand identity, positive economic responsibility and flexibility when it comes to technology and change.

How can your brick and mortar store outpace the competition? Check out JLL’s video for more information on the redefined landscape of retail.

(more…)

Retailers Ring in the Holidays with a Focus on In-Store Customer Experience (REPORT)

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

JLL HolidayDeloitte reported that total holiday sales are forecasted at $981 to $986 billion, up from $602 billion spent last year, according to the NRF. That’s a lot of potential business—and competition—for retailers.

Not surprisingly, new data from JLL’s 2014 Holiday Sentiment Report found that 77 percent of retailers still feel the holiday season is their most critical time. The survey, which includes feedback from more than 800 national and global retailers in JLL-managed shopping centers across the country, also found that the number of in-store shoppers is expected to increase, or remain stable, this year. 

Why does it matter? Retailers have the chance to compete with e-commerce, and create a charming, memorable customer experience.

JLL’s survey revealed a few ways in which retailers are going above and beyond this holiday season. (more…)

JLL Detroit & Pittsburgh Offices Recognized as Top Workplaces

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

Business success is dependent on employee happiness, productivity and progress. Ultimately, it all comes back to the people behind the job.

Here at JLL, we champion culture that’s committed to community betterment and individual growth. In fact, Forbes named JLL among America’s Most Trustworthy Companies in 2013. And this year, InformationWeek selected JLL among its Elite 100, which includes top business technology innovators in the U.S.

Closer to home, two of our local offices have been also been recognized as Top Workplaces. The Pittsburgh Business Times recognized the Pittsburgh office among the Best Places to Work in Western PA 2014, and the Detroit Free Press selected its local office as a 2014 Top Workplace.

Here’s why. (more…)

Owens Corning Honors JLL with ‘Supplier Recognition Award’

By: George Elliott, Managing Director, JLL 

Toledo, Ohio-based Owens Corning has manufacturing, distribution, office and R&D facilities in 28 countries across the globe. Every year, Owens Corning recognizes its leading suppliers with awards in various categories, from safety, sustainability, innovation, value creation, risk mitigation, among others.Owens-Corning-logo

This year, Owens Corning recognized JLL with one of its highest honors — the Supplier Recognition Award. JLL’s team stood apart from more than 6,000 other suppliers who competed for the award through value creation and cost savings.

But, let’s rewind to where it all started.

Manufacturer Meets Real Estate Expert

JLL’s relationship with Owens Corning dates back to 1998, when it was initiated by The Staubach Company. It became official in 2001 when Staubach formalized its relationship with Owens Corning in an exclusive outsource agreement.

Since then—and following it’s merger with Staubach—JLL has helped the global manufacturer with asset and lease management, incentives consulting, strategic planning, and property disposition and acquisition.

Here at JLL, we are proud to work so closely with a best-in-class organization like Owens Corning, and even more honored to be recognized with its most prestigious award.

(more…)

How To Advance Your CRE Negotiation Strategies

By: Collin Wheeler, Vice President at JLL 

JLL-Keys-successReal estate is expensive. In fact, it’s usually one of the most expensive line items on a business’ financial statements.

A decrease in rent, real estate taxes or capital exposure can have major impact on the bottom line. Often overlooked, hidden liability within a lease document can also have consequences. In the ever-changing economy, I frequently see organizations fall into a common real estate trap when they lose sight of financial impact, and make hasty, simple decisions based on landlord direction and lack of leverage.

Are you approaching your next move or occupancy decision? Below, I discuss a few tips to engaging in more strategic negotiations, plus insight into why working with a tenant representation advisor will save you money in the long run.

You might be shaking your head in disagreement (I get that), but please read on.  In addition to bottom line dollars, there are other avenues of liability and flexibility that are addressed.  In an age where business can change overnight (expand, contract or merge), flexibility within real estate situations are increasingly important.

Negotiation 101: Keys to Success

You can set yourself up for successful negotiation by being proactive, whether you are facing relocation or staying in your current asset.  There are two keys to getting what you want: time and leverage. Here’s why.

  • Time: If your lease is expiring in six months (and you haven’t engaged the landlord), you’re in a tough spot. At JLL, we involve the landlord no less than a year in advance of expiration. From the landlord’s perspective, he or she hopes to keep current, paying tenants in place. This means no down time (or lost rent) between tenants, no significant capital requirements by a new tenant as an enticement to lease, and no additional costs associated with a new transaction.  Therefore, most landlords are open to and appreciative of early negotiations.

(more…)

Commercial Real Estate News Brief: October 2014

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.  

The Link Between Wellbeing and Green Office Design (REPORT) 

JLL CRE News BriefGreen, energy-efficient office space is more than a trend. In fact, research has shown that certain office design features can have great impact on employee health, happiness and productivity. A few of these features include thermal comfort, noise and acoustics, lighting, look and feel, and location.

Are you updating your space, or going green? Below are common office features that limit productivity and workplace satisfaction, reported by Fast Company.

  • Extreme office temperatures (either too hot or too cold);
  • Using more electric lighting than natural lighting;
  • Lack of exposure to plants and nature; and
  • Closed, non-collaborative workspaces.

For more information about the benefits of environmentally friendly office spaces, download JLL’s full report, compiled in partnership with the World Green Building Council: Health, wellbeing and productivity in offices: The next chapter for green building.  (more…)

Open vs. Closed Office Space: OH, PA & MI Businesses Deliberate [Survey Results]

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

The New Yorker called it the “open-office trap.” Inc said, “…open plans are better after all.” The debate over open versus closed workspaces is far from over.

Naturally, we wanted to know firsthand: What do business professionals in our neck of the woods prefer? Do they feel more productive in a cubicle, or a shared area?

Between September 23 and October 10, JLL’s regional office conducted a survey—targeting local business professionals in Ohio, Michigan and Pennsylvania—to find out what’s really trending in office space. Out of 100 survey recipients, 84 percent said their office environment is either very important (42 percent) or important (42 percent) to individual success. So, it’s critical that employers pay attention and provide a desirable, attractive place to work.

What’s Trending in Office Space?

Of those surveyed, just over half (51 percent) currently work in an environment with a good mix of open and closed space. Another 36 percent work in more traditional offices, and only 10 percent reported working in an open office, with no private zones.

JLL-Survey-Space-Planning
 

Survey Findings: Leading Trends

1. A majority of survey respondents (35 percent) said open, collaborative office space hinders individual productivity. Another 16 percent said these types of workplaces fuel their creativity and productivity.

JLL-Survey-Space-Planning
 

2. When considering a new company or employer, real estate is definitely a factor (but not critical) in 70 percent of respondents’ decision-making process.

JLL-Survey-Space-Design
 

3. Eighty percent said their dream office would include a good balance of open and closed space.

JLL-Mixed-Use-Space
 

(more…)

JLL Releases 2014 Law Firm Perspective [Free Download]

By: Robert Kramp, Vice President and Director of Research, Jones Lang LaSalle, Midwest and Great Lakes Region

Law-Firm-2JLL research released the 2014 Law Firm Perspective, and with it, the industry’s leading trends and the latest real estate insights. Across the U.S., JLL found that the rightsizing wave is finally slowing down. Most firms have already downsized for efficiency, and are now looking for new approaches to location strategy.

Another national trend: There’s a supply shortage. Since location, often within prime office buildings, is critical for law firms, they “face more supply constraints than nearly any other industry,” according to the report.

On the upside, law firms are now making site selections based on employee preference. It’s all about talent for law firms, and some hotter, desired locations are in “fringe CBD” areas.

From national to local, law firms in Ohio, Michigan and Pennsylvania have been busy during 2014. Read on to find out what’s happening in your city’s law firm CRE landscape.

(more…)

Commercial Real Estate Trends in the Midwest: Q3

By: Andrew Batson, Senior Research Analyst, Great Lakes Region, JLL

The third quarter of 2014 wrapped up on a positive note.

According to JLL, “Broad-based domestic economic expansion has fueled the tightest office market fundamentals in eight years across the United States.” And, thanks to strong economic forecasts nationwide, JLL expects 2014 absorption rates to exceed that of the last three years.

What does it mean for the U.S.? More confidant developers likely means more development for 2015.

Looking to the local cities across the Midwest, we also saw dynamic, lively activity in our local CRE markets. Below is a quick recap of Q3 highlights in Cincinnati, Cleveland, Columbus, Detroit and Pittsburgh. Download the full reports for details.

Market Activity in the Midwest

JLL-Research

Cincinnati

During Q3, there was an evident shift in demand for downtown space. We also observed an upturn in capital market activity during the third quarter. Increasing rental rates and declining vacancies have made Cincinnati an attractive investment spot. In fact, investors have spent more than $1 billion on Cincinnati CRE since the start of 2014.

In other news, construction teams stayed busy in Cincinnati. The majority of new projects are located in urban submarkets, with most interest in the CBD and Midtown. JLL predicts that this trend will continue, “…as development figures through the third quarter now equal that of pre-recession levels.”

By the numbers: 

  • Total vacancy: 20.3%
  • Total under construction: 1,389,000 square feet
  • YTD net absorption: 214,538 square feet

View the full Cincinnati Q3 analysis. (Office Insight Office Statistics)

(more…)