COLLIERS INSTITUTIONAL CAPITAL MARKETS
WESTERN REGION Q1 2019
Scroll down
Go Fullscreen
Capital Trends
BID SHEETS ARE CASE BY CASE
HEALTHIEST TRADING ENVIRONMENT SINCE 2015
BIGGER IS BETTER
DECELERATION OF ASIAN & EUROPEAN CAPITAL FLOWS
TECHNOLOGY EXPOSURE A “MUST” IN A PORTFOLIO
RAIL SERVED/TOD THESIS FAVORED
DEFENSIVE PLAYS GAINING FAVOR
DISCIPLINED ACQUISITION UNDERWRITING
$215B LIQUIDITY
DRY POWDER (NORTH AMERICA)
Download Placemat
60%
50%
40%
30%
20%
10%
0%
Debt
Core
Core-Plus
Proportion of Fund Searches
Value Added
Opportunistic
Distressed
21%
16%
53%
61%
34%
38%
55%
45%
48%
11%
9%
STRATEGIES TARGETED BY PRIVATE REAL ESTATE INVESTORS OVER THE NEXT 12 MONTHS, Q1 2018 VS. Q1 2019
Capital Strategies
Well-located value add deals, with proven exits, pricing very efficiently; deep bidder pools. Underwriting associated with value oriented offerings in “off-center” locations remains highly disciplined; varying bidder depth. Occupancy, in the 50% to 70% range with associated cash flow, very much in favor. Contrasts early cycle trends of 100% vacant building acquisitions. Underwriting core plus deals and employing high leverage to achieve hurdles Covered land plays gaining momentum Development return on costs for well-located sites dipping into the mid-6% zone; all in construction costs into the $800 per square foot range.
VALUE
Significant uptick in core plus capital formation Strategy is partly driven by later cycle concerns as well as perceived inefficiency within that part of the capital market Select state pension fund separate accounts on board with strategy
Core Plus
Extreme locational discipline Core buyers seeking a “story” as opposed to acquiring commodity core product Physical quality in some cases compromised given the right location and/or credit and term profile Recognition of a scarcity premium $1,000 psf + trades becoming more commonplace Long-term investment grade NNN offering pricing in the mid 4% range led by ultra HNW capital
10
9
8
7
6
5
4
3
2
1
0
Sales Volume
Billions ($)
18
16
14
12
Primary vs. Secondary Market Delta
2013
2014
2015
2016
2017
2018
$15.6bn
$11.2bn
Primary vs. Secondary Market Sales Volume Delta
Silicon Valley
San Francisco
Portland
Reno
Seattle
Las Vegas
Phoenix
Denver
Salt Lake City
Office/Industrial Sales over $25M
Western Region Historical Sales Volume
Western Region Acquisitions 2018 to 2019 TYD
Capital Flows
8%
43%
23%
Cross-Border
Institutional
Public REITs
Private
User/Other
Institutional Buyer by Sub Category
44%
12%
6%
3%
35%
Private Equity
Pension Fund
Insurance Co.
Bank
Investment Manager
Tech Titans of the West
FIRM
Q1 PERFORMANCE VS. ANALYST'S EPS ESTIMATES
FORWARD GUIDANCE
BEAT
MISS
DOWN
RAISED
INLINE
IPO Landscape
Macroeconomic Factors
2017: 14 IPOs
2018: 28 IPOs
2019: 11 IPOs
$1.8B
$6.5B
$13.8B
2014 (Cyclical High Water Mark): 35 IPOs
$4.9B
GDP Annual Growth Rate 2010-2017
6.9
%
San Jose, CA
4.0
Los Angeles, CA
Reno, NV
4.2
Salt Lake City, UT
5.3
San Francisco, CA
4.9
Seattle, WA
2.9
Portland, OR
3.8
Denver, CO
Las Vegas, NV
3.4
United States of America
Phoenix, AZ
Colliers Institutional Capital Markets Pipeline
Andy Zighelboim
License # CA 0135922 andy.zighelboim@colliers.com +1 408 282 3939 225 West Santa Clara Street 10th Floor, Suite 1000 San Jose, CA 95113
Executive Vice President
Kevin Moul. SIOR
License # CA-01836970 kevin.moul@colliers.com +1 408 282 3873 225 West Santa Clara Street 10th Floor, Suite 1000 San Jose, CA 95113
Senior Vice President
Robert Gilley
License # CA 01084869 bob.gilley@colliers.com +1 415 288 7887 101 Second Street, 11th Floor San Francisco, CA 94105
Brad Idleman
License # CA-01838809 brad.idleman@colliers.com +1 415 288 7889 101 Second Street, 11th Floor San Francisco, CA 94105
Contacts
Back to Top
Copyright © 2019 Colliers International. Information herein has been obtained from sources deemed reliable, however its accuracy cannot be guaranteed. The user is required to conduct their own due diligence and verification.
MENU
HIDE
Capital Flow
Capital Markets Pipeline
Home
Winning the Business As a Team
Current Representative Transactions
Global Reach
The Institutional Capital Markets Team
Select Clients Represented
Colliers Capital Markets
DRY POWER(NORTH AMERICA)
RAIL SERVED/TOD THESISIS FAVORED
Tech Titan of the West
Top
Significant uptick in core plus capital formation Strategy is partly driven by later cycle concerns as well as perceived inefficiency within that part of the capital market Select state pension fund separate accounts on boardwith strategy
Extreme locational discipline Physical Quality in some cases compromised given theright location and/or credit and term profile Recognition of a scarcity premium $1,000 psf + trades becoming more commonplace Long-term investment grade NNN offering pricing in themid 4% range led by ultra HNW capital
STRATEGIES TARGETED BY PRIVATE REALESTATE INVESTORS OVER THE NEXT 12 MONTHS, Q1 2018 VS. Q1 2019
SF Bay Area Buyers 218 - 2019 YTD
REIT/Listed
Bloomberg Silicon Valley Index
- Pension Funds - Insurance Companies - Private Equity Funds - REITS - Foreign Capital - Family Offices
Who We Work With
external
Improved chances of winning institutional business Higher fee participation vs. participating as a market expert for a competitor. Demonstrates to client deeper understanding of product life cycle Higher lease listing retention> Opportunity to earn fees with limited participation Keeps Colliers information in house vs. turning rent rolls, etc. over to competitors
- Leasing Market Brokers - Market Manging Directors - Tenant Rep - Landlord Rep - Local Market Resarch
INternal
Our Services
Strategy Disposition Debt Structuring Asset Services
Deal Process
PRESENT PROPERTY DISPOSITION PROPOSAL
SIGN EXCLUSIVE LISTING AGREEMENT
PRE-MARKETING (prepare marketing materials and DD) 21 Days
MARKETING/BUYER DISCUSSIONS/CALL FOR OFFERS 30 Days
BEST & FINAL OFFERS/BUYER SELECTION
PSA NEGOTIATION/ DUE DILIGENCE 30 Days
CLOSING PERIOD 15 Days
Capital Markets team works with Owner and local market specialist to underwrite asset
Capital Markets team / local market specialist production of Offering Memorandum/Deal Site
Capital Markets team and local market specialist conduct marketing calls and tours
Capital Markets team coordinates with Owner/Buyer on pending items
Debt Financing options released to potential bidders
Current Representative Transaction
620 National, Mountain View
Hillsboro Industrial Park, Hillboro
Tacoma Financial Center
3375 Scott Blvd, Santa Clara
Price: $200,000,000 $/PSF: $1,324 Square Feet: 151,064 SF
Cap Rate: 4.5% Occupancy: 100% Est. Close: Q2 2019
Price: $70,000,000 $/PSF: $150 Square Feet: 465,387 SF
Occupancy: 43% Est. Close: Q2 2019
Price: $42,000,000 $/PSF: $215 Square Feet: 195,000 SF
Occupancy: 85% Est. Close: Q3 2019
Purchase Price: $40,000,000 $/PSF: $160 Square Feet: 250,000 SF
ROC: 7.5% Occupancy: 71% Est. Close: Q2 2019
in Total Consideration
Over $57 Billion
Bob Gilley
Kevin Moul
Jeremy Thornton
Ken Karmolinski
Andrew Gibson
Catherine Dombrowski
Project Coordinator
Carrie Evans
Senior Financial Analyst
Tom Lewis
Financial Analyst
Isaac Kurlan
Dave Kotansky
Co-Head | US Capital Markets |Managing Directory - Portland
David Amsterdam
President, Investments and Eastern Region | Co-Head, US Capital Markets
INSTITUTIONAL CAPITAL MARKETS
DEBT & STRUCTURED FINANCE
financial analysis / project coordination
capital markets leadership
ICM at a Glance: West Coast
in Office/R&DIndustrial
Over $50 Billion
in Retail
$3 Billion
in Land/Mixed-Use
$4 Billion
OFFICE/R&D
INDUSTRIAL
RETAIL
LAND
Los Vegas, NV
Creating Markets
Based in the San Francisco Bay Area, our boutique team is the West Coast representation of a greater national capitalmarkets platform. With boots on the ground in every major primary market nationally and globally, our ICM teamcomes with deep relationships and an extensive network to create markets for any institutional real estate opportunity.
Based in the San Francisco Bay Area, our boutique team is theWest Coast representation of a greater national capital marketsplatform. With boots on the ground in every major primarymarket nationally and globally, our ICM team comes with deeprelationships and an extensive network to create markets forany institutional real estate opportunity.
Total Volume in Consideration
west coast experience
Hawaii
Washington
Oregon
California
Nevada
Utah
Colorado
Airzona
$2B
$16B
$5B
$28B
$1B
$214M
$142M
$3B
Global breadth, local depth
investment sales | acquisitions | structured finance
(No handoff to junior broker)
4 SENIOR LEVEL BROKERS LEAD EACH TRANSACTION FROM START TO FINISH
DEEP RELATIONSHIPS WITH A WIDE ARRAY OF CAPITAL SOURCES FROM INSTITUTIONAL DOWN TO HIGH NET WORTH
ACTIVE IN A WIDE GEOGRAPHY ALLOWS US TO DELIVER NEW CAPITAL TO THE MARKET AS WE STEER CAPITAL FROM OTHER LOCATIONS
SEAMLESS SALES PROCESS FOCUSED ON MAXIMIZING VALUES
Colliers Institutional Capital Markets Pipliine
