Our country’s current economic situation features uncertainty in a variety of flavors, shapes and sizes, and the commercial real estate market feels the influence of all of them. Phoenix Business Journal asked the leaders of some of the Valley’s largest brokerages their thoughts inflation, remote work and subleasing in the market. Beth Jo Zeitzer, CEO and Designated Broker at R.O.I. Properties, shared her insight on the Phoenix-area subleasing market and Arizona’s upcoming election for governor. Read the original article on bizjournals.com. The post How Valley CRE Brokers Think Rising Interest ..read more

Particularly with the proliferation of short-term-rental platforms such as Airbnb and Vrbo, single-family homes for rent in Greater Phoenix are a prime example of the intersection of residential and commercial real estate. In fact, many strictly commercial investors have moved into the single-family space due to the value, and are successfully operating large portfolios of homes for rent. The success of the short-term-rental (STR) model hasn’t been without its detractors, however, due to noisy parties, trash, parking, and other more serious problems such as a recent shooting at a property in S ..read more

Interest rates have trended up, and the Federal Reserve is showing no signs of stopping in its efforts to curb inflation by making borrowing more costly. Fed officials are attempting to avoid a vicious circle, in which the current 9-plus-percent annual inflation rate feeds expectations for further inflation—which then causes prices and wages to spiral higher. Several more hikes are expected through the remainder of 2022, bringing the federal funds interest rate to 2.5%, the highest since 2018. How can we expect these changes to affect investing in commercial real estate property in Phoenix? Th ..read more

Home prices in Phoenix from March-April were historic, and the market likely saw a peak in mid-April, when rates hit 5%. The double whammy of higher mortgage rates and increased pricing for consumer/homebuyers meant that many buyers were really priced out of the market and the Greater Phoenix area was no longer affordable. Since then, rates have ticked up slightly higher—5.5% as of mid-July. At about this time last year, the question was when Phoenix home prices would start to stabilize. Now the question is: With interest rates projected to continue going up and supply soaring, where are we he ..read more

A triple-net lease deal (a.k.a., NNN) is a lease agreement in which the tenant is responsible for all expenses, including rent, real estate taxes, insurance, and maintenance. These types of deals are increasingly being sought out by investors who are 1031 investors and/or those who are seeking low management. A subset of triple net-lease deals is the sale-leaseback, which gives a commercial real property owner the ability to convert equity into liquid capital. In this type of transaction, the seller relinquishes ownership rights to an investor and then leases back the property when escrow clos ..read more

Multifamily has been scorching hot in the Phoenix market during the past few years, but the surge in build-to-rent communities has been the most astonishing performer of all. Also known as BTR or BFR (build for rent), this is a unique segment of the single-family rental (SFR) market: Entire communities of detached, single-family or attached townhouse-style dwelling units that are specifically built to be rented rather than purchased. While different developers have different operating models, most are gated communities with one-to-three-bedroom homes with small backyards and a wide range of up ..read more

For the fifth year in a row, the Phoenix metro area ranked as the fastest-growing city in the United States, according to the US Census Bureau. Over the past decade, Maricopa County’s population has increased by 15.8%. In the process, the growth rate for Phoenix investment properties has also created top opportunities in Arizona. Behind the growth is Phoenix’s appeal as a business-friendly destination, which has spurred local investment as well as out-of-state interest from pricier coastal markets in California, such as San Francisco, Los Angeles, and San Diego. There are several factors at pl ..read more

Overview of the Intersection of Real Estate in Arizona There’s a tendency to view commercial real estate and residential properties in Greater Phoenix through different lenses, but it’s also a useful exercise to observe them together, as components of the state’s larger economy. At the risk of oversimplifying complex economic and social factors, Arizona’s solid economy (fourth highest GDP growth in the U.S.) and relatively affordable cost of living and commercial properties in recent years (minus the downward blip of COVID) have attracted more people and jobs. In turn, that spurred housin ..read more

By Beth Jo Zeitzer and Josephine Giordano for Arizona Attorney Scope Limitation Definition and Overview Experts are often faced with challenges as a result of scope limitations imposed during financial investigations, court-appointed receiverships and special master and compliance-monitoring appointments. For instance, in the world of financial audits, a scope limitation is defined as a restriction on the applicability of an auditor’s report that may arise from the inability to obtain sufficient appropriate evidence about a component in the financial statements. When all the audit procedures t ..read more

Nationally, the largest office commercial real estate markets are showing signs of recovery, and the NAIOP Research Foundation is projecting a strong resurgence through 2023. When we last addressed this sector in August, we discussed who has the upper hand in the Valley’s office market.  As we head into the final weeks of 2021, we ask: Is Greater Phoenix following or lagging the positive national trend, and what does the future look like? Based on the metrics of vacancy rates, direct and sublease space, and the volume of leases coming up for renewal, it is clear that challenges remain in ..read more