Tuesday, April 17, 2018

Colliers 1Q 2018 Sacramento Office Research & Forecast

The Sacramento office market has improved to pre-recession levels and according to Colliers, the Sacramento office market is now seen as a safe haven for investors. Rental rates increased 2.7 percent over last year with Class A downtown reaching $3.00 per square foot.

Colliers 2018 1Q Sacramento market indicators






Big investment sales. According to a national office market study published in February by investment auction platform Ten-X listed Sacramento as one of the top five “buys markets” in the U.S. Colliers believes this is true because demand is resilient and the construction pipeline is sparse. The sale of David Taylors 621 Capitol Mall high-rise tower for $161 million set a new standard for Class A per square foot at $439.49.

Colliers 2018 1Q Sacramento summary of statistics










Even with all the positive news, Colliers does not see development in large scale (private high-rise construction downtown) returning to the Sacramento market in the near future. Office rates still do not justify the cost of new construction, hence no new speculative office projects in the first quarter of 2018. Until rents and values rise nearer or replacement costs, we will likely see development in the region to focus on government and healthcare build-to-suit, with any speculative capitol going toward rejuvenating existing spaces or building apartments and warehouses. 
Colliers 2018 1Q Sacramento Office Report

Thursday, March 22, 2018

CADA Site 21

CADA – Site 21, 93 units, height 115 ft  (New Mixed-Use Building)
1522 14th Street, Sacramento, CA












CADA Site 21 proposal goes to the Planning & Design Commission today. This is a fine project and one Sacramento can support. 10 years ago Sacramento could only support residential as high as 5 floors and now were up to 9. Anyone who expects the city to leap into the high rise living better take a step back. We should be lucky this is going up, an apartment building over 50 years old will be demolished and the local preservationist could not find a way to make it an historic structure.
CADA – Site 21, 93 units, height 115 ft (New Mixed-Use Building) 
1522 14th Street, Sacramento, CA

Tuesday, March 20, 2018

$520MM Tower To Rise

The $520 million headquarters building for the Dept. of Natural Resources is expected to break ground this fall. At 20-storys and 838,000 square feet, this tower will be the largest office building built downtown since CalPERS build their headquarters on Q Street in 2006.
20-story, $520 million CA Dept. of Natural Resource's Headquarters








The tower will feature 10,000 square feet of retail and public space, and auditorium with 300 seats, food court and pedestrian plaza. Improvements will also be made to the historic Heibron House. Completion is scheduled for 2021.


The Registry Bay Area Real estate

Wednesday, March 14, 2018

15Q

15Q is now out of the ground.
15Q construction - 73 units, mixed use

15Q construction - 73 units, mixed use

15Q construction - 73 units, mixed use

15Q construction - 73 units, mixed use

Tuesday, March 13, 2018

19J

What’s the hold up here? Two floors in 4 months? Well, it could be they needed money… there is now signage on the chain-link fence saying “Construction financed by Bank of the West”. Footing for the tower crane is now installed on 19th street.
19J development will feature 175 residential units

19J development will feature 175 residential units

19J development will feature 175 residential units

 

Tuesday, January 09, 2018

17th & S Street Mixed-Use Building










This Thursday the 11th, the Sacramento Planning and Design Commission will conduct a public hearing and approve this 6 story, 159 unit residential mixed-use project. This CFY Development Inc. and the Capitol Area Development Authority project is ready to go and construction could begin as soon a Spring 2018.  About 12 years ago another proposal closely resembling this one was also proposed for this site, but it did not get out of the gates early enough before the market went south.
P17-030 17th & S Street Mixed Use Building

Friday, January 05, 2018

2017 Year-end Snapshot: Sacramento Office

Colliers International released a report last week showing declining vacancy, modest rent growth and healthy investment in 2017. Colliers report highlights: Net Absorption was positive, but 18 percent below the 5-year average due to scarcity. The Vacancy rate reached the lowest point since early 2003, before the last development boom. New development picked up late in 2017, with several new build-to-suit projects underway. In addition, average rents increased modestly overall, Downtown asking rates increased more sharply. For those wondering about a new office tower being built downtown in the near future, back in 2015 pre-leasing agents for the Vanir Tower said that rents would have to rise to $3.10 a square foot before the Vanir Tower could be built and profitable. Last year the year over year asking rate rose 6.2% to $2.56 per SF compared to $2.41 per SF in Q4 of 2016.