As the title describes what areas do you think will pop in the next 3-5 years both domestically and internationally. My pick is De Moines Iowa and Newark NJ. I think growth in these areas is inevitable.
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Explain Newark, please
A lot of reason but north Iron bound is going to do wonders for the city.
.....yeah but why? Is there a boom in residential which will bring people back to Newark's Office market?
Is Ironbound going to start producing Agent Orange again and become a superfund site...again?
Des Moines, Iowa???? yeah right
Q4 Potato Harvest Fundamentals Strong; Office Demand Peaking as Rents Surpass $0.50 PSF High Water Mark
Apartment Rent growth last year was in the double digits. Not enough supply to reach current demand
Completed a development there. It's a weird market because it is growing very quickly, but it is still a very small market. It takes way longer than you would expect to fill up new developments. I'd do another deal there, but my expectations would be set much lower.
I lived in Des Moines and still visit for work every few months. Most feel that the growth has gotten ahead of itself at this point.
The sunbelt will continue to boom. Southeast, Texas, and the Southwest.
I think you're right. Which markets specifically though?
Listen to the wheelbarrow podcast with Jake and Gino - their primary market for multi family is Nashville, they're making a killing.
Agree w/CRE. I'm bearish on the northeast corridor - I think the region will continue to lose people to the sunbelt markets, but will not have the influx of immigrants they had these past couple of years to supplement domestic out migration.
Newark is already one of the strongest submarkets in the country.
for industrial
Interestingly and as strange as this sounds the Capital Region (Albany, Saratoga, Schenectady, Troy) New York is one of the leading markets in the country regarding STEM job growth. The market used to be made up of almost entirely of family owned real estate developers, but has since seen institutional money flock in over the last 18 months. I know it's out there, but we're looking at a couple deals currently in the market and think there is pretty substantial cushion for growth.
CRE already touched on it here, but I am hugely bullish on the Carolinas, especially SC. Greenville and Charleston in particular.
I love those areas, but they're a long ways away from attracting bigger name companies (principal offices, not just factories). you need an airport, like ATL, CLT, RDU (to a lesser extent) if you want big companies to come your way.
I'm still bullish on Denver over the next 3-5 years. While it has received a lot of attention over the past few years I think there is still a lot of room for future growth. I also think major cities in the southern half of the country will continue to do well. Texas (Dallas, Austin, and Fort Worth), Charlotte, and Raleigh are all target markets for me.
Well DFW has been the fastest growing area in the US for the last 3 - 4 years... with an oil recovery don't see that slowing down.
Oil recovery applies to Houston areas and west-Texas. If you look at the largest employers in Dallas, an energy company doesn't even make the top 20 in terms of local employment even with Exxon Mobil HQ in Irving. Houston has 6. Dallas specialty is corporate relocation.
As for Charlotte, I am slightly bearish on them. Terrible infrastructure with the I-77 and I-485. It is extremely difficult to move east-to-west in that town.
"Oil recovery" Oil ain't going up to peak levels like before, it's only going to stay level. That spells a lot for American energy companies. DFW has a growing technology industry developing. Lots of defense and security (including cyber) firms coming up.
Listen, I agree that Energy is not #1 in DFW... but ya'll haven't spent much time up here if you think the oil industry doesn't mean anything to us.
My point was yes, due to their other industries (Consumer / Industrial, Defense, Technology, etc.) they have been the fastest growing place in the US, and add to that a small boost with the oil market recovery it should still be fastest growing.
Definitely agree with you, although I will say that Dallas is a strange city. Granted I was only there for 5 days over ULI, but it had weird feel to it, almost as if it didn't have any feel or culture or identity whatsoever.
Ridiculously good brisket though.
Well A) Delicous Brisket is part of the culture and B) I otherwise totally disagree. Between the plastic millionaires, and the rabid Cowboy fans, the negative aspects of the culture are so in your face as to be totally noticeable. The more prominent aspects of the culture; christian values, strong families, entrepreneurship, boots at work and gun range on the weekend (among others), may take more than 5 days to figure out.
I'm more involved in multifamily on the west coast, so that tilts my perspective a good bit, but I'd put my money on seeing more growth in secondary markets surrounding the core markets in CA. There is so much pressure on multifamily rents in the core markets that its pushing people outward to places like Riverside or out of the state altogether into cheaper cities such as Phoenix (and further). Some back office type jobs are following suit and leaving the state for cheaper locations. I would expect to continue to see year over year growth in these "cheaper" markets in the western region in the 3-5 year range at least. Places like Phoenix have little to no supply constraints (except construction financing currently) so the rent growth isn't as spectacular but it seems supported by middle / high wage jobs moving into the state so I think its quite sustainable in the near term.
Los Angeles. hasn't been overbuilt yet, demand > supply.
The demand and limited supply are pushing a good number of people (and jobs) out of LA and other SoCal markets if you look at migration numbers. Not saying markets like LA will collapse anytime soon for the same reason you give but I think "better" deals can be found in nearby markets/sub-markets with better migration patterns and job growth. If you are a core buyer/builder and have the funds, sure all the CA markets are great but your not going to find many under-priced opportunities.
LA badly needs its infrastructure fixed. The traffic situation is honestly disturbing.
I agree, the traffic situation is mind-numbing, but the problem isn't unique to LA. Check this out: http://inrix.com/scorecard/. 2016 average driver hours spent in congestion: LA (104.1), NY (89.4), SF (82.6)
Some submarkets have an insane amount of supply coming in. For instance, Koreatown has a ton of MF supply coming in at extremely high rental rates in an area that has much lower MHH income. How will those units get absorbed?
Avoid those submarkets. But yeah, class A is the closest to be overbuilt.
I'm not sure if LA works the same way as NYC but luxury rentals seem to be renting up pretty much anywhere it gets built. I've seen luxury buildings in Spanish Harlem become fully leased up 4 weeks post CO certificate. I think every thing within a 20-30 minute subway ride to Manhattan is going to gentrify eventually.
In the office space really like the Florida markets like Tampa or Orlando that currently have
Newark, ok - things must be looking up for the US
New York City
Southeast.... Specifically Charlotte, Greeneville, RDU
People have been saying Newark is the next Brooklyn for the past 15 years.
Maybe office will pick up there if it hasn't already with firms seeing a cheaper option than being in NYC. Industrial as well. Multifamily however is still utter shit and anything outside Downtown/Ironbound is still a complete war zone.
I'm very bullish on NJ multifamily even though I avoid warzones. I'm down to acquire land near transit hubs in warzones and hope it gentrifies in 10 years. You can live 20 to 30 min away from Manhattan in NJ and the price point is completely different than Brooklyn or Queens. New Yorkers already spend 65% of their net income on rent, so I think chasing affordability in the surrounding areas will be the trend of the next decade. Pending NYC rents don't see a massive correction.
How do people feel about Miami?
particularly, can people compare Miami vs Atlanta for me, pros/cons.
Con #1 - both are full of Floridians
Downtown Milwaukee. ~2 billion in new construction in development.
Philadelphia multifamily still has some room to run in my opinion. Tons of capital flowing in from NY/North Jersey and DC because they can actually get a decent yield relative to what they're seeing back home.
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But what does wireless data mean on a more cumulative social standpoint?
A lot. From personal experience alone, without the integration of Snapchat, Instagram, and iMessage, I was three steps behind when it came to social normalcy. Even now, the applications used with wireless data are a large point of everyday conversation and communication to a point where it is actually detrimental to our own mental and social growth.
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