January SIG Insider: CRE News, Insights & Announcements
Sands Investment Group
SIG is a full-service commercial real estate brokerage firm specializing in investment sales and capital markets.
Whether you're a seasoned investor or just starting out, we're here to provide you with valuable information that will keep you informed and ahead of the game in the dynamic realm of commercial real estate.?You'll have the tools you need to identify emerging trends, evaluate potential risks, and uncover investment opportunities that others may overlook.?Let us be your trusted companion on your investment journey, helping you navigate the complexities of the market and unlocking the potential for success!
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CRE NEWS?THAT MATTERS
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IN THE SPOTLIGHT: OUR FAVORITE CRE ARTICLES
?? Nuggets of Wisdom: Why Chick-fil-A Stays on Top
Do you remember the chicken wars of 2019? Popeyes sparked the conflict with the reveal of its fried chicken sandwich which gained a cult following in short succession. This triggered a Twitter battle between fast-food establishments featuring chicken on their menu to see who was the best. The battles resurfaced in 2021 as more companies added sandwich variations and although no official winner emerged, there were wins across the board for all.?
All that being said, the number one ranking does not appear to have moved. Chick-fil-A’s unique positioning as a chicken-only restaurant distinguishes it as a leader in the fast food space, securing a 45.5% share in the chicken fast food market. Despite being closed on Sundays, Chick-fil-A has become the third-largest restaurant chain in the US (undeterred by all of its challengers fighting for market share). It serves as a fascinating case study demonstrating the importance of tenant selection in QSR investments.??Knowledge of a brand and its fit within the local community are vital factors in determining tenant suitability for a specific location. Rising tides do lift all boats, but it is important to know if you are driving the yacht or the dinghy. (CNBC, Amelia Lucas)
??? Quality Over Quantity: Remote Work Leads to Office Vacancies,?But New Spaces Are Finding Success
It has been hard to find too many positive stories about office real estate lately but the North Loop Green, a mixed-use development set to open this year in downtown Minneapolis, is currently under construction and has already leased nearly ? of its space, including a reputable anchor tenant.?
Despite potentially being the last new office development in the Twin Cities for a while, this recent success is attributed to a ‘flight to quality’. With remote and hybrid work redefining office dynamics, many businesses are continuing to downsize or eliminate office spaces, leading to a rise in vacancies from 14% to 21% in the past three years. So why would this new development be an immediate success? The short answer is that companies with long-term goals of being in offices are seeking higher-quality spaces. Even so, this could be the start of a change in the market, especially in city centers with large corporate headquarters nearby.
This development highlights the dynamism of the real estate landscape. Whether it’s the flight to quality or the evolving demands of a transforming workspace, adapting to these shifts will prove invaluable in the long run. It is essential to recognize that not all overarching trends are imperative to follow; sometimes, thinking outside the box can yield transformative results. (Axios, Nick Halter)
?? Retail is Back and Brighter Than Ever
Fifth Avenue in New York City maintains its title as the world’s most expensive retail destination, with average rents surpassing even Via Montenapoleone in Milan. The pandemic created challenges for retail centers around the world, and the iconic shopping corridor in NYC was no exception. However, over the last few years, there has been a considerable uptick in foot traffic and everyone in the world has seen a huge increase in travel. A successful holiday season, complete with the classic Saks on Fifth light show, indicates that the new normal includes a healthy retail landscape. With the peak of the pandemic nearly three years in the rearview, certain spaces display remarkable resilience amidst challenges. Success in these spaces hinges on many variables, such as individual tenants, location, consumer behavior, and a strong knowledge of the market space.?
One of the critical variables to finding success in the field of your interest is the careful selection of experts to collaborate with. While we recognize that highlighting Saks Fifth Avenue and its flagship location in New York City is not rocket science, we do see similar trends existing in Charleston, Chattanooga, Phoenix and so many other thriving cities across the country. By exploring similar patterns in cities and towns, having a real understanding of the players in the space, and collaborating with top talent, you may uncover the next emerging business opportunity, irrespective of scale or location.?
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