Trends & Insights

Atlanta, Georgia, January 23, 2019  – Stan Johnson Company, one of the nation’s premier net lease brokerage firms, has completed the sale of a 276,887-square-foot industrial building that serves as a manufacturing facility for Grupo Antolin, a tier one automotive parts supplier. The heavy manufacturing property, at 18355 Enterprise Avenue in Nashville, Illinois, is strategically located near Interstate 64 outside St. Louis, Missouri. The tenant has occupied the property for 30 years and recently expanded the facility while also making multi-million-dollar investments into the site. The tenant is currently on a long-term lease. The property was sold by Illinois-based Agracel, Inc., which was represented by Stan Johnson Company’s Mike Sladich and Mollie Alteri. The property sold in mid-January for $15.5 million. “The mission-critical nature of the property and the heavy tenant investment into its manufacturing site provides comfort to the long-term passive investor with regard to the stability of their future cash flows in a way most traditional industrial facilities cannot,” said Mike Sladich, Director in Stan Johnson Company’s Atlanta office. The buyer, a private investment group out of Bluffton, South Carolina managed by David Strong and Nick Dzendzel, was represented by Jason Powell and Colin Couch, also of Stan Johnson Company’s Atlanta office. “While much of the institutional investor focus this cycle has been on core bulk distribution, there is an incredibly robust private investor appetite for manufacturing facilities,” adds Mollie Alteri, Associate Director.  

Atlanta, Georgia, January 4, 2019  – Stan Johnson Company, one of the nation’s premier net lease brokerage firms, has completed the sale of an Ashley Furniture Distribution Center. At 9791 Green Park Industrial Drive, the 119,680-square-foot single-tenant industrial building is strategically located in the southwest quadrant of the St. Louis metro area directly off Interstate 55 which provides excellent logistical access to major highway thoroughfares. Stan Johnson Company’s Jason Powell and Colin Couch represented the seller, an affiliate of private equity group Mohegan Capital. “The Denver-based seller did a first-class job facilitating the sale of this A+ quality facility,” said Colin Couch, Associate Director in Stan Johnson Company’s Atlanta office. “The institutional quality construction boasts a rare 38-foot clear height, and the buyer was primarily motivated to own this distribution center as they also own the tenant’s headquarters in Memphis, Tennessee.” The property sold in mid-December for $10.0 million to New York-based One Liberty Properties, Inc., a publicly traded REIT (NYSE: OLP). The sale closed at a 7.20 percent cap rate. “Given the excellent industrial location and Stan Johnson Company’s extensive marketing reach, we received interest from buyers across the U.S., including both institutional and private investors,” Couch added.  

Private capital’s demand for industrial, coupled with the already strong appetite from buyers, has been a contributing factor in the cap rate compression during the last few years, says Moore in this EXCLUSIVE. Article originally published on globest.com by Lisa Brown   HOUSTON—Industrial investors continue to remain drawn to Houston which has shifted from a sole focus on oil to e-commerce and other commercial real estate property types. So says Todd Moore, director of the Stan Johnson Company, who shared his insights into the strength of the industrial market and what is in store for the next three to five years in this exclusive. GlobeSt.com: What is the state of Houston’s industrial market? Moore: The Houston market is strong. We’ve been in the national spotlight for a while, dealing with everything from massive hurricanes to energy industry downturns, but the market has remained strong and resilient. Investors are drawn to the Texas economy, and particularly Houston’s, because it is diversified and pro-business. Demand for industrial, especially distribution deals, has overshadowed some of the negativity surrounding retail and the rise of e-commerce. GlobeSt.com: Which investor types are showing the most interest in Houston’s industrial properties? Moore: As evidenced by closed deals at the Port of Houston, we’ve seen strong interest from institutional capital to private capital. All buyer types have remained active in this market, but when it comes to really driving pricing, we’ve seen the private buyers get more aggressive on one-off asset purchases, especially our 1031 exchange buyers. In today’s market, we’re seeing a lot of private investors explore the net lease industrial world as they seek relief from the turbulent retail sector, or as they look to minimize their management responsibilities from traditional investment sectors like multifamily. The rise of private capital’s demand for industrial, coupled with the already strong appetite from our industrial buyers, has really been a contributing factor in the cap rate compression we’ve seen over the last few years. GlobeSt.com: What industries are driving growth in and around the Port of Houston? Moore: The petrochemical industry is really driving port activity these days, but demand is there from all types of businesses. For the last several years, it has been the tightest submarket in Houston with a close to 0% vacancy rate across the single-tenant sector. Growth in this area has been driven by investments made by petrochemical companies and refinery expansions, which has translated to tenant stability in and around the port, and growth among supporting industries. There has been a high volume of container traffic as a result, with the Port of Houston ranking second last year in total tonnage across US ports and six in total TEUs. The port handled 68% of Gulf Coast container traffic in 2017, and we expect to see that dominant level maintained in the coming years. GlobeSt.com: What are your predictions for this market in the next three to five years? Moore: With interest rates rising, everyone is watching the capital markets, but we expect Houston to continue being a target investment market across all product types, but especially industrial. The diversification in Houston’s economy, employment and population growth, and the pro-business environment should keep investment dollars flowing to Houston real estate. If we continue to see stabilization and continued increases in oil prices, that growth will also be a positive influence on Houston’s economy and commercial real estate market.  

Exhibitors are keen to get to business at ICSC’s New York Deal Making, being held Dec. 4–6 at the Jacob Javits Convention Center. The event has evolved into one of the most important yearly retail events over the past several years, they say. With about 10,000 attendees and 530 exhibitors, the New York show is smaller than RECon, in Las Vegas, but it has nonetheless outgrown its status as a regional convention and taken on national and international importance. Article originally published on icsc.org The event has evolved into one of the most important yearly retail events over the past several years, they say. With about 10,000 attendees and 530 exhibitors, the New York show is smaller than RECon, in Las Vegas, but it has nonetheless outgrown its status as a regional convention and taken on national and international importance. “The New York show offers the best of both worlds,” said John Rotunno, a New York City–based associate director with net-lease brokerage Stan Johnson Co. “You can meet a number of the same national commercial real estate groups [that attend RECon], but it offers a large presence of Northeast-based real estate professionals as well.” Like other exhibitors this year, Rotunno is looking forward to starting new relationships as well as maintaining existing ones. He is also interested in gauging the way investors perceive the current market and learning about their plans for 2019. Similarly, Eliot Fierberg, vice president of retail with Denver-based investment firm Black Creek Group, says he wants to survey brokers and sellers on where they think the market is headed over the next six to 12 months. He also expects to meet with existing tenants to discuss their needs and goals. Like many exhibitors, he says he has seen the convention change greatly since he first attended 20 years ago. “The ICSC New York show gives us the opportunity to accomplish a number of items during a short period,” Fierberg said. “This year I have meetings with brokers and tenants from four different states, whereas in the past, this would not have been the case.” For Birmingham, Ala.-based Bayer Properties, the New York show presents an opportunity to pursue a handful of goals, says Libby Lassiter, the firm's executive vice president of leasing and development. While the leasing team meets with retailers to drive more business, Lassiter meets with Bayer investment executives and with the firm's partners and clients to talk about the future. The conference is also a good time to discuss talent and compensation trends with peers and to check out the latest technology for use throughout the enterprise, she says. Last but not least, the developer is holding its fourth annual Cocktails and Conversations event, Lassiter says. “This affords us the opportunity to connect with a pretty large group of attendees in a more informal and festive setting." The New York meeting attracts the Who’s Who of retail players, according to Mike James, executive chairman of James Capital Advisors, a net-lease retail and multifamily brokerage based in Los Angeles. “Our firm has doubled market share year over year, and much of that growth originates from New York–based customers,” James said. “We find the conference to be our net-lease division’s most significant retail conference of the year.” Mark Toro, managing partner of Atlanta-based North American Properties, is looking to finalize deals and to lay the groundwork on additional ones for the company’s $3.5 billion mixed-use development pipeline, which includes Colony Square, in Atlanta; Revel, in Duluth, Ga.; and Riverton, in Sayreville, N.J. The developer is targeting a broad range of users for the experiential mixed-use projects it says can serve as a community’s “living room.” This is the next-generation retail format, Toro says. “So many retailers, restaurateurs and entertainment operators will not set foot in a regional mall, but we’re finding that they’re still anxious to expand,” he said. “Digitally native brands entering the brick-and-mortar space are clearly on our list too.” Count Altitude Trampoline Park among the expansion-minded tenants. The Woodmont Co., master broker for that 35,000-square-foot concept, considers the show the best place to advance Altitude’s aggressive growth plans, by finishing deals in progress this year and by kicking off next year's deal making. “There is nothing more exciting that can be brought to a show than a rapidly expanding big-box tenant,” said John Day, a senior vice president at Fort Worth, Texas–based Woodmont. With a current emphasis on redeveloping closed or soon-to-be closed department stores, Chattanooga, Tenn.–based CBL Properties will be seeking out entertainment, food-and-beverage, value retail and some nonretail tenants at the show, according to Stephen D. Lebovitz, CEO of the REIT. In November, for example, Round1 Bowling & Amusement opened a facility in the former Macy’s location at CBL’s Jefferson Mall, in Louisville, Ky., and CBL unveiled plans to turn its Hamilton Place mall, in Chattanooga, into a town center featuring a mix of uses, including a hotel and offices. “Each one of the properties is different and market dependent,” Lebovitz said. “But there’s a lot of interest in these locations from a variety of users.” Meanwhile, Steven Stoehrer, managing director for SVN Stora Realty, is looking forward to finding some promising prospects for his clients. “This year in particular there have been some challenges in the retail sector,” Stoehrer said. “But where we see challenges, we also see opportunities, and we have a full schedule of meetings with clients looking for those opportunities in the coming new year.”

New York, New York, November 15, 2018  – Stan Johnson Company, one of the nation’s premier net lease brokerage firms, has completed the sale of Ashley Overlook, a multi-tenant office building in Charleston, South Carolina. Located at 4390 Belle Oaks Drive, the 104,610-square-foot building serves as the corporate headquarters for Select Health of South Carolina. Stan Johnson Company’s David Bailey, along with Erik Carlson of First Guardian Group / SVN, represented the seller, a group of individual investors managed from San Jose, California. “This was an attractive value-add opportunity for a buyer specifically seeking office investments in the North Charleston market,” said Bailey, Associate Director in Stan Johnson Company’s New York office. “Through the combined efforts of Stan Johnson Company and FGG/SVN, an extensive bid process resulted in an unprecedented cap rate for the seller.” The property was 81 percent leased when it sold to New York-based LRC Properties, LLC in late October for an undisclosed price. “The keys to success on this transaction were the property’s proximity to the Charleston Airport, the positive influence of Fortune 50 companies like Boeing on the local market, and a rigorous marketing campaign,” Bailey added.    

Los Angeles, California, November 15, 2018  – Stan Johnson Company, one of the nation’s premier net lease brokerage firms, is pleased to announce that it has hired three brokers in the West region. Ronnie Givargis, the former President and CEO of Allied Real Estate Investment Group, joins Stan Johnson Company as a Senior Director. He brings with him two Associate brokers, Michael Yousef and Leonard Arsanos. “The integrity and ethical business practices exhibited by everyone at Stan Johnson Company were the motivating factors in my decision to join the firm,” said Givargis. “’Michael, Leonard, and I are eager to tap into a platform with industry-leading marketing tools, which will allow us to list properties outside of California. The transition to Stan Johnson Company will exponentially expand the services we’re able to provide to our loyal clients.” Prior to starting his own company, Givargis worked at Marcus & Millichap and is a graduate of Ashford University. Yousef and Arsanos also worked at Allied Real Estate Investment Group and are both graduates of California State University Stanislaus. The trio brings a combined 45 years of sales, management, and operational expertise to Stan Johnson Company. “The West Coast continues to be a key region of growth for Stan Johnson Company,” said Myles Helm, Stan Johnson Company Regional Managing Director. “We’re very excited to have Ronnie, Michael, and Leonard join the team.”