Phoenix tops nation in housing appreciation
Phoenix remains one of the most lucrative housing markets in the U.S. The city’s metro area led the nation in housing appreciation during the third quarter as well as during the 12 months ending Sept. 30, according to data from the Office of Federal Enterprise Oversight. During the third quarter, the housing of the Phoenix-Mesa-Scottsdale area appreciated 8.32 percent, and during the 12 months, it appreciated 34.37 percent well ahead of the national averages of 2.86 percent for the quarter and 12.02 percent for the year. The desert city also leads the nation in drawing condo converters, according to the Slatin Report. During 2005, investors spent $1.3 billion to convert 11,862 units an increase of 1,384 percent from 2004’s $91.9 million spent for 961 conversions.
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Atlanta
Residential/Commercial
Developers of one of Atlanta’s most prominent high-end residential projects announced that the 26-story St. Regis hotel and condo complex would open in 2008 in the Buckhead neighborhood. Starwood Properties said the project will include 150 high-end hotel rooms, plus a spa, two restaurants, butler service, and a 9,200-square-foot ballroom with an assembly hall, the Atlanta Journal-Constitution reported. The complex on West Paces Ferry Road will also include 50 condos averaging about 4,000 square feet each and priced at more than $2 million a unit.
Boston
Residential
A cooling housing market in Massachusetts has pushed brokers to use selling incentives not seen in the Bay State in more than a decade, the Boston Globe reported. As of mid-November, there were 25,656 houses for sale in Massachusetts, 39 percent more than were on the market the same time in late 2004, according to MLS Property Information Network. This overabundance has driven brokers, the Globe reported, to offer buyers free plasma TVs and other deal sweeteners. Also, brokerages are now giving their agents cash bonuses for selling properties that are sitting on the market.
Residential
As the market for houses continued to weaken in and around Boston as 2005 disappeared, the condo market in the area actually remained strong. Condo sales were up 15 percent in October over October 2004, the Globe reported, and the median price of the 1,777 units sold in October was 0.5 percent higher than September’s $271,350.
Chicago
Residential
Even before the year ended, 2005 was a record for the downtown Chicago housing sales market. During the first three quarters of 2005, 6,937 housing units were sold downtown, the Chicago Tribune reported, the highest annual total since the downtown building boom started in 1997. In all of 2004, 6,298 units were sold. The numbers include newly constructed condos and townhouses, redeveloped lofts, and rental conversions.
Residential
A planned 71-story skyscraper could transform the south end of Chicago’s Magnificent Mile. The skyscraper, a hotel-condo hybrid, would replace the north tower of the InterContinental Chicago hotel on Michigan Avenue, according to the Chicago Tribune. If approved by the city, construction on the skyscraper could start in mid-2007.
Las Vegas
Commercial
At least seven malls are planned or under construction in the Las Vegas Valley. They include the 1.5-million-square-foot Great Mall of Las Vegas being built at the corner of U.S. 95 and Interstate 215 and set to open in 2008, according to the Las Vegas Sun. Also planned are the Summerlin Centre and another yet-unnamed mall in the southwestern part of the valley, the Sun reported; both are slated for 1 million square feet. The biggest new mall the 1.7-million-foot Town Square at the intersection of Interstates 15 and 215 is expected to open in mid-2007, with 250,000 square feet also planned for offices.
Los Angeles
Residential
Los Angeles’ housing market didn’t collapse toward the end of 2005 but it did level off. The median price was still up by more than 21 percent compared to the same period in 2004, according to the California Association of Realtors. But month to month, the tale of the market was different: Sales declined more than 22 percent from September to October, and the median price dropped 0.6 percent, too.
Commercial
The Los Angeles office market should continue to tighten in 2006. Net absorption in the L.A. area office market in the third quarter totaled 3.3 million square feet and the overall vacancy rate dropped to 11.3 percent from 12.6 percent the quarter before, according to a report from Colliers Seeley International. With the area’s economy expected to stay healthy, demand for office space, the report said, should remain strong for at least another 10 months.
Memphis
Commercial
As the market for Class A space tightens in Memphis, the city may be headed this year for a rare office building boom. The availability rate for Class A space in the 385 Corridor reached 10.4 percent by the end of the third quarter, according to a report from CB Richard Ellis; for East Memphis, the city’s other major commercial district, the rate was 6.2 percent. These vacancy rates are the lowest that the Memphis office market has seen in years, the Memphis Business Journal reported, fueling speculation that the city will see fresh Class A construction as current space continues to disappear.
Miami
Residential
The once mighty South Florida housing market cooled decisively as 2005 drew to a close. Like most of the nation, the market there had been coming down off record highs since the summer, but it was data for October that really turned heads. Sales of existing single-family homes plunged 48 percent in Miami-Dade County and 44 percent in Broward County compared to the same month in 2004, according to data from the Florida Association of Realtors. These were some of the steepest monthly declines in recent memory, the Miami Herald reported.
Commercial
Western Broward County is one of South Florida’s most active areas for new office construction. More than 912,000 square feet of office buildings were in various stages of development in the area toward the end of 2005, the South Florida Business Journal reported. The average rent for Broward’s 26.8 million square feet of office space was $24.90 a foot, with rents in downtown Ft. Lauderdale, the county’s biggest city, at $28.51 a foot.
Philadelphia
Residential
Philadelphia’s also-ran status among major East Coast cities may actually benefit its housing market this year. With the current median price of a house in the city roughly half that of a house in Washington or New York, the Philadelphia Inquirer reported, price growth in Philadelphia could be near 10 percent in 2006, even as the rest of the nation is expected to see a price growth of 5 percent. Plus, the Inquirer reported, Philadelphia’s job market is generally strong and its housing market doesn’t have the same speculation-driven investor interest as places like Las Vegas or Miami.
San Francisco
Commercial
It’s a foreign investor’s market when it comes to commercial real estate in San Francisco. Foreign and institutional investors dominated the office sales market there in 2005, investing nearly $2 billion in it as of the end of November. About 54 percent of all office buyers in San Francisco were both institutional and foreign, the San Francisco Business Journal reported. REITs and other publicly traded entities made up 17 percent of the year’s purchases leaving private owners with the remaining 29 percent. That’s a decidedly different breakdown than the rest of the nation, according to the Journal, where one-third of office buyers were foreign or institutional in 2005 as of early December.
Washington, D.C.
Residential/Commercial
More than $1.5 billion in office, housing, and retail development was recently completed, is planned, or is under construction along the long-neglected H Street corridor from North Capitol to Blandensburg Road and 17th Street NE. The corridor, according to the Washington Post, never fully recovered after the 1968 riots. Now, though, more than 30 new shops and various developments, including the Security and Exchange Commission’s new 1.5-million-square-foot headquarters, are either done or going up along H Street.