The good folks at CBRE recently hosted the Fried On Business program for a live broadcast from their offices in Miami.
As could be expected from a company like CBRE, the show was an absolute home run. Their people provided some first-rate insight into the South Florida and statewide commercial real estate markets.
Arden Karson and Drew Schaul
First up were Arden Karson and Drew Schaul. She runs the whole show for CBRE in South Florida as Senior Managing Director, and he recently came back to the company as Senior Vice President of Advisory and Transaction Services, specializing in retail representation of landlords and tenants.
Drew and his team recently brought drone manufacturer DJI into the Wynwood market, providing the company with one of its first deals outside of China.
“They felt Miami warranted a global flagship for them,” he said, adding that CBRE is also representing shoe manufacturer ASICS throughout South Florida.
Arden said CBRE’s investment in people is a major focus for her in South Florida.
“One of my personal initiatives is to help mentor the next generation of real estate professionals. I have children in their mid-20s, and I think real estate is a great career path,” she said.
Serving on the advisory board of the University of Miami Master of Real Estate program, Arden has helped develop an initiative that gives students access to internships at CBRE.
There’s also a networking program to help facilitate their personal and professional contacts.
In addition to providing relationships, CBRE provides a number of high-tech tools that are vital to working on commercial real estate today, Karson said. The Liquid Galaxy aerial imaging program, incorporating Google Earth technology, produces flyover images of just about any location worldwide.
“We actually view ourselves as a technology company, in addition to being a real estate company,” she said.
Click here to listen to the entire conversation with Arden Karson and Drew Schaul of CBRE.
Next was Brad Meltzer, President of Plaza Construction. Based in New York City, the company has operations in New York, Washington, and South Florida, among other places.
Working on projects like the Paraiso District for Related Group and 1000 Museum Tower by Zaha Hadid Architects, Plaza Construction has turned its gaze to Central Florida, opening a new office in Tampa. The company has started work on the Westshore Marina District project for BTI Partners.
Plaza Construction grew as an in-house building, Brad said, which gives the company a unique connection to its clients.
“We like to look at ourselves as an owner-builder. We think like an owner. We act like an owner, and we treat their money as if it was ours,” he said.
Now, speaking of technology, Brad said new tools have made their way into the construction side of the business.
On the Paraiso projects, for example, the company has started using software called PlanGrid, which allows all superintendents in the field to have instant access to drawings and updated information.
Brad discussed a lot more, including their diverse project types and how Plaza Construction takes a holistic approach to cost control without compromising quality.
“South Florida, Miami specifically, is maturing,” he said. “We’re going to have some ups and downs, but the variance is going to be minimal. I see South Florida as the place to be.”
Click here to listen to the full interview with Brad Meltzer of Plaza Construction.
Christian Charre, Senior Vice President, CBRE Hotels, said construction is ongoing in the select service and luxury segments, but select service is taking the lead by far because the projects are smaller and less expensive.
Generally speaking, occupancy in Miami has suffered for a couple of years, but the market is on the path to recovery, he said. This is due, in part, to the unavailability of Caribbean destinations as they continue to recover from Hurricane Irma.
Coming into vogue are boutique hotel concepts like Autograph by Marriott, Curio by Hilton and Andaz by Hyatt, Christian said.
“It appears that the consumer is getting smarter. When they go on vacation, they want something different from the cookie-cutter approach,” he said.
Christian said other new trends include:
– The creation of quality restaurants within hotels, such that they become destinations for non-guests.
– A growing number of pet-friendly hotels.
– More interest in so-called “micro-room” offerings.
Click here to listen to the entire conversation with Christian Charre of CBRE.
Last, but certainly not least, was a talk with my longtime friend Christian Lee, Vice Chairman, CBRE Capital Markets.
His emphasis is on the office market statewide and the industrial market in South Florida.
Institutional buyers of office properties have a narrow focus, Chris said. They want only the best core assets is markets like Brickell, Downtown Miami and Downtown Fort Lauderdale.
As for industrial, almost everything seems to pass muster, he said.
“We recently looked at our smaller industrial deals. Over the last five years, we executed 21 industrial deals between $15 million and $30 million, and interestingly, 20 of those 21 transactions went institutional,” he said.
“In years past, you wouldn’t have thought that deals of that size would be institutional.”
The office sector across Florida is doing very well, Chris said. There’s been very little new construction, plus healthy population growth and job growth.
And even though vacancies are low, he said, properties are still trading at below replacement cost, so there’s very little incentive to start new projects. In some cases, mixed-use projects are including office space as an afterthought. The emphasis will be on the residential space.
Capital, Chris said, is abundant. The difficult part is finding assets that meet the investors’ criteria.
Click here to listen to the full interview with Christian Lee of CBRE.