Waiting for Industrial Foreclosures-Low Interest Rates

Just a quick note today on the state of the Orange County Industrial Real Estate "for sale" market. Interest rates are near record lows, yet there were only a dozen sales in the first quarter. Most businesses are simply renewing leases, or staying put in owner-occupied buildings. Many of those business owners who are considering a purchase are waiting for significant price reductions, similar to the 50% reductions we have seen in many residential markets. As of this date, many would-be Sellers have reduced their sale prices, but apparently not enough to increase demand from the buyers.

Some experts are predicting a substantial supply of foreclosures in the industrial real estate market later this year. I believe that there will be some good opportunities, and several developers are already saying "no reasonable offer will be refused" on their recent construction and condo conversions. The Inland Empire has a much higher vacancy rate, so expect dramatic price and lease rate reductions in those areas.

Whether you are in the market for a building to occupy, or for investment-or you are considering the sale or lease of your building, call me at 949-646-2727 for an accurate appraisal considering competition and recent sales/leases.

Warren Buffet checks in with Colossal Losses

Even the "Oracle of Omaha" hasn't been immune to our economic changes. Read his annual letter to shareholders http://www.berkshirehathaway.com/letters/2008ltr.pdf

Industrial Brokers is seeing a sharp slowdown in Orange County industrial transaction activity. Landlords are busy with tenant retention efforts, and buyers are awaiting price drops similar to those in the local residential market. There haven't been enough sales this year to guage who is winning that tug-of-war, but we suspect that it will be the buyers gaining advantage soon.

Call me today at 949-646-2727, if you have any questions about your Orange County industrial property or lease.

Industrial Market Mid-Summer update

The Orange County industrial market vacancy has ticked up from around 3% to 4.5% in the past few months, as the economy stalls over consumer spending declines. This is still a historically tight market, and many companies are finding there may be only one or two buildings which suit their needs here in the O.C.

Leasing activity has picked up in the past few weeks, but sales have slowed down with buyers hoping for a mirror of the local residential price reductions. INDUSTRIAL BROKERS represents two quality buildings for lease: 27,000 SF at 3545 Cadillac, Costa Mesa and 53,264 SF at 20 Icon, Foothill Ranch. We are also aware of some great unlisted opportunities including a 75,000 SF Anaheim Stadium building which can be purchased at a below market price.
If you are looking for a building to lease email me at greg@ozimec.com or call directly at 949-646-2727.

California Commercial Loans Are in Great Shape

The California Mortgage Bankers Association reported today that only 4 commercial loans in the entire state have been reported as more than 30 days delinquent. Furthermore, not one of those 4 delinquent loans is for an industrial property.

Additionally, the interest rate for the SBA 504 loan program has dropped below 6% fixed for 20-25 years. These loans are available to borrowers who plan to occupy at least 51% of the building they purchase, and have a low down payment requirement of 10%.

If you have any questions about the value of your property, or available properties, call Greg Ozimec today at 949-646-2727 at Industrial Brokers in Newport Beach.

2008: The Year Ahead-Low Interest Rates & Low Vacancy

January 21, 2008
INDUSTRIAL BROKERS
949-646-2727 PHONE

An interesting dichotomy has developed in Orange County commercial real estate. Industrial and Office Real Estate are heading in different directions. Industrial vacancy is around 4%, maintaining record high occupancy. On the other hand, office vacancy is rising to the 15%+ range. While this rising office vacancy is a concern, it is currently affecting mainly large buildings which housed the shrinking mortgage industry. Large floor plate, Class A buildings will likely see a drop in lease rates. The under 20,000 SF market will remain stronger, especially office buildings for sale to Orange County entrepreneur/owner-occupants.

Industrial real estate is experiencing its best days ever. Occupancy is high, lease rates are rising, and interest rates have fallen to 6% for SBA loans. This presents an incredible opportunity, even if you believe values may dip from these record highs. You can fix the largest component of your company's monthly occupancy cost for 20-25 years! When we go through inflationary times, and periods of high appreciation, your payment will remain level!

If you are interested in the value of your building on a sale or lease basis, or need to review options for relocation of your company, call me today at 949-646-2727.

Get your 6.5% fixed rate loan now

When Marie Osmond's doll company, Charisma Brands, was seeking new headquarters in Irvine Spectrum, Charisma's President-who is also a C.P.A.-reviewed several thorough surveys of the inventory of available buildings for sale or lease. It became clear that lease rates had more than doubled in the 10 years since Charisma's last relocation. While sale prices had a similar rise, the availability of 85-90% loan-to-value SBA loans at fixed rates near 6.5% gave the clear advantage to purchase over a lease.

Many companies considering relocation have a simplified choice these days, because vacancy is so low in Orange County. There may be only a couple buildings for sale or lease in any given market and size range. INDUSTRIAL BROKERS is here to assist you in making the right decision for your situation. We have a network of experienced commerical loan brokers, tenant improvement contractors and technology providers to assemble all the data needed to optimize your company's relocation and return on investment. For a consultation in the New Year call Greg Ozimec at 949-646-2727.

The Advantages of "Build to Suit"

Your company is growing, and a move to accomodate your success is in the works. If you are here in Orange County, CA, there are few opportunities for a ground up "build to suit" to meet your specifications. Industrial Brokers represents one of the last remaining industrial build-to-suit opportunities in Orange County. Rather than trying to make your company's facility requirement fit the available building inventory, you can customize the building in the pre-construction planning stages.

Our client, Foothill Land, LLC, owns a uniquely situated 7.5 acre lot at 20 Icon, Foothill Ranch. It is currently improved with a modern 103,000 SF highly improved industrial building. The adjacent planned 53,264 SF building will overlook the Foothill Transportation corridor. The eventual tenant can customize the planned 9,600 SF office area-with a generous two-story window line wrapping the southwest corner-or expand the office to 17,000 SF. We also have the capability to engineer the foundation for specialized plumbing or heavy machinery, air-condition the warehouse-manufacturing area, or customize the electrical power.

For further information, call 949-646-2727 or email greg@ozimec.com