Can Downtown Survive?

[fieldafm]

They're a landlord, just like I already said in one of my earlier posts, of course the landlords are going to cook up skewed stats, since otherwise they'd be undermining their own negotiating position when they're trying to sign tenants.

sorry, but Cushman & Wakefield is not a landlord...they are the premier commercial real estate services firm in the country (if not the world).

http://www.cushwake.com/cwglobal/jsp/globalHomeSSO.jsp

Yeah, Cushman and Wakefield are THE source for commercial real estate.  You're both right... occupancy rates by themselves don't show you the entire picture.  I'm trying to get a hold of the actual report, as there is a breakdown of those numbers on some of their detailed matrices... just swamped right now

[tufsu1]

I checked field...their website only lists the 2010 1st quarter report....on it, Jax. vacancy is listed as follows:

CBD - 21.6%
Non-CBD - 22.9%
Total - 22.5%

The CBD is then broken up by northbank (25.3%) and southbank (12.4%)...non-CBD areas are also broken up by subareas...note that the metro report includes Clay, St. Johns, and Nassau Counties.

[ChriswUfGator]

They're a landlord, just like I already said in one of my earlier posts, of course the landlords are going to cook up skewed stats, since otherwise they'd be undermining their own negotiating position when they're trying to sign tenants.

sorry, but Cushman & Wakefield is not a landlord...they are the premier commercial real estate services firm in the country (if not the world).

http://www.cushwake.com/cwglobal/jsp/globalHomeSSO.jsp

I am well aware of what Cushman & Wakefield is...are you?

Do they not lease and manage properties? How exactly doesn't that make them a landlord?

[ChriswUfGator]

No, Tufsu, you're clearly right as always...

Doesn't look like C&W is a landlord at all, does it? And certainly not in the Downtown Northbank. Yup, you're right again.

Oh wait, what's this....

http://looplink.loopnet.com/16094156/cushwakenational

And since you quoted them as declaring that their vacancy rates in the core were less than 20%, isn't it quite interesting that they're trying to lease out a skyscraper with 100,000 total leasable square feet, and their listing clearly indicates that 90,129 square feet of that same building are vacant and immediately available?

Maybe my calculator is broken, but that adds up to a lot more than 20% doesn't it? Isn't that actually a 90% vacancy rate? Hmm... And you're really going to argue with me when I say that these landlords skew their statistics to improve their position when negotiating leases? The proof's in the pudding on this one, wouldn't you say?

So you tell me again, whether you really believe that 20% figure you just cited to...

Did you mean to type "90%" instead of "20%" by chance?

This building is another example of what the true condition of the core is. 90% vacancy. Nice.

[Captain Zissou]

Chris, they're a commercial brokerage as well as a real estate services firm.  They are very similar to CB Richard Ellis, Marcus & Millichap, or Grubb-Ellis.  Each one of these firms has armies of analysts that crank out these statistics that the brokers use to pitch a client one way or another.

[ChriswUfGator]

Chris, they're a commercial brokerage as well as a real estate services firm.  They are very similar to CB Richard Ellis, Marcus & Millichap, or Grubb-Ellis.  Each one of these firms has armies of analysts that crank out these statistics that the brokers use to pitch a client one way or another.

I know that. That was my point to Tufsu all along...

The problem is that Tufsu is citing to a statistic published by this organization that claims their vacancy rates are 20%, and he's treating this as gospel, when a look at their available listings clearly shows their actual vacancy rate is roughly 90%.

Also, I'm not sure if we're losing each other with symantics here, but in commercial property the manager is the landlord. The actual owners are generally consortiums of investors, and the tenant never deals with that. The actual lessor/landlord is in fact C&W for Atlantic Place. The ownership structure is irrelevant, it's C&W (or some company like it) who is the actual landlord responsible for marketing, managing, and leasing the space.

[ChriswUfGator]

I checked field...their website only lists the 2010 1st quarter report....on it, Jax. vacancy is listed as follows:

CBD - 21.6%
Non-CBD - 22.9%
Total - 22.5%

The CBD is then broken up by northbank (25.3%) and southbank (12.4%)...non-CBD areas are also broken up by subareas...note that the metro report includes Clay, St. Johns, and Nassau Counties.

This is super-interesting, Tufsu!

Since Atlantic Place appears to be their biggest space under management on the Northbank, and since we just determined that tower is presently running at a whopping 90% vacancy rate according to their own listing sheet, I have such an astounding level of confidence in that 25% figure...

[tufsu1]

The problem is that Tufsu is citing to a statistic published by this organization that claims their vacancy rates are 20%, and he's treating this as gospel, when a look at their available listings clearly shows their actual vacancy rate is roughly 90%.

dude...their analysis reports overall office vacancy rates in the CBD at 22%....what the vacancy rates of one or more of the properties they are marketing is only part of the bigger picture.

btw...here's what I said previously...

"If all of the buildings downtown are so empty, why is the vacancy rate less than 25 percent?"

now it turns out that the northbank vanacy rate (which I had not seen broken out until today) is just over 25%...so yes, I guess I was way off  

[Captain Zissou]

^ I agree with you that this isn't gospel.  The statistic is generated to serve some end.  To sell investors on 'Value-Add Potential', or to justify  a higher rental rate in a different part of town.  I worked for one of the brokerages as an analyst, and I'm familiar with how these numbers are generated.  
If it says 20%, I'm sure its very close to true, but not exact.  I don't do this often, but in tufsu's defense, you are only showing 1 building with a 90% vacancy rate.  I'm sure there is another with 4% vacancy, and another with 35%, and another with 8%.

As for the landlord mess, it varies from property to property.  Often times the property owner is responsible for keeping the rent roll full, the broker just lists it.  However, the larger the property, the more likely there is for a 3rd party property manager, which could definitely be Cushman.  

However, at 90,000 sf, they're not called 'Landlords', they're called 'property managers'.  It makes no difference, but I wouldn't want tufsu to get in a huff over the difference.  

[ChriswUfGator]

The problem is that Tufsu is citing to a statistic published by this organization that claims their vacancy rates are 20%, and he's treating this as gospel, when a look at their available listings clearly shows their actual vacancy rate is roughly 90%.

dude...their analysis reports overall office vacancy rates in the CBD at 22%....what the vacancy rates of one or more of the properties they are marketing is only part of the bigger picture.

btw...here's what I said previously...

"If all of the buildings downtown are so empty, why is the vacancy rate less than 25 percent?"

now it turns out that the northbank vanacy rate (which I had not seen broken out until today) is just over 25%...so yes, I guess I was way off 

Yes, Tufsu, according to the statistic published by the very same company whose actual listing sheets indicate a 90% vacancy rate. If you believe that 25% figure, I have a fantastic deal for you on a bridge in Brooklyn. And I don't mean Jacksonville.

[ChriswUfGator]

^ I agree with you that this isn't gospel.  The statistic is generated to serve some end.  To sell investors on 'Value-Add Potential', or to justify  a higher rental rate in a different part of town.  I worked for one of the brokerages as an analyst, and I'm familiar with how these numbers are generated.  
If it says 20%, I'm sure its very close to true, but not exact.  I don't do this often, but in tufsu's defense, you are only showing 1 building with a 90% vacancy rate.  I'm sure there is another with 4% vacancy, and another with 35%, and another with 8%.

As for the landlord mess, it varies from property to property.  Often times the property owner is responsible for keeping the rent roll full, the broker just lists it.  However, the larger the property, the more likely there is for a 3rd party property manager, which could definitely be Cushman.  

However, at 90,000 sf, they're not called 'Landlords', they're called 'property managers'.  It makes no difference, but I wouldn't want tufsu to get in a huff over the difference.  

By "landlord" I meant "property manager" e.g., the party actually responsible for the leasing and operation of the building. In this case, that would be C&W. Again, sorry if we got lost in semantics. This particular building is a large highrise originally built as a bank headquarters, whatever entity owns it almost certainly is not handling their own leasing.

As far as these statistics go, I understand how they're generated, but that's about as far as I agree. They usually represent a time period, not just the present, so while that 25% figure may be C&W's vacancy rate on a trailing 24-month basis, that doesn't mean their actual vacancy rate isn't the 90% that their own listing indicates.

That was my point to Tufsu. Well not really to Tufsu, since this is his profession and he already knows all of this, but just likes to argue his losing battle in defense of asinine parking policies anyway. I guess I was pointing out that this figure he cited is inaccurate more for the benefit of everyone who hasn't had dealings in this industry, than for him. But either way, now it's done.

[Captain Zissou]

As far as these statistics go, I understand how they're generated, but that's about as far as I agree. They usually represent a time period, not just the present, so while that 25% figure may be C&W's vacancy rate on a trailing 24-month basis, that doesn't mean their actual vacancy rate isn't the 90% that their own listing indicates.

This is true.  The shear volume of work that would go into a perfect, infallible, to date statistic is cost prohibitive for a good analyst.  Their time would be better spent elsewhere.  The second a single office gets leased, that figure is inaccurate anyway.  I'm sure their statistic was for quarter 1 of 2010, using a sampling of probably 2 million sf.  The law of large numbers would say this is probably pretty accurate, but who knows.

[CS Foltz]

Kinds like dealing with the COJ departments ain't it stephen? JTA and JEA present the same thing.....phantom numbers to make them appear in the best light! In order to obtain accurate numbers you may be correct big fella!

[tufsu1]

So let me get this right, On the basis of the largest property leased by cushman and wakefield being listed at 90% vacancy---in terms of real numbers, TUFSU ascertains this as proof that the vacancy rate for the company is 25% vacancy?

ok...let's try this again...

Cushman & Wakefield has a department that does market research throughout the world....that group has determined that the overall Jax. CBD office vacancy rate for the first quarter of 2010 was 21.6%.

Cushman & Wakefield also has a brokerage department....that group manages/leases buildings throughout the world...they apparently have some buildings in downtown Jax....one of which has a 90% vacancy rate.

I never once said anything about "the company's vacancy rate being less than 25%"

Why is this so hard to understand?

[ChriswUfGator]

Kinds like dealing with the COJ departments ain't it stephen? JTA and JEA present the same thing.....phantom numbers to make them appear in the best light! In order to obtain accurate numbers you may be correct big fella!

Exactly, CSFoltz, exactly...

People throw around these numbers but at the end of the day the DT Northbank is a total ghost town, and no amount of hinky purpose-built ass-covering statistics is going to change that.

Another great case in point of how far the Northbank has fallen is the Skyline Cafe. Now don't get me wrong, I absolutely love the place. The setting and the view are knock-the-wind-out-of-you stunning.

But doesn't it say something, when the 41st and 42nd floors of our premier highrise, we're talking spaces with 30ft ceilings, wood, marble, and gilding everywhere, and a space that in any other city would represent a trophy that would command the highest of the highest rent premiums, is instead being used here to serve $5.99 sandwiches and bagged chips?