Capital Gazette / April 16th, 2015
Capital Gazette reports: The recent $121.5 million sale of the Union Wharf apartment complex is representative of the boom to US secondary markets. According global commercial real estate data and analytics firm Real Capital Analytics (RCA), Baltimore numbers in 2014 shot up nearly 72 percent to $3.69 billion. While less than the peaks in 2006 and 2007, the growth is remarkable for a non-major metro.
So far in 2015, sales volume is up about 8.5 percent, with 47 deals worth $936 million based on estimates from RCA. “There’s activity across the market,” said Jim Costello, a senior vice president at the RCA. “What’s going on is there is just a lot of capital … looking for safe, yield-driven investment, and commercial real estate fits that bill.”
Out of all the property types, apartments lead the way with 48 of the 242 commercial properties sold in Baltimore last year, representing $1.2 billion (up 58 percent year-over-year) of the total investment reports RCA. 11 of the aforementioned 47 2015 transactions total more than $413 million. RCA figures show that office ranked second, with 43 sales at $761.3 million, nearly double 2013 figures and topped only by 2007.
RCA noted that private buyers accounted for most of the deals, though pension funds, insurance companies and hedge funds are also stepping up their shares. An estimated $843.5 million in 2014 Baltimore-area deals involved institutional investors, with another $146.5 million coming in the first quarter of 2015.