Real Estate News, Views & Schmooze!
Real Estate News
Finding the Right Commercial Real Estate Can Make or Break Your Dream
Jan 8th
Form a Life-Long Relationship With an Exclusive Tenant Client Advisor and You Will Have an Edge.
By Steven Ladin
Special to New Business Minnesota
Every day in the State of Minnesota a multitude of people get laid off, become tired of working for someone else, or have a great new idea. In fact, there are on average 44,000 people every year, year after year, who start a business in Minnesota.
Since you are one of those 44,000 with a dream of your own, you have many decisions to make when setting up your office. As a commercial real estate broker, every day I work with businesses – new and old – that are looking for the right property, in the right location, at the right price.
The good news is that the right property – one that fits your needs and budget – is out there. The bad news is that finding it on your own is extremely difficult and time consuming.
The key to securing the best deal is to work with someone who knows the market inside and out, and is cognizant of special situations, emerging commercial real estate trends and the range of deals that are being done. Also, just as important, working with someone who looks out for you and your business needs. That person is an Exclusive Tenant Client Advisor. If you are looking for property to lease or buy for an immediate need or just planning your budget for a future move, I highly recommend you consider using one.
The traditional way to find commercial property on your own is to drive around the area where you’d like your business to call home; spot as many “For Lease” or “For Sale” signs as you can and write down the phone numbers. This is pretty scattershot.
When you start calling off your list, you most likely will speak to the building owner or the owner’s representative. Their role is to represent their property. They usually are not willing to tell you that a building nearby actually might be a better fit.
Just remember whose interest they are looking out for. They will work very hard to get you into the buildings they represent. There isn’t any incentive for them to do price comparisons for you or to recommend options they don’t represent.
You are on your own.
Another traditional route is to use a commercial brokerage firm that represents multiple properties and multiple owners. They bring tenants or buyers to the table and negotiate a transaction in the best interest of the owner.
Most brokers negotiate from both sides of the table, claiming to impartially represent both an owner and a tenant or buyer in the same transaction. The pressure of retaining major listing arrangements for local and national accounts often influences the outcome of transactions within a firm.
Again, you are on your own.
I don’t believe it’s possible to negotiate from both sides of the table. I believe you are best served by exclusive representation – someone who represents you.
Finding an Exclusive Tenant Client Advisor can save you both time and money. They know business and commercial real estate and are skilled negotiation specialists.
They will analyze your specific business needs and occupancy requirements, identify and evaluate the appropriate options and facilitate your lease or purchase negotiations for you. Just like a residential real estate transaction, typically there is not any cost to the tenant for this representation.
Even when you do find the right space on your own or with a broker, you will wonder if you have negotiated the right price. An Exclusive Tenant Client Advisor will research properties, arrange showings and assure that you lease or buy your property at the best rate.
Research has shown that tenants who utilize an Exclusive Tenant Client Advisor can save as much as 10 percent to 40 percent on their lease or purchased transactions.
The relationship you form with your Exclusive Tenant Client Advisor will also assist you in other ways in setting up your office. They can offer professional referrals for phone service, IT services, furniture, office supplies, accounting, legal services, insurance, and much more. A good Exclusive Tenant Client Advisor has already built strong relationships with many value-added service providers they know and trust.
You’ve probably heard this a lot since you started your business: work with professionals and have a team of trusted advisors. The reason people tell you this, is because it’s true. It’s not any different when it comes to leasing or buying office space.
Make sure you have someone in your corner…office.
Steven Ladin, CEO and owner of Ladin Ventures, LLC, has extensive real estate experience in the Twin Cities market and has a staff of Exclusive Tenant and Buyer Client Advisors. Previously, Ladin was Managing Partner with Miller Management Company. Ladin is a member of the real estate industry’s top professional associations and organizations including the National Association of Realtors Commercial Alliance, Minnesota Association of Realtors, Minneapolis Area Association of Realtors and the Minnesota Commercial Association of Realtors. He can be reached at (763)331-3010, sladin@ladinventures.com or on Twitter – @LadinVentures. www.LadinVentures.com.
Ma-and-Pa Focused Ladin Ventures Moves To Grow
Dec 4th
Photo taken by Nancy Kuehn | Minneapolis/St. Paul Business Journal
Ma-and-Pa Focused Ladin Ventures Moves To Grow
Minneapolis / St. Paul Business Journal – by Sam Black
Steve Ladin wants to expand his real estate brokerage business 500 square feet at a time.
Ladin, CEO and owner of Ladin Ventures, has turned the focus of his three-year-old firm primarily to representing mom-and-pop businesses that fly under the radar of most commercial real estate firms.
On Monday, Ladin moved his five-employee company from a small office in St. Louis Park into a strip center next to a Famous Dave’s restaurant in Plymouth.
Ladin said his company targets day-care providers, hair salons, restaurants and other small companies that can benefit from having a real estate advocate. That strategy has potential because the small-business market is expanding as laid off workers start new companies, he said. “We see this huge upswing in the small-business realm. In Minnesota, 44,000 new businesses start every year.”
Small tenants and new entrepreneurs tend to rely too heavily on finding commercial real estate by calling phone numbers on signs in front of buildings, Ladin said, adding that it’s often difficult for small businesses to find a broker.
Ladin wants his company to be approachable by small businesses. “We’re not going to wear suits or be ostentatious.”
Ladin’s real estate career began in 2000 when he joined Miller Management Co., a St. Louis Park-based apartment operator that he and two partners sold in 2006.
He spent his first few years at Ladin Ventures focusing on the multifamily market, helping buy and sell apartment buildings. When that market tailed off this year, Ladin began to focus on the needs of small businesses.
Ladin said he has about 20 small clients, and most deals he works on are for between 500 and 10,000 square feet.
He’s recruited Jackie Fenske, former vice president of merchandising operations at Fingerhut, to be executive vice president and oversee most day-to-day operations.
Ladin’s goal is to increase the firm’s size to at least 15 advisers and 25 total employees by the end of 2010, then double that in 2011.
Ladin said he received a lot of quality resumes from brokers through ads on Craig’s List. His blog, theschmoozer.net, says that the company is seeking agents who know the market and are enthusiastic about trying new business methods. He indicates the brokers might make more than $80,000 in the first year.
Ladin is heavily involved in social media. He designed his own avatar (above) and has about 950 followers on Twitter.
Ed Hanlon, a commercial real estate broker in the Minnetonka office of Edina Realty Inc. who works with many small companies, said most small businesses can benefit from having their own tenant reps and it seems like Ladin’s business plan has merit.
However, it takes many little deals to equal one big deal, and the little ones often require hand-holding while excited entrepreneurs figure out the realities of paying for real estate.
Ladin Ventures Is Now Hiring!
Oct 7th
We Are Looking For The Right Candidates To Expand Our Company!
Why? We are building something very exciting and now’s your chance to get in on the ground level of this huge Minnesota expansion!
Tired of the traditional commercial real estate brokerage? Do you love real estate, technology, business and helping people? Then, Ladin Ventures is the place for you!
Ladin Ventures, LLC provides high-level expertise in commercial and investment real estate in the state of Minnesota. Our primary focus is our Commercial Corporate Tenant & Buyer Representation Division which provides services for new and growing businesses, as well as, investors.
We are looking for:
Professional Commercial Real Estate Advisors
• Highly Productive And Extremely Organized Commercial Real Estate Agent With Outstanding Professionalism
• Agents Who Live In Minnesota And Understand The Local Commercial Real Estate Market
• Internet Savvy And Demonstrates Efficiency With Marketing Mediums Such As Blogs And Social Media
• Enthusiasm To Learn New Approaches And Become Successful Using These Methods
• This Is Full-Time Employment Only
You will need:
• Laptop, Cell Phone (with PDA/Email/Calendar) And Reliable Transportation
• Active Minnesota State Real Estate License
• Entrepreneur’s Mindset, Ideas, Energetic And A Great Personality
We will be filling these positions quickly. Please email your resume to info@ladinventures.com
Thank you!
- Location: Twin Cities
- Compensation: Realistic $80k+ First year
SmartZip-A Rating System for Real Estate Investors
Jun 23rd
Features More than 12 Million Investment-Rated Properties, Including Foreclosures, in
Home prices and mortgage rates are at historic lows and, in February, Fannie Mae announced a new policy to allow qualified investors and second home buyers to obtain up to 10 loans, replacing the previous four loan limit. “There is immense pent-up demand from investors looking to capitalize on this opportunity,” said Tom Glassanos, president and CEO of SmartZip. “With today’s announcement, SmartZip brings transparency to the best investment values in two of the top markets,
SmartZip Score is the first quantitative property rating to offer a risk-adjusted assessment of the investment potential of residential real estate. SmartZip Score applies proven stock and bond rating analytics to the most comprehensive base of real estate investment attributes ever assembled. On a 1-100 scale, SmartZip Score gives investors and homebuyers an easy and intuitive way to assess if a property is really worth buying. Properties are rated two ways: a “growth” score for risk-tolerant investors seeking above-average capital appreciation and an “income” score for risk-averse investors looking for consistent monthly cash flow.
SmartZip.com provides a full range of tools and features, making it the first one-stop online destination for real estate investment. Using visual, color-coded “heat maps,” and ratings-based market screening and home search tools, users can research and compare markets, then find and confirm top-rated for-sale and foreclosure properties, all based on investor criteria such as SmartZip Score, cash flow, appreciation, school ratings, and more.
SmartZip offers a variety of benefits to a range of audiences:
- SmartZip for Investors
- Identifies the best markets and best properties;
- Computes rental income and expenses to expect;
- Projects long-term cash flow and appreciation; and
- Assesses how to maximize after-tax returns.
- Identifies the best markets and best properties;
- SmartZip for Sellers and Listing Agents
- Calculates best price for rapid sale;
- Markets properties to a national buyer pool;
- Differentiates the value of properties; and
- Instills confidence in the value of a transaction.
- Calculates best price for rapid sale;
- SmartZip for Lenders
- Determines present and future collateral value of a property;
- Assesses the size of potential loss in foreclosure; and
- Simplifies the decision to foreclose or modify a loan.
- Determines present and future collateral value of a property;
“Online real estate sites are focused on what a home costs and not on what it’s really worth,” said Avi Gupta, vice president of research and marketing at SmartZip. “SmartZip Score is an independent, disciplined methodology that gets to the fundamentals of property value. In a time of uncertainty, fundamentals, not price, count most.”
About SmartZip, Inc.
SmartZip is the leading provider of independent, analytics-based ratings and research for real estate investment. SmartZip is used by investors and homebuyers looking to easily rate, compare and confirm the best properties to buy. The SmartZip Score™ is the first and only quantitative rating offering a risk-adjusted assessment of the investment potential of residential properties. SmartZip Score applies proven stock and bond rating analytics to the most comprehensive base of real estate investment attributes ever assembled. SmartZip is a privately held, venture backed corporation headquartered in
SmartZip and SmartZip Score are trademarks of SmartZip, Inc.
National Association of Realtor’s Commercial Market Survey
Apr 6th
As expected in 2009, the state of Commercial Real Estate has already taken it’s share of uppercuts in this ever-evolving prize fight. Although we’re starting to see a some daylight in the Residental Real Estate sectors, the majority of the Commercial Real Estate sectors are poised to see significant free fall in the month’s ahead. Fasten your seat belt!
Here is a detailed survey from The National Association of Realtor’s Commercial Alliance which was compiled in Febuary:
Twin Cities Apartment Market Update
Feb 13th
By Keith Collins
Although healthy fundamentals existed market-wide for most of 2008,
a noticeable slowdown occurred in the fourth quarter. Apartment
rents declined 1.7% in the 4th quarter resulting in a 0.7% net gain
for the year. Infill locations continue to be the best performer as
evidenced by the city of Minneapolis 4.4% rent growth in 2008.
The current apartment vacancy rate remains at a healthy 4.9%
as of the 4th quarter.
The Twin Cities lost 43,000 jobs in the 13 county metro area
(all in the second half of the year) during 2008. While the Twin
Cities rental housing sector has been the benefactor of the “for sale”
housing fall-out, where the median home sale price decreased 13%
to $195,000 during the past 12 months, our market cannot sustain
continued job losses without negatively impacting rents. Rents are
likely to remain flat for Class A product this year while Class B and
C product may see rent increases in the 1% – 1.5% range.
Approximately 1,000 units were delivered in 2008 (down 30% from
planned) and several proposed projects were tabled due to the
challenging debt and equity markets.
Sales volume for properties valued over $5 million in 2008 totaled
$312 million, down from $431 million in 2007. The remaining
apartment REITs (AIMCO and EQR) continued to sell-off their
assets. Principal Global Investors, a life insurance company,
and Cornerstone Real Estate Advisors, a pension fund advisor,
selectively sold as well.
Strong local ownership has stepped in for the institutional buyer.
Many investors, both local and national, look at the Minneapolis-
St. Paul market as a safe haven during these difficult economic times.
And although return parameters have lifted during the past 3-4 months
(cap rates for Class A currently 6.5% -7%), the stability and diversity
of the local economy and current property fundamentals have so far
prevented capitalization rates from rising on par with other large
metropolitan communities throughout the U.S. Investors are currently
targeting cash-on-cash returns in the 8% – 10% range.
It is clear that 2009 will be a challenging year, but after a 15% drop in
pricing in late 2008, a lack of new product coming to market, the
widespread acceptance of rental housing, and the benefit of a diverse
economic base, the Minneapolis-St. Paul market is well positioned to
weather the current recession.
Gulp!…Uptown Apartments Sell For Upsize Price
Sep 18th
Down market, Uptown price
by Burl Gilyard
South Minneapolis apartments sell for $30 million, perhaps a result of ‘pent-up demand’
By all accounts, the investment market for commercial real estate is slow.
But the recent sale of the Uptown City Apartments project in south Minneapolis suggests a strong investor appetite for solid multifamily properties.
Dallas-based Invesco Real Estate paid $30.1 million for Uptown City Apartments, a robust price that works out to just shy of $185,000 per apartment unit. The seller was Farmington Hills, Mich.-based Village Green Companies and its partner in the development, Hartford, Conn.-based Cornerstone Real Estate Advisers, LLC, an arm of the Massachusetts Mutual Life Insurance Co.
The deal closed on September 2.
“We had more than 70 confidentiality agreements returned. We had a good and solid shortlist of buyers,” said Gina Dingman of Colliers Turley Martin Tucker, who brokered the sale of Uptown City Apartments with her colleagues James McCaffrey and Julie Lux.
“I think there’s been so little property come on the market in the Twin Cities that there’s a pent-up demand here. People are looking for quality investments in good locations,” Dingman said.
Uptown City Apartments is actually two separate buildings that stand a few blocks apart at 714 and 1220 West Lake Street, respectively, and offers a combined 163 apartments.
Dingman said Uptown City Apartments was 98 percent leased at the time the deal closed. The development includes 222 enclosed parking spaces and some retail space.
Dingman declined to discuss or comment on the sale price, which surfaced through public records.
Village Green Companies started the recent local trend of developing new Class A apartments with Uptown City Apartments in 2003.
Andrea Roebker, a spokeswoman for Village Green Companies, said that Village Green is typically a long-term owner of its apartments. But in this case, she noted, the firm’s joint venture partner had a right to pursue a sale under the terms of their contract. Village Green’s partner in the project was
Cornerstone Real Estate Advisers, LLC, an arm of the Massachusetts Mutual Life Insurance Company.
Abe Appert, an apartment broker in the local office of CB Richard Ellis, said it’s been a quiet year so far for apartment sales, with only three sizable deals closing since the beginning of the year.
But he expects more deals before the end of the year. Appert said 10 local apartment buildings are currently on the market for sale.
“The second half of the year should be busier for us as well as the entire market,” Appert said. “There is a lot of new capital chasing apartments in the Twin Cities today.”
The Uptown City deal marks the second large local apartment deal to close within the last month, according to local property sales records.
The Boston-based Intercontinental Real Estate Corp. bought the 353-unit International Village in Bloomington for $30.1 million, in a deal that closed on August 12. The property was 98 percent full. Appert is part of the team at CB Richard Ellis that brokered that sale.
The pricing on that deal works out to roughly $85,000 per unit. In contrast to Uptown City Apartments, the International Village building dates to 1968.
Earlier this year, Seattle-based Olympic Investors paid $24 million for The Cosmopolitan, a 255-unit building in the Lowertown area of downtown St. Paul. That deal closed in January.
Village Green still has interests in 6 local apartments. The company’s latest project, the 213-unit Eitel Building City Apartments, opened in January near Loring Park in Minneapolis.
“Eitel has performed very well. I think we’ll be at 95 percent occupancy at the end of the month,” Roebker said.
Village Green also plans to develop the 175-unit Mill District City Apartments in downtown Minneapolis along Washington Avenue near the Guthrie Theater on which another developer once planned condos. Construction is slated to start this winter.
Dingman said that apartment investors see the Twin Cities apartment market as stable, with lower vacancy than other cities.
“Our market is very stable,” Dingman said. “There’s definitely a demand for multifamily in the market.”
U of Minnesota’s Dinkytown To Get Some New Digs
Sep 16th
New Dinkytown Apartment Complex Deal Finalized
By Paul Groessel Twin Cities Business
The Dinkydome is getting hitched. Property sales to Doran Development were finalized, and renovations of the 90-year-old building, along with construction of a new 12-story apartment complex, named Sydney Hall, will begin immediately.
The renovation of the University of Minnesota landmark will take two years, in time with the intended occupancy date of July 2010 for the complex’s 198 apartment units and ground-floor retail units. Twenty-three surface parking spaces and 192 underground spaces will also be constructed.
From its connection to the iconic Dinkydome, the new Sydney Hall will extend to the northeast corner of Fifteenth Avenue and Fourth Street Southeast, and the former university parking lot on Fourth Street.
With a range of floor plans, from studio apartments to four-bedroom units, the new complex “will be the premier student housing project in the Midwest,” said founder and chief manager of Doran Development, Kelly Doran, in a press release.
The coordination between Doran Companies, Dinkydome tenants, the university and the City of Minneapolis, “took a little longer to put together,” Doran said, “but it was worth it.”