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How Motorola Office Park Renovation Is Paying Community Dividends

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Chicago-based investment firm is about to complete the $35 million re-positioning of the former Motorola office park into an office/retail campus in Plantation.

The renovation of this iconic property has injected new life to the city. Specifically, the renovation is attracting innovative tech and healthcare companies as tenants and adding restaurants, landscaping, lighting, a fitness center, a jogging trail around a manmade lake and other amenities for tenants to enjoy. The campus is now home to Motorola, Magic Leap, a company developing virtual reality technology, and health care company Amsurg Corp., among others.

GlobeSt.com sat down with Arnstein & Lehr Attorney Josh M. Atlas to discuss the behind-the-scenes of transforming the former Motorola campus into Plantation Pointe. Atlas is a partner in the law firm’s West Palm Beach office and a member of the Construction Law and Commercial Litigation Practice Groups.

Atlas represented Illinois-based Blue Water Builders, the general contractor for the developer Illinois-based Torburn Partners. In part one of this interview, GlobeSt.com asked him what is the main takeaway from the transformation of the iconic Motorola Corporate Park into a sprawling retail/office campus designed with Millennials lifestyle-preferences in mind?

“The main takeaway is that a forward-thinking developer can restore and revitalize an entire community by taking the right approach to a project like the re-positioning of the former Motorola Corporate Park,” Atlas says. “Growing up in South Florida, everyone recognized that the Motorola Corporate Park was an important part of the local community because it was so noteworthy that such a high-profile company would have a large presence in a suburb like Plantation. “

By transforming the project into a multi-tenant corporate campus and adding both retail and lifestyle amenities, he says, the developer created a platform to bring in a much more diverse group of tenants. And that is benefiting everyone.

“The transformation of this campus gives tenants the ability to satisfy the demands of a workforce that is increasingly populated with Millennials who want more out of their professional experience than just having an office to go to work,” Atlas says. “The transformation should also serve as a boost to the local economy by increasing the tax base, creating opportunity for local business and giving more people a reason to move into the community to be near work.”

 

Source: GlobeSt.

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South Florida Aviation Company Sold To Iowa Firm For $8.6B

Wellington-based B/E Aerospace, an aircraft cabin interior products and services manufacturer, has sold to Rockwell Colllins of Cedar Rapids, Iowa for $8.6 billion.

B/E said it will close its South Florida headquarters at the close of the acquisition. The number of employees affected was not immediately available.

B/E Aerospace was among South Florida‘s top public companies with $2.7 billion in revenue in 2015.

Effective immediately, B/E Aerospace is rebranded as Rockwell Collins. Werner Lieberherr, former B/E Aerospace president and chief executive officer, is now executive VP and COO of Rockwell Collins’ newly created interior systems business. He will report to Kelly Ortberg, chairman, president and chief executive officer of Rockwell Collins.

With the acquisition, Rockwell Collins now has about 30,000 employees and annual revenue of more than $8 billion based on calendar year 2016 results.

The acquisition also expands the Iowa-based company’s portfolio with a wide range of cabin interior products for commercial aircraft and business jets including seating, food and beverage preparation and storage equipment, lighting and oxygen systems, and modular galley and lavatory systems.

“Today marks a major step in advancing our vision of being the most trusted source of aviation and high-integrity solutions in the world,” Ortberg said. “The industry-leading products and solutions being brought together by this acquisition give us a much broader offering, increasing value for our customers and ultimately driving long-term, profitable growth and shareowner value.”

 

Source: SFBJ

Monitoring Evolving Trends In South Florida Industrial Real Estate

As part of Colliers International South Florida’s annual Industrial Owners Forum, more than 50 institutional owners gathered in Miami.

They converged to take part in a closed discussion on the state of the industrial market in South Florida, where they own properties.

Steven Wasserman, executive vice president of the Colliers International’s South Florida industrial services team, hosted the forum. He sat down with GlobeSt.com to highlight the main takeaways from the discussion and the sentiment these influential leaders have about South Florida’s industrial market. In part two of this exclusive interview series, he spoke about evolving industrial market trends.

“There’s still a lot of excitement surrounding e-commerce and the impact it’s having on brick and mortar retailers,” Wasserman tells GlobeSt.com. “While many retailers are downsizing their retail stores, there is a growing demand for distribution space as consumers are buying their products online. Distribution centers near urban cores are in high demand.”

Wasserman pointed out another trend shaping the industry: construction costs. Construction costs have been on the rise, but he expects they will most likely remain flat in 2017 as the condo construction market slows down.

“Institutional owners expect the cost of labor and construction materials to start to level off after years of increasing costs,” Wasserman says. “New development construction costs are ranging from $70 to $100 per square foot for new class A warehouse space and will most likely remain at that price throughout the year.”

On the other hand, he says, cumbersome environmental and permitting issues continue to slow the construction process down. That is forcing tenants to holdover because space takes so much longer to build out in South Florida.

Another topic of discussion was the trend of parking requirements. Institutional owners discussed the significant increase in employee and trailer parking requirements for all sites nationwide, especially “last mile” sites.

“This used to be a requirement from larger tenants but they’re now seeing it from smaller tenants in the 80,000-square-foot range,” Wasserman says. “We’re also seeing growing demand for cold storage facilities. As population continues to increase and lifestyle patterns change, we’re seeing increasing demand for cold storage facilities. This particularly true in South Florida where suburbs are becoming urbanized.”

 

Source: GlobeSt.

Commercial Real Estate Is The Surprising Winner From The ‘Trumpcare’ Debacle

When the effort in Congress to pass a health-care bill failed – the American Health Care Act, designed to replace the much maligned Affordable Care Act – the thing that wasn’t supposed to happen happened: The industry that had whined for years about this, that, and the other in the Obamacare law, breathed a huge sigh of relief.

Despite the general unease in the stock market, heath care stocks rallied. Well, they didn’t exactly rally, they edged up. But it made them the best-performing sector among the 11 S&P 500 sectors. But no one apparently breathed a bigger sigh of relief than the over-indebted and teetering Commercial Real Estate sector. Investors, including the largest asset managers in the world, had experienced the rich benefits of a multi-year mega construction boom of hospitals, medical office buildings, and other health-care facilities to accommodate the ballooning industry that is taking over the US economy and provides 16% of its private-sector jobs.

Property prices had soared over the years as part of the overall commercial real estate bubble. It has gotten so huge that if it deflates, it risks taking down the banks, particularly smaller banks where CRE lending is heavily concentrated. Even Federal Reserve governors admit its policies since the Financial Crisis have helped fuel this bubble, and it admits that it is a bubble, and references to it keep showing up in their statements and speeches as the fretting has begun. Among them, Boston Fed President Eric Rosengren, a Fed “dove,” is now worried that the commercial real-estate bubble in the US has once again become a risk to “Financial Stability.”

Just how relieved are commercial real estate investors really?

Chris Muoio, Senior Quantitative Strategist, Ten-X Research, of online CRE platform Ten-X, put it this way on Monday: “We noted at the beginning of the year that the new presidential administration in D.C. potentially increased risks for certain commercial real estate sectors as proposed regulatory and legislative changes could alter the growth trajectory of industries and with that the demand for certain types of commercial real estate. One of the sector’s that faced the most acute possible changes was medical office/retail as the new administration proposed sweeping changes to health care legislation. Hospitals and medical offices faced the prospect of lower demand for health care services as the proposed legislation would have reduced the number of insured patients and the growth pace of federal spending on health care.”

Which sums up what the sector has been expecting year-in and year-out: endless growth in revenues, paid for by government entities, insurers, and the flow of premiums. Throw doubt on these endless growth stories, and health-care focused real estate quakes in its foundations.

The note goes on: “Following the withdrawal of the proposed American Health Care Act, real estate investors in the medical and health care space can breathe easier as it appears this risk has dissipated. The proposed legislation was scuttled late last week as it became clear it lacked the votes to pass the House. The current rhetoric out of Washington signals a desire to move off of the issue and towards other policy initiatives. Commercial real estate investors should continue to monitor the machinations in Washington carefully, as the administration could revert to the issue at a later time, but for now it appears the existing fundamental story underlying health-care based real estate, which has produced uninterrupted growth in health care services, should remain intact.”

CRE investors are among the biggest beneficiaries of the health care monster that has been draining consumers, businesses, and governments for years, starting way before Obamacare was even a word. And for as long, this health care monster has been cannibalizing other sectors of consumer, business, and government spending.

So it makes sense that commercial real estate investors, at the peak of this bubble, are dreading any little thing that might possibly derail that gravy train. Booms and busts have historically been driven by speculation and over-borrowing, often triggering recessions. This time, the health care sector, after years “of unsustainable growth,” has become the biggest “systemic recession risk” to the US economy, as the debt binge that funded it, hits its limit.

 

Source: The Real Deal