Tag Archives: commercial real estate

CB Richard Ellis - Best of the Best Awards 2009 presented by Ranking Arizona

Best of the Best Awards 2009: Real Estate Commercial

Real Estate Commercial Honoree: Brokerage Firms: 25 brokers or more

CB Richard Ellis

CB Richard Ellis - Best of the Best Awards 2009 presented by Ranking Arizona

Photograph by Duane Darling

CB Richard Ellis has been serving clients in Arizona for more than 55 years, becoming a dominant player in the state’s commercial real estate market. From leasing, acquisitions and sales, marketing and consulting, it has earned a reputation as a respected leader in the business community through its ability to track market trends and build relationships. Whether marketing a portfolio of properties or negotiating a complex lease agreement, CBRE brokerage professionals — more than 100 statewide — offer the most integrated array of commercial real estate services. Their approach is strategic rather than merely transactional.

That is, CBRE’s professionals can assess a client’s entire real estate portfolio requirements on a company-wide scale, delivering results and surpassing expectations.

2415 E. Camelback Road, Phoenix
602-735-5555
www.cbre.com/phoenix

Year Est: 1952 Brokers: 103
Principal(s): Craig Henig
(Arizona/Phoenix), Tim Prouty (Tucson)


Real Estate Commercial Finalist: Architectural Firms: 10 architects or more

SmithGroup

SmithGroup Inc. is one of the largest architecture, engineering, interiors and planning firms in the United States. With 10 offices and a staff of 800, Smith- Group specializes in the health, education, science and technology, office workplace, high tech and urban/campus planning markets. SmithGroup’s Phoenix office is well-known for its innovative design of the Arizona Biomedical Collaborative; the award-winning Apollo Riverpoint Center; and the recently completed Norton School of Family and Consumer Science at the University of Arizona.

455 N. 3rd St., #250, Phoenix
602-265-2200
www.smithgroup.com


Real Estate Commercial Finalist: Contractors: General, 120 staff or more

The Weitz Company

Since entering the Phoenix market in 1978, the Southwest Business Unit of The Weitz Company has built a solid reputation based on excellent service, quality work and long-term relationships. Weitz attributes its success to the company’s core values: honesty and integrity, respect for people, performance with absolute reliability, long-term perspective, and nurturing personal growth. In 2007, Weitz expanded its Arizona market by opening an office in Tucson based on its reputation for quality and service to clients.

5555 E. Van Buren St., #155, Phoenix
602-225-0225
www.weitz.com


Best of the Best Awards 2009 presented by Ranking Arizona

wood beam

As Commercial Real Estate Sector Prepares To Be Hit By Recession, Leaders Should Become Proactive

The headlines today have focused on the bailout of the banking industry and the housing market’s severe contraction. Not a lot of attention has been paid to the commercial real estate sector. As with all business cycles, there is a flow-through to the various sectors. The fact that we have lost more than 1 million jobs this year, and have had a severe reduction in housing values and record foreclosures, can only bode ill for retail and other commercial areas.

Since retail traditionally follows housing, how can it not be negatively impacted when fewer homes are being built and more and more people can barely afford their current homes? In recent months Mervyn’s, Linen ’n’ Things, The Shoe Pavilion and Circuit City have all announced either closing of some or all of their stores. The larger tenants oftentimes are the anchors of some of the smaller centers. There is usually a cascading effect on other tenants who feed off the traffic generated by the anchors. We have many clients who talk about tenants leaving in the middle of the night.

At this time, most of the bankers we have talked to have stated that they have few commercial projects on their radar, but most admit this is the next big area to hit them and the economy in general. Are they prepared and how can the lenders minimize the fallout from this?

We would like to outline some of the steps that lenders and others can take to be proactive in the process. Some lenders we have talked to take the position that they will sell the returning assets “as is,” so they do not incur anymore costs on a bad loan. This shortsighted approach will end up costing these lenders and their shareholders money.

We advise lenders to do a thorough analysis of the project in such areas as:

  • What is the current situation with the permits, utilities and other entitlements? This may unfortunately turn up information that the bank should have known about before it made the loan or kept funding it. There is a good case to not have the same people who approved the loans involved in this process. Some of these items may involve minor fixes that could make the project more marketable. For example, assume the contractor had not ordered some of the utilities, which usually involves a long lead time. By the bank being proactive (after they take the project back) and ordering some of the utilities, the project would have more appeal for a potential tenant versus sitting on the asset and waiting for things to happen. A new potential owner may have a tenant, but he needs to get him into the space within a set period of time. If the bank has done nothing but sit on the asset, the buyer may go to a project where he can get his tenant in immediately.
  • What is the status of payments to the contractors versus how much work has actually been performed? Is the project really 50 percent complete but you have paid out 60 percent, for example? Where are materials stored if ordered and paid for?
  • Another problem is when banks have the same people or departments evaluate the project. They are the ones who may have missed some of these issues to begin with. You want a fresh look at what you have. It is difficult to want to spend more money on an asset that will be a loss — but if you can do a proper evaluation of what you have, you may recoup quite a bit of additional money.

Why do Realtors for homes recommend cosmetic fixes to make them more saleable? Because they work. But the real estate owned (REO) departments of many banks do not want to incur additional costs in these areas. We like to assist the lenders by also giving some ideas on how to reposition the property. When clients come to us for an initial project, we frequently work with them on site plans. Even on a project that is partly or fully built, you can analyze how it can be revitalized and repositioned. It may have been poorly designed to begin with. Smart buyers are going to be looking at these ideas before they make an offer. If the lender hires someone to give them some of these ideas it can be very helpful information real estate brokers can use in marketing the asset.

We know of certain retailers developing new concepts to fit into smaller spaces to take advantage of a good location. If you have prepared some estimates of what would be involved to reconfigure the space, that makes it easier on the potential new owner and his tenant.

In summary, retail should be the next area to seriously impact the balance sheets of lenders. Most lenders have not had departments devoted to this problem because the market has been good for so many years. It is important to hire experts who can give an unbiased view of the asset and what can or cannot be done with the project. When a lender uses the same people or moves some of its people over they may not have the expertise to properly analyze the project to obtain the best possible value from it upon a sale.

Majerle-Cover-2

Cover Story – He Shoots

He Shoots…

Will former Sun Dan Majerle
score in real estate?

Photography by Brian Fiske

Dan Majerle’s left ring finger is broken. It’s wrapped in a small black cast, the result of some aggressive play in a pickup basketball league he plays in. Ironically, the same finger on his right hand was broken in a hoop-playing battle called the NBA. “I went too hard after the ball, go figure,” he smiles as he relays the cause of his most recent injury. This late summer day, he’s sitting at a Starbucks in Phoenix sipping an iced coffee, wearing jeans and a cool blue T-shirt. He’s sporting a thick black leather watch and looking tan and relaxed — probably because he’s been playing golf and, well, playing basketball.

Dan Merjerle

But this day, Majerle’s thoughts aren’t too much on the sport that brought him wealth and fame. Several people will stop by for an autograph during our chat, which he always obliges with that Thunder Dan white-tooth smile. He’s got a couple things on his mind today: first up, it is his son’s fifth birthday.
“Getting ready to cut some cake,” he says.

Most days, however, Majerle, purple and orange No. 9 to most of us, is thinking about something beyond basketball and birthday parties. Like many sports stars, he is searching for the next big thing following his professional career. Sure he’s got a successful namesake restaurant, Majerle’s Sports Grill in downtown Phoenix and another one opening soon in Chandler, but No. 9’s thoughts are now on the No. 1 industry in the Valley and how he can partake in it, make a name for himself and maybe score a buck or two. Yep, today, Thunder Dan is a real estate man.

He Shoots, He Scores
The Dan Majerle Group will soon break ground on its first real estate project and already this former power forward is thinking about how he can score his next big deal.

“It’s been a great learning opportunity for me,” says Majerle, 42, who played pro ball for 14 years, eight of those with the Phoenix Suns. “I have surrounded myself with some great people and I think we can do great things. I don’t attach my name to anything but something that will be first-class.”

Majerle’s first commercial real estate venture will be a retail project at McDowell and Dysart roads called The Shops at Palm Valley. The two-and-a-half acre project is a slice of a SunCor 30-acre project and master-planned community, Palm Valley.

“We’ve been meeting people, getting into the groove and figuring this thing out,” says Majerle. “We’ve got our architect and we’re selecting a contractor. We should be up and running sometime by early next year.”
If anything, Majerle smells the sweet nectar of real estate: the planning, the vision, the design, the build-out, and of course, the payday. But for Majerle, it is much more than a power play. It is something his name is tied to, so it has to be great.

“Because of my name, my career and the like, I get approached by all kinds of people offering some sort of a great deal, a ‘sure thing,’” he says. “But I am careful. I will not put my name on something that isn’t good for me, the community and those who have placed their trust in me.”

Riding the Wave
Majerle has been a professional athlete, national spokesperson for various products, restaurant owner, as well as a color commentator with the NBA. So it begs the question: why real estate?

“Over the past 18 years in the Valley I have seen the tremendous growth and I thought with some of the relationships I’ve developed I could leverage to get involved in some projects,” says Majerle. “The projects that we are involved in are at different stages from negotiations to design, and up to construction.”

As Maricopa County continues to add more than 100,000 residents per year as it has for the past decade, real estate — both commercial and residential — has been a far better investment than the stock market. It is because of these real estate deals, grocery-anchored retail centers, mixed-use urban living complexes and more rural strip malls that many-a-fortune has been made. It is also where Majerle has found his calling.

“We are involved with all kinds of clients from nail salons, day spas, tanning salons, health food stores, sandwich shops, dry cleaners and vitamin stores — if you see it at a commercial retail site, we work with them,” says Majerle. “The community has welcomed me with open arms and I am excited about working with them. With any opportunities come different levels of challenges that one needs to overcome to be successful. With my sense of discipline and commitment, I have been fortunate to be successful up to this point in my life.”

No doubt, as it does in professional sports, practice produces results at the end of the day. However, a little luck, strategic planning and a quick elbow or two thrown in the heat of battle goes a long way. While the first of The Majerle Group’s projects will be in the West Valley, he isn’t limiting his company’s anchors to any single area of town, or region for that matter.

“There are so many real estate opportunities here in the Valley — and really the Southwest — that brokers are showing us on a daily basis, that we are looking at numerous sites from Buckeye all the way down to Queen Creek,” he says.

Even though Arizona’s residential real estate market has become mired, as has the nation’s, in a glut of oversupply, overzealous pricing, aggressive mortgage contracts and investor speculation, Arizona, and specifically Maricopa and Pinal counties, remain some of the strongest long-term plays in the national real estate market. Further, the region from Prescott Valley to Arizona’s border with Mexico has been tagged as a “Super Metropolis,” one of only a handful of mega-metropolitan urban areas in the nation that millions of residents and businesses will continue to call home. And of course, there are the retail and mixed-use centers that will surely follow.

Many areas have experienced an enormous growth in housing, but the retail/office market is underserved in new neighborhoods around town, notes Majerle, sounding more like Donald Trump than a physical education major from Central Michigan.

“If they stopped building houses today, we would need to build commercial development projects for the next five years to catch-up,” he says

Everyone Knows Your Name
As in sports, teamwork is key, and Majerle is certainly the go-to guy. He says he analyzes every deal that crosses his desk and knows real estate is a long-term play, not a fourth-quarter sprint.

“Development is all about relationships and with my 18 years in the Valley, I have relationships with a lot of influential people that we work with or complement us in the development game,” he says.

Here’s another intriguing piece of the development game in the Valley: Majerle’s former boss and Phoenix icon, Jerry Colangelo, now dabbles in the real estate game. Colangelo is part of the group developing Douglas Ranch, one of the largest master-planned communities ever to be built in the state. So will the two become business partners?

“At this time Mr. Colangelo and I have not talked about partnering in any deals,” Majerle admits. “I have the greatest respect for him, not only as a business man, but as a person. From day one when I came to the Valley in 1988, he treated my family and me wonderfully. I would love to be associated with him in any aspect.”

Meanwhile, away from the development game, the former Phoenix Suns’ player keeps busy with Majerle’s Sports Grill. The Phoenix location, now in its 15th year, has been so successful, it has spurred Majerle to open a second location in Chandler. The same hands-on, know-every-detail philosophy will be a part of the new Majerle’s Sports Grill.

“The best part of what I have been able to do lately is get more and more involved with the restaurants,” he says.

The Chandler location will mirror the downtown Majerle’s with about 5,000 square feet, a big bar, an indoor/outdoor patio with seating for lunch and dinner, as well as state-of-the-art audio/visual systems with flat screens throughout the restaurant.

Arizona Business Magazine Oct-Nov 2007“With the bigger kitchen size, we expect to expand the menu to include pizzas, fish, steaks and other daily specials that we cannot do at the downtown location,” Majerle says. “Besides that, we expect to bring the same friendly ‘Cheers’-type feeling from the downtown Majerle’s, and to make it both a satisfying and fun experience for everyone who comes in.”

If Majerle’s broken finger is any indication, the real estate industry has a true competitor on the scene. He’s proven throughout his career that he has the determination and smarts to be a major player on the court. Can he transfer this success to real estate?

“I know I can do this,” he grins as he signs another autograph for a fan, who is probably wondering why Thunder is talking about real estate and not hoops. “It’s time for another chapter in my life. I can’t wait to get rolling.”

www.majerles.com

AZ Business Magazine Oct-Nov 2007 | Next: A Mall Rises