Written by Rich Rosfelder Commercial Investment Real Estate Magizine, Jul/Aug 2012
The office investment market is at a crossroads. The spread in capitalization rates between office properties in core markets vs. office properties in secondary and tertiary markets reached a 10-year high in first quarter 2012, according to Real Capital Analytics. “This has to change,” says Dan Fasulo, managing director of RCA. “Either major metro cap rates will start to rise, or secondary and tertiary market cap rates will fall. Investors are betting on the latter.”
Secondary and tertiary market office cap rates began to close the gap last year, dropping from 7.9 percent to 7.8 percent and from 8.5 percent to 7.8 percent, respectively, according to RCA. This reflects an uptick in interest among investors, who purchased more than $19.5 billion in office assets in secondary markets in 2011. And with more than $5.6 billion in office sales in 1Q12, secondary markets are clearly gaining momentum.
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Mike Stinson, a native of Monroe, Louisiana, is a graduate of Louisiana State University (LSU). A real estate licensee since 2004, Mike specializes in the sale and leasing of commercial real estate. A Designee member of the Certified Commercial Investment Member Institute (CCIM), Mike’s other professional memberships include Baton Rouge’s Commercial Investment Division (CID), the LSU Alumni Association, REALTOR Land Institute (RLI), an associate member of Louisiana REALTORS® (LR), and an associate member of the National Association of REALTORS® (NAR).
Saurage Rotenberg Commercial Real Estate is a member of the Baton Rouge Area Chamber of Commerce (BRAC); the West Baton Rouge Chamber of Commerce; the Baton Rouge Better Business Bureau; the Louisiana Commercial Data Base (LACDB); and the International Council of Shopping Centers (ICSC). Several agents, on an individual basis, are members of the Society of Industrial and Office Realtors® (SIOR), the Certified Commercial Investment Member Institute (CCIM); the National Association of REALTORS® (NAR); and the Greater Baton Rouge Association of REALTORS® Commercial Investment Division (CID).