NAI Norwood Group Blog

Nothing is Certain Except CAM and Taxes

2012-01-09T15:24:00.000-05:00

written by Chris Norwood, NAI Norwood Group

The New Year’s parties are over. Thechampagne flutes and funky glasses are packed away for another 12 months. It isthat time of year for resolutions and CAM review.

It is time to break out the lease and findout who is responsible for increases in expenses. Common Area Maintenance (CAM)and Taxes are expenses that are paid for by a tenant in a triple net lease.When the Real Estate Taxes or the CAM go up (or down in some cases) the tenantis responsible. Even in some gross or modified gross leases the tenant stillhas to pay for the overage charges if the expenses go up.

Typically as a tenant pays their rent on atriple net basis, the monies that get paid in rarely equal the actual expenses.Snow falls differently than budgeted, there is more landscaping that takesplace, or the taxes went up. At the beginning of the new year the tenant shouldreceived a statement of what they paid in and what the new budget for thefollowing year is. For triple net and some gross leases the tenant will beresponsible for this increase marching forward. On most triple net leases thetenants will also have to look back over the previous year and come out ofpocket for any difference in the expenses in one stroke.

If you are a landlord or a tenant, take thenew year to review these clauses of your lease. In addition be on the lookoutfor expense “stops”. A stop is when one of the parties has a cap on theirexposure to increases. For example there may be a tenant “stop” of a 3%increase annually on real estate taxes. Therefore a tenant shall pay for thefirst 3% increase but then the landlord picks up the balance. You should lookinto these details on your lease to see what your exposure is.

There are no guarantees and leasing is noexception. As such there are no “standards” when it comes to lease language,you must consult your own lease and your own counsel if necessary. However, our team is always available shouldyou have any questions on this clause or any other’s in your lease, we will behappy to point in the right direction.

NAI Norwood Group Brokers Lease at Exeter Commons

2012-01-05T12:26:00.002-05:00

Exeter, NH - Chris McMahon of NAI NorwoodGroup's Portsmouth, NH office has leased 6,000 +/- SF of retail space to ExeterPaint and G&N Flooring by Design at Exeter Commons Shopping Center onPortsmouth Avenue in Exeter, NH. Exeter Paint and G&N Flooring By Design,the newest additions to Exeter Commons, are both locally owned businesses whichhave shared retail space on Portsmouth Avenue in Stratham for the past 10+years. When Abba Medical Supply decided to close their large store at ExeterCommons and downsize, Chris saw the perfect opportunity for these twocomplementary businesses to occupy the vacant space and add to the shoppingcenters unique tenant mix. Through a creative approach, the Tenants and theLandlord, REL Commons, LLC were able to put together a great space at ExeterCommons for both Tenants to share and operate independently. Both businessesare expected to open at Exeter Commons by April 1st, 2012. For more informationabout Exeter Paint please visit www.exeterpaintstores.com and for moreinformation about G&N Flooring by Design please visithttp://www.gnfloorbydesign.com. Chris McMahon from NAI Norwood Group is theleasing agent for the Landlord, WJP Development at all of their New Hampshireshopping centers.

NAI Norwood Groupis an affiliate of NAI Global, the world’s leading managed network ofindependently owned commercial real estate brokerage firms. Through this network of 355 offices in 55countries, NAI Norwood Group is able to leverage their strong local experiencearound the world. With our extensive background and strong local contacts, weare able to assist individual corporations in negotiating leases, sales,business brokerage, investments, relocation, site selection and development. Formore information please visit www.nainorwoodgroup.com. Or contact one of our offices: 116 South River Road, Bedford, NH03110, (603)668-7000 or 100 Market Street Suite 200, Portsmouth, NH 03801 (603)431-3001.

NH CIBOR Inducts New President

2012-01-04T13:35:00.000-05:00

Bedford, NH – In 1976 the Commercial Investment Division (CID) ofthe New Hampshire Association of Realtors (NHAR) was formed. In 1993, NHARvoted to change the CID into the New Hampshire Commercial Investment Board ofRealtors (NH CIBOR). Now over twenty years later, Chris Norwood of NAI NorwoodGroup is taking the reigns as the organizations president. In a ceremony heldon December 14^th, 2011, Norwood took the oath of office for 2012.

In his “stump” speech he discussed some of the benefits of theorganization most notably the work done through NHAR on public policy. Lastyear over 80 New Hampshire real estate specific bills were reviewed. With thehelp of NHAR, NHCIBOR and many other volunteers these bills were reviewed anddiscussed so that property ownership rights could be heard. In addition Norwooddiscussed other membership benefits upcoming in 2012.

NAI Norwood Group is pleased to have him serving the greater communityof commercial real estate brokers and their clients. Of note, he is part of thefirst Mother/Son duo to serve as NH CIBOR Presidents. Louise Norwood served asNH CIBOR president in 1998.

NAI Norwood Group is an affiliate of NAI Global,the world’s leading managed network of independently owned commercial realestate brokerage firms. Through thisnetwork of 355 offices in 55 countries, NAI Norwood Group is able to leveragetheir strong local experience around the world. With our extensive background andstrong local contacts, we are able to assist individual corporations innegotiating leases, sales, business brokerage, investments, relocation, siteselection and development. For more information please visit www.nainorwoodgroup.com. Or contact one of our offices: 116 SouthRiver Road, Bedford, NH 03110, (603)668-7000 or 100 Market Street Suite 200,Portsmouth, NH 03801 (603) 431-3001.

NH CIBOR Cares

2012-01-03T15:29:00.001-05:00

Bedford, NH – CIBOR (the NH Commercial Investment Board ofREALTORS®) is a board of commercial real estate professionals focusing on specificcommercial needs. CIBOR member Judy Niles-Simmons of NAI Norwood Group, foundedthe charitable organization CIBOR Cares. She was recently honored for her hardwork and dedication on December 14^th in front for the entire CIBORorganization.

It was in March of 2009 that CIBOR Cares became an official 501c3organization recognized by the IRS. However it took years to get to that point.Starting a few years after Katrina some members of the New Hampshire CommercialInvestment Board of Realtors (NH CIBOR), including Judy Niles-Simmons flew downto New Orleans to assist in the recovery. From this the idea was born that NHCIBOR needs an outlet for community service and engagement. As a foundingmember and the first chair, Judy worked tirelessly to create that outlet.

While the IRS status was important there were many smaller goalsbefore and after that have been important to the development of theorganization. Blood drives. Fundraising. Donations. These were the main focusesof the organization and helped meet the vision that Judy had created.

We are pleased at NAI Norwood Group to have Judy as part of ourteam.

Where Are All of the Commercial Foreclosures?

2011-12-20T10:58:00.001-05:00

In a sea of bad news, locally and nationally, we wouldintuitively think that there is a multitude of bad commercial properties comingon line in the foreclosure arena. Passive investors and users alike should be well suited to sit and waituntil that building or dirt comes on the block and they can grab it up. Howeverthe data illustrates a different picture for The Granite State.

From the beginning of the first quarter of 2010 through theend of the third quarter of 2011, there were 2255 property transfers eachmonth* in the state. In any given month only 100 of these were labeledcommercial (about 4.5%), while the balances were residential or unclassified.Commercial property transfers in the state, as the numbers show, are a smallportion of the total number of deed transfers. It should be noted however thatthere are a large number of unclassified deed transfers, about 8%, which canskew the data.

Back to the alleged tidal wave of commercial foreclosures thatare coming on line. On average there are about 100 commercial propertytransfers each month, of these about 12% are foreclosure transfers. Keep inmind this is statewide and for all property types such as free standing,condominium and land. As a point of reference residential home, condo and landforeclosures, over that same period was 15%. While these numbers may soundhigh, keep in mind that in the last real estate recession in the nineties, ourrate was up close to 20%.

Commercial foreclosure transfers in the state are far lowerthan the perception of what they should be and slightly less than theresidential homes that are being foreclosed upon. What types of properties aregetting foreclosed upon?

Of 10 Commercial Property Foreclosures…

…1 is a piece of raw land

…1 is a commercial condo

…2 are multifamily property five units or above

…6 are commercial land and building

Beyond the numbers we are not seeing these foreclosure salesaffecting the overall market in terms of huge discounts to value. Are pricesdepressed off their highs a few years ago? Yes. Are they taking the steepdiscounts that residential homes have taken? Surely not. The reason is thatthere is still demand and even when these commercial properties are purchasedat foreclosure they are being resold, released or utilized. The next time thenational press discusses the decline in value of commercial property, rememberthat The Granite State is fairing well.

*Deed transfers,warranty, quitclaim and foreclosure deed transfers.

NAI Norwood Group Leases Space to AirZone – A Play Zone For Kids

2011-11-18T15:50:00.001-05:00

Exeter, NH - NAI Norwood Group has leased 5,700 SF of retail space to AirZone at Exeter Commons Shopping Center at 75 Portsmouth Avenue in Exeter, NH. AirZone, the newest addition to Exeter Commons, is a "fun-filled" inflatable playground with slides, obstacle courses and bouncy structures galore. AirZone is designed to provide kids and families with a safe, clean, and exhilarating environment to have fun and exercise. AirZone will offer planned parties, individual admission, and more. The grand opening of AirZone at Exeter Commons is scheduled for November 25, 2011. For more information about AirZone or to book a party please visit www.airzonekids.com. AirZone has chosen Exeter Commons as their first location and plan to open more locations in the future. Chris McMahon from NAI Norwood Group is the leasing agent for the Landlord, REL Commons, LLC at all of their New Hampshire shopping centers. When Furniture Options decided to close their large store at Exeter Commons, Chris saw the perfect opportunity for a business like AirZone to take a portion of the vacant space.

NAI Norwood Group is an affiliate of NAI Global, the world’s leading managed network of independently owned commercial real estate brokerage firms. Through this network of 355 offices in 55 countries, NAI Norwood Group is able to leverage their strong local experience around the world. With our extensive background and strong local contacts, we are able to assist individual corporations in negotiating leases, sales, business brokerage, investments, relocation, site selection and development. For more information please visit www.nainorwoodgroup.com. Or contact one of our offices: 116 South River Road, Bedford, NH 03110, (603) 668-7000 or 100 Market Street Suite 200, Portsmouth, NH 03801 (603) 431-3001.

Understanding Your Exposure with Coinsurance

2011-11-18T14:46:00.005-05:00

By Craig Frank, NAI Norwood Group cfrank@nainorwoodgroup.com

In today’s economy, everyone is managing risk more than they have in the past. Commercial real estate is no different. Insurance is a huge portion of risk management that property owners and investors have to manage. However rather than looking at insurance as a common area expense that is paid out of cash flow, lets analyze it from the stand point of what happens when a loss occurs.

Understanding a Coinsurance Clause
Coinsurance is an insurance policy stipulation that a building, personal property or business income including loss of rents be insured for at least a certain percentage of its insurable value. Failure by the Insured to adequately carry the required amount of insurance will result in the Insured becoming a Coinsurer in the loss. We will focus on Building and typical Coinsurance percentages are 80, 90 or 100%. There are several different methods by which an insurance company may “value” the amount it will pay for a loss such as Replacement Cost (RC) or Actual Cash Value (ACV). For our discussion we will assume RC, so this valuation compensates the Insured for the actual cost to replace or rebuild the property with comparable material and
quality.

Loss Example
Replacement Cost of Building: $2,000,000
Coinsurance: 80%
Amount of Insurance Required: $1,600,000 (2,000,000 x .80)
Amount of Insurance Carried: $1,000,000
Loss: $400,000
Deductible: $5,000

Calculating the Loss Paid by Insurance
The insured is only going to get a fraction of this loss covered by their insurance company because of the co-insurance clause.

Amount of Insurance Carried: X Insurable Loss - Deductible = Amount of Loss Paid by Insurance
Amount of Insurance Required

$1,000,000 X $400,000 - $5,000 = Amount Paid by Insurance
$1,600,000

.63 X $400,000 - $5,000 = $247,000 (Amount Paid by Insurance)

One can see that it is important to understand how the Coinsurance Clause within the insurance policy functions. In this example the Insured was underinsured for the minimum requirement of the Coinsurance Clause by $600,000. As a result the Insurance Company will pay $247,000 of loss and the Insured will become a Coinsurer and pay $153,000. Had the Insured carried a limit of $1,600,000 (Amount required to meet the 80% Coinsurance Provision) the loss would have been paid in full, less the deductible by the Insurance Company.

SAFE Act: Who or what is a mortgage originator?

2011-10-21T14:43:00.000-04:00

Written by Sarah Carson, NAI Norwood Group

In an effort to regulate the mortgage industry, the federalgovernment passed what is known as the Secure and Fair Enforcement MortgageLicensing Act, or the SAFE Act for short, in 2008. This requires all loanoriginators to be licensed. That sounds reasonable, right? If it were only thatsimple. The law has actually caught attorneys, real estate brokers andhomeowners in a pickle.

What qualifies someone to be a mortgage originator?Technically there are two tests, a credit check and a background check. Thissounds straightforward. How does this cause trouble? A person is considered amortgage originator the moment they interact with a mortgage company, licensedor not. As attorneys and real estate brokers, one might contact a mortgagecompany on behalf of a client. Once that call is made that person has become amortgage originator. Insert penalties here. It’s a misdemeanor to act as anunlicensed mortgage originator.

How does this affect real estate owners? Well, it’s madeseller financing a scary phrase. Under the law it requires a homeowner sellinga non-primary residence to have a licensed originator in the transaction. Thehomeowner is in violation of the SAFE Act the moment they become a go-betweenfor the mortgage company and the potential buyer. If thereis a question about whether or not a person is acting as a loan originator,always look from the perspective of the buyer, to understand if that individualfrom the buyer’s view has been negotiating terms of the loan with them. Thishas made foreclosures and short sales an even more complicated issue. Not justanyone can talk to the lender.

Even more frustrating is that HUD doesn’t seem to want totake responsibility. HUD makes the rules as we all know, but both HUD and thestate Banking Department say the other is responsible for interpreting thelanguage. Without any real answers coming from either side real estate andlegal communities are chomping at the bit.

A New Hampshire attorney has already succumbed to new lawand was ordered to pay $330,000 in fines for helping his clients modify theirmortgages. While he thought he was doing a good thing for those suffering fromeconomic hardship he was actually violating the SAFE Act. What’s the sayinghere? No good deed goes unpunished.

Until the gray becomes black and white, consult aprofessional before you act. No one wants to be the guinea pig that changes thelaw even though that’s what it’s going to take.

Seacoast Power Yoga

2011-10-13T12:22:00.003-04:00

Portsmouth, NH – Andy Fleisher of NAI Norwood Group represented SeacoastPower Yoga in their relocation to 909 Islington Street in Portsmouth, NH. JasonVarney, owner of Seacoast Power Yoga, moved into the new studio at the end ofthe summer and has signed a two year lease.

909 Islingtonis a mixed use retail/office/industrial facility. Great location just minutesfrom downtown Portsmouth in area of rapid redevelopment/development. Thisproperty is conveniently located just down the street from popular Plaza 800anchored by Hannaford.

NAI Norwood Group is anaffiliate of NAI Global, the world’s leading managed network of independentlyowned commercial real estate brokerage firms. Through this network of 355 offices in 55 countries, NAI Norwood Groupis able to leverage their strong local experience around the world. With ourextensive background and strong local contacts, we are able to assistindividual corporations in negotiating leases, sales, business brokerage,investments, relocation, site selection and development. For more informationplease visit www.nainorwoodgroup.com. Or contact one of ouroffices: 116 South River Road, Bedford, NH 03110, (603)668-7000 or 100 MarketStreet Suite 200, Portsmouth, NH 03801 (603) 431-3001.

NAI Norwood Group Announces Sale of Development Land in Portsmouth

2011-09-13T13:28:00.000-04:00

Written by Sarah Carson, NAI Norwood Group

Portsmouth, NH –Is New Hampshire getting back on track on the real estate front? “The Seacoast area isrecovering quicker than the northern part of the State; the lower to mid rangehomes are recovering more quickly than larger homes,” said Ed Buczynski, SeniorVice President of Real Living | The Norwood Group. So how is this important tothe sale of development land in Portsmouth?

Greg Whalen fromNAI Norwood Group in Portsmouth represented the seller Bonhomme Richard RealtyLLC in the sale of a 5.2± acre site off Kearsarge Way in Portsmouth to ChinburgBuilders out of Durham. “This is significant because this is the first newhousing development for single family homes approved in Portsmouth for nearly adecade,” stated Whalen.

Chinburg Builders’plan has received final approvals and permits from the City of Portsmouth todivide the site into 18 single family house lots and these “high performance”homes will start in the mid $300’s. What makes this project stand out is thatthe energy efficiency of these new homes will be better than Energy Star ratedhomes. Site work is now underway with home sales starting in the spring of2012. The new community will be called Harborside Way.

Harborside Way islocated at the entrance to Atlantic Heights. The Atlantic Heights developmentwas completed in 1919 by the US Shipping Board Emergency Fleet Corporation. InSeptember 2006, the neighborhood was listed on the National Register ofHistoric Places by the United States Department of the Interior.

“It’s refreshingto see a home builder take on this market in such an aggressive manner,”commented Ed Buczynski. “It gives us confidence when looking into the future.”

To contact NAINorwood Group for your commercial real estate needs please visit www.nainorwoodgroup.com. Or contact one of our offices: 116 SouthRiver Road, Bedford, NH 03110, (603)668-7000 or 100 Market Street Suite 200,Portsmouth, NH 03801 (603) 431-3001.

To contact oursister company Real Living | The Norwood Group for your residential real estateneeds, please visit www.reallivingnorwood.com. Or contact one of the offices: 46 Route 101A,Amherst, NH (603) 673-1775; 116 South River Road, Bedford, NH (603) 472-4400;or 150 Broad Street, Nashua, NH (603) 889-1875.

Lakeview Property Sells in Northwood, NH

2011-09-06T13:20:00.001-04:00

Written by Chris McMahon, NAI Norwood Group

Northwood, NH - Brian O'Brien, RPA, Managing Broker and Chris McMahon,Sales and Leasing of NAI Norwood Group's Portsmouth NH office represented theSeller, Lakeview Antique Center, LLC in the July 27, 2011 sale of a 5,679 +/-SF retail property on US Route 4. The sale price of $353,000 represents a persquare foot value of $62.

The lakeview property, with significant frontage on US Route 4, has beenused as an antique store since early 2000 until the recent sale to Maize &Blue, LLC. The new owner has plans to renovate the property and convert intomedical office space for Northwood Family Dental with additional space on thesecond floor being converted for apartments. Rachel Eames of Eames Insuranceand Real Estate represented the Buyer, Maize & Blue, LLC.

NAI Norwood Group is an affiliate of NAI Global, the world’s leadingmanaged network of independently owned commercial real estate brokerage firms. Through this network of 355 offices in 55countries, NAI Norwood Group is able to leverage their strong local experiencearound the world. With our extensive background and strong local contacts, weare able to assist individual corporations in negotiating leases, sales,business brokerage, investments, relocation, site selection and development. Formore information please visit www.nainorwoodgroup.com. Or contact one of our offices: 116 SouthRiver Road, Bedford, NH 03110, (603)668-7000 or 100 Market Street Suite 200,Portsmouth, NH 03801 (603) 431-3001.

New Hampshire Housing Update

2011-08-19T09:55:00.005-04:00

Bedford, NH - NOTE: While NAI Norwood Group focuses on commercial real estate, our affiliate firm Real Living The Norwood Group is a 100% residential real estate brokerage operation. As the two markets are so linked, we felt a midyear review of the housing market would be helpful to all property owners. – Editor.

Nationally the housing market is heaving through the challenges of a recovery. We all knew the upswing would not be an easy climb and we are seeing that now. CNN Money discussed on August 5th that home ownership dropped to its lowest levels since 1965. We are currently as a nation at 65.9% as opposed to 2004 when home ownership was at 69.2%. As more people nationally flock to the rental market, CNN Money also reported in July that the national foreclosure rate plummeted 29% compared to this same time last year. What are we to make of these conflicting reports locally?

New Hampshire has always been unique. Through this downturn, despite the State’s budget gap, there is positive news. The state’s unemployment numbers have been hovering around 5% in 2011 while the rate of the nation is nearly twice that. Along with our strong unemployment numbers the state’s residential market has stabilized. While the number of homes sold declined over the first two quarters of this year compared to last, the average sales price of these homes were up marginally. The numbers vary largely throughout the state. The Seacoast area is recovering quicker than the northern part of the State; the lower to mid range homes are recovering more quickly than larger homes.

On foreclosures the Granite State has given different results in 2011 than the national figures. While CNN was reporting national foreclosures being down, from 2010 to 2011, New Hampshire saw an increase of foreclosures in the first two quarters of 20%. Conversely the State also saw a decrease in the number of foreclosure notices dropped over that same period, giving thought that the system is working through and that the rest of the year will see a decline in these numbers.

In addition we have seen the number of conventional loans (versus, FHA, VA etc) increase, denoting that more people are tapping into traditional sources. This is encouraging because this means more people are “financeable” through traditional lending means which increases turnover time and helps with more buyers in the market.

The forecast moving forward appears to be the same to slightly positive. What the numbers do not describe are the number of people actively searching, attending open houses and putting offers in. As recently described by one Real Living The Norwood Group team member, “July was the busiest month we have had since 2006.” People are still out searching for homes at good prices with great interest rates, trying to capitalize now, versus the unknown of the future.

In the end only time will tell, Libya, the Debt Ceiling and the Tsunami have jittered a recovering national economy. However through this all, the New Hampshire market is stabilizing and as the NAI Norwood Group team will tell, there are job creators out there adding new space, which is a good sign moving forward.

Ed Buczynski
Senior Vice President
Real Living The Norwood Group

C-III Capital Partners to Acquire NAI Global

2011-08-16T12:01:00.006-04:00

NEW YORK, NY, June 22, 2011 — C-III Capital Partners LLC (C-III) announced today that it has entered into a definitive agreement to acquire NAI Global, the largest and premier network of independent commercial real estate firms worldwide. C-III is led by Andrew L. Farkas, who founded and was Chairman and CEO of Insignia Financial Group, Inc. (NYSE:IFS). NAI Global will continue to operate as a separate company under its current management following the acquisition.

NAI manages a network of commercial real estate firms comprising 5,000 professionals and 350 offices in the US and 55 countries throughout the world. NAI’s network members provide a full spectrum of corporate, financial, technology and project management services.

“C-III plans to use its asset base, along with strategic acquisitions such as NAI, to create a fully diversified commercial real estate services company,” said Mr. Farkas. “This is the strategy that was successful for Insignia. C-III is led by the same team that built Insignia, and with C-III’s significantly larger asset base, I believe C-III can substantially exceed Insignia’s success,” concluded Mr. Farkas. At its height, Insignia managed $12.5 billion in assets, while today C-III’s portfolio approximates $150 billion in assets. Insignia was one of the largest commercial real estate services companies in the world when it merged with CB Richard Ellis in 2003.

C-III commenced operations with the purchase of Centerline Capital Group’s institutional real estate debt fund management and commercial mortgage loan servicing businesses in March 2010. Since that time, C-III has successfully launched mortgage origination, investment sales and title insurance businesses from scratch, and expanded its principal investment, loan origination fund management and primary and special loan servicing businesses.

“Today’s agreement represents a tremendous opportunity for NAI and our members,” said Gerald C. Finn, Chairman of NAI Global. “By teaming up with Andrew Farkas, one of the world’s leading real estate businessmen, we expect NAI will be able to significantly grow its service offerings and present new opportunities to our members.”

“We have built the world's leading commercial real estate network, but we now believe it is time to take the enterprise to a new level and add even greater value to our members and our collective corporate and investment clients. The combination with C-III will provide a depth of resources, talent and tools from which we can draw upon to accelerate our growth,” noted Jeffrey M. Finn, President and CEO of NAI Global. “Rarely do you find partners so perfectly strategically aligned as NAI Global and C-III. This is a natural fit and extremely exciting news for the industry.”
The transaction is expected to close in the third quarter of 2011. Financial terms of the transaction were not disclosed.

About C-III Capital Partners
C-III Capital Partners LLC is a leading commercial real estate services company engaged in a broad range of activities, including primary and special loan servicing, loan origination, fund management and principal investment. The company’s principal place of business is located in Irving, TX, and it has additional offices in New York, NY, Greenville, SC and Nashville, TN.

C-III Asset Management LLC, a wholly-owned subsidiary of C-III Capital Partners, is a highly rated servicer (primary and special) of commercial real estate loans. Its clients include issuers of commercial mortgage-backed securities (CMBS) and collateralized debt obligations (CDOs), institutional lenders and other investors. C-III Asset Management is the primary servicer for approximately $20 billion and the named special servicer for approximately $127 billion of commercial real estate loans. C-III Asset Management is rated CPS 2- by Fitch and Above Average by Standard and Poor's as a primary servicer, and is one of the highest rated special servicers in the industry with ratings of CSS 1- by Fitch and Strong by Standard and Poor's.

About NAI Norwood Group
NAI Norwood Group is an affiliate of NAI Global, the world’s leading managed network of independently owned commercial real estate brokerage firms. Through this network of 355 offices in 55 countries, our extensive background and strong local contacts, we are able to assist individual corporations in negotiating leases, sales, business brokerage, investments, relocation, site selection and development. For more information please visit www.nainorwoodgroup.com. Or contact one of our offices: 116 South River Road, Bedford, NH 03110, (603)668-7000 or 100 Market Street Suite 200, Portsmouth, NH 03801 (603) 431-3001.

Jeanne Butler of NAI Norwood Group Sells Mobile Home Park

2011-06-28T11:49:00.007-04:00

Written by Sarah Carson, NAI Norwood Group

Bedford, NH – NAI Norwood Group and Jeanne Butler are pleased to announce the sale of a 12 site mobile home park in Hillsboro, NH. The park is situated on 2.9 acres and also included a cottage, restaurant, tool shop, and craft shop in the sale. This was a great investment for the new owners, Bay Point Realty. Jeanne Butler represented the seller, Bob Ploettner in this transaction. The sale was completed on June 23, 2011 for $230,000.

When asked about the park and transaction Butler had this to say, “although this property had many challenges including a fire a few weeks before closing, the buyer and seller ultimately wanted a sale and were able to come together”. She also noted that Hillsboro and its residents can look forward to a renovation in which new commercial tenants will be added. Broker, Jeanne Butler looks forward to representing mobile home park owners in the future.

NAI Norwood Group is an affiliate of NAI Global, the world’s leading managed network of independently owned commercial real estate brokerage firms. Through this network of 355 offices in 55 countries, NAI Norwood Group is able to leverage their strong local experience around the world. With our extensive background and strong local contacts, we are able to assist individual corporations in negotiating leases, sales, business brokerage, investments, relocation, site selection and development. For more information please visit www.nainorwoodgroup.com. Or contact one of our offices: 116 South River Road, Bedford, NH 03110, (603)668-7000 or 100 Market Street Suite 200, Portsmouth, NH 03801 (603) 431-3001.

IT IS THE BEST TIME TO BUY SELF STORAGE

2011-06-24T09:44:00.005-04:00

Self storage has sometimes been called recession proof. I am not sure about that. But I do know that it is recession resistant. By this I mean that in good economies people store for positive reasons. That is, people store because they have more things to store like snow mobiles, 4 wheelers, boats and classic cars etc. During downturns people store for less positive reasons like scaling down from a house to an apartment and they hold on to things in hopes that the economy rebounds. Or families consolidate so some things that are important to them have to be put in storage.

As far as self storage becoming recession proof, I do not see any indication that that is the case. A benchmark that I found useful is that if warehouse space reaches a vacancy rate of greater than 10% and the unemployment rate exceeds 10%, this vacant space will put pressure on self storage, like it did in the 1991 recession and vacancies in self storage will increase beyond normal levels. This is due to the fact that landlords of warehouse space will start leasing out space to smaller and smaller storage uses at very low rents.

Since I do not see the New England economy getting to that vacancy level in most areas, the financing climate has made self storage a compelling investment right here and right now. By this I mean that, for an investor with good credit scores, banks are very willing to lend to self storage operators for all of the reasons I noted above. One can borrow with very favorable terms with an interest rate of 6% or less. In addition, the Small Business Administration has expanded its borrowing activities to self storage. This is a new and very positive development for the self storage industry.

The most important reasons for investing in self storage is because this recession resistant investment class will perform better in an inflationary period and an investor will be able to pay back the loan with dollars that will be worth less in buying power as the value of hard assets rise exponentially in inflationary times. Also, if one can lock in these low interest rates now, one can avoid borrowing at higher inflationary rates if they do not wait until inflation comes before making an investment in real estate. This borrowing opportunity adds to the positive cash flow of self storage. Lastly, the equity that is being built up tax deferred due to the pay down of the mortgage over time adds to the total return for this fine investment class.

The other reason why self storage is a good buy now is that many investors are fearful of another downturn in the economy. So the competition for buying investments now is very low. And, if you will make an offer on self storage, you will find out the lowest price the seller is willing to take. Some believe that self storage is a distressed asset class, but this is not the case, because occupancies are very good in most markets in New England. So, even if you are the only offeror, you cannot buy self storage in New England at a deep discount like you can in areas like Florida and Nevada. In the words of the astute investor Warren Buffet, “Buy when everyone is scared and sell when everyone is giddy”. If you accept the wisdom of Mr. Buffet then now is the time to buy.

I have been a real estate broker through 5 recessions. I started with the oil embargo of 1973 when you could only buy $2 worth of gas at a time. In closing I will ask you the same question I ask all of my clients. Which one of those 5 recessions did not turn out better after it was over? The answer is none or I would not be writing this article to you about investing in real estate. The comeback is, yes Joe, but this recession is different. After short laugh, I remind that person that in 1991 there were no banks in New England to lend to anyone. The market was controlled by the FDIC. Today we have wonderful banking opportunities for creditworthy borrowers. This recession is only different in that it is not nearly as bad as the others. However, inflation is coming soon. Those investors who buy hard assets with good cash flows will increase their wealth significantly in the coming years.

Written by Joe Mendola, NAI Norwood Group, joe@nainorwoodgroup.com

Commercial Real Estate Regulations That May Surprise You

2011-05-24T09:55:00.008-04:00

I am a political junkie. While most kids may have gotten autographs of their favorite baseball player, or perhaps a rock star, when I was younger I got an autographed Union Leader from the all of the1992 Presidential Primary’s…. Yes I am a political dork. Where else then would I find excitement but by being down in Washington DC for the National Association of Realtors’ (NAR) midyear political meetings. We had a chance to meet with New Hampshire’s entire delegation as well as their staff. The discussions we had with the delegation were mostly dealing with real estate issues affecting the residential industry. However it was in DC at these meetings that I was made aware of a few items that are on the rule making side of the coin, and not tied in with the current legislative session.

You may have heard that the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) have proposed changes to how tenants place their leases onto their financial statements. The old method of noting them will no longer apply and the new method, if adopted, will require leases be capitalized on the balance sheet. There will be an obligation of payment as a liability, and then offsetting “right of use” as an asset. The details are immense, complicated and raise questions such as lease options, net payments and percentage rents. According to NAR, in April of this year both Boards agreed to delay the finalization of these rules for at least a few months. If adopted, these rules could be a huge change for a property manager accounting for nets, and large public tenants who may require shorter term leases in order to protect their balance sheet.

According to NAR, on May 6, 2010 the Environmental Protection Agency (EPA) released an Advanced Notice of Public Rulemaking concerning the renovation, repair and painting programs for commercial and public buildings. You may be familiar with this if in the last 18 months you have done any renovation to an older residence. Under the residential rules contractors conducting any repair on a home or apartment have to adhere to many new rules including the quarantining of the area. The new proposed rules, if the go into effect, would make these same measures applicable for commercial buildings, both interior and exterior. While it is unclear when and if these will come into play, there is no question what the impact could mean for commercial real estate property owners.

NAI Norwood Group and this news blast will keep you abreast of anything we hear on these and other rules that may affect you and your business. In the mean time it may be important for you to discuss these issues with other provisional advisors such as accountants and CPAs. Be it rulemaking or legislation, there is no question that we must always take part in the process and be proactive to learn more.

Written by Chris Norwood, NAI Norwood Group, cnorwood@nainorwoodgroup.com.

NAI Norwood Group Sells 50,000 SF Industrial Building

2011-05-10T14:03:00.009-04:00

by Sarah Carson, NAI Norwood Group

Bedford, NH – NAI Norwood Group is pleased to announce the sale of 109 Industrial Park Drive in Franklin, NH. This industrial property consists of a 50,000 SF state of the art manufacturing facility inclusive of 8,270 SF of office space and sits on 10.14 acres. This well located facility was sold on March 31, 3011 for $2,200,000.

Karl Norwood, Joe Mendola and Todd Norwood of NAI Norwood Group represented the seller, Business Finance Authority. Michael Gagne of the Bean Group represented the Buyer. Authentic Trends Company, Inc, a coffee and tea manufacturer and distributor, purchased the Industrial Drive building and is currently running their operations from this location.

Karl Norwood stated, “We are very pleased to represent and assist the BFA with this transaction.”

This was the second sale for the Business Finance Authority negotiated by NAI Norwood Group in less than a year. The previous sale was a 48,652 SF industrial building in Laconia, NH.

NAI Norwood Group is an affiliate of NAI Global, the world’s leading managed network of independently owned commercial real estate brokerage firms. Through this network of 350 offices in 55 countries, NAI Norwood Group is able to leverage their strong local experience around the world. With our extensive background and strong local contacts, we are able to assist individual corporations in negotiating leases, sales, business brokerage, investments, relocation, site selection and development. For more information please visit www.nainorwoodgroup.com. Or contact one of our offices: 116 South River Road, Bedford, NH 03110, (603) 668-7000 or 100 Market Street Suite 200, Portsmouth, NH 03801 (603) 431-3001.

What’s a QR Code and how are we applying it to real estate?

2011-04-21T12:10:00.008-04:00

What’s a QR Code? It’s the bar code shown to the left. You might be asking yourself what you’re supposed to do with that. Well, if you take your smartphone (Android, Blackberry, iPhone, etc) you will find there is a free app called QR Code Scanner. Download this app and you will be able to read the information the code provides.

You might have seen these around and not known what they were or what to do with them. Originally these were made in Japan to track vehicle manufacturing parts back the early 1990’s. Today you can find QR codes in and on video games, tourist locations, in-store displays, mailing campaigns, tradeshows, museums, and even billboards. The codes provide anything from general information, to instructions, to customer feedback forms, to even your receipt for a purchase.

What exactly is a QR Code? QR stands for Quick Response. Essentially data such as a website link is stored within the code and it allows you to scan the code and receive the information via the internet. It can also store simple text that can be viewed right on your phone. This is also known as mobile tagging. The difference between a product bar code you see at the store everyday and a QR code is the amount of data it can hold.

Fun facts: 57% of Facebook and Twitter users say they have scanned a QR code at least once in the last 12 months. 40% consider themselves frequent users having scanned more than 5 times. There’s a 1200% increase in scanning QR codes in general from July 2010 to December 2010. Starbucks is starting to use QR codes for payment.

The population of smartphone users is growing. According to Burson Marsteller, research shows 78% of Fortune 500 companies use QR Codes and that number is still growing. This is just the beginning.

So why use QR Codes in real estate? While Internet searches and print advertising are grand, using QR Codes is mass marketing in the area we are selling or leasing property. In a real estate office how often does the phone ring and the conversation begin with, “I saw your sign at…”? It’s a huge number of times. If someone is walking downtown Portsmouth and sees my retail space they can take out their phone, scan the code, and receive the data to their phone immediately. Customer satisfaction achieved on the spot. And, it’s completely traceable. We can track how many people are scanning our code at any given time. It’s one of the easiest, free marketing strategies available. Because of all of the reasons above, the number of people who use and feel comfortable using QR codes is growing. It also allows us to give more data to our customers than a normal sign will allow, and then can then share that data with other decision makers in their company.

But what about you? How will you personally use QR codes outside of the business world? Jade Monkey Tattoo in Phoenix is now offering QR code tattoos. The reason? In case of an accident there can be medical information, personal information like your name and address, or perhaps it goes to your website when scanned. If this becomes the way of the future will your first tattoo be a QR code?

Written by Sarah Carson, NAI Norwood Group, scarson@nainorwoodgroup.com

Our offices: 116 South River Road, Bedford, NH 03110, (603)668-7000 or 100 Market Street Suite 200, Portsmouth, NH 03801 (603) 431-3001.

NAI Norwood Group Successfully Leasing Space at Woodbury Corner in Newington, NH

2011-03-25T11:17:00.009-04:00

Portsmouth, NH – NAI Norwood Group is pleased to announce two recent lease signings at 2001 Woodbury Avenue in Newington, NH. Horizon Group, an authorized Batteries Plus Franchisee, has leased 3,600 +/- square feet and Wireless Link, LLC, an authorized Sprint Dealer, has leased 1,300 +/- square feet of retail space.

Brian O'Brien, RPA and Chris McMahon of NAI Norwood Group represented the Landlord in both transactions. Strategic Retail Advisors represented Wireless Link, LLC and Charles Zoulias of Perfecta Real Estate represented Horizon Group.

The newly re-developed retail strip center on the corner of heavily traveled Woodbury Avenue and Gosling Road is prime real estate. Prior to re-development, 2001 Woodbury Ave, was home to one of Tweeter, Etc.'s New Hampshire locations. The re-development of this high profile retail property has brought with it the opportunity for national, regional, and local retail tenants to position themselves well in the Newington / Portsmouth NH retail market. The property is owned by Riverside Properties, Inc. based in Wellesley, MA. Additional retail spaces from 1,900 +/- SF to 4,475 +/- SF are available at Woodbury Corner.

TMS Architects, located in Portsmouth, was chosen to revamp the old building inside and out. Jason Bailey at TMS Architects commented, “The main purpose was to break the space into four suites and maximize street frontage. The colors and architecture chosen utilize a traditional approach to contemporary architecture, creating a more timeless look. It’s no longer the Tweeter building, it’s a new entity.”

Malt House Construction, also located in Portsmouth, was chosen as the building contractor to carry out the design set forth by TMS Architects. Sandy Dewing, President of Malt House Construction had this to say about working on the project: “It was challenging, but it was a good project for our company. It definitely improves the intersection. With the support of the owners and a great design from TMS the project has gone smoothly”.

NAI Norwood Group is an affiliate of NAI Global, the world’s leading managed network of independently owned commercial real estate brokerage firms. Through this network of 325 offices in 55 countries, NAI Norwood Group is able to leverage their strong local experience around the world. Whether your commercial real estate needs require local expertise, or you need brokerage consulting around the world, the firm is here to help. With our extensive background and strong local contacts, we are able to assist individual corporations in negotiating leases, sales, business brokerage, investments, relocation, site selection and development. For more information please visit www.nainorwoodgroup.com or please contact us at one of our offices: 116 South River Road, Bedfrod NH, 606-668-7000 or 100 Market Street Suite200, Portsmouth NH, 603-431-3001.

Written by Chris McMahon and Sarah Carson of NAI Norwood Group
Quotes submitted by Sandy Dewing of Malt House Construction and Jason Baieley of TMS Architects

To contact Chris McMahon: cmcmahon@nainorwoodgroup.com
To contact NAI Norwood Group Marketing Dept: scarson@nainorwoodgroup.com

Jeanne Butler of NAI Norwood Group Sells 13,680 SF Industrial Building

2011-03-22T12:14:00.005-04:00

Bedford, NH – NAI Norwood Group is pleased to announce the sale of 13,680 SF industrial building located in Auburn, NH. Jeanne Butler, of NAI Norwood Group, represented the owner, 47-2 King’s Court LLC, and David Morin, of Prudential Verani, represented the buyer, Air Solutions & Balancing LLC.

The newer 13,680 SF industrial building sold due to the excellent highway access, 20ft ceiling height, young age of 5 years, three drive-in doors and two docks. This building sold quickly. It was divided into 3 separate units. Air Solutions & Balancing moved in immediately and is open for business. The middle condo unit is currently available for lease.

NAI Norwood Group is an affiliate of NAI Global, the world’s leading managed network of independently owned commercial real estate brokerage firms. Through this network of 325 offices in 55 countries, NAI Norwood Group is able to leverage their strong local experience around the world. Whether your commercial real estate needs require local expertise, or you need brokerage consulting around the world, the firm is here to help. With our extensive background and strong local contacts, we are able to assist individual corporations in negotiating leases, sales, business brokerage, investments, relocation, site selection and development. For more information please visit www.nainorwoodgroup.com. Or contact one of our office: 116 South River Road, Bedford, NH 03110, (603)668-7000 or 100 Market Street Suite 200, Portsmouth, NH 03801 (603) 431-3001.

Written by Jeanne Butler and Sarah Carson of NAI Norwood Group
Contact Jeanne Butler: jbutler@nainorwoodgroup.com
Contact NAI Norwood Group Marketing: scarson@nainorwoodgroup.com

NAI Norwood Group Leases Space to Raider Laser LLC

2011-03-21T15:44:00.006-04:00

Portsmouth, NH - Raider Laser LLC the NH Seacoast’s newest family attraction has signed a lease for 6,000 sf space located at 25 Fox Run Road, Newington, NH across from Wal-Mart. Roger Rivers, the owner of Raider Laser states, “Our facility will be the most advanced laser tag experience in the country”. Along with creating a state of the art Gosport 2268 laser tag arena, Raider Laser will feature an SR2, 12 passenger motion simulation ride, the first Aero Ball arena in the northeast, as well as redemption games and prizes. Raider Laser will also offer a diverse menu of foods and beverages in its 80 seat dining and birthday party center. Rivers wished to add, “I contacted Chuck Goss of NAI Norwood Group at the beginning of our location search. Chuck listened to our needs and secured the perfect location for Raider Laser.” Raider Laser management plans to open mid-April this year.

Chuck Goss represented the Landlord (Horizon Trust) in the lease negotiations in securing for the Tenant Raider Laser LLC. Earlier this year Mr. Goss represented the Landlord in the Adaptations lease and they have been opened and very pleased with their new store.

NAI Norwood Group is an affiliate of NAI Global, the world’s leading managed network of independently owned commercial real estate brokerage firms. Through this network of 325 offices in 55 countries, NAI Norwood Group is able to leverage their strong local experience around the world. Whether your commercial real estate needs require local expertise, or you need brokerage consulting around the world, the firm is here to help. With our extensive background and strong local contacts, we are able to assist individual corporations in negotiating leases, sales, business brokerage, investments, relocation, site selection and development. For more information please visit http://www.nainorwoodgroup.com/.

Written by Charles Goss and Sarah Carson @ NAI Norwood Group
To email Charles Goss: cgoss@nainorwoodgroup.com
To contact the marketing department: scarson@nainorwoodgroup.com

Contact us: 116 South River Road Bedford NH 603.668.7000
or 100 Market Street Suite 200 Portsmouth NH 603.431.3001
http://www.nainorwoodgroup.com/

Buying an Existing Business vs Starting from Scratch

2011-03-21T12:48:00.009-04:00

March 2011

So you have made the decision to become an entrepreneur. Starting a business is no easy task. If you are serious about operating your own business, you might want to consider minimizing some of the anguish and pain associated with startups by purchasing an established business.

Since many experts have predicted that a significant percentage of the workforce will be working in a self-employment capacity in the next decade, business ownership is becoming increasingly more important to many people.

For a financing perspective, you'll have a much easier time securing capital from lenders by taking over an established business, than starting one from scratch. Not to mention, you’ll dramatically minimize the financial risk to yourself and your finance partners because the company will have proven revenue and a customer base. Many lenders will fund 50% to 75% of the acquisition cost for businesses depending on a number of factors such as the cash flow numbers, assets and security available.

Buying an existing business will dramatically reduce the risk when compared with start-ups since statistics estimate that 60% of start-up businesses fail within the first three years. Additionally it takes two years on average for a start-up to become profitable. Your chances of success are still clearly best when you buy an existing business.

Written by Pierre Elie @ NAI Norwood Group
Contact Pierre at pelie@nainorwoodgroup.com or in the Portsmouth office.

Contact us at:
116 South River Road
Bedford, NH 03110
(603) 668-7000

or

100 Market Street Suite 200
Portsmouth, NH 03801
(603) 431-3001

or visit us at http://www.nainorwoodgroup.com/

2011 – The Year Ahead

2011-01-24T18:44:00.007-05:00

Welcome to 2011! It took a bit to get here, but I think we are all pleased to be here. It is the year of no elections, the year of positive outlooks, and the Year of The Rabbit. What does it have in store for commercial real estate?

We begin our look ahead by looking back at what we have done this year. One of the key indicators on how much commercial real estate we need is employment. In late 2009 New Hampshire was faced with an unemployment rate of close to 7%, today we are almost a point and a half lower at 5.5% (http://www.bls.gov/; http://www.nh.gov/). In discussions with staffers and employers, job growth, a far better indicator, is slow. While a few New Hampshire firms are growing, most growth is done with a few part timers here, or a full timer there. Signs are positive that there is growth however there can never be enough positive stories and antidotes about large scale hiring.

Residential real estate is a bit of a loose benchmark, but historically the rise and fall of commercial is preceded by residential by 12-24 months. In 2010 New Hampshire saw the number of home sales grow by over 30%, off the trough of 2009. In addition the average home price rose by 5% (Real Living The Norwood Group). If history is an indicator, with a better unemployment outlook and home sales, this should mean that commercial real estate will be on the rise in 2011.

Indicators do not always come via statistics. As mentioned before election year is over! Judging by the 24 hour news cycle the 2012 election may as well be tomorrow. Regardless of who won or lost last November, knowing the outcome of the election means the world to investors and users of commercial real estate. Business decisions are based on certainty and knowing that the lame duck session is over was a big step to positive growth. Closer to home there lurks a problem. The looming budget deficient in Concord is presenting itself as a potential key issue for real estate. Leaving off the speculation on how much the shortfall may be, it is sure enough to say the impact may be widespread. Cuts in services? Increase of real estate taxes? These are the “in your face” variety of possibilities. However, what about softer ones like a change in the fees required by your town for development? What about rulings that affect your taxes that are not passed through legislative review first? (it has happened before with 1031 exchange issues). All in all the political view for commercial real estate is a push, too many clouds to see through in this crystal ball.

The final, and possibly the most important, is the gut feel. This indicator is often right with an equal chance of being wrong! However, in talking with members of our commercial real estate team the feelings are good. More people looking at property, more people discussing moving or growing, this means more business. Key result areas to look at this coming year will be energy improvements to the building envelope, as the energy prices rose 6.6% (http://www.bls.gov/). In addition, land development may come back as investment in infrastructure has created new corridors for growth. Lastly, rate lock downs will remain for the rest of the year. Rate could mean interest, lease or basis, but locking in today’s rates will be important moving forward.

In the end I will not be able to tell you what 2011 has to offer until 2012, but until then be confident but be watchful. While there are forces outside of our control that we must watch to measure the impact, the indicators are positive that we are seeing growth both objectively and subjectively.

To contact NAI Norwood Group visit our website at http://www.nainorwoodgroup.com/ or contact one of our offices: 116 South River Road, Bedford, NH 03110 (603) 668-7000 or 100 Market Street #200, Portsmouth, NH 03801 (603) 431-3001.

Movin’ and Shakin’ – Retail Real Estate in Greater Portsmouth NH

2010-11-19T15:40:00.010-05:00

NAI Norwood Group
November, 2010

NAI Norwood Advisor Article

It is no secret that Portsmouth, New Hampshire and its surrounding area is a highly desirable place for residents, businesses, restaurants, retailers, and tourists. This small city with a population of only 20,443 (nh.gov) is said to draw up to 100,000 people per day on the busiest of days. The downtown area of Portsmouth, laden with its historic buildings, brick walkways, historic sites, casual and fine dining restaurants, hotels, bed & breakfasts, busy nightlife, and local retail shops is a haven for high-end businesses, wealthy individuals, and tourists alike. Looking beyond downtown Portsmouth, there are several other areas offering shopping and entertainment for residents, tourists, and the 50,000+ employees working within seven miles of downtown. These areas include the high traffic Lafayette Road, Islington Street, and Woodbury Avenue retail corridors. In effect, this makes the Portsmouth market an extremely sought after area to open a restaurant or retail-related business.

New Hampshire has faired the recent global recession quite well with a current unemployment rate of 5.1% compared to 9% nationally (Public Data - Google). Within NH, Portsmouth has weathered the storm even better with a current unemployment rate around 4.7%, positive job growth, several new construction projects under way, new business openings, and a minimal amount of business closures. This strong local economy has a major impact on the success of the local, regional, and national businesses who choose to locate in this vibrant seacoast community. By combining a strong local economy with heavy tourism and wealthy residents you get a perfect recipe for retail-related businesses. Officially, the recession is over (Huffington Post) and it is important to look back at what 2010 has meant for Portsmouth retail business openings, movements within the market, retail business closings, retail related real estate sales and new / re-development retail projects currently underway.

New Store Openings in 2010: Starting with the best news, there have been a fair amount of retail-related store openings in greater Portsmouth thus far in 2010. Below are some examples:

1. Lowes Home Improvement: Greenland Road in Greenland next to Target
2. Home Goods: Woodbury Ave in Portsmouth next to Shaw’s Supermarket
3. Savers Thrift Store: Woodbury Ave in Newington next to The Fox Run Mall
4. Subway: Lafayette Road in Portsmouth next to Big Lots and Goodwill
5. LaBella Italian Restaurant: Lafayette Road in Portsmouth next to Big Lots and Goodwill
6. Maximum Mattress: Woodbury Ave in Portsmouth next to Dollar Tree
7. Vitamin Shoppe: Woodbury Ave in Portsmouth in front of Shaw’s Supermarket
8. Roundabout Diner: Portsmouth Traffic Circle attached to Best Western in Portsmouth
9. Foobar Restaurant: Congress Street in downtown Portsmouth
10. Chef’s Table Restaurant: State Street in downtown Portsmouth
11. Accents in Glass: State Street in downtown Portsmouth
12. 106 Kitchen and Bar: Penhallow Street in downtown Portsmouth
13. Port City Convenience: Hanover Street in downtown Portsmouth
14. Mombo Restaurant: Strawberry Bank Museum next to Prescott Park in Portsmouth
15. Greenovations Home Improvement Store: Lafayette Road next to Bowl-O-Rama

Store Re-locations in 2010: In addition to the store openings mentioned above, there have also been several lateral moves in the market place as leases expire and businesses expand, contract, or take advantage of an available location that better suits their needs. A few of these moves include:

1. Wireless Zone: Moved from Woodbury Ave to Lafayette Rd. next to the Meat House
2. Bournival KIA: Moved from 2458 Lafayette Rd. to the former Lincoln-Mercury Dealership on Lafayette Rd.
3. Second Time Around: Moved from 29 Congress Street to 19 Congress Street (former GAP Inc.)
4. The Denim Rack: Moved from Bow Street to Congress Street (former GAP Inc.)
5. Adaptations: Moved from the Spaulding Turnpike to Fox Run Road next to Wal-Mart
6. Yarn Basket: Moved from Hanover Street to Deer Street
7. Fast Eddies Dirty Laundry: Moved from Congress Street to Market Street
8. Mojo’s Grill and Tavern: Moved from Islington Street to Brewery Lane (former Brewery Lane Tavern)

Store Closures in 2010: It’s not all good; there have been a few retail stores and restaurants that have shuttered their doors over the past year. Here is a list of business closures:

1. Jumpgate Science Fiction: Closed store located on Lafayette Road in Portsmouth
2. Commonwealth Lacrosse: Closed store located on Lafayette Road in Portsmouth
3. The Frame Shop: Closed store located on Deer Street in Portsmouth
4. The Muddy River: Closed restaurant on Congress Street in Portsmouth
5. A.C. Moore Arts and Crafts: Closed store on Woodbury Ave next to Shaw’s Supermarket in Portsmouth
6. Blockbuster: Closed store on Islington Street next to Hannaford in Portsmouth
7. Outback Steakhouse: Closed restaurant on Woodbury Ave next to the Mall in Newington
8. Gap Clothing: Closed store on Congress Street in Portsmouth
9. Jennifer Convertibles: Closed store on Woodbury Ave next to Dollar Tree in Portsmouth

Retail Related Real Estate Sales in 2010: Overall, there has been a decent amount of movement in the retail-related real estate sales. In 2010, there has been over $15,000,000 in recorded sale transactions in the retail sector. Many of the larger transactions are listed below:

1. 2700 Lafayette Road, Portsmouth: Former Portsmouth Fire Station purchased by an investor at auction
2. 2458 Lafayette Road, Portsmouth: Former KIA Dealership purchased by Salvation Army for a thrift store
3. 750 Lafayette Road, Portsmouth: 4.0 acre retail development parcel sold. Current home of Jeep Dealer
4. 135 Islington Street, Portsmouth: Former Exxon gas station sold
5. 175 High Street, Portsmouth: Downtown, mixed use property sold, four retail units totaling 6,200 SF
6. 121 Congress Street, Portsmouth: Retail condo purchased by new restaurant, Breadward Baking Co.
7. 30 Maplewood Ave, Portsmouth: Office building purchased by developer, 15,000 SF planned retail
8. 233 Vaughan Street, Portsmouth: Industrial building purchased by developer, 10,000 SF planned retail
9. 1725 Woodbury, Portsmouth: Mr. Bubbles Car Wash purchased by an investor
10. 106 Penhallow Street, Portsmouth: Restaurant building purchased for new 106 Kitchen and Bar restaurant
11. 1980 Woodbury Ave, Portsmouth: Sale of Mobil Gas Station to an investor
12. 1400 Lafayette Road, Portsmouth: Sale of 0.33 acre retail property improved with a gas station at auction

New / Re-development Retail Projects underway in 2010: A good sign of recovery and a strong local market is the vast amount of construction activity taking place in the greater Portsmouth market. There are currently several new and re-development projects taking place that will provide around 70,000 SF of space ready for occupancy in 2011. Some of these projects include:

1. 2001 Woodbury Ave, Newington: Re-development of former Tweeter, Etc. property to accommodate 1,000 to 9,300 SF retailers – 2011 delivery
2. 99 Bow Street, Portsmouth: New construction of a 53,000 SF waterfront office building includes plans for 25,000 SF of retail and restaurant space – 2011 delivery
3. 100 Portwalk Place, Portsmouth: New construction of 31 unit luxury apartment building will include 9,500 SF of first floor retail space – 2011 delivery
4. 51 Islington Street, Portsmouth: New construction of a residential condominium project will create around 12,000 SF of retail space – 2011 delivery
5. 2454 Lafayette Road, Portsmouth: Re-development of the 165,000 SF Southgate Shopping Plaza continues with the blasting and leveling of a portion of the property.
6. 800 Lafayette Road, Portsmouth: New construction of a convenience store and gas station.
7. 111 Maplewood Ave, Portsmouth: Re-development of the former Portsmouth Herald building has created 13,500 SF of retail space.
8. 2800 Lafayette Road, Portsmouth: Re-development of the former Wendy’s restaurant to accommodate a new, local seafood restaurant in 2011 is underway.

After taking a close look at the recent retail-related activity in Portsmouth it appears there has hardly been a recession at all. Properties are continuing to sell, vacant spaces continue to lease, new retail / restaurants continue to open, and construction projects are underway. The Portsmouth Chamber of Commerce reports that downtown retailers saw a major improvement in the 2010 summer season over the previous year. An increase in consumer confidence and great weather can definitely be considered to be contributing factors to the mentioned retailer’s successes this past summer season. What will 2011 bring? Time will tell, but a signals tell us that Portsmouth, New Hampshire will continue to thrive maintain its appeal to local, regional, and national retailers and restaurants.

What are you hiding from the assessor?

2010-10-15T15:55:00.005-04:00

By Chris Norwood

Google Maps with their encompassing satellite view and their creative street view, became the subject of some controversy this summer, over a warm weather tradition: the pool party. You may be asking what pool parties and maps have to do with commercial real estate, but I assure you there are connections.

Last winter in Greece, CNN had reported that amidst financial slow down, Greek officials had begun to use Google Maps to locate property improvements that had not been reported to the local municipality. Houses, villas and of course pools, were items that had not been reported to the tax officials. Over this summer, it was reported that this trend caught on state side. On Long Island in the town of Riverhead 250 pools were found by town officials that had not been permitted. They used web based mapping and $75,000 of fines were levied. In a lighter hearted, but still unsettling story, Facebook and Google Maps were the tools that London teens used to collaborate to have spontaneous pool parties at pools where home owners were absent.

This has spawned debate over what is and what is not private. Perhaps Orwell was off by 26 years or so but it is honest for us to agree that Big Brother is watching us. Now take some time to think about your assets. Have you made any improvements to the lot over the years that may not have been permitted? Might a few trees met their demise in the back of your lot to improve a view or make way for parking? More maliciously are their items of value (copper in particular) that a savvy thief could spot on the roof top of your investment asset that could be removed?

These are not meant to be scare tactics nor are they meant to spawn a large debate. These tactics are here to stay so just make sure to be aware of the tools that others can use when reviewing your property, and please make sure to dress appropriately when you take a swim in your pool…. you never know who is watching.

Chris Norwood

Executive Vice President

NAI Norwood Group

Increasing Cash Flow in a Declining Lease Market

2010-09-17T10:17:00.006-04:00

INCREASING CASH FLOW IN A DECLINING LEASE MARKET

By Brian O'Brien

Times are tough, lease rates are trending downward. It is imperative that commercial property owners look for non-traditional ways to keep your properties performing at their peak maximized value. Here are a few tips to potentially add value without necessarily increasing rents:

Market Review: Re-examine your local market and get ahead of potentially declining market. Find out the most up to date comps in your market area to detect if there is a declining trend. You may want to re-negotiate with existing tenants early then waiting for their current leases to expire. Tenant retention is extremely important in a challenging market. Vacancy is expensive, not only are you potentially losing income stream but you are picking up additional operating expenses, tenant improvement dollars, and leasing commissions. “RETAIN IS THE GAME”.

Investigate a tax abatement: Is your property assessed accurately for the current market conditions? Don’t wait for a municipal Assessor to act to lower your assessed value, probably not going to happen. In most cases the Assessors are not working off current market information and it is important to keep abreast of your real estate taxes on an annual bases. A proper tax abatement specialist may be able to know only get you relief in a current year but may also go back to a previous year and years going forward.

Cost Segregation Depreciation: If you paid approximately $750,000 or more for your property you may realize significant savings and/or rebates through accelerated depreciation tactic called Cost Segregation Depreciation. Cost Seg is a form of depreciation where the components of a building are analyzed and broken down by individual depreciation schedule vs. standard straight-line depreciation method. The theory behind cost seg is that different building components have different life cycles. Carpets, HVAC equipment or moldings may have 7, 15 or shorter life cycles that traditional bricks and mortar. Thus, the property owner may accelerate the depreciation leading to significant rebates and or expense deductions, increasing your depreciation and increasing your after tax bottom line. Firms specializing in cost segregation can advise a property owner if it is feasible to do so.

Building Maintenance and Operating Cost Review: Have you re-bid your vendors lately? Have you explored new ways to operate your building more efficiently? Is your building energy efficient? Are there programs from your utility companies or tax incentives to upgrade your mechanicals to better energy efficient equipment? Now is the time to a conduct a top to bottom review of your building expenses and see if you r leaving anything on the table by not running your property at it’s maximize efficiency.

Financing: Interest rates are at historic lows. It is time to review your financing. You may be able to get a better rate, stretch your current amortization Schedule for better monthly cash flow. Reassessing your current financing for not only your interest rate but additional term and conditions could be another way to maximizing your bottom line.

These are 5 quick points a property owner can take, to ensure they are maximizing cash flow.

Route 125 Corridor – Growth Continues in Epping

2010-08-12T11:04:00.002-04:00

As the economy stabilizes, interest in the route 125 Corridor has been rekindled. “Epping will be one of the first areas to start growing again,” according to brokers that represent national businesses and retail tenants. “Market Basket is doing gangbusters, and O’Neil Theaters is close to breaking ground – that will bring a lot of new customers to Epping.” And Exeter Hospital is seeking approvals to open a larger, 10,000 SF primary care facility in Epping.

I’ve been aware of the impact of the completed NH 101 ever since I researched population growth along it. The towns along NH 101 grew at a rate at least 55% faster than the average growth rate for the state, in great part because driving east and west, between I 95 and I 93, was faster and easier than ever before. And the single fastest growing community was Epping. Now that the economy is showing signs of life, major expansion plans are being executed and we will see the differences in the next 18 months. CVS, Exeter Hospital, and O’Neil Theaters, along with other major retail tenants have plans to open soon in Epping.

Once the retail market reaches a certain density, I expect office and service uses to look more closely at Epping as well. The development and utilization of office space typically follows retail growth – it’s easier to hire employees when they can fulfill their shopping and dining requirements close to where they work. For example, since the Rockingham County Courthouse complex is only 2 miles south in Brentwood, it’s only a matter of time until more law firms open offices in Epping. Because of careful planning for growth, the availability of land and a convenient road way network, Epping is on the move again.

John Mueller

Do I Have to Pay NH State Taxes on My 1031 Exchange?

2010-07-09T16:22:00.004-04:00

Starting in late 2008 the New Hampshire Department of Revenue Administration began billing certain tax payers in the state a business profits tax on 1031 Exchanges they had conducted in the past, up to five years prior. A 1031 (Ten Thirty One) Exchange is a federal tax law, which allows tax payers to sell one real estate asset and purchase a new asset, and defer any capital gains taxes on the sale. To accomplish this deferment certain steps must be taken, anyone conducting an exchange should seek professional involvement. The goal is to defer all of your state and federal takes so that a tax payer can reinvest their gains back into a new property.

But the State of NH claimed that exchangors would have to pay 8.5% business profits tax on certain types of exchanges, retroactively for five years. NH was to be only one of two states in which local 1031 Exchange law differed with federal law.

Let us fast forward from 2008, when 20 of these DRA billings were reported, to 2010 when the New Hampshire State Congress became involved to clear up the issue for tax payers who may have conducted an exchange from 2004 up until present day.

Senate Bill 483, in March, was one such piece of involvement which said, among other things:

“The department of revenue administration shall recognize any like-kind exchange that qualifies under the provisions of Internal Revenue Code section 1031, United States Department of the Treasury Income Tax Regulations, or pronouncements issued by the Internal Revenue Service relating to likekind exchanges.”

In other words… “if it works for the IRS, it works for the Granite State”. In May an updated version of the Bill has passed the House Ways and Means Committee, which then need to be signed into law by our Governor. The House report on the above bill, passing 18-2 in committee said that the bill should allow tax payers to gain under the business profits tax the same way they are allowed to do under Federal Code.” As of July 9, the bill has been signed by Governor Lynch, clearing up the issue immediately and post dated to when things started.

This issue is not yet resolved but the take away’s are clear: 1) Be aware of all tax implications of any real estate transaction you perform and account for “rule change” risk such as this when making decisions and consult trusted experts… 2) Become involved when there is an issue, bill or ruling that affects your properties.

- Chris Norwood

Reflection on NYC ICSC 2009 - By Chris McMahon

2010-01-06T07:21:00.002-05:00

On December 7^th and 8^th over 6,000 shopping center industry professionals converged upon New York City for the International Council of Shopping Centers (ICSC) 2009 New York National Conference and Deal Making event. The ICSC holds this two-day national conference annually, for which professionals travel from all over the country to participate in. In attendance this year, from NAI Norwood Group’s Portsmouth New Hampshire office, was Managing Broker Brian O’Brien and I.

The two day conference was comprised of several different important events and sessions. I found that the most notable event of the conference was Deal Making where over 400 exhibitors occupied nearly all of the Hilton Hotel’s exhibition halls and the Sheraton Hotel’s Metropolitan Ballroom. It was in those exhibition halls that retailers, developers, real estate brokers, engineers, and other industry professionals congregated. A 35,000 SF retailer looking to expand into the Northeast, Ultimate Electronics, could be seen showing interested developers and brokers their expansion plans for 2010 and their site requirements. Developers and brokers could be seen showing retailers their newest development projects and available retail space. I noticed that there was a lot of energy in the air on the deal making floor this year with renewed excitement and enthusiasm for 2010. When attendees weren’t busy finding their way through Deal Making they had other high profile events they could attend such as the Retail Runway.

It has become a common place for the volunteer Program Planning Committees to organize an event called Retail Runway where popular national retailers are given the opportunity to showcase their business and expansion plans for the upcoming year. This year, participating retailers included Auto Zone, Dollar Tree, Game Stop, Hobby Lobby, Planet Fitness, Halloween Venture, Kiddie Academy, Muscle Maker Grill, REI Sporting Goods, Rosa Mexicano Restaurants, ShopRite, Sonic, and Wingstop Restaurants. The ICSC Planning Committee placed a unique twist on the event this year by also showcasing a one minute clip of each of the above mentioned retailers “favorite fans” prior to the retailer’s presentation. The “favorite fan clips” were a huge success as most of them had all of us roaring in laughter.

Planet Fitness, a National Franchise of Fitness Clubs whose headquarters is in Portsmouth NH, was well represented by the Director of Real Estate, Brian Kunkel. Kunkel explained how Planet Fitness got started in New Hampshire and quickly grew to a chain of over 300 stores in 33 U.S. States. Planet Fitness is currently in expansion mode with plans to open 85 to 100 locations nationwide in 2010. Kunkel discussed Planet Fitness’s real estate requirements which include 15,000 to 25,000 SF, 100+ parking spaces, and 14’ ceiling heights in suburban locations. He also explained that Planet Fitness requires 15,000 to 25,000 SF which can be on multiple levels, with 9’ ceilings in urban locations. By being a customer of Planet Fitness and also living in Portsmouth NH, I was able to relate to the real estate requirements of the company and why they have been so successful with their business model.

Overall, the event was well attended and there seemed to be a greater amount of activity in comparison to the New York National Conference and Deal Making event that took place in 2008. This was my second time attending the New York Conference and my sixth ICSC National or Regional Conference. NAI Norwood Group is typically represented at the Boston ICSC Regional Conference, the New York ICSC National Conference, and the Las Vegas National Conference. I continue to experience the benefits of being a member of the International Council of Shopping Centers and volunteering on committees such as the New Hampshire Next Generation Event committee. Thanks to everyone who helped make the 2009 New York Conference as success. See you next year!

Chris McMahon

Commercial Sales and Leasing

NAI Norwood Group

Green Blog

2009-12-03T13:01:00.007-05:00

After recently taking part in the Greater Manchester Chamber of Commerce’s “Green Summit” I thought I would share some things that I learned from the speakers whom I spoke with. Bob Duval, Tom Sullivan and Chris Drobat all helped share their thoughts on what it means to have a Green Building, and in general what green means to commercial real estate. LEED, Energy Star, CHPS…. What are they all and what do they mean for our buildings???

Leadership in Energy and Environmental Design (LEED) is a certification a building can receive if it meets a set of pre defined points, the more points the higher the rating (Silver, Gold, Platinum). LEED has become the “Gold” Standard (pun intended) for the commercial real estate industry as not only are towns looking at their zoning to adopt green practice, but also as green building owners seek to have their properties marketed.

Energy Star was developed by the Environmental Protection Agency, and we may all be familiar with appliances in our home that are Energy Star rated because they save water/fuels/electricity, such as dishwashers, freezers, and AC units. There is also a labeling process that over 30 New Hampshire buildings have at the present time.

CHPS started in California, with Erik Estrada… or something like that. Actually from what I know Collaborative for High Performance Schools (CHPS) did come from California, and is now a national guideline for public school buildings seeking to increase the performance of their buildings.

There are other platforms out there to measure your success. Ultimately if you want to go green your success can be measured by the resources you use, dollars you save and the comfort level of the people in the building.

-Chris Norwood
Executive Vice President
NAI Norwood Group

NAI Norwood Group Offers Tour of Power Sale Property

2009-11-12T14:17:00.004-05:00

NAI Norwood Group is pleased to offer a personal guided tour of one of its two Power Sale properties located in Laconia, NH this coming Monday, November 16th through Wednesday November 18th. We will be able to answer any and all questions about the Power Sale, which is to be held on Thursday, November 19th. Please call our office today to schedule a tour. (603) 668- 7000.

Two facilities are being offered: a 50,000+/- SF facility on 8 acres at 109 Industrial Park Drive in Franklin, NH and a 48,652+/- SF building on 13.6 acres at 51 Growth Road at the intersections of Routes 106 & 107 adjacent to Route 3 in Laconia, NH.

The Seller will provide up to 100% financing. Franklin and Laconia will be sold in a timed online auction in the Commercial Property PowerSale™, an Accelerated Marketing Program created by NAI Global to bring together motivated buyers and sellers of commercial real estate assets. In all, more than 70 properties valued in excess of $250 million are being offered in the sale.

Both properties are inclusive of 8,270 square feet of furnished office space. There is 22’ height clearance with docks as well as drive-in capability. Heavy power is available offering 3,000 amps, municipal water and sewer. These properties built just 10 years ago are in excellent condition and flexible for a variety uses from distribution to heavy manufacturing.

The Commercial Property PowerSale™, an ongoing series of national, multi-seller online auctions and sealed-bid sales, gives property owners and financial institutions the opportunity to sell their asset quickly, reducing their holding costs and securing true market value for the property. Sellers benefit from the tremendous marketing leverage created by aggregating properties from multiple sellers into a series of nationally marketed events. Sellers are assured a shortened sales process and a date certain sale schedule.

For more information, contact Karl E. Norwood at 603.668.7000 ext. 202.

Why a Power Sale?

2009-11-11T14:49:00.007-05:00

In this current economic market, it is imperative that owners and agents think outside of the box and explore new ways to sell and market properties. This is one of the primary reasons we are excited to be using the NAI Global Power Sale Program.

A Power Sale is an auction bid on a property. It's important to note that an auction is for sale by owner, and in no way is it under financial distress. The sealed bid process is an effective marketing tool to get the property into the mainstream. It is a way to maximize value in a timely manner.

Here is how the Power Sale Program works, an except from the NAI Global Home page:

"Place Your Bid: Placing a bid is simple and easy. Incremental and Autobids are accepted. Simply enter the dollar amount you wish to bid. If there are competing bids, you must place a value at least as much as the last bid plus the bid increment. As a bidder you will be notified if someone outbids you. If you are outbid and wish to bid again, you need to return to the site and bid again, repeating this process. You may also choose to Autobid – that is start your bidding at an opening price level while letting the system know how high you are willing to bid. In this event should your opening bid be outbid, the system will automatically increase your bid by the bid increment and you will remain the high bidder until your set high bid limit is reached. Once again, you will be notified as each bid is made. Should you be outbid at your set limit you may return to the site to reset your limit or continue bidding incrementally...At the closing of the sale you will be notified via email if your bid is accepted by the Seller. Assuming you are the winning bidder, you will be required to submit the amount to equal a 10% deposit (cash, check or wire transfer) and submit the signed Purchase and Sale Agreement within 3 business days."

Our first Power Sale has two warehouse properties, both auctioned separately. One is a 50,000+/- SF facility on 8 acres at 109 Industrial Park Drive in Franklin, NH and the other a 48,652+/- SF building on 13.6 acres at 51 Growth Road at the intersections of Routes 106 & 107 adjacent to Route 3 in Laconia, NH.

These unique properties are made even more attractive as the Seller will provide up to 100% financing. This property will be available for confidential online bidding at http://powersale.naiglobal.com. If you are interested in learning more about these properties, or would like to put your own property into the program, please contact Karl E. Norwood at 603.668.7000 ext. 202.

So What's So Good About New Hampshire?

2009-10-14T00:17:00.004-04:00

Twelve years ago I moved to southern New Hampshire from western Massachusetts. I moved because of a job oportunity. I didn’t know much about the state other than hiking in the White Mountains. But, I was looking forward to living in a rural area while having a decent job in the city.

That’s one of the many reasons I love living in New Hampshire… you can own a large tract of land, have gorgeous views of mountains, lakes and rivers, witness really cool wildlife in your yard, but then go to work and make a decent living.

We are not just a bunch of "hicks" either…. We rank 9th overall for highest percentages of college educated citizens.

So if you are looking for a change of scenery and are tired of fighting the increasing traffic, taxes, and crime, consider New Hampshire. Our real estate prices (both residentially and commercially) are pretty reasonable too (especially when compared to the Boston area).

Whether working with buyers, sellers, tenants or landlords, most people are looking to achieve a good work/life balance. In my job as a commercial realtor, I have the opportunity to meet new companies moving into the state, as well as people looking to start their own businesses. Most people choose to relocate here for that balance.

Hopefully someone who reads this blog will consider moving their company to this great northern New England state. If so, I’d be happy to talk further, whether it’s about the economics, or just the improvement in quality of life by moving to the granite state.