2 0 1 3 REAL ESTATE TRENDS MOVING MARKETS Metairie, CBD tenant battle rests on parking perks; other markets see supply, demand shifts INSIDE North Shore builds to meet high-end office demand Page 25 Wetlands costs curb West Bank development Page 29
Real Estate Strategies Delivered Shreveport New Orleans Dallas as Houston San Antonio Atlanta a Nashville Full-Service Commercial Real Estate Investment Development Leasing Management We leverage our experience and relationships to bring maximum benefit to your real estate transactions. Sealy brokers, who hold significant experience in industrial, office, retail, and land, provide superior service and deliver results. Sealy & Company 150 James Drive East, Suite 140 St. Rose, LA 70087 504.463.5600 www.sealynet.com
REAL ESTATE TRENDS 2 0 1 3 INSIDE: AREA COVERAGE MAP Central Business District 2 4 Center City 10 Eastern New Orleans and Chalmette 13 12 Kenner and St. Charles Parish 15 16 Metairie and East Jefferson 18 19 North Shore 25 26 West Bank 29 28 LISTS Business/industrial campuses 31 Flex space 32 Commercial leasing companies 34 Commercial property managers 36 Shopping centers 38 Warehouse space 43 ON THE COVER Corporate Realty President Michael Siegel says established companies and startups alike are driving demand for Central Business District office space. Photo by Susan Poag The data published in Real Estate Trends is compiled every six months by the CityBusiness research department. Published by the NOPG LLC 3445 North Causeway Blvd., Suite 901, Metairie, La. 70002 504-834-9292; Fax: 504-832-3534 Associate Publisher: Lisa Blossman Editor: Greg LaRose Managing Editor: Jennifer Larino Art Director: Lisa Finnan Account Executives: Liz Baldini, Jennifer Forbes, Cassie Foreman, Coco Evans Judd Production Manager: Julie Bernard Interim Market Researcher: Emily Jones The COMMERCIAL INVESTMENT DIVISION of the New Orleans Metropolitan Association of REALTORS congratulates its Achievement Award winners - Top Commercial Real Estate Producers of 2012 1st Row, Left to Right: Joe Gardner, Meg Carrone, CCIM, Judy Slack, Kirsten Early, CCIM, Sandy Preston, Sandra Corrigan, SIOR, Barry Spizer, CCIM 2nd Row: Ben Derbes, Skip Weber, CCIM, Mark Inman, CCIM, Michael Wilkinson, Duff Friend, SIOR, Steve Reisig, CCIM, Richard Juge, CCIM, SIOR 3rd Row: Rob Spratt, CCIM, CRS, GRI, Rich Stone, CCIM, Paul Richard, Ryan Pearce, Gaines Seaman, Bert Duvic, CCIM, SIOR, Matt Eaton James Barse, CCIM, SIOR Colleen Kuebel Berthelot, CCIM, SIOR Trimble Green Gerard Henry, SIOR Keith Henry, SIOR Stephanie Hilferty Lane Hindermann, GRI, CBR Andrea Huseman, CCIM Other winners not pictured: www.nomarcid.org 504.885.3200 Joe Kramer Jennifer Lee, CCIM, SIOR Schaffer Mickal Martin O. Miller III, CCIM Dan Poulin, CCIM, SIOR David Quinn, SIOR Rhonda Sharkawy Bobby Talbot, CCIM Real Estate Trends 2013 1A
Michael Siegel, president and director of office leasing for Corporate Realty, expects the slow pace of new office construction in the Central Business District to keep supply and demand steady over the next five years. CENTRAL BUSINESS DISTRICT By Mason Harrison Contributing Writer mail@nopg.com Corporate office space in the Central Business District remains a sought after commodity for established companies and start-up businesses alike, demand that has driven prices for premium units up near $20 per square foot. An assessment of the market released by Corporate P H O T O B Y S U S A N P O A G BY THE NUMBERS Class A occupancy Average rent* 1Q 86.64 percent $18.21 2Q 87.31 percent $18.30 3Q 87.46 percent $18.40 Class B occupancy Average rent* 1Q 67.58 percent $15.75 2Q 65.58 percent $16.04 3Q 66.46 percent $15.88 Source: Bruce Sossaman, Corporate Realty *Per square foot Select Properties, Ltd. Riverside Office Buildings I and II Causeway Highrise 6660 and 6620 Riverside Dr., Metairie 3421 N. Causeway Blvd., Metairie Select Properties can fulfill your office space needs at one of our conveniently located, well-maintained five office buildings in Metairie. Please allow our staff of qualified professionals (with CPM and CCIM credentials) to assist you in maximizing your office potential. Specializing in commercial real estate since 1982, Select Properties is an IREM Accredited Management Organization with offices in Metairie, Baton Rouge, and Lafayette. Call us today for leasing, sales, brokerage, asset management, construction and consulting. New Orleans Metro Area Properties Office Buildings 3421 Office Tower 3421 N. Causeway Blvd., Met. Medical Plaza I & II 3901 Houma Blvd., Met. Riverside I & II 6660 and 6620 Riverside Dr., Met. Residential River Vieux Terrace Condominiums 520 St. Philip St., New Orleans 301 Tchoupitoulas Condominiums 301 Tchoupitoulas St., New Orleans Retail The K-Mart Shopping Center 2840-2940 Veterans Memorial Blvd., Met. The Forum 3131 Veterans Blvd., Met. SELECT PROPERTIES, LTD. 833-0044 6620 Riverside Drive Suite 300 Metairie, LA 70003-7109 For Professional Asset Management, Leasing & Sales Also Offices and Properties in Baton Rouge & Lafayette CERTIFIED PROPERTY MANAGER ACCREDITED MANAGEMENT ORGANIZATION Individual Members 2A New Orleans CityBusiness November 29, 2013
Realty in 2012 projected a stable market for office space. The report predicted Class A office space occupancy rates approaching 90 percent in coming years driven in part by the slow pace of new construction in the area. Rates for Class B are also expected to climb. Michael Siegel, president and director of office leasing for Corporate Realty, said those predictions hold true moving into 2014. He expects steady supply and demand for office space in the CBD over the next five years. The one word I would use to describe the market for office space in the CBD is equilibrium, Siegel said. If I could use two words, I would say equilibrium and optimism. Projections are less rosy for older, non- Class A office buildings in the CBD, which report average occupancy rates below 70 percent. Duff Friend, an agent with NAI Latter & Blum, noted that non-class A space is still priced fairly high compared to premium units, ranging from $14 to $17 per square foot. Until the price gap increases, it will be tough to attract additional tenants, he said. Demand would have to increase for Class A office space in order for those prices to rise high enough to make non-class A office space more attractive, Friend said. Experts predict the steady increase of outside firms and start-up ventures seeking space near the city s historic center could spark new office tower construction over the next decade. Yet there are hurdles to new development. In general, there is a lack of land in the New Orleans area, Siegel said. New Orleans is surrounded by water, and there is limited developable land. In the CBD, we are blessed with lots of old, historic buildings which cannot be torn down. Therefore, new land in the CBD and in the Warehouse District is even more of a limited commodity. Siegel added that the value of vacant land in the CBD has spiked in recent years as demand has recently increased from developers interested in building new hotels, apartments, and garages not necessarily office buildings. Friend said the CBD market will continue to be characterized by its relative stability in coming years. The market is healthy right now, he says. I ve got no crystal ball, but I see no reason for that to change. Prime Office Space Immediately Available The Rault Building 2400 Veterans Blvd. Kenner, LA The 110 Veterans Building 110 Veterans Blvd. Metairie, LA Locally Owned and Managed by Rault Resources Group For leasing inquiries call Jennifer Amedee at 504.581.1314 www.raultresources.com Escape from the ordinary... come visit our newly upgraded properties! 3925 N. I-10 Service Rd. Metairie 4300 S. I-10 Service Rd. Metairie 2200 Veterans Blvd. Kenner Newly upgraded properties, atrium offices, retail, warehouse space for lease and self storage space for rent. 3925 North I-10 Service Rd., Ste. 130 Metairie, LA 70002 504.455.8644 www.preferredrealityinc.net Real Estate Trends 2013 3A
CANAL Howard CANAL Cleveland CANAL MAP: Central Business District INTERSTATE 10 S. Claiborne N. Claiborne SUPERDOME 10 9 Clara Magnolia 11 7 S. Robertson Freret LaSalle Perdido Gravier Tulane S. Robertson S. Villere LaSalle S. Saratoga N. Robertson N. Villere Marais Treme Crozat Iberville S. Liberty 13 POYDRAS ELK PLACE BASIN PONTCHARTRAIN EXPRESSWAY Baronne Carondelet 18 St. Charles Julia Julia 23 Lee Poeyfarre Circle Joseph Julia Camp Howard Girod LOYOLA S. Rampart Girod LOYOLA O Keefe O Keefe Baronne Baronne Julia St. Charles Magazine Joseph 16 3 Carondelet 20 Church Julia 24 Tchoupitoulas Lafayette Notre Dame Commerce S. Rampart St. Charles Camp 17 Fulton 6 Penn Constance Union Carroll South Peters Gravier Carondelet 19 1 12 POYDRAS 5 25 21 Natchez Convention Center Boulevard Riverwalk 8 14 15 22 Baronne Picayune Pl. Magazine Tchoupitoulas University Pl. Common 2 26 N. Rampart Burgundy Dauphine Bourbon Royal Exchange Alley Chartres Decatur 4 Ferry Mississippi River 4A New Orleans CityBusiness November 29, 2013
One Shell Square The skyline doesn't lie: One Shell Square is the iconic office building in New Orleans' Central Business District. Located on thecornerofpoydrasstreetandst. Charles Avenue, One Shell Squareputsyouat the center of the city's business community while anticipa i ating all of your needs through h our on-site retail space, including a fitness club, dry cleaning and tailoring, copying and imaging, computer serv vice, postage and deliver y,andsundries in addition to several restaurants. Why work in it when you can work above it? Elizabeth L. Hughes 504-323-7000, ehughes@reitmr.com 701 Poydras Street, Suite 3870, New Orleans, LA 70139 www.oneshellsquare.com P lace St. Charles 52 stories of luxury office spac e with unbeatable amenities m ake Place St. Charles the most prestigious address to house your business. In the heart of the Central Business Di istrict, i Place St. Charl e s offers all the conveniences of t he area while being just a short walk to the French Quarter. Place St. Charles retail section contains a 10 station food court, two restau urants, UPS Store, G Bass Men s Clothing, Terrazu Coffee Shop, AT T&TT Wireless Store, art gallery y, sundry shop, barber shop, hair salon and nail salon, a jewelry shop and much, much more. Complimentary concierge service is exclusively offered to our tenants. Connected to the Hampton Inn. Real Estate Trends 2013 5A
400 Poydras Tower is a striking black granite office tower strategically located in the New Orleans Central Business District at the intersection of Poydras and Magazine. This modern 32-story office tower features more than 620,000 sf of office space with excellent views in all directions, including the Mississippi River, French Quarter, Warehouse District and the CBD skyline. The in-building parking and the adjacent 601 Tchoupitoulas Garage combine to provide perhaps the best parking capacity in the CBD. Prestigious location, convenient access, excellent views and ample parking are just a few reasons your business will be well served at 400 Poydras Tower. 1515 Poydras is a 27 story Class A office tower featuring a dramatic main lobby and covered courtyard four stories high. Location: Landmark presence across from the Superdome offering unsurpassed access to I-10. Parking: Over 500 spaces in the building and 700 auxiliary spaces allows for a suburban parking ratio in the CBD. Amenities: Shuttle Van, Restaurants, Conference Room TOP 3 FLOORS AVAILABLE FOR UP TO 60,000 SQUARE FEET OF CONTIGUOUS SPACE. Suites of various sizes are ready for occupancy. 6A New Orleans CityBusiness November 29, 2013
1615 Poydras Freeport-McMoRan Building A distinctive curved design of green marble and reflective glass forms the 23 story 1615 Poydras Building. Located directly across from the Mercedes-Benz Superdome, 1615 Poydras offers the easiest access to and from the interstate system of any office building in the CBD. Within walking distance of City Hall, civil district courts, hotels and the Superdome and its large parking garage. 1615 Poydras features an on-site restaurant, barbershop and dry cleaning delivery. As one of the only locally owned and operated Class A buildings in the CBD, the building s experienced management team makes tenant satisfaction its highest priority and provides some of the highest quality build-outs and finishes available. Great accessibility, excellent parking, and high quality all come together in the 1615 Poydras Building. is a 22 story Class A office tower featuring striking silver sawtooth bay windows that double the views. Landmark presence across from the Superdome offering unsurpassed access to I-10. Over 500 spaces in the building and 700 auxiliary spaces allows for a suburban parking ratio in the CBD. Shuttle Van, Restaurant, Conference Room, Sundry Shop Suites of various sizes are ready for occupancy. Real Estate Trends 2013 7A
Exchange Centre New Orleans newest and most exciting office building in the CBD! Refurbished elevator lobbies and common area provide a handsome, inviting office environment. Unique amenities including fitness centre, with men s and women s locker rooms with showers, building conference centre, building training centre, ground floor restaurant/wine bar, data center, affordable parking options and much more! Located in the Theatre District, adjacent to the Bio-Medical District in the fastest growing corridor of Downtown New Orleans. Joe Gorman, CCIM 504-733-7109 joe@maxderbes.com 935 Gravier Street, Suite 1840, New Orleans, LA 70112 www.exchangecentre.net 8A New Orleans CityBusiness November 29, 2013
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Canal MAP: Center City LAKE PONTCHARTRAIN Lakeshore 2/3 5 Leon Simon Jefferson Parish Orleans Parish 12 West End 9 Robert E. Lee Filmore Elysian Fields Lake Pontchartrain Blvd. Harrison I-10 I-610 Gentilly Jefferson Parish Orleans Parish Pontchartrain Expressway Canal Blvd. Marconi City Park Wisner Esplanade St. Bernard 7 Orleans Broad Claiborne Earhart Washington Tulane 15 Jeff Davis 11 I-10 Basin Rampart Royal Oak Carrollton Broadway Fountainebleau Claiborne 13 Earhart Claiborne 14 Loyola Poydras Decatur Freret Martin Luther King Jackson 10 8 1 CCC GNO Bridge Jefferson Napoleon Toledano Louisiana St. Charles 4 6 Magazine 10A New Orleans CityBusiness November 29, 2013
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MAP: Eastern New Orleans and Chalmette Lake Pontchartrain Lakeshore I-610 I-10 France New Orleans Lakefront Airport Downman Mayo Hayne Blvd. Morrison Crowder Dwyer Chef Menteur Bundy 8 9 Read 2 Almonaster Wright Bullard 3 Intracoastal Waterway 1 Orleans Parish St Bernard Parish Morrison 5 I-10 Lake Forest Blvd. Paris Rd. Michoud 6 7 Dwyer Old Gentilly Hwy Discovery Blvd. Chef Menteur Intracoastal Drive Mississipi River Gulf Outlet Florida 12A New Orleans CityBusiness November 29, 2013 Poland Mississippi River N. Claiborne St. Claude Friscoville Center Jean Lafitte W. Judge Perez 4 Chalmette
P H O T O B Y A S H L E Y M E R L I N Developer Wade Verges, standing outside one of his new developments at 7500 Bullard Ave., says the construction of a new hospital in eastern New Orleans could spur interest in medical office space. EASTERN NEW ORLEANS CHALMETTE By Mason Harrison Contributing Writer mail@nopg.com Eastern New Orleans and Chalmette have struggled to attract large corporate tenants in the eight years after Hurricane Katrina uprooted many businesses in the area. But returning residents, upcoming retail openings and the construction of a new hospital make up the silver lining in the cloud that hangs over the market. Construction on a new Walmart Supercenter on Bullard Avenue is expected to wrap up next year, with the store opening slated for mid-2014. Crews have also started work on the $130 million New Orleans East Hospital. The hospital is expected to open in the spring with 80 staffed beds. Developer Wade Verges, who operates a leasing firm in eastern New Orleans, is prepared for a slow commercial real estate market until then. While the new Walmart Supercenter will attract more foottraffic to the area, Verges noted it will take time for businesses to invest. Coming out here to visit the new establishments opening up and being out here after opening a new business yourself are two different things, Verges said. We are not having the spin-off effect we d hoped for. Verges said the new hospital could be the catalyst that makes the area more attractive to business. Office space in eastern New Orleans averages $12 to $14 per square foot, though he said that will likely rise as more healthcare service companies eye the area for growth in 2014. When the hospital gets up and running there will be a huge service component that s not in the East at the present time, Verges said. Different firms will follow the hospital and locate in the area, but now much of what s out here is located in trailers on job sites. Verges added occupancy rates in the East hover around 80 percent, though that rate is really based on your definition of office space. He noted that smaller start-up firms often locate in flex space and don t always show up in the numbers. When they are removed from the equation, the number of firms that have set up shop in the area appears lower. The office market recovery experienced in other parts of the region has also been slow to materialize in Chalmette. Barry Spizer, managing partner at SRSA Commercial Real Estate, said large-scale office development is still not in the cards for the area any time soon. Spizer s firm manages Torres Park Plaza, the only Class A office complex in Chalmette. The price for new construction would put rates way above market and you would price yourself out of the market, Spizer said. There s also no demand for new properties. Spizer said the bulk of office space in Chalmette is concentrated in one-off large residential homes that have been converted for use by one or two firms. He noted it s hard to track demand for such space. Some of these homes, I m sure, are really nice, but a good portion of what s out there along Judge Perez Drive is Class B or Class C properties, Spizer said. I m not sure because these are not traditional office buildings and no one really follows their development. Spizer said that trend may reverse as Chalmette continues to repopulate. You have a steady number of people moving back to Chalmette and repopulating the area and the rebuilding of new government buildings and retail and restaurant establishments is attracting the return of those residents, Spizer said. These are factors that will help the return of old businesses and the creation of new firms that will increase demand for office space in the future. Real Estate Trends 2013 13A
14A New Orleans CityBusiness November 29, 2013
Don Borngesser, a Realtor with Coldwell Banker, and partner Tetyana Volosh, left, specialize in industrial sales and leasing. Borngesser says the lack of developable land in Kenner has kept demand for existing warehouse space stable. P H O T O B Y T R A C I E M O R R I S S C H A E F E R KENNER AND ST. CHARLES PARISH By Kerry Duff Contributing Writer mail@nopg.com Regina Allemand says companies in search of industrial and warehouse space in the greater New Orleans area are increasingly searching for options in St. Charles Parish. Allemand, a life-long St. Charles Parish resident who has sold commercial real estate in the area for 22 years, said developable land is available, commercial properties are selling and residential and commercial building permits are up over last year. St. Charles Parish has a lot to offer, said Allemand, a Realtor with Gardner Realtors. It s a centralized location between Houma and New Orleans with great access to interstates, the bayou area, oil fields, waterways and the airport, and residents enjoy a good school system and relaxed life. Allemand has sold four commercial warehouse and office buildings on both sides of the Mississippi River in St. Charles Parish so far this year with an average sale price at $115,000. Three of the four buildings are being refurbished or torn down to make way for new construction. Allemand pointed to the Esperanza Business Park in Luling, a light industrial area, as an example of the type of growth the parish has seen in recent years. Ice cream producer Blue Bell Creameries purchased property there for $314,000 in August to build a 92,000-square-foot distribution center. Allemand noted one of the draws for the company was the property s relative proximity to the Houma and New Orleans markets. Obtaining loans and gaps in infrastructure remain the main obstacles for companies interested in purchasing property in the area. The biggest hurdle for BY THE NUMBERS Occupancy 1Q 85.7 percent $18.13 2Q 85.05 percent $17.83 3Q 83.71 percent $17.83 Source: Bruce Sossaman, Corporate Realty *Per square foot buyers today is getting financing and having 20 percent or more to put down to purchase, she said. St. Charles also doesn t have a paid fire department and that s a big issue for some companies because it keeps them from building in our area. In Jefferson Parish, the Kenner commercial real estate market remains stable, said Don Borngesser, an 81-year-old Realtor with Coldwell Banker who specializes in industrial sales and leasing. Borngesser has closed on more than 100 commercial deals in Kenner over the past decade. Kenner is running out of developable land, and there s very little new construction of office buildings and warehouses, Borngesser said. He noted annual rental rates have decreased from about $7.50 per square foot in 2009 to $6.50 earlier this year. Rates have edged up to $6.75 per square foot in recent months, he said. Charlie Mullin, senior vice president and associate broker with Re/Max Commercial, said many tenants have opted for one-year renewals instead of three-year leases in recent years because Average rent* of the economy and concern for consumer confidence. Demand in the Kenner and St. Charles Parish area is highest for Class A, light industrial buildings outfitted with tractor trailer loading docks. Dan Poulin, senior regional director of Sealy & Co. in St. Rose, said companies seeking to build new are being forced out of the market to find space. We re seeing people go to Hammond because we re running out of buildable industrial land that is permitted and ready to go, Poulin said. One successful development went to Gonzales because they couldn t find a site to build a 250,000 squarefoot warehouse building. Poulin noted the former BP refinery in Destrehan presents an opportunity for developable land, though the company hasn t made it available for purchase. James Business Park in St. Rose, which boasts 53 buildings on 200 acres and is managed by Sealy & Co., also has 14 acres of developable land available in front of its property. Poulin noted that the land is deed restricted to new office building construction, a market that s far too costly to attract investment now. Real Estate Trends 2013 15A
Loyola MAP: Kenner and St. Charles Parish I-10 St. Charles Parish Jefferson Parish Chateau Blvd. 10 W. Esplanade 9 Veterans Blvd. 1 3 James Business Park 6 2 7 5 4 New Orleans International Airport 8 Williams Blvd. W. Metairie Blvd. U.S. 61 River Road Mississippi River Kansas City Railroad Illinois Central RR Jefferson Hwy. U.S. 61 (Airline) 16A New Orleans CityBusiness November 29, 2013
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Jeff Cohn, a sales and leasing associate with Corporate Realty, says ample parking remains a key selling point for The Galleria and other Jefferson Parish office towers in his portfolio. P H O T O B Y S U S A N P O A G METAIRIE AND EAST JEFFERSON By Mason Harrison Contributing Writer mail@nopg.com The commercial real estate market in Metairie and much of eastern Jefferson Parish continues to outpace the region and doesn t show any signs of slowing down. The market is about as good as I have seen it in my 22 year career, said Jeff Cohn, a sales and leasing associate with Corporate Realty. Occupancy is high, rates are as high as I have ever seen, and activity remains strong. Cohn said the market for new traditional office buildings in Metairie is narrow. Rather future growth in the market rests with medical office buildings and other specialized commercial spaces, he said. Experts note tenants continue to be drawn to the area s central location and the abundance of affordable parking compared with downtown New Orleans. Bruce Sossaman, leasing director for Corporate Realty, pointed to Smoothie King s decision to relocate its headquarters from Covington to the Lakeway Center in Metairie. The company cited the proximity to Louis Armstrong International Airport as one reason behind the move. The Metairie market is a convenient location for employees commuting from just about anywhere they live in the greater New Orleans area, Sossaman said. Sossaman added tenants in the Metairie market are able to secure three parking spaces per 1,000 square feet of leased office space. That compares with an average of one parking space per 1,000 square feet leased in the Central Business District. That adds up for large corporate clients, he said. While the CBD market has gained ground in terms of occupancy, local experts predict eastern Jefferson Parish will maintain its spark. The high occupancy rates in the CBD have not yet affected Metairie, Cohn said. If it does, it will be slight. Cohn agreed that affordable parking remains a differentiating factor for the market. I recently did an analysis for an insurance company with high density parking and it would have been more expensive to lease space downtown due to the cost of parking, Cohn said. Experts say any potential drag on the Jefferson Parish market from downtown New Orleans appears to be years away. Sossaman noted Class A office occupancy in Metairie is at 95 percent and Class B is on its heels at 90 percent. Rates are at or above 90 percent in Kenner and Elmwood as well. Rental rates for Class A space in Metairie peaks at about $25 per square foot, while rates hover around $19 further into the parish. BY THE NUMBERS Metairie Class A occupancy Average rent* 1Q 94.66 percent $23.31 2Q 94.94 percent $23.50 3Q 95.19 percent $23.75 Class B occupancy Average rent* 1Q 90.07 percent $18.69 2Q 90.3 percent $18.54 3Q 91.16 percent $18.37 Elmwood Occupancy Average rent* 1Q 54.69 percent $19 2Q 49.77 percent $19.25 3Q 47.59 percent $19.38 Source: Bruce Sossaman, Corporate Realty *Per square foot We expect the Jefferson market to steadily continue to improve and tighten in 2014, Sossaman said. Cohn expects Class B lease rates, which range from $16 to $19 per square foot in Metairie, to experience the most growth over the coming year, though premium office units will remain the best performing. 18A New Orleans CityBusiness November 29, 2013
MAP: Metairie and East Jefferson Metairie Lake Pontchartrain 40 Power Jefferson Hwy David Dr. 18 W. Esplanade Zenith W. Metairie Ave. Hickory Ave. Airline Dr. Citrus Earhart Exwy Transcontinental I-10 Clearview Pkwy 32 26 34 36 42 24 41 35 37 33 29 17 RAILROAD N. Arnoult Severn 1 5 27 3 12 9 6 25 19 23 2 31 Causeway Bonnabel Metairie Rd. Veterans Blvd. 15 38 Orleans Parish Jefferson Parish 8 4 I-610 Edwards Wholesalers Pkwy 30 6 Mounes 13 21 16 14 Plantation Toler Jefferson Hwy Mississippi River S. Claiborne Evans Brookhollow Harahan West Esplanade Clearview 22 10 11 7 Cleary Veterans Blvd. Arnoult 28 I-10 20 39 Severn Causeway Real Estate Trends 2013 19A
REGIONS BANK TOWER Metairie CBD building at Causeway Blvd and Esplanade Ave offers sweeping views, flexible floor plans, renovated common areas, elevators and lobbies, on-site management, ample parking, competitive rates and amenities such as The Caboose Restaurant and Regions Bank. Call Graham Little / Mac McMillan, CBC TEC at 504-566-1777 click here: 3535causeway.com 20A New Orleans CityBusiness November 29, 2013
L Loc ated in the heart of the thriving Metairiee Business District Prime office space available from 200rsf 6,500rsf. We offer very competitive rental rates, newly renovated common areas, above standard office finishes and ample freee parking. Whether you seek a private suite or a half floor, 3445 Causeway can accommodate your needs in a client-friendly environment. Become part of our thriving business community, in the heart of Metairie. Plea ase visit our website feilorg.com L Located in the center of t he thriving Causeway corridor C auseway Plaza I, II & III, located on the corner of Causeway & West Esplanade, consists of three (3), six (6) story office buildings, containing over 335,000rsf of prime office space, adjacent to ample free and reserved parking, consisting of an eig ht (8) story parking garage. g The Property boasts beautiful atrium lobbies and glass elevators, nestled in a lush park-like setting. Become part of our business community, all in the heart of the Causeway corridor. Please visit our website feilorg.com Real Estate Trends 2013 21A
A An Unsurpassed Loc ation Old Metairiee Road A very established business community makes Metairie Office Towers a n ideal business environment. Prime office space located in the most prestigious office address in Old Metairie. Metairie Office Towers has a spectacular lobby, all newly renovated restrooms and common area hallways, ample complimentary parking and 24 hour access. Become part of the most prestigiou us office address on Metairie Road. Full floor now available. Please visit our website feilorg.com 22A New Orleans CityBusiness November 29, 2013
COLDWELL BANKER BUILDING 4051 Veterans at PRIME corner of Veterans Boulevard & Lake Villa Avenue is easily accessed from Esplanade, Clearview and Causeway. The property has great natural light from many large windows, ample free parking and pylon signage available. Call Graham Little / Mac McMillan, CBC TEC at 504-566-1777 click here: 4051veterans.com Real Estate Trends 2013 23A
24A New Orleans CityBusiness November 29, 2013
Kellie Osbon, co-owner of K2 Realty in Covington, says the North Shore is attracting more interest from companies searching for newer and larger commercial space. P H O T O B Y J E N N I F E R L A R I N O NORTH SHORE By Kerry Duff Contributing Writer mail@nopg.com Demand for office space on the North Shore has yet to hit full stride, but that hasn t stopped developers from preparing for an anticipated need for higherend complexes. Mac McMillan, a retail and office specialist with Coldwell Banker TEC Realtors, said the North Shore office market is very stable, with 80 to 85 percent average occupancy. Several new buildings are expected to open in coming years that will fill a noticeable gap in Class A office space, he said. The North Shore needs more Class A office space, and it s being planned now, but the rates will be expensive $22 to $28 a square foot because there s not a lot of it, McMillan said. He noted the North Shore has the opportunity to meet growing demand for special high-end amenities, such as built-in Internet access, marble floors and energy efficient windows and air conditioning. Kellie Osbon, co-owner of K2 Realty in Covington, said she has fielded calls recently from several Fortune 500 companies interested in locating in the area. Recent requests are for as much as 10,000 to 15,000 square feet of Class A office space. We haven t had anyone looking for that amount of square footage in a long time, but we do have a few spots that size, Osbon said. One company is planning to build their own 15,000-squarefoot building after a year, but they want to lease first to make sure they re investing in the right location. Osbon sold 6 acres of industrial property on Louisiana Highway 50 in August to a local businessperson who owns and operates an auto detail and body shop. She said the commercial sale was her biggest in a long time, due in part to the fact that the property ran into few of the wetland-related permitting hurdles other St. Tammany Parish deals have encountered. Chris Abadie, vice president of commercial brokerage for Stirling Properties, said developers are required to map out any wetlands on the land they seek to develop and get their plans permitted prior to starting construction. Tighter wetland permit laws rolled out in 2012 increased land prices on the North Shore and killed some developments. The permit process can take as long as two years. The new laws make it more difficult to get a permit, so there s a bigger barrier to entry for development, Abadie said. It also makes construction more expensive, which means higher rental rates to offset increased costs. So properties that already have wetland certificates have a distinct advantage over property not delineated and mitigated. Stirling s River Chase development at the intersection of Interstate 12 and Highway 21 in Covington has approximately 110 acres available for development and already has wetland certificates. Phase one of the 253-acre development opened in 2004 anchored by Target, Belk Department Store and JC Penney. Brewster Commons at River Chase, a 240-unit multi-family development, opened in 2011 followed a year later by a Sam s Club. We re doing a good job providing for retailers interested in our market right now and we have plenty of developable land that could be office or retail, he said. Abadie said River Chase is primed for Class A office space development, though he doesn t expect new construction in that market to pick up for another two years. Stirling Properties is also developing Fremaux Town Center, a sizeable retail development under construction in Slidell. Its first phase, opening in March, is 95 percent leased. Retailers include Kohl s, Dick s Sporting Goods, Michaels, Best Buy, Ulta and Panera Bread. Phase two, which will have a Dillard s department store, will open in March 2015. Abadie said the opening of Fremaux Town Center will be a game changer for Slidell, drawing activity away from North Shore Square Mall on the other side of the city. Retailers want to be where they can get higher sales, Abadie said. It s all driven by demand. Real Estate Trends 2013 25A
MAP: North Shore U.S.190 Covington 26 2 W. 21st St.. Covington Hwy. River Rd. 1 West Causeway Approach 10/11 18 12 * N. Causeway Blvd. 4 * 6 3 N. Lee Rd. * U.S. Highway 190 Military Rd. Boston Ave. I-12 21 17 25 28 27 Range Line Rd. Abita Hwy. Allen Rd. Talisheek Rd. Highway 1088 Florida Ave. Abita Springs Davis Rd. Pine I-5 9 Mandeville U.S. 190 Hickory Ave. I-12 8 Fish Hatchery Rd. * * * West Causeway Approach 9 13 16 N. Causeway Blvd. 19 U.S. Highway 190 15 23 29 20 Watts Rd. 24 Lake Ave. U.S. 190 I-12 Thompson Rd. Bayou Liberty Rd. FrontSt. St. Joe Rd. 14 7 5 22 Robert Rd. Military Rd. U.S. 1 9 0 Old Spanish Trail LAKE PONTCHARTRAIN Slidell I-10 26A New Orleans CityBusiness November 29, 2013
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Wall Blvd. LA 407 Wright Blvd. Behrmann Hwy Woodland Holiday Hyman Pl. MAP: West Bank To Huey P. Long Bridge LA 18 Bus U.S. 90 River Road Louisiana West Lapalco 4th Uptown LA 541 Bank Expressway Westwood Central Business District Crescent City Connection LA 18 6 Mississippi River Barataria MacArthur Destrehan Ames Pritchard Alexis Industrial Blvd. Peters Rd. Lafayette Huey P. Long Derbigny Manhattan Blvd. Harvey Canal Franklin 3 Gretna Blvd. Lapalco Verret Thayer Bus. U.S. 90 7 Whitney 1 5 8 2 Opelousas Holmes Blvd. Terry Pkwy Belle Chasse Gen. Meyer Gen. DeGaulle Stumpf Behrman 4 ORLEANS PARISH JEFFERSON PARISH MacArthur PLAQUEMINES PARISH intracoastal warehouses Peters Rd. Engineers Rd. Intracoastal Waterway Main St. 28A New Orleans CityBusiness November 29, 2013
WEST BANK By John Breerwood Contributing Writer mail@nopg.com Jack Stumpf, president of Jack Stumpf and Associates, says rising flood insurance rates and wetlands mitigation hurdles remain hurdles to large-scale commercial development on the West Bank. P H O T O B Y A S H L E Y M E R L I N With the Huey P. Long Bridge expansion project complete, experts say the West Bank is positioned to accommodate large-scale industrial or commercial projects if developers can jump several key hurdles. Jerry Bologna, executive director of the Jefferson Parish Economic Development Commission, said the expanded bridge is already having a significant economic impact. He noted retailers in Elmwood on the East Bank have already seen significant appreciable upticks in traffic counts. The West Bank also stands to benefit. Bologna said much of the open land at the foot of the bridge has the potential to tap into the same traffic that Elmwood has seen. The bridge completion positions the area west of the Harvey Canal to capture a lot of future growth, he said. Many West Bank property owners that have owned land in the proximity of the Huey P. Long Bridge are starting to position their properties to get them into commerce. Jack Stumpf, president of Jack Stumpf and Associates, is also optimistic about the area s future growth, particularly at the base of the newly expanded bridge. I ve been getting calls about my property near there, Stumpf said. The Huey P. Long Bridge has been a big plus. Still, a number of challenges stand in the way of widespread commercial development. Stumpf said that flood insurance and wetlands issues are the biggest concerns for prospective developers. It cost about $4,000 per acre to address a wetlands mitigation issue seven years ago, and today that cost could run up as high as $30,000 per acre, he said. If an acre is worth $25,000 and you have to put another $30,000 into it, then it does not become realistic to develop it, Stumpf said. The cost of land and improvements will be more than the value of the land after it is all done. Bologna added the uncertainty surrounding the Avondale Shipyard continues to weigh on the market. Huntington Ingalls Industries intends to close the facility when U.S. Navy contracts end late this year if it can t find alternate work. The shipyard now employs 1,500 down from a workforce that once surpassed 5,000. The strong retail market on the West Bank could prompt future development, though Stumpf said large retail center developments are unlikely. He noted the cost of building such centers exceeds BY THE NUMBERS Occupancy Average rent* 1Q 76.77 percent $17.50 2Q 75.81 percent $17.20 3Q 82.64 percent $17.60 Source: Bruce Sossaman, Corporate Realty *Per square foot the return on investment and national retailers such as Family Dollar and CVS increasingly prefer to open in freestanding buildings. Stumpf sees more opportunity in redeveloping currently vacant retail centers. You are going to see a reduction of large vacant spaces, so it is going to be difficult finding a vacant retail building on the West Bank right now, Stumpf said. He added demand for industrial and residential space is also high. There is a demand for apartments because occupancy is very high, Stumpf said. We have fewer apartments today than 10 years ago and there is much demand for industrial space for speculative industrial buildings or parks. JEDCO relocated its headquarters in 2011 to the Churchill Business and Technology Park in Avondale. Bologna said the move underscored the role the West Bank will have in the future of Jefferson Parish development. There is a lot of green space that is ripe for residential, commercial, or retail development, he said. If you are looking for that untapped space to build on, the West Bank is that last frontier. Real Estate Trends 2013 29A
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