In 2015, office investment properties in Greater Cincinnati yield over $500 million in sales
Cincinnati, OH, January 27, 2016 – Investors are searching for attractive yield after being priced out of gateway markets and, consequently, office investment activity is increasing in secondary markets such as Cincinnati, according to CBRE research. That storyline is happening all over the U.S., but Cincinnati is experiencing investment in a unique fashion.
Traditionally, the majority of investors in the Cincinnati market have been private equity groups, including local companies and individual investors. These investors are willing to accept more risk, but demand a higher return, and, as a result, they gravitate toward value-add properties in hopes of maximizing their return. As market fundamentals strengthen, the value-add options in desirable submarkets are running dry and stabilized product has been trading.
And the resulting capital is coming to Cincinnati, according to Keith Yearout, vice president with CBRE’s Investment Properties Group.
In 2015, office investment properties in Cincinnati yielded $517 million in sales, a 141 percent increase year-to-date compared to 2013. In addition, the market is starting to witness an increase in cross-border capital.
“Cincinnati provides a safe haven for investors with stable cash flow and room for unexpected volatility such as interest rate risk,” Yearout said. “It is no longer viewed as just a place in the Midwest but as a place where people want to invest.”
There is no mystery as to why such a diverse pool of investors is attracted to Cincinnati.
In a city with large stable companies headquartered in the region including P&G, Kroger and Macy’s, there is significant office activity happening, which creates a stable job market and a demand for space. Major developments such as the Banks, General Electric’s 340,000-square-foot global operations center, and the addition of many start-ups, restaurants, bars, and craft breweries in Over-the-Rhine, have dramatically changed investors’ perception of Cincinnati in the last decade.
CBRE’s Cincinnati office provides a complete spectrum of commercial real estate services including asset services, brokerage services, corporate services, debt and equity financing, facilities management, industrial and logistics services, investment sales, office services, project management, research, and valuation and advisory services.
To request an interview with a CBRE professional, please contact Joe Ludwig at +1 513 369 1305 or joe.ludwig@cbre.com.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2015 revenue). The Company has more than 70,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through more than 400 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. Please visit our website at www.cbre.com.