Monday, October 20, 2014

Goodyear auto repair shop uptown closes

When I went to get my routine oil change at the Goodyear auto repair shop uptown this morning, I discovered some unexpected breaking news: the repair shop, at Stonewall and Tryon streets, has closed down.

According to the mechanic who walked up before I could exit the vehicle, the shop closed for good on Friday. The parking lot, normally full of cars left by busy uptown office workers like myself, was half-empty. Big oil barrels sat in one of the empty repair bays -- part, I supposed, of the process of tearing down and cleaning up the site. “We are closing that store,” Goodyear spokesman Jim Davis confirmed to me later. “It’s a difficult decision, but what’s going on there is it’s been an unprofitable store and we have an expiring lease.”

Photo by Mark Hames
The employees will scatter to other Goodyear stores, he said, but Goodyear will no longer have a shop uptown. Bad news for a lot of uptown workers, especially on the south end of Tryon, who enjoyed the convenience of dropping their car off, walking to work and just picking it up fixed in the afternoon at quitting time.

Ostensibly, the shop's closing helps set the stage for the 27-story Tryon Place mixed-use development Crescent Communities plans to build on the three-acre site. Crescent's plans for the site include office, retail and hotel components, but the company has said it won't announce a start date for construction until it lands an anchor tenant. I'll be checking in with them, and will update this post when I hear more.

Friday, October 17, 2014

Rising demand pushing Charlotte office rental rates to post-recession highs

Rental rates for office space in Charlotte have risen to their highest point in more than a decade, according to new third quarter figures from real estate firm JLL.

With the economy rebounding and employment gains accelerating, average direct asking rents have risen to $22.32 per square foot, according to JLL. The company said office rents haven't been that high in Charlotte since it started tracking the figure in 2000. (The figures cover Class A and Class B office space over 15,000 square feet).

What's pushing prices up? Simple supply and demand, says Charlotte broker Chase Monroe, JLL's market director for the Carolinas. "When the supply decreases, the demand increases, which allows landlords to increase rental rates," he said. According to the company's third quarter report on the Charlotte office market, there's just one block of office space greater than 200,000 square feet available. That means for companies looking to expand, it's becoming cost-effective to just build new rather than rent existing space, Monroe said.

He pointed to recent examples: fast-growing software firm AvidXchange, which announced last month that it is building a four-story, 115,000-square-foot headquarters building at the N.C. Music Factory; and Bubble Wrap maker Sealed Air, which announced this summer that it is moving its headquarters from New Jersey to Charlotte and spending at least $58 million on a new building somewhere in the city.

Charlotte Center City Partners CEO Michael Smith has been banging the drum for a while now about the lack of large blocks of available office space in the city. JLL's latest figures seem to support that contention, putting the Charlotte market's total vacancy rate at 12.3 percent -- the lowest point in at least nine years. It could mean Charlotte's a tough sell for companies looking to relocate quickly.

"Companies that are looking at Charlotte will sometimes cross Charlotte off the map because there isn't adequate space available for them to relocate to now," Monroe said. "Those are the ones that are looking to do something in 12 months. The ones that are looking at a little bit longer term, and Sealed Air is a good example of that, they will look at coming in and building a facility."

To fill its local space needs while it works on its new building, Sealed Air signed a lease early this month for 70,000 square feet in the Forest Park office complex in southwest Charlotte. John Culbertson of Cardinal Real Estate Partners, one of the brokers involved in that deal, said even though construction costs are rising, build-to-suit is becoming a more viable option for companies. That's at least in part because developers can erect buildings faster now than they could a decade or so ago. "The office developers are looking hard at pricing right now," he said, "and dusting off plans they probably haven't looked at for a decade."

We've seen more developers announcing plans for new office towers. There's three on the drawing board for South Tryon Street alone (1000 South Tryon, 300 South Tryon and Tryon Place, at Stonewall Street). Nearby, Portman Holdings wants to build a 15-story tower on top of the Westin Hotel's parking garage. And in SouthPark, Lincoln Harris has its twin 10-story Capitol Towers project well underway.  (Lincoln Harris was one of the few developers to start construction without an anchor tenant lined up. All of the others say they won't move dirt until they get that main tenant on board).

So how long will the office space crunch last? "For the next two years, for sure," Monroe said, "until the new product is delivered to the market -- assuming that we're going to continue to grow at the rates we've been continuing to grow over the last couple of years."




Wednesday, October 15, 2014

New Hilton hotel planned for First Ward district

Hilton hotels announced today that it is launching a new hotel brand called Canopy by Hilton, and a representative for Levine Properties says one of the first of the new hotels will land in the First Ward district the real estate firm is developing in uptown Charlotte.

Canopy San Diego

Levine Properties broke ground last month for the public park that marks the start of a 12- to 15-year development plan that hopes to bring as much as $1 billion in new offices, shops, residences and hotels to a nine-block area around UNC Charlotte's Center City building. Levine Properties has several possible hotel sites in the area; one sketch of its plan for the district shows a 175- to 200-room hotel going in at Caldwell and Seventh streets, near the new park. Levine spokeswoman Colleen Brannan said it's too early to say where exactly the new hotel would go.

Construction could start in 2016, she said, and would take two to three years to complete. Hilton says it hopes to open the first of the new Canopy hotels in 2015. It has signed letters of intent in Charlotte and 10 other cities, from London to Portland.

Levine Properties President Daniel Levine said the Canopy brand's emphasis on building in attractive neighborhoods and showcasing local food, art and design makes it a good fit for the First Ward project, which he has said he envisions as Charlotte's answer to New York's Greenwich Village. "Hilton's selection of Charlotte as one of only 11 markets for its new lifestyle brand ... is further evidence that the Queen City is a national draw," he said in a statement. "Levine Properties is looking forward to delivering more hotel rooms to the center city."


Monday, October 13, 2014

Construction costs rising in Charlotte

The cranes sprouting all over town offer ample evidence of what's becoming more and more obvious by the month: the slow-moving economic recovery is finally generating enough steam to lift the construction sector. Building permit applications are running higher than last year, especially in the hot multifamily sector. And employment in the labor sector that includes construction is up nearly 7 percent from last year in the Charlotte region.

But Stephen Keckeis, a vice president in Messer Construction Co.'s Charlotte office, said even such welcome growth can bring a few complications.  He pointed to the Cinncinnati-based company's recent market condition report, which takes the business temperature of the market in Charlotte and eight other cities where it operates.

It found that construction costs from May 2013 to this past May rose by 2 percent, higher than any other city. Keckeis said that's a function of growing construction activity. As more firms need more raw materials for their growing number of projects, the prices rise, buoyed by the increased demand.

Why are costs rising faster in Charlotte than the other cities? Keckeis responded by asking and answering a question of his own: "Where's all the growth in the country? Here, and in Texas."

Messer's index showed prices for lumber and softwood, gypsum products and fabricated structural steel up more than 7 percent.

Friday, October 10, 2014

400 South Tryon office tower sold to Trinity Capital Advisors, DRA Advisors

Just days after announcing that it is building a 14-story office tower at Morehead and Tryon streets, Trinity Capital Advisors announced Friday that it has bought the 33-story 400 South Tryon office tower in a partnership with a New York-based investment group.


Trinity Capital bought the 584,000-square-foot building in partnership with DRA Advisors. The tower is 92 percent occupied, mostly by Duke Energy. "This is a terrific acquisition for Trinity and DRA," said Gary Chesson, founding partner at Trinity Capital, citing the accelerating growth along South Tryon and near the BB&T BallPark.

Trinity Partners has been hired to lease and manage the building. Rob Cochran, Bill Collins, Jud Ryan and Craig Evans with Cassidy Turley brokered the sale on behalf of the undisclosed seller. The sales price was also undisclosed.

The tower joins other uptown landmarks that have changed hands in recent years. One Wells Fargo Center, the Hearst Tower and the Fifth Third Center were all sold in 2012. The 19-story 525 N. Tryon St. tower, owned by Parkway Properties, is currently listed for sale by commercial real estate firm HFF.


Read more here: http://www.charlotteobserver.com/2014/10/09/5231137/525-n-tryon-street-office-tower.html#.VDgmGvldVTJ#storylink=cpy

Wednesday, October 1, 2014

Help improve Charlotte, win a share of $5 million

If you've got ideas for how to make Charlotte a more vibrant place to live and work, the John S. and James L. Knight Foundation wants to hear from you. The foundation, which promotes civic engagement and quality journalism in 26 cities, today is kicking off its first Knight Cities Challenge. The foundation is seeking applications and ideas at KnightCities.org, with winners receiving a share of $5 million in prize money.

The challenge comes with two rules: submissions can come from anywhere, but they must benefit Charlotte or one of the other 25 Knight communities. And the idea should focus on one or more of these drivers of city success: attracting and keeping talented people, creating economic prospects and breaking down divides, and spurring civic involvement.

Anybody can throw their idea in the ring, the foundation says -- activists, artists, city planners, students, educators, architects, neighbors. The deadline closes Nov. 14 at 5 p.m.

So if you've got a Big Idea, here's your chance. Care to give your idea (or your gripe) a test run? Hit us in the comments.

Tuesday, September 23, 2014

Money magazine ranks Charlotte No. 1 Big-City Bargain

If you're looking to move and want a city that will give you good housing and cost-of-living value, Money magazine highly recommends Charlotte. Its newly released 2014 Best Places to Live rankings list has Charlotte pegged as the Best Big-City Bargain in the country.

The magazine ranked Charlotte No. 1 in that category. Phoenix, Fort Worth, Tx., Boston and Chicago rounded out the top five. The magazine created the list by studying metropolitan areas with more than 500,000 in population, and by analyzing housing affordability, economic strength, home price forecasts and livabililty data. The researchers also, in each city, singled out several "promising, well-priced" neighborhoods.

In Charlotte, they pointed out Plaza Midwood, calling it "an interesting mix of the gritty and the pretty" for its mix of tattoo parlors and antiques shops. Mountain Island Lake also earned a mention for being what local Realtor Francine Dupont called "a thrifty alternative to Ballantyne."

Charlotte didn't make the overall top 50 best places to live list, though. Cary came in 19th, Chapel Hill 36th.