Forecasts mixed for Memphis commercial real estate
| Author/Source: | Memphis Business Journal |
|---|---|
| Published: | Nov 29, 2007 |
| Link: | View the article |
Forecasts for commercial real estate next year in the Memphis area are mixed, according to a panel of local developers who gathered Thursday to discuss emerging trends .
Nearly 100 real estate developers, managers and brokers attended the annual meeting of the local chapter of the Urban Land Institute at the Hilton Hotel in East Memphis Thursday morning.
In an overview of several U.S. markets, Memphis ranked No. 38 among 45 markets based on the organization's new Emerging Trends in Real Estate forecast publication, said Chuck DiRoccio, managing director of industry trends and analysis for Washington, D.C.-based ULI.
New York and Seattle topped the list; New Orleans and Detroit were at rock-bottom.
Addressing the office market, Clark & Clark principal Nick Clark said very little new construction put occupancy rates in a "good, healthy spot" in Memphis, with the exception of the Downtown market.
Jim Mercer, executive vice president at CB Richard Ellis Memphis, said absorption prospects are good and leasing activity is solid, too, which could make 2008 a "pretty good year" for the industrial sector.
Clark said, however, that the population of Shelby County is expected to decline through 2010 and that attracting new business is key.
"If the quality of life is better, we'll draw more businesses here," he said.
Bob Loeb, chairman and president of Loeb Properties, said 2007 was a good year overall for retail real estate and that people are "apprehensive" going into 2008.
Several strong submarkets include Wolfchase and Southaven, he said. Parts of Bartlett are "struggling" and areas of the Winchester corridor and South Memphis are "disastrous," he said.
"2008 will be a challenge for the retail sector," he said.
Michael Greenberg, CEO of Makowsky Ringel Greenberg, said some investment sales of multi-family properties in the market were not as successful as buyers had hoped. Some buyers have asked for management help on deals that are not performing well, he said.
"Out-of-town buyers came in with great expectations," Greenberg said. "They (now) say, 'I bought this thing and it's not performing.'"