WESTSHORE OFFICE MARKET OVERVIEW PRESENTED BY: LARRY RICHEY

Transcription

1 MARKET PRESENTED BY: LARRY RICHEY

2 YESTERDAY LOCATION, LOCATION, LOCATION Center of the Region WestShore Plaza 1967 Tampa International Airport 1971 I-275 with exits in all the right places International Plaza 2001

3 TODAY!

4 MARKET STATISTICS First Quarter 2014 Inventory Pinellas 12,922,478 SF Westshore 12,758,942 SF Northwest 4,542,035 SF I-75 Corridor 7,510,278 SF CBD 6,453,637 SF

5 Current Office Market Outlook INVENTORY 12,758,942 SF VACANT SPACE 1,781,155 SF VACANCY RATE CLASS A 15.2% CLASS B 14.7% ASKING RATE CLASS A $27.21 CLASS B $ YTD ABSORPTION 40,468 SF CONCESSIONS months free rent per year of term

6 Office Market Trends 5.1% TROPHY BUILDINGS ASKING RATE $ $32.00 LIMITED AVAILABILITY 4.1% 10.4% NEW CONSTRUCTION PROJECTED $ BUILDINGS have been completed in Westshore over the past decade totaling over 1.5 MSF. Combined, these buildings are just 6.7% vacant and have an average rent of $29.65 PSF

7 DRIVERS FOR URBAN GROWTH UR BAN I ZA TION the rapid and massive growth of, and migration to, large cities. RURAL SMALL TOWN SUBURBS MEDIUM / LARGE CITY OTHER Gen Y (ages 18-34) Gen X (ages 35-47) Baby Boomer (ages 48-66) 16% 21% 20% 38% 19% 21% 25% 31% 25% 28% 15% 24% Source: Urban Land Institute national survey of 1,202 adults taken Jan.-Feb The Wall Street Journal

8 WESTHORE MOMENTUM a national movement goes LOCAL

9 THE EMPLOYEE OF THE FUTURE NOW HALF OF THE AMERICAN WORKFORCE WILL BE MILLENNIALS IN THEY WILL FORM BETWEEN 15 & 18 MILLION NEW HOUSEHOLDS BETWEEN 2010 & 2020 ALONE. BY 2025, MILLENNIALS WILL MAKE UP THE MAJORITY OF THE WORKFORCE. Sources: US Census Bureau

10 ADAPTING TO THE NEW WORKFORCE FOR THE FIRST TIME SINCE THE 1920S, U.S. CITIES ARE GROWING FASTER THAN SUBURBS Amenities Housing Accessibility Services Flexibility Transportation Connectivity

11 RENTAL RATE COMPARISON REGIONAL RIVALS CITY AVERAGE QUOTED RATE Dallas $20.48 Atlanta $20.86 Nashville $19.72 Raleigh/Durham $18.83 Charlotte $19.50 Jacksonville $17.45 FLORIDA CITIES CITY AVERAGE QUOTED RATE Tampa / St. Petersburg $20.71 Orlando $19.94 Miami / Dade $32.13 OTHER MAJOR CITIES CITY AVERAGE QUOTED RATE New York $67.11 San Francisco $53.97 Los Angeles $30.74 Chicago $27.07 Westshore $24.47 National Average $26.14

12 FUTURE OPPORTUNITIES POTENTIAL BUILDING SITES

13 Westshore New Lease & Expansion Activity For 2013 Westshore New Lease & Expansion Activity for 2013 By Industry 6.8% 5.8% 9.8% 14.6% 9.4% 18.5% 10.9% 12.2% 3.3% Insurance & Healthcare Financial Services Legal Services Business Services Computers & Software Communications / High-Tech Personal Services Retail / Wholesalers Engineering & Architects All Others 8.7%

14 CURRENT OPPORTUNITIES 7,500 19,999 SF

15 CURRENT OPPORTUNITIES 20,000 49,999 SF

16 CURRENT OPPORTUNITIES 50,000 SF

17 FORECAST It s still a tenant s market, but shifting ever so As the market tightens, effective rents will increase slowly and concessions will wane Without a speculative building, larger tenants will be forced to consider build to suits Decrease in opex in Westshore due to taxes and insurance (as much as $1.50)

18 WHAT S AHEAD? The number of larger blocks of higher-end, class A available space (30,000sf+) within Tampa Bay office market dropped significantly over the past year Westshore has been one of the submarkets most adversely affected by this growing trend. The office market gradually, but consistently improved as 2013 progressed. Overall vacancy steadily decreased and net absorption (the change in occupied space) posted positive figures since the first quarter of the year. Tampa Bay s economic recovery will continue to outpace the nation s thanks to aggressive population growth, the revival of the residential housing market, as well as, the release of pent-up demand for additional space within most types of commercial real estate. Is Slow and Steady Win the Race mantra right for the commercial real estate industry? And how far ahead is that Finish Line? What could be in store for Westshore s future?

19 THANK YOU! LARRY RICHEY Senior Managing Director Cushman & Wakefield of Florida, Inc. One Tampa City Center, Suite 3600 Tampa, FL Direct Fax