Tag Archives: CRE

Featured Client: 85°C Bakery Cafe

85°C Bakery Cafe is a cafe and bakery specializing in espresso coffee, flavored beverages, decorative cakes, and freshly baked breads. Founded in 2004, the chain quickly branched out overseas to China and Australia before establishing a foothold in the United States.

85°C Bakery Cafe is currently seeking sites throughout the Austin area.

Real Estate Requirements:

  • 2,500 – 3,000 sf
  • High density
  • Strong visibility
  • Preferably near other Asian co-tenants but can also go in traditional shopping centers

Featured Client: Waxxpot

Waxxpot is a head-to-toe waxing salon that offers services to both men and women in a comfortable, modern atmosphere.

Waxxpot has salons in both Columbus and Atlanta (coming soon) and is currently seeking sites in Austin and Denver.

Real Estate Requirements:

  • Approximately 1,500 – 2,000 sf
  • Trendy neighborhoods
  • Good visibility
  • Strong daytime & evening populations

2018’s Retail Outlook Can Be Summed Up In 3 Words — Reduce, Reuse, Recycle

Though retail real estate has suffered greatly from the massive closures of major brick-and-mortar retailers in the past year, there are still ample investment opportunities in the sector. Tenants, owners and investors could find opportunities in the sector as retailers strategically transform their business models and physical locations to embrace e-commerce and become more experiential.

TH Real Estate said in a 2018 outlook report that there are three ways the retail sector will be transformed this year. The firm called it the three R’s of retail: reduce, reuse and recycle. 

Reduce

Rather than ditching all of their space, a number of retail tenants are opting to decrease square footage in order to hone their focus on the stores that are performing well. Others are choosing to get rid of the brick-and-mortar locations altogether in favor of e-commerce. 

Reuse

Some landlords are getting creative in their attempts to keep pace with the shift in consumers shopping preferences, and are repurposing spaces instead of getting rid of them. Malls are adding tenants like grocers, gyms and medical offices, while retailers are turning spaces previously used for shopping into pickup-and-order counters where consumers can easily collect items purchased online. 

Recycle

While many retail spaces can be revived with an update, others have met their end. This has presented an opportunity for investors and developers who are turning these previous retail spaces into multifamily, residential, office, healthcare, self-storage and industrial properties.

January 07, 2018 – Lara O’Keefe

Original article published on Bisnow.com

What Xceligent’s Bankruptcy Says About the Property Data Business
Some in the sector lamented the loss of another competitor in an increasingly narrow field.

In the wake of commercial real estate data firm Xceligent filing for bankruptcy protection, the property data industry was not surprised—it’s an expensive field to be in. Still, some in the sector lamented the loss of another competitor in an increasingly narrow field.

Before it filed for Chapter 7 liquidation, the firm was embroiled in a lawsuit with real estate data giant CoStar Group Inc. The lawsuit will now fall under the jurisdiction of the bankruptcy court in Delaware, where Xceligent filed its case—a move that puts more knots in an already thorny case. “It complicates things even further. It delays things even further,” says Carl W. Hittinger, partner in the Philadelphia office of law firm BakerHostetler.

Last year, CoStar sued Xceligent in federal court in Missouri, where Xceligent is headquartered, alleging the company had stolen copyrighted commercial property information, which CoStar sells for a subscription fee, and re-sold the information for a lower price. In June 2017, Xceligent denied the allegations and in turn alleged that CoStar engages in anti-competitive practices to raise competitor prices, drive competitors out of business and keep its “monopoly” on the commercial real estate information industry. Last week, Xceligent, owned by the London-based Daily Mail and General Trust PLC (DMGT), filed for Chapter 7 bankruptcy and will seek liquidation. It immediately shut down its website and laid off hundreds of employees.

“DMGT had fully impaired Xceligent at the end of [fiscal year 2017], following weaker than expected revenues from its NYC rollout and other challenges, including lower renewal rates,” wrote Alex Moorhouse, head of communications at DMGT, in an email. “Ultimately, in light of these challenges, the Xceligent management team was unable to identify a way for it to operate on a sustainable basis and recommended filing for Chapter 7 liquidation. The CoStar litigation was not a direct factor, but of course did create additional cost for the business.”

Moorhouse declined to respond to CoStar’s comments.

Meanwhile, the firm’s exit from the field has opened up new business opportunities for its competitors. A google search for Xceligent brings up ads from firms including Property Shark and CrediFi offering themselves as alternative service providers to Xceligent’s clients. Employees from CoStar and 42Floors, a San Francisco-based website that also has a national database of commercial property listings, have reached out to brokers, so transactions could continue without interruption. An executive with RealMassive, a listings marketplace, said it reached out to former Xceligent employees for support.

“No one wants to see a good company—even a competitor—go down like that, because there are so many people’s lives affected,” says Jason Freedman, CEO of 42Floors, which was formed in 2011.

Unable to compete?

While antitrust claims are difficult cases to prove, filing for bankruptcy may lend some credence to Xceligent’s claim that it was unable to compete, says Andre P. Barlow, partner in the Washington, D.C. office of law firm Doyle, Barlow & Mazard PLLC. “Clearly the damages are much larger now, because now we’re talking about the loss of the business,” Barlow says. CoStar’s dominance in the sector was compounded by its 2012 acquisition of marketing platform LoopNet.com, which was approved by the Federal Trade Commission (FTC) as long as CoStar spun off Xceligent from LoopNet and adhered to a set of conditions that would allow competition to thrive. “The behavioral solutions that the FTC required in allowing that merger didn’t appear to work here,” Barlow adds. Moorhouse declined to comment on the litigation, as DMGT is not involved.

However, bankruptcies happen, even in light of the FTC’s review, according to Hittinger. “That’s just the competitive world we live in. There are casualties,” Hittinger says. However, while antitrust laws are not designed to prop up inefficient businesses, these laws still protect against anti-competitive practices that could lead to bankruptcies, he notes.

Still, Xceligent’s liquidation could put a chill on others trying to compete with CoStar, which has a history of litigation against other commercial property data companies, including LoopNet, Barlow says. “It certainly makes it difficult for all these smaller competitors to exist and to grow,” he notes.

According to Linnington, though CoStar is dominant in its field, it embraces competition and will continue to innovate. Accusations that the company is anti-competitive are “fictional,” he says.

Competition is good for the industry as it creates an incentive for innovation and more options for the brokers, says Kevin Green, vice president of marketing for Austin, Texas-based RealMassive, which also settled a lawsuit filed by CoStar in 2016. “Now there’s one less choice for brokers in the marketplace,” he notes. While it may be too soon to tell how the case with Xceligent—and its subsequent bankruptcy—will affect the industry overall, Green says there is still room for players with different value propositions. “The market is made up of different brokers and people who have different needs.”

What lies ahead

Xceligent’s fall points to what some in the industry—not affiliated with CoStar—say is a fundamental business issue: It is difficult to have enough human and capital resources to match CoStar’s database, one the company has constructed over three decades, and finding new ways to create such information more efficiently.

“People underestimate what it takes to build a property database, and all the research that goes into building a database like that,” says Andrew Bermudez, CEO of Digsy AI, a commercial property interface which is based in Fullerton, Calif. and was founded two-and-a-half years ago. Even if a company were to match CoStar’s reach—as Xceligent was attempting to do—many brokers would be prone to stick with whatever service they were using, Freedman notes. Commercial brokerages are not required to use CoStar—unlike the MLS on the residential side—but many do, sometimes in addition to internal databases.

While Bermudez does not fault CoStar for filing a lawsuit against Xceligent—“It would be irresponsible to them to not try to protect its asset,” he notes—he says the industry itself is in need of disruption. Similarly to how crowdfunding has shifted the fundraising industry, “The paradigm needs to change all together, taking economics and process and human resources into account,” he says.

Mary Diduch | Dec 22, 2017

Original article published by National Real Estate Investor at NREIOnline.com

Meet The Commercial Real Estate Industry’s Military Veterans

Many of the skills needed to excel in the commercial real estate industry parallel those learned while serving in the United States military: Discipline. Preparedness. The ability to stay calm and think rationally in heated situations. Integrity.  Bisnow spoke with nearly two dozen military veterans from across the country ahead of Veterans Day on Nov. 11 to gain insight into their experiences in the military and how those years of service have influenced their careers in real estate. 

See below for information on a few of these remarkable professionals in our industry, and check out the full article for the complete listings and photos!


St. Croix Capital Advisors Senior Vice President Stephen DePizzo

City: Austin

Military Rank: Army, Engineer Officer – Captain

Years Served: Six

Military Memories: The greatest memories during my time in the military [were from] being able to lead young men and women. The time we spent was priceless. I also had the opportunity to be an Aide de Camp to a two-star general. Being mentored by a high-ranking officer was one of the best experiences I have ever had. 

How has your military service shaped your life and career? The military shaped the way I look at all situations in my life and in business. It taught me to be patient, to analyze all situations from different perspectives and to pay attention to all the details. I’ve been able to use my skills and military experience in all aspects of commercial real estate.  

Newmark Knight Frank Executive Managing Director Jeff Castleton


City: Denver

Military Rank: Navy Lieutenant Commander

Years Served: May 1981-February 1991

Military Memories: Castleton graduated with honors from the United States Naval Academy, where he earned his bachelor of science in mechanical engineering.

What lessons from your military service carried over into real estate? Leadership skills to focus on the team and ensure all members are enabled and motivated to succeed. 

CBRE Advisory & Transaction Services associate John Bernatz


City: Portland

Military Rank: Army; E6, Staff Sergeant

Years Served: Six years, from 1995 to 2001

Military Memories: I highly enjoyed my years of service in the U.S. Army. I was stationed out of Fort Bragg, North Carolina, and had a lot of great experiences. My job while in the Army was combat medic, and one of my fondest memories was during initial basic training. Growing up, I was involved in Boy Scouts and attained the rank of Eagle, so camping and backpacking were an important part of my life. During our sixth week of training, it was time for the 15-mile ruck to camp and we spent several days in the woods learning how to be better soldiers. I always backpacked trying to carry as little as possible, but in the Army it’s about carrying as much as possible. About halfway into the hike, a few of my battle buddies started falling out due to their back weight, and so instead of getting in trouble with our drill sergeant I started carrying some of their gear. By the time we got to camp I had more than doubled my weight and thought that I was going to crumble. Hoping that we would have some time to rest, I dropped gear and reached for a snack. To my dismay in my efforts to help my friends, it brought attention to the one person we were trying not to alert, Drill Sergeant Cambell. Once he saw how well we did during the march and that I was just ‘sitting around’ snacking, he felt it would be a good time to do some additional training. We were then put through the ringer for the next three hours doing physical training in the rain and mud. The next three days were torture. And to top it off, since I was such a great help on the march there, he decided to let me carry their gear on the way back, too. Soldiers do the stupidest things. As a medic we have to spend time in the hospital emergency room treating soldiers and families when we are not deployed or in the field. It was a little after midnight (I always seemed to be stuck with that shift) on a Sunday night, and the ER was silent. We were all dozing on the beds, recovering from a rough Saturday night when all of a sudden, a soldier barges into the ER screaming for help. The guy looked oddly familiar, but I couldn’t quite place the face. The group of us went into solution treatment mode and got him on a bed and started shearing off his uniform. We begin to cut off his underclothes, when suddenly four snakes fall to the floor. His body is covered in little bites, and now there are four loose snakes in the ER. We found out that he and his buddies had been playing a drinking game, which he was losing. Every time he lost a round, they put another snake in his uniform, keeping it buttoned up and the snakes tucked under his clothes. We gave him some medication to calm down, dropped an IV on him to sober him up and then spent the rest of the night catching snakes in the ER. Needless to say, he and his buddies were in deep with their commanding officer, and we only recovered one snake that night.

How has your military service shaped your life and career? Military experience has shaped every aspect of my professional career, but has come in extremely handy in commercial real estate. My experience has taught me to stay cool under pressure, think clearly and remain unemotional in stressful situations. Being able to dissect a situation in my head rapidly and make quick decisions has proved to be a valuable skill.

Original article posted November 9, 2017 on Bisnow.com