Tag Archives: Master of Real Estate Development

Arizona Commercial Real Estate Development

Survey: Phoenix Commercial Real Estate in Recovery

It’s shaky, but improving. Experts say the Phoenix-area commercial real estate market is now officially in a slow recovery mode. A full 100 percent of the real estate brokers participating in a quarterly survey by the W. P. Carey School of Business at Arizona State University indicate they feel “optimistic,” and 84 percent believe the market is on an upswing.

The participants recently came together for a forum and the survey about progress on apartments, retail, industrial, offices and more. They say land prices are still going up and that some areas of the Valley are already doing better than others. However, don’t expect any drastic changes over the next year.

“We expect 2015 to be much like 2014, so we’re likely looking at one more year of slow recovery,” explains one of the forum’s organizers, Mark Stapp, director of the Master of Real Estate Development program at the W. P. Carey School of Business. “Over the long run, we’ll grow, but in ways we haven’t in the past — like more mature, established markets that focus on infill and developing in context with what’s already there. Some reasons for our current slowdown include tight lending standards, sluggish job and wage growth, and the need to absorb around 150,000 new homes built between 2000 and 2007. I also think it will be at least 2016 before any significant new retail space comes onto the market.”

Those participating in The Commercial Real Estate Broker Forum come from a variety of sectors, specializations and brokerage houses across the Valley. The event is moderated and co-organized by Pete Bolton, executive vice president and managing director of Newmark Grubb Knight Frank’s Phoenix office. Quarterly reports from the forums are available for download at the W. P. Carey School’s website, http://research.wpcarey.asu.edu/real-estate/commercial-reports under “Commercial Brokers Survey.”

Here are some of the Quarter 3, 2014 results:

• Where are we in the cycle?
92 percent – Recovery, 8 percent – Expansion, 0 percent – Correction, 0 percent – Maturity, 0 percent – Recession
NOTE: 100 percent said the area was in recovery in Quarter 1, 2014.

• In what direction is the metro Phoenix market moving?
84 percent – Up, 8 percent – Stationary, 8 percent – Down

• What is the overall feeling about the metro Phoenix commercial real estate market?
100 percent – Optimistic, 0 percent – Pessimistic

• Is uncertainty in the federal government affecting the commercial real estate market and hindering our local growth potential?
100 percent – Yes, 0 percent – No

• Have land prices reached their peak?
82 percent – No, 18 percent – Yes

• Have homebuilders stopped buying land?
91 percent – No, 9 percent – Yes

• Is the tight inventory of homes on the market affecting the commercial side at all?
50 percent – Yes, 50 percent – No effect, 0 percent – Not yet, but it will

• Where are apartment rents headed in the next six months?
55 percent – Stationary, 45 percent – Up, 0 percent – Down

• Where are office vacancy rates headed in the next six months?
73 percent – Down, 9 percent – Stationary, 18 percent – Up

• Where are retail vacancy rates headed in the next six months?
64 percent – Down, 36 percent – Stationary, 0 percent – Up

• Is this a landlord or tenant industrial market?
83 percent – Tenant, 17 percent – Landlord

• Where are interest rates for commercial loans headed in the next six months?
75 percent – Stationary, 25 percent – Up, 0 percent – Down

• Where are investor returns headed in the next six months?
92 percent – Stationary, 8 percent – Down, 0 percent – Up

Phoenix-Area Housing Market

How to Survive the Phoenix-area Housing Market

The Phoenix-area housing market is especially difficult for home buyers to navigate right now. They face rising prices, competition from investors and other bidders, and a short supply of available homes for sale. That’s why The Arizona Republic and the ASU Real Estate Council at the W. P. Carey School of Business are hosting a free event to help people sort through the complications.

“We keep hearing from potential home buyers how tough it is to deal with current conditions in the Valley housing market,” says Catherine Reagor, who covers the real estate market for The Arizona Republic and azcentral.com. “This is one way to help.”

The event called “Phoenix Housing Market Explained” will be held Saturday, April 6, starting at 9:30 a.m. at Arizona State University’s Tempe campus.

It will feature:

* Catherine Reagor, senior real estate reporter for The Arizona Republic
* Mike Orr, director of the Center for Real Estate Theory and Practice at the W. P. Carey School of Business
* Mark Stapp, the Fred E. Taylor Professor in Real Estate and director of the Master of Real Estate Development (MRED) program at the W. P. Carey School of Business

The three will participate in a panel discussion and then take questions from the audience. Reagor will offer insight into what she’s seeing as buyers and sellers negotiate ever-changing market conditions…and prospective buyers try to secure a mortgage.

Orr, a prominent real estate expert whose monthly reports on the Phoenix-area housing market are often covered by the national media, will talk about many factors that could affect prospective home buyers right now.

“Everything from investors to rising prices and the short supply of houses are coming into play for people who want to own a new home,” says Orr. “It can be frustrating to bid repeatedly for properties and still come up dry. I’ll go over some of the latest data that could help provide an edge.”

Stapp, an established real estate developer himself, will moderate the discussion and explain current trends in new-home building.

The event will be held in the Business Administration C-Wing Building, or BAC, at 400 E. Lemon St. at ASU in Tempe. Parking is available just across the street at the intersection of Apache Boulevard and Normal Avenue. Signage will direct participants from the garage to room BAC 116 on the first floor of the BAC building.

Because space is limited, registration is encouraged at conversations.azcentral.com. More information about the event can be found at www.money.azcentral.com, www.wpcarey.asu.edu, or by calling (602) 444-4931.

More information about the Valley real estate market is available in the W. P. Carey School’s monthly reports at http://wpcarey.asu.edu/finance/real-estate/market-reports.cfm.