Real Estate Principles The Real Estate Market

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Real Estate Principles The Real Estate Market

• A brokers perspective
• Jim Chynoweth, SIOR, CCIM
• CB Richard Ellis

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Real Estate Market Fundamentals

• How do we analyze the market
• Define the market vs submarket
• Demand for space
• Supply of space
• External economic factors

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Demand For Space

• Who is in the market?
• Who is looking at the market?
• Who should be looking at the market?
• Employment Statistics
• Demographic Statistics

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RETAIL EMPLOYMENT
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Project

• What should be the use of this project?
• What kind of jobs will go into the project?
• Is there a market?
• Will there be a market?

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5900 Jefferson NE
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5900 Jefferson NE
Site
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5900 Jefferson NE
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5900 Jefferson NE
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5900 Jefferson NE
Is this a good location?
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5900 Jefferson Drive Time
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Uptown Drive Time
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Downtown Drive Time
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Mesa del Sol Drive Time
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Rio Rancho City Center Drive Time
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Population Comparisons
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Business Employment15 minute drive
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Business Employment10 minute drive
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Business Employment5 minute drive
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• What are some of the uses that could go on this
  site?
• What effect will land price have on this choice?
• Retail Gap Analysis

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Supply of space

• Inventory of space in the market
• What is vacant?
• Vacant Space/ Total Space Vacancy Rate
• What are the rental rates?
• Annual Rent / Rentable Space Rental Rate
• How much new space is coming on the market?
• What is the absorption of space?
• EOY Occupied SF BOY Occupied SF Annual
  Absorption

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CBRE office statistics table
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BOMA Experience Exchange Report
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External Economic Factors

• Government Actions
• Inflation
• Stock Market
• National Economy
• Local Economy

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Who do you go to for this information?

• Your broker
• UNM Bureau of Business and Economic Research
• Albuquerque Economic Development
• U.S. Census Bureau
• Web based demographic companies

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Why Brokers?

• Brokers job is to provide information to the
  parties to a transaction.
• Listing Agent
• Tenant/Buyer Representative

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Listing Agent

• Master of information on the building
• Physical attributes of property
• Competing property
• Advantages/disadvantages of property
• Anticipate questions a user needs to know
• Negotiate terms of a deal on behalf of owner

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Tenant Representative

• Master of the Market
• Educate client on market conditions
• Identify available options
• Analyze available options
• Negotiate terms of a deal on behalf of user

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How is it done?

• Networking
• CARNM
• LoopNet
• CoStar
• SIOR
• CCIM

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Homework

• Submit an explanation of why you would like to
  build an office building at this location, use
  supply and demand as the basis of your logic.
  Identify 3 industry types that will move in.
• Find the 3 best comparable properties using
  CARNM.com Search office properties over 20,000
  sq. ft. for lease in zip code 87109. Why are they
  the best?