Section 1031 of the United States Internal Revenue Code has been in existence for nearly 100 years, first instituted in 1921. However, the new administration’s promise of tax reform has House Republicans working on a proposal that could severally limit or repeal this investment tool.
(Spring Creek Village, Edmond, Oklahoma)
On June 14th, the Federal Reserve increased the federal funds rate by another .25%, which will take the prime rate to 4.25%. It is expected by many that a third increase will be approved later this year further impacting investors’ expected investment returns.
Contrary to the news headlines you might see throughout the various reports on retail, brick and mortar is still growing at a steady rate. Overall retail market vacancy is down to 5.1% versus 5.5% this time last year per Marcus and Millichap research department. The overwhelming majority of this growth is certainly in the food and beverage sector as new and exciting concepts continue to roll out. The up and coming soft good retailers that are thriving are those tenants that focus on the unique in-store experiences, quality of product and sustainability.
In the last blog “Modern Updates Attracts Younger Generations” we discussed that the owners of office buildings should take a serious look at the exterior of their buildings and consider updating and upgrading the appearance of their buildings to bring them into a new era of office building design with an accent on the good and replacing or redesigning the bad and the ugly. That was outside. Now, let us go inside.
(Aldi's Edmond location on West Edmond Road)
The winds of change are blowing into the Oklahoma City grocery market in the form of discount retailers Winco, Aldi and Save A Lot. Winco is a major warehouse-type grocer new to Oklahoma with a 90,000 sq ft footprint. They have identified four locations in the Oklahoma City metro area and are under construction with three of those stores now. Aldi and Save-A-Lot are both small neighborhood deep-discounters with a limited assortment of items targeting thrifty shoppers, and both are adding locations to their store count.
Of all the expenses to consider in running your new business, rent is one of the largest. In commercial leasing, "Base Rent" is generally marketed on a per square foot, annualized basis. However, one feature to be cognizant of is rent escalation based on the Landlord operational cost increases or the dreaded “Additional Rent”. Landlords want protection from uncontrolled cost increases that affect their return. So, they will bill back to all tenants a pro-rata share of the operational cost increases.
As our "Price Edwards Client Profile Series" continues, we look at a sit down with Darin Miller, CEO of Miller Architects Inc. Mr. Miller and his company are involved in the operations of St. Anthony's newest healthplexes across the Oklahoma City metropolitan area. The newest locations are in Midwest City, Mustang, North Oklahoma City, and South Oklahoma City. The four properties were the first Freestanding Emergency Facilities in the state of Oklahoma and continue to serve thousands in the community every month.