By hiring a reputable and respected commercial real estate advisory firm your commercial real estate investment can be a success. So how can IAG help? Investment Analytics Group (IAG) sees the big picture and we are your partner. IAG can help maximize the overall performance of properties by bringing knowledge and experience in property management, leasing, lease administration, acquisitions, and due diligence, enabling us to develop and implement ownership solutions to achieve the objectives in operating and leasing property.

Regardless if you’re a veteran at commercial purchasing, or a rookie that has just stepped into the game, the future isn’t always predictable. Obstacles will arise, yet many – to a large extent – can be avoided. To minimize the stress level, having a concrete and unambiguous purchase contract is crucial. Clearly, the document should be comprehensive. Though one should consult his/her attorney regarding the terms’ legality and suitability, there are some ground provisions to include:

* Parties to the CRE transaction (buyer/seller)
* The history of the transaction; the purpose of the real estate venture
* Property description – price, condition, etc.
* Payment terms/ closing date and conditional closing
* Title abstract and insurance
* Rights to adjust purchase contract
* Duration/ termination provision
* Assignment/delegation rights
* Escrow
* Warranties
* Zoning and land use issues
* Inspection rights
* 1031 tax deferral/exchange
* Liability insurance
* Contract breach remedies
* Possible dispute settlement options (arbitration)
* Governing laws

About Investment Analytics Group
Established in December 2006, Investment Analytics Group (IAG) provides integrated commercial real estate advisory services to investors. Our core services include asset level due diligence, asset management, financial modeling, feasibility studies and other related advisory services.
For more information visit us at www.iagroupllc.com or contact us at 208.846.8476 or info@iagroupllc.com.

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Real estate owners and investors always have choices. In times of uncertainty like our current environment, the majority of people opt to do nothing. Whether it is because people are gripped with fear or as a result of historically weak market dynamics, the number of closed property sales dropped precipitously in 2008. What should you, as an owner and/or investor, consider as we enter 2009 amid continued uncertainty? Here are some questions you should ask yourself:

1. Where are the opportunities to buy?
2. Is it even possible to sell property in today’s environment?
3. Will I be able to refinance, and under what circumstances?
4. What are the risks of doing nothing?

Buying opportunities exist today and are expected to get more plentiful throughout 2009. Many properties that were listed for sale in 2008 did not sell. We are starting to see more frequent price reductions and, in fewer cases, owners turning properties over to their lenders. An estimated $160 billion in commercial loans are coming due this year, and many of those borrowers will have to: a) invest additional equity into the property, b) find a mezzanine lender or equity partner, c) sell the property, or d) hand the property back to the lender. Many will choose options “c” and “d”, which will create some interesting buying opportunities later this year.

If you own a property and are considering selling it this year, your obvious concern is whether you might be selling at the bottom of the market. While prices may be down from the 2007 peaks, they are not likely to increase for two or three years. If you need to sell during this period, you will still be able to find a buyer provided that you are realistic about your property’s value.

If you are considering a sale/leaseback, you will be encouraged to know that demand remains strong among investors for good-quality, income-producing real estate. In fact, sale/leaseback transaction volume actually increased in 2008, indicating a flight to quality as investors turned away from speculative deals with “upside” in favor of lower returns with predictable cash flows. Unfortunately for sellers, cap rates are slowly returning to their historic averages, and are now 50 to 100 basis points higher than in the 2007 lows.

What about refinancing? With the demise of the CMBS market, and many banks and insurance companies on the sidelines, the remaining active lenders are being increasingly selective and tightening their underwriting standards. Appraisers are struggling to determine values in the absence of recent comps. Expect your lender to request a loan-to-value ratio of 65% or less with debt coverage ratios of at least 1.25. Many borrowers are opting for short-term floating loans, with the anticipation of obtaining permanent financing in two or three years when the markets (hopefully) will have stabilized.

Many other borrowers will end up renegotiating with their lenders. If their debt is non-CMBS, but rather portfolio debt on the balance sheet of the lender, borrowers may be able to buy the debt at a steep discount, possibly for only a fraction of the outstanding loan balance. This not only improves the borrower’s balance sheet and cash flow, but will free them up to acquire other assets.

The final option for property owners and investors is to do nothing. While this may seem to be the safe alternative, sometimes inaction is risker than action. Many owners who rejected offers last year, for instance, wish they could turn back the clock and accept those terms today. Similarly, sellers refusing to lower their asking prices may be well-advised to drop the price now in order to avoid further valuation declines later this year. For borrowers, taking a proactive approach with your lender may enhance your bottom line. And if you’re a buyer opting to remain on the sidelines, you may miss out on some great buying opportunities.

About Investment Analytics Group
Established in December 2006, Investment Analytics Group (IAG) provides integrated commercial real estate advisory services to investors. Our core services include asset level due diligence, asset management, financial modeling, feasibility studies and other related advisory services.
For more information visit us at www.iagroupllc.com or contact us at 208.846.8476 or info@iagroupllc.com.

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The Commercial Property New’s Dee Stribling wrote an interesting article about how the commercial real estate industry is changing its green movement. During the recent commercial real estate boom, developers and owners had the luxury of deciding how and if they would incorporate green elements into their new buildings. The CPN article argues that the one-time voluntary decision is becoming an industry mandate, driven by LEED and the US Green Building Council.

You can read the full article here.

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The global recession, decline in consumer spending and international trade have contributed to a number of big box retailers closing their doors in the last 18 months. Joining the ranks of Circuit City, companies like Linens ‘N Things, Shoe Pavilion, Mervyns and Tweeter have been shuttering their doors for the better part of a year. Other national retailers, like coffee-powerhouse Starbucks, are scaling back their U.S. chains to conserve cash.

While just a small percentage of the overall commercial real estate vacant space, property owners are finding it difficult to fill big box retail space. With few new chains stepping forward and thriving to expansion level in today’s economy, owners must get creative to fill that space.

Where short-term tenants (like discount bookstores) bring in some income, they will not sustain the overall space’s rent for very long. And subdividing a large retail location into smaller spaces may make sense today, but how will that impact the property’s value when the commercial real estate market recovers?

Unfortunately, there is no clear cut solution. While leasing out a vacant Circuit City location to a political campaign office in the short term may work in one market, it may not be supported in another. Property owners need to look at the industry’s history to find that these vacancies and the current market uncertainty will lead to the birth of new retailers in the future, much like Target and Walmart quickly overtook the market after the loss of Bradlees, Caldor and the pullback of Kmart.

The true challenge is finding a way to make the space profitable in the meantime.

About Investment Analytics Group
Established in December 2006, Investment Analytics Group (IAG) provides integrated commercial real estate advisory services to investors. Our core services include asset level due diligence, asset management, financial modeling, feasibility studies and other related advisory services.
For more information visit us at www.iagroupllc.com or contact us at 208.846.8476 or info@iagroupllc.com.

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Nothing is as simple as it seems, and hiring the right advisory firm is no different. Aside from the obvious requisites such as knowledge, experience, personality, a strong support team, a broad sphere of influence, market savvy, etc., the key to engaging the right firm is defining the relationship in such a fashion that goal alignment is achieved out of the gate. Productive professional services relationships insure that there are no conflicts of interest, and that the advisory firm’s loyalty and fiduciary obligations are to the owner and no other third party. Creating a certainty of execution in this market goes far beyond sales ability.

If you want to know if a commercial real estate project (new or existing) is viable, you need to know whether or not it is positioned, or can be repositioned properly in the market place … Put simply, any property you acquire needs to have a strategic competitive advantage in the market. Put even more simply, it has been our experience that when a sponsor will make the decision to engage a qualified commercial real estate advisory firm at the time a project is first being conceptualized, it is the single best form of insurance an owner can purchase.

Commercial real estate should be approached like any other business in that you need create a clear vision, a sound strategy, and demand precise execution to come out on top. Examine any successful commercial real estate investor and to the one you’ll find that they have surrounded themselves with professional advisers whose sound counsel they rely upon to avoid the ever increasing number of mistakes that can be made in this market.

About Investment Analytics Group
Established in December 2006, Investment Analytics Group (IAG) provides integrated commercial real estate advisory services to investors. Our core services include asset level due diligence, asset management, financial modeling, feasibility studies and other related advisory services.
For more information visit us at www.iagroupllc.com or contact us at 208.846.8476 or info@iagroupllc.com.

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If you answered yes to that question then you should call Investment Analytics Group (IAG) immediately. National distressed commercial real estate totaled $97.4 billion in early June, including foreclosures, lender-owned properties and those headed in that direction, according to a new report from Delta Associates.

Distressed commercial real estate volume has doubled every three months since December 2008 with retail properties representing the largest segment in June, at $29.7 billion. Commercial mortgages had a 3.2 percent delinquency rate in the first quarter, up from 1.8 percent in the first quarter of 2008.

So how can IAG help? Investment Analytics Group (IAG) sees the big picture and we are your partner. IAG can help maximize the overall performance of properties by bringing knowledge and experience in property management, leasing, lease administration, acquisitions, and due diligence, enabling us to develop and implement ownership solutions to achieve the objectives in operating and leasing property.

Established in December 2006, Investment Analytics Group (IAG) provides integrated commercial real estate advisory services to investors. Our core services include asset level due diligence, asset management, financial modeling, feasibility studies and other related advisory services.
For more information visit us at www.iagroupllc.com or contact us at 208.846.8476 or info@iagroupllc.com.

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After several boom years, Utah’s commercial real estate sector is slowing as companies of all sizes, stung by recession, put off expansion plans and close locations. But as with most segments of the state’s economy, conditions are far better than in many other areas of the country plagued by empty storefronts and buildings.

“In spite of what’s going on nationally, Utah really continues to be a bright spot,” said Brandon Fugal, director of corporate services with Coldwell Banker Commercial in Salt Lake City.

Take retail. While many “big-box” retailers, such as Target and JC Penney, are putting off new stores and many malls are on hold, a number of smaller retail and restaurant players continue to set up shop and expand in Utah. They may not have the cachet of IKEA or Cabela’s, but they are creating jobs and filling space that would otherwise remain vacant or unbuilt.

Smashburger, for example, plans to enter Utah with two restaurants: at 1028 E. 2100 South in Salt Lake City and 3513 S. 2700 West in West Valley City. Over the next two years, the chain plans to add eight more. Another popular burger joint, In-N-Out Burger, which has one location in southern Utah, is expanding into the Wasatch Front.

Despite leaner times and tighter credit, numerous small businesses continue to open and expand. In the Daybreak community in South Jordan, seven locally owned businesses are opening this summer in the SoDa Row Village Center. The 68,000-square-foot center includes expanding companies like Black Diamond Gymnastics and Sport Centers, Tio’s Mexican Restaurant and Classic Cleaners. Others, such as Oopsie Daisy, a children’s boutique, and Guy’s Barbershop, are debuting in the development.

The downturn also has affected Utah’s industrial market, which includes buildings used for manufacturing, warehousing and distribution. Earlier this year, several large operators, including Lozier Corp., announced they were cutting back or shutting down, vacating nearly 900,000 square feet of industrial space.

Lozier, which makes fixtures for stores, such as display shelving, said it will close its 500,000-square-foot Cedar City facility by August, laying off 82 employees. The company has been hurt by the lack of retail expansion.

Compensating for these cutbacks are some high-profile, large-scale expansions. Detergent maker Sun Products Corp. is leasing a 400,000-square-foot facility in Salt Lake City. Reckitt Benckiser, which manufactures Woolite, Lysol, Electrasol, French’s mustard and other products, is building a nearly 575,000-square-foot facility near Tooele.

Overall, vacancies remain low in the state’s industrial sector, said Jim Sheldon, NAI Utah’s director of industrial.

“Utah is in an enviable position,” he said. “Our industrial market is on more solid ground than other markets.”

The same appears true in the office market, which has been hurt by the downturn but is still expanding. First, the bad news: vacant office in Salt Lake County has increased to a four-year high, according to a report by CB Richard Ellis. It reached 14.2 percent at the end of June, up from 13.5 percent a year earlier. That translates into an estimated 4.2 million square feet of vacant office space, up from 3.9 million square feet.

Yet Utah still attracts some plum office expansions. Online auctioneer eBay Inc., is adding 200 new jobs in Draper, where the company already employes 1,100. Ebay also is building a $334 million computer center in South Jordan. Set to open in 2010, it will employ 50.

Microsoft, the world’s largest computer software company, said last month it will open an office in Lehi, creating 100 good-paying jobs. Another large expansion involves the U.S. Census Bureau, which is taking 130,000 square feet of vacant space at the Discover Card building in Sandy.

“Utah’s very fortunate to have landed these expansions,” said Mike Richmond, an office leasing specialist with Commerce CRG in Salt Lake City.

About Investment Analytics Group
Established in December 2006, Investment Analytics Group (IAG) provides integrated commercial real estate advisory services to investors. Our core services include asset level due diligence, asset management, financial modeling, feasibility studies and other related advisory services.
For more information visit us at www.iagroupllc.com or contact us at 208.846.8476 or info@iagroupllc.com.

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a) Tokyo
b) Hong Kong
c) London
e) New York
d) Moscow

Is that your final answer?
If you guessed Tokyo, Japan then you should give yourself a pat on the back because that is the only prizes we are handing out today.

Tokyo’s Inner Central District has supplanted London’s West End as the world’s most expensive office market, according to a recent survey.

London’s West End, is now the world’s second most expensive office market, followed by Moscow, Hong Kong’s Central Business District or CBD, and Tokyo’s Outer Central District in the report, which tracks office occupancy costs in more than 170 cities around the globe.

Financial centers have been most significantly affected by declining occupier demand and, as one would expect, registered the most material decreases in office rents. In many cases, major global office markets have seen occupancy costs fall by 20 percent or more over the last 12 months. Across the 170 cities as a whole, office occupancy costs fell 2.8 percent over the 12 month period ending March 31, 2009 (on an un-weighted average basis) compared with an increase of 8.0 percent in the 12 month period ending September 30, 2008 Singapore had the largest year over year decrease in occupancy costs with a drop of 34 percent.

Some markets did record increases in costs over the last 12 months but these markets—such as Charlotte (U.S.), Marseille (France) and Perth (Australia)—are very much the exception rather than the rule. Generally, these increases are either due to exceptional local market conditions, such as the completion of a top quality new building in a market where none was available previously, or simply that occupancy costs remain above the level of a year ago despite the fact that they are now falling. Such situations illustrate the uneven way in which the economic downturn is affecting different markets around the globe, according to the report.

Americas
The most expensive office location in the Americas is still New York’s Midtown with occupancy costs of $68 per sq. ft. However, that market’s occupancy costs declined 32 percent–the second steepest decline in the global survey. While occupancy costs in New York’s Midtown are high for North America, it ranked just 21st globally. Boston’s suburban market posted a decrease of nearly 30 percent, putting that market in fourth position in the top decreases chart in the report.

São Paulo (Brazil) posted the Latin American region’s highest occupancy costs at $57 per sq. ft. and is ranked 33rd globally. Latin America has held up better than the rest of the world with only three cities posting small negative growth rates, the worst being Mexico City with a 5.6 percent decrease. Nine markets in North America posted double digit declines.

Asia-Pacific
Tokyo (Inner Central) was the world’s most expensive market with an occupancy cost of $183 per sq. ft. Hong Kong (CBD) was the fourth most expensive global market with occupancy costs of $150 per sq. ft. Tokyo (Outer Central) and Mumbai were the other two Asia-Pacific markets in the top 10 most expensive cities roster.

Singapore, while experiencing the largest drop in occupancy costs, was not alone among Asia-Pacific financial centers in seeing a sharp decline. Hong Kong, Tokyo and Mumbai posted large drops in office occupancy costs. Conversely, Perth had the second fastest growing occupancy cost during the past 12 months with costs rising 22 percent, although it’s important to note that the increase took place in 2008.

Europe
London’s West End was the world’s second most expensive office market at $172 per sq. ft. and Moscow was a close third with occupancy costs at $170 per sq. ft. Dubai, Paris, the City of London and Dublin all were in the top ten most expensive markets.

Twelve cities in the region posted doubled digit declines in office cost. Moscow had the sharpest decline in the region followed closely by Oslo (Norway), while occupancy costs in London’s West End, previously the most expensive market in our report, fell 20 percent. In addition to Marseille, Durban (South Africa) was among the world’s top five markets with occupancy cost growing by 18 percent during the past 12 months.

So why is this information important to Investment Analytics Group and our future clients? At IAG, our team is not new to the commercial real estate business. With combined experience in managing and operating commercial real estate exceeding 65 years, the IAG team comprises decades of relevant experience including the management of tenant-in-common investments, land assets, and development product. The IAG team includes personnel with a 25-year history in banking and finance with specific, relevant focus on commercial assets and development lending. Additionally, we have lender workout experience both on behalf of lenders and borrowers.

As Asset Managers, IAG can effectively manage assets in any geographic location across the country, and does so for its clients today. Investment Analytics Group is committed to providing commercial real estate owners consistent communication, transparency in all of the services and functions we perform, and access to all asset level information, providing round the clock access to all members of our team including IAG’s Principals.

IAG will work side-by-side with legal counsel in this current state of turmoil to determine where property cash reserves have gone and ensure property tax, insurance, and relevant lease obligations are protected; provide workout strategies and options in addressing LLC entities; maintain your investment’s 1031 Exchange status; ensure any applicable loan maintains a “performing” status.

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Whether you are engaged in a transaction of a single asset or an entire portfolio, Investment Analytics Group’s (IAG) experienced team can provide you with great resources including strong financial, accounting and legal backgrounds. Investment Analytics Group (IAG) will also ensure that financial records reconcile with historical performance and projections. Investment Analytics Group provides the following services as well:
• Audit operating statements and reconcile tenant billings to lease terms
• Analyze collection issues
• Conduct capital expenditure analysis
• Review expense trends and adjust for deferred maintenance
• Perform complete lease file review and default analysis

About Investment Analytics Group
Established in December 2006, Investment Analytics Group (IAG) provides integrated commercial real estate advisory services to investors. Our core services include asset level due diligence, asset management, financial modeling, feasibility studies and other related advisory services.
For more information visit us at www.iagroupllc.com or contact us at 208.846.8476 or info@iagroupllc.com.

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