Colliers scores big assignment; to manage worldwide properties of telecom giant

btlogoColliers International has won yet another big property-management task as Telecom giant BT has appointed the company to manage its worldwide property interests outside of Ireland and the UK.

As part of the deal, Colliers International’s corporate solutions team will manage more than 1,200 property interests across the world, everything except BT’s UK and Irish Republic properties. Colliers and BT already have a working relationship; Colliers has previously provided services to BT across the telecom company’s Americas region. The new contract lasts for three years.

Roger Barr, Head of Global Real Estate for BT, said, in a written statement, “We were impressed with Colliers’ strategic thinking, best-in-class tools, cultural alignment with our team and global reach.”

Colliers will provide a full range of services, including global property portfolio strategy, business intelligence technology, lease administration and transaction management.

The deal gives Colliers 15 million square feet of property interests across the globe to manage.

– Dan Rafter

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How committed is Dan Gilbert to downtown Detroit? Jones Lang LaSalle charts it

1001 Woodward in downtown Detroit

1001 Woodward in downtown Detroit

Just how impressive has Quicken Loans founder Dan Gilbert’s commitment to downtown Detroit been? Just ask Jones Lang LaSalle.

The real estate firm recently released a chart — part of its new chart of the month feature — highlighting Gilbert’s Detroit buying spree. The numbers are impressive.

During the past three years, Gilbert’s Rock Ventures has acquired 2.9 million square feet of commercial and residential space in Detroit’s urban core. The company also owns several parking garages and a surface lot with 4,250 parking spaces.

Gilbert continued his buying spree with his recent purchase of the 1001 Woodward office building in Detroit. The building, sold by local real estate investor Dimitrios Papas, is 283,000 square feet and comes with a 730-space attached parking structure. Gilbert paid an undisclosed price for the building.

Quicken Loans plans to take 65,000 square feet of space at 1001 Woodward. This will immediately increase the building’s occupancy rate from 68 percent to 87 percent.

John Cullen, senior vice president with Jones Lang LaSalle, said that Gilbert has a vision of Detroit as a 24/7 active community, one with a Central Business District that is built out 100 percent and filled with office buildings, residential units and retail centers.

AJ Weiner, executive vice president with Jones Lang LaSalle, said that Gilbert’s efforts have already brought a younger workforce into the Central Business District.

“Since Gilbert’s initial acquisitions the daytime population has spked, driving a vibrant, energetic workforce downtown,” said Cullen, in a written statement.

– Dan Rafter

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Kraus-Anderson, BWBR Architects work together to build a new kind of school in Minnesota

blaine

Not all schools work for all students. That’s the challenge that Minneapolis-based Kraus-Anderson Construction Company and St. Paul, Minn.-based architecture firm BWBR Architects face in designing and building a new school designed to serve kindergarteners through eighth-graders with special education needs.

The new 70,000-square-foot Karner Blue education center, to be built in Blaine, Minn., will serve students who have either struggled in a traditional school setting or those whom officials with Northeast Metro 916 Intermediate School District have identified as likely to falter in a typical school.

Because of this, BWBR Architects could not design a typical school.

“In some cases, the students who will attend this building see school as a place where they have failed,” said Steve Erickson, BWBR’s project manager for Karner Blue. “We didn’t want these students coming into another building that looked like an institution, that looked like a school built in the ’50s, ’60s or ’70s. That would be counterproductive. We wanted to create a warmer, friendlier environment.”

This meant embracing a pod concept. Karner Blue will serve four distinct sets of students. Some of the students at the school are autistic. Others are dealing with emotional behavior disorders. One pod will house students with austism. Two pods will house elementary-age students with emotional behavior disorders. The final pod will be the home base for middle-school-age children with emotional behavior disorders.

The architects also had to create a school that didn’t rely on the traditional central-hallway schemes of typical schools.

“With most schools, you have long corridors with classrooms on either side. That’s a way to get students where they need to be as quickly as possible,” Erickson said. “But in this school, they didn’t want any long corridors. They didn’t want there to be any chaos in the hallways.”

School officials also didn’t want any clear sightlines from inside the building’s classrooms to its hallways. Such views can distract students, with some becoming fixated on what’s happening in the corridors instead of what is taking place in their classrooms.

To make the school look friendlier, BWBR incoroprated skylights and large windows throughout, something that would bring natural light into the building. Because the new school will sit adjacent to a 50-acre protected wetland — the school’s name comes from a type of butterfly — this is especially appropriate.

Again, though, planners had to take steps to minimize possible distractions. The students at Karner Blue can become easily distracted by window views. To help alleviate this, while still providing large swaths of natural light, BWBR designed classroom windows with sills that are elevated to five-and-a-half feet off the ground.

Kraus-Anderson and BWBR officials also met with the Minnesota State Fire Marshal’s office so that they could replace the traditional loud horns and flashing strobe lights that come with fire alarms with less jarring speakers and digital message boards.

Karner Blue is not the first project on which Kraus-Anderson and BWBR have worked together. The companies have also worked on the Regions Hospital Inpatient Mental Health Center in St. Paul, Minn., and the Early Childhood Family Center in Stillwater, Minn.

Construction on the new school will begin in June of this year. It is scheduled to wrap up in July of 2014.

“This exceptional building for District 916 is a national model and an example of a new trend in education construction,” said John Huenink, Kraus-Anderson vice president and director of the company’s education group.   “We are proud to partner with BWBR on behalf of Northeast Metro 916 to meet the growing demand to support special needs children in our community.”

– Dan Rafter

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New Subway sandwich locations popping up across the Midwest

subwayQuick: What fast-food chain is growing faster than any other?

It’s Subway. And the chain didn’t slow its momentum during the first three months of 2013.

In January, February and March, Subway opened more than 600 locations across the globe. The chain now boasts more than 39,000 locations. Its goal? According to a press release sent to Midwest Real Estate News, Subway is targeting 40,000 locations.

In the United States, Subway added 232 new franchises during the first three months. A Midwest state, Missouri, reached its own personal milestone, getting its 500th Subway store during this time.

Subway even opened its first restaurant in the nation of Estonia.

Subway has found success, too, in the non-traditional restaurant space, with 9,000 stores in airports, department stores, hospitals and park and recreational facilities.

The chain even operates a restaurant inside a Goodwill Industries training center in South Carolina. Goodwill uses the restaurant as a training center for clients in the organization’s foodservice program, giving these clients valuable job skills.

In the Midwest during the first three months of the year, Illinois saw five new Subway locations, Indiana four, Iowa three, Kansas two, Kentucky four, Michigan two, Minnesota one, Missouri four, Ohio 11, Tennessee five and Wisconsin six.

– Dan Rafter

Posted in Illinois, Indiana commercial real estate, Kansas Commercial real estate, Kentucky commercial real estate, Michigan commercial real estate, Minnesota real estate, Missouri commercial real estate, Ohio commercial real estate, retail, Wisconsin commercial real estate | Tagged , , | Leave a comment

With business in the region booming, McCarthy opens Kansas City area office

A rendering of Project Sweetness for MARS in Topeka.

A rendering of Project Sweetness for MARS in Topeka.

St. Louis-based McCarthy Building Companies had never operated an office in the Kansas City region. But that doesn’t mean that the commercial construction company hasn’t been active there. The company recently started construction on a high-profile project for the U.S. Department of Homeland Security and another for the MARS chocolate company, both in the Kansas City region.

And these projects are far from rare. McCarthy construction crews have become common sights in the Kansas City region. In all, the company now boasts more than $1.4 billion worth of construction underway in the region.

This is why McCarthy earlier this spring finally opened a new office at 10601 Mission Road in Leawood, Kansas, right in the heart of the Kansas City area.

Scott Wittkop, central division president for McCarthy, said that the timing made sense for the new office.

“We’ve had our eye on Kansas City for a while,” Wittkop said. “We’ve picked up some pretty significant work in the region lately, so this seemed like the perfect time. We want to put our folks out there on the ground and see if we can’t gain an even stronger foothold in Kansas City.”

The Kansas City region holds a special place for Wittkop. His first construction project for McCarthy came 27 years ago in Kansas City, a residential redevelopment of historic buildings.

“I spent about two years in Kansas City with McCarthy. I enjoyed my time there,” Wittkop said. “I’ve always wanted to go back to Kansas City, so here we are.”

McCarthy is currently working on projects in Springfield, Joplin, Topeka and Manhattan, Kansas.

One of the company’s highest-profile projects in the region is the construction of the National Bio and Agro-Defense Facility in Manhattan, Kansas, for the U.S. Department of Homeland Security.

McCarthy, in conjunction with Minneapolis-based Mortenson Construction, recently started work on an $80 million, 87,000-square-foot free-standing central utility plant that will house the primary heating and cooling systems for an adjacent laboratory. Construction of the utility plant will be complete in October of 2015, with construction of the lab scheduled to begin in 2014.

Another nearby prominent project is MARS Chocolate North America’s Project Sweetness, a $180 million, 550,000-square-foot food-grade production and manufacturing facility in Topeka. When finished in 2014, the 150-acre site will be home to seven structures, including production, administration and central utilities facilities; rail buildings; a guard house; and a wastewater treatment plant.

McCarthy’s Barry Sutherland has relocated to the area to lead the 3,500-square-foot Kansas City region office as its director. McCarthy’s Brad Schoen will serve as the office’s preconstruction director.  The office opens with four full time McCarthy staff.

– Dan Rafter

Posted in industrial real estate, Kansas City commercial real estate, Kansas Commercial real estate, Topeka commercial real estate | Tagged , , , , , , , , , , | Leave a comment

Guest Post: Multi-family on the rise in Wichita

Jeff Englert

Jeff Englert

Nathan Farha

Nathan Farha

Guest post by Jeff Englert and Nathan Farha, multi-family specialists, The Martens Companies

After more than a decade of minimal multi-family construction activity, numerous developments are planned for the Wichita market. Fueled by increased occupancy rates, historically low interest rates and a demand for Class-A product, more than 2,500 units are in the planning, development or construction phase.

The last surge in multi-family development took place from 1998 to 2000, when more than 2,000 units were added almost exclusively in the northeast and northwest quadrants of Wichita. The residential housing boom of the 2000s mixed with rising cost of construction, low rental rates and the economic downturn in the Wichita market virtually halted new development during the past decade. Of these, the primary deterrent has been Wichita’s low rental rates. According to a report produced by Reis in 2012, apartment rents in the Wichita market were the lowest among the 82 urban markets with rents averaging $510 per month, compared to the national average of $1,091.

In January of 1998, the occupancy rate peaked at 94 percent, similar to today’s market. The occupancy rate bottomed out at 87.5 percent in January of 2001, and the new units were not fully absorbed until 2008. The Wichita multi-family market is currently operating at 93 percent occupancy. Most Class-A and -B properties are operating above the overall market averages, with Class-C properties located in less desirable areas bringing down the market averages.

Similar to the growth experienced in the late ‘90s, proposed new development is focused on the northeast quadrant of Wichita, and in the northwest and downtown areas to a lesser extent. Nearly 60 percent of the planned units are located northeast, and most are positioning themselves as Class-A developments with amenities not found at competing properties; such as putting greens, attached garages, pet washes, upscale clubhouses, stainless steel appliances, etc.  Rental rates for existing Class-A northeast complexes are in the 90-centto $1-per-square-foot range with the amenity-rich properties at the upper end.  The majority of the Class-A northeast properties are operating around 95 percent to 97 percent occupancy, with the most sought-after properties at nearly 100 percent. Most new developments in the area are proposing rents at the upper end or above the existing properties, typically in the 95-cent to $1.15-per-square-foot range.

The downtown and Old Town multi-family market has continued to flourish. During the past 20 years, warehouses and office buildings have been converted to apartments and condos. These projects have been well-received and consistently operate at 98 percent to 100 pecent. Additionally, these units command the highest rental rates in the market, varying from 90 cents to $1.50-plus-per-square foot. There are plans for additional “rehab” projects in the CBD. However, for the first time in more than 30 years, the CBD will experience a significant amount of ground-up development. Three planned projects along the Arkansas River could add 300 units to the market. These properties should be well-received assuming rents will be closer to those proposed for the new suburban projects. It’s questionable if tenants will be willing to pay higher rents typically associated with the unique “loft” characteristics unless projects offer exceptional unit and site amenities.

The big question is what effect will the addition of 2,500 units have on the market? It is anticipated that the market can absorb the new higher priced units assuming they come on line over a reasonable timeframe and the economy grows at a consistent rate. Existing properties, with less attractive amenity packages and locations, may feel the impact the most and will likely experience a slight decrease in occupancy leading to a period of increasing use of concessions.

The one guarantee is that the Wichita multi-family market will be very dynamic in the coming years. Urban development will continue to offer a mix of distinctive loft renovations and more traditional units; continuing to add to the viability of downtown living. The new suburban properties will focus on more amenity-laden properties with conventional floor plans and higher rents. In the long run these trends will result in a shift in the market creating new standards for Class-A multi-family; one with a high level of amenities and increased rental rates.

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Another auto-parts maker chooses Michigan’s Auburn Hills for its world headquarters

A rendering of Ralco's new headquarters building.

A rendering of Ralco’s new headquarters building.

The city of Auburn Hills, Mich., has taken an aggressive approach to attracting new businesses, especially those that serve the area’s traditionally strong automotive industry.

City officials celebrated another victory earlier this spring when a manufacturer providing parts to both the automotive and other industries announced plans to set up shop in Auburn Hills.

Ralco Industries, Inc., which manufactures metal stampings and welded assembly products, has submitted plans for a new 125,000-square-foot world headquarters and manufacturing facility on more than 18 acres near the Fieldstone Golf Club in Auburn Hills.

Steve Cohen, director of community development for the city of Auburn Hills, said that Ralco’s decision is yet more evidence that his city’s pro-business approach is helping to bring new businesses to this area near Detroit.

“Ralco could have built this new facility anywhere in the Midwest,” Cohen said in a written statement. “But they want to be here.”

JB Donaldson Company, based in Farmington Hills, Mich., is the developer for Ralco Industries’ new building. About 14,000 square feet of the building will be used for office space while the remaining 111,000 square feet will be used for manufacturing. The company is investing an estimated $13 million in the facility.

Jim Piper, president at Ralco Industries, said that Auburn Hills offered the pro-business atmosphere that his company sought. Piper and Ralco chief executive officer Tom Gitter both have roots in Michigan, too. The pair of officials lives in the state.

“We are pleased to demonstrate to the world that manufacturing is alive and growing in Michigan,” Piper said in a written statement. “We are excited to market his investment in Auburn Hills.”

Members of the Auburn Hills Planning Commission is holding a public hearing May 28 to review Ralco’s plans. The City Council is scheduled to vote on the plans June 3.

This isn’t the first manufacturer to make Auburn Hills home in recent months. Faurecia, the sixth-largest automotive supplier in the United States, chose the city for its new North American headquarters earlier this year. That building will rise three stories and total 278,000 square feet.

– Dan Rafter

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