Commercial deals to be found in gateway markets: national real estate pros

TRD NEW YORK /
Sep.September 21, 2011 11:59 AM

Economic uncertainty is not stopping commercial real estate industry heads from finding deals nationally, top executives at the International Council of Shopping Centers’ and NAIOP’s 2011 Real Estate Capital Marketplace Conference at Chelsea Piers agreed yesterday, GlobeSt.com reported. There are still key development opportunities to be found in hot gateway markets, they said.

Scott Rechler, CEO of RXR Realty, is focusing primarily on Class A assets, he told the audience. RXR recently acquired the Starrett-Lehigh Building at 601 West 26th Street and is in contract to purchase a controlling share of 620 Sixth Avenue

“What we’ve seen historically, and this goes back through the last 20 years of cycles, is that B quality assets are a value trap,” Rechler said. “People think they are getting good returns and people think they are getting good deals until you get down to the down cycle, where you have to invest almost as much as you spend to buy the building, re-build the building and get the same rent that you got 10 years ago.”

Rechler advised a large degree of caution for these acquisitions.

“These are very volatile times, and firstly, take nothing for granted. It is very difficult to know what is going to happen,” Rechler said.

Alex Klatskin, partner at Forsgate Industrial Partners, of Teterboro, NJ, said his company is being extra careful about the quality of the tenants it accepts.

“Rather than run for the highest rent we could get on the property, we are always focusing on the credit and viability of the customer,” he said. “The only thing you can’t change about a building is where it’s located. One opportunity we have as developers is finding what we consider a B building in an A location.” [GlobeSt]


Related Articles

arrow_forward_ios
Larkin Plaza (Credit: Rendering courtesy of SLCE Architects)

RXR project among developments caught up in alleged Gambino mob scheme

Senator Todd Kaminsky and RXR Realty's Scott Rechler (Credit: Getty Images)

No backlash for senator who broke ranks on rent vote

Scott Rechler and clockwise from top left: 2455-2457 Third Avenue, 150 West 48th Street and 42-11 9th Street (Credit: Google Maps, Getty Images)

RXR’s Long Island City development was the biggest new project filed in December

From left: RXR Realty's Scott Rechler, Chicago real estate mogul Neil Bluhm, Joe Biden, Adler Group's Michael Adler, L.A.-based developer Jeff Worthe (Credit: Getty Images, Adler Group, iStock)

These real estate players have raised a bundle for Biden

RXR CEO Scott Rechler and an aerial view of the site (Credit: Getty Images, Google Maps)

RXR plans 21-story LIC office building with manufacturing incentives

ICSC CEO Tom McGee (Credit: Twitter, iStock)

Retail trade group: We can prove brands need brick-and-mortar

James Famularo of Meridian Capital Group and Jeff Edison of Phillips Edison & Company (Credit: iStock)

What apocalypse? Expo showed few signs of retail’s struggles

ICSC’s annual New York show will feature twice as much programming as in years past.

Here’s what to expect at ICSC’s 2019 NYC event

arrow_forward_ios
Loading...