Archive for the ‘ General ’ Category

2 Weddings and a Poop-Bag

Over the years my travels to visit family in Maine have provided me with many first time experiences

It’s the month of July, peak vacation time; so let’s take a break from commercial real estate talk for a week.

I guess it’s Independence Day that kicks off the summer travel season.   For my wife Nancy and I, we took advantage of the long weekend to amble our way up the Jersey Turnpike into New England for a bit of hiking between Amesbury, Massachusetts and Bald Rock Mountain in Camden, Maine.

We brought along our 12 year old Border Collie Tripp, as his specialty is that of a trail blazer.  

It was in Amesbury that we visited my politically and environmentally correct friend Richard and his wife Sally, who introduced this country boy to the sweet aroma of scented doggy poop-bags as we hiked along the shores of the Merrimack River in Maudslay State Park.  

It “almost” made it a pleasure to pull those little green baggies out of my new hip mounted dispenser to collect droppings of excrement along the trail … Truly gave new meaning to the phrase “a walk in the park!” 

The primary purpose of the journey, however, was to attend the wedding of Emily Russell, the daughter of my first cousin Robin (for you genealogists, Emily is my first cousin once removed).  The extent of my family members in Maine is as broad as that of the propagation that my five siblings and I have provided Maryland.  We are close bunch of cousins with relationships that now span five generations in the little seaside Down Eastern vacation village of Castine. 

Castine, with a permanent population of about 1,400, is in many ways a microcosm of Frederick.  It shares a very strong sense of community.  Their annual 4th of July celebration parade has got to be one of America’s best. And for anyone who cares to, you can get to know all the movers and shakers of the town within a matter days, or in minutes, especially if you stop into MarKel’s Bakehouse off Main Street for breakfast, where you will find my cousin Kelly and husband Mark doing their magic in the kitchen producing some of the best Danish pastry south of Bar Harbor. 

To pass the time in the evening, one can always stop in at Danny Murphy’s Bar down along the dock.  Ownership has changed hands a few times since Kelly and Mark were married twenty-five plus years ago.  That happened to be the last time I visited the establishment, when a large contingent of the wedding party migrated there to continue the celebration after my Aunt Dorie and Uncle Bob shut down the backyard reception so they could get some sleep. 

Mainers can be a rowdy bunch. 

As it turned out the after-party in the pub didn’t really go all that well.  It was another cousin of mine Chip of New York fame, who tried to order a drink by bellying up to the bar that night … which was crowded elbow to elbow by a pack of visiting merchant marines.  I’m not sure if it was his thick New York accent or that he may have made a smart ass remark as he attempted to wedge his way through that inebriated crew of bulky sailors.  It wasn’t long before the fists and chairs were literally being flung in every direction.  At that point, my only focus was to save what was left of my New York blood line. 

It was a short walk up the hill to the medical clinic, where Nancy, my brother and I dragged a battered Chip to get stitched up before the numbing effects of the alcohol he ingested had worn off. 

As the three of us stood on the front entrance steps of the clinic waiting for Chip’s return, we breathed in Castine’s cool midnight air.  Unfortunately it was my brother who became the next victim of too much celebration – Mainer Style.  This family member’s name is being withheld to protect the fine reputation he has earned in the Frederick community over the years … So let’s just say that the freshness of the air turned a rancid green as he lost his lunch (and his reception dinner) on those steps within minutes of Chip’s admission. 

Speaking of reputations to protect, the Maine Maritime Academy makes its home in Castine.  Established by the state legislature in 1947, it is a public post-secondary college and nautical training institution.  My late uncle served as the medical doctor for the Academy back in the 1980′s.  Today, my Cousin Heather’s husband Billy serves as the president of the nearly 1,500 student organization.  

A pre-wedding party was held at the centuries old presidential mansion which rests atop one of Castine’s highest points offering expansive views of the wide mouth of the Penobscot River with the Academy and the town on the foreground. 

So clearly this time around everyone and President Billy himself had to be on the best of behaviors, so as not to tarnish the family image.   

As the full moon rose over the river that evening, we partiers once again journeyed down to the dock as we did 25 plus years earlier.  Not to imbibe at Danny Murphy’s, but to watch the fireworks that were rained out from the past week’s 4th celebration.

Turns out that Fire Marshall Randy (not a relative) had planned to shoot them off the next night, but since he was invited to Emily’s wedding, he did himself a favor and lit the clear night sky with a spectacular display from out in the river.  With the full moon perfectly situated off to the right, it was hard to imagine that this show would not match any other any where.  

Have you ever watched fireworks under a full moon?  It was another first for me! 

The next day was a perfectly clear and cool Maine day.  The 4 o’clock wedding was set at a former family “camp” along the shores of Alamoosook Lake (aka “the pond”) about half way ‘tween Castine and Bangor.  Now the home of Cousins Kelly and Mark, the outdoor event brought in family and friends from all over the country.  

Gathered around an old canoe filled with local craft beers and wine covered in crushed ice with white Christmas tree lights draped above in the trees, the crowd began to migrate to their seats as the setting sun offered up a golden backdrop reflecting across the lake.  What a setting for Emily and her soon to be wedded partner Kate to walk down the lush green pathway to recite their vows!

Yes, it was my first gay wedding, and it was a wonderful event.  Meaningful words were shared about the value of deep personal relationships that brought tears to the eyes of many.  With the understanding and love of all the attendees, the bride and bride stated their vows, and then the real party started.  

It truly was a beautiful event that carried on well into the early morning hours in true wicked Mainer style.  

As I am now less than 120 days away from qualifying for Medicare, I continue to discover the joy of life and the fresh experiences it has to offer. 

Enjoy the rest of your summer! 

The author: Rocky Mackintosh, President, MacRo, Ltd., a Land and Commercial Real Estate firm based in Frederick, Maryland. He has been an active member of the Frederick, Maryland community for over four decades.  He has served as chairman of the board of Frederick Memorial Hospital and as a member of the Frederick County Charter Board from 2010 to 2012, to name a few. 

East Frederick Rising: The Future of Modern Urban Renewal

Can the east side of Frederick become a Dutch wonderland on American soil?

During the summer of 2005, I had the opportunity to travel with my husband and children to Holland to visit extended family.  Prior to our trip, I read with trepidation that the Netherlands is the most densely populated country in the European Union.  I pictured my small children being swept out of my hands and into Amsterdam hash bars on a tide of boisterous crowds rivaling Times Square on Thanksgiving weekend.

I was way off base, as it turns out–about the crowds and the hash bars–because the Dutch are masterminds at urban planning and engineering.

The streets of Amsterdam were bustling and alive, but not crowded.  In the nearby suburb of Wassenaar–where my brother-in-law lived with his family–it was a 30-minute stroll from the center of the charming village square through suburban neighborhoods to the farms that ringed the outskirts of the community.  We spent a sunny August afternoon on a pristine beach just a 20-minute bike ride from his home–again, busy and lively, but not unpleasantly crowded.

Best of all, it is possible to travel to just about anywhere in the Netherlands by way of bicycle on dedicated bike paths criss-crossing the entire country.  Perhaps as a result of the heavy dependency of the Dutch on bicycle travel, obesity did not appear to me to be a problem there (this despite the fact that most food groups in Holland are served fried into some sort of pancake).

I would never have guessed at any point during our all-too-brief time in the Netherlands that nearly 17 million people are crammed into such a tiny jewel-box of a country.  To this day, I have no idea where those millions of people were tucked away.  (I also had trouble spotting the very discreet Amsterdam “coffeeshops” until they were pointed out to me.)

My thoughts have returned to Holland many times as I’ve watched Frederick’s political pendulum swing back and forth between pro-growth and no-growth administrations.  In Amsterdam I saw proof positive of an existence that allows for the best of both worlds:  a vital and breathtakingly beautiful urban city community, surrounded by bucolic villages and farms.  An existence with room for all kinds of people living in all kinds of environments supporting all kinds of lifestyles.

I have a tendency to become enchanted abroad, so this Utopic vision of Dutch life is no doubt partially a result of travel-dazzle and jet lag, but only partially.  If the Dutch can create such beautiful clean-living harmony for millions of people on so few square miles of land (land that they largely artificially engineered out of reclaimed river delta) why can’t we create something similar here in Frederick?

Frederick may have a chance to do exactly that with East Frederick Rising, a 2,000 acre mixed-use smart growth project located between Carroll Creek Linear Park and Frederick’s expanding airport just west of the Monocacy River.  Billed as “Mid-Maryland’s Economic Hub for the 21st Century,” this project is planned to marry the walkability of Frederick’s historic downtown with modern technologies and sustainable methodologies to create a community very unlike typical suburban developments.

East Frederick Rising is the next natural step in building on what was begun with Carroll Creek Linear Park, a beautiful destination born of Ron Young’s determination and indomitable will to solve the problem of recurrent flooding in the city and at the same time create a park drawing locals and tourists alike.

It may seem counter-intuitive for a city the size of Frederick to undertake a project of such substantial scope in a lackluster economy.  However, the stars are aligning in a manner that suggests this project is entirely feasible:

  • Millenials: East Frederick Rising dovetails perfectly with the zeitgeist of the millennial generation:  urban living in walkable, vital communities served by public transit, rich in restaurants and cultural activities, and surrounded by environments that support active lifestyles.
  • Political Will:  Smart Growth is here to stay, and East Frederick Rising could potentially be a marquee project setting the bar for sustainable development in Maryland going forward.
  • Location: Frederick is well within commuting distance of Baltimore and D.C. and airports serving both, and 2,000 acres is a massive tract of land for an urban renewal project.
  • Capacity: We’ve had conversations at MacRo with several regional developers (all deep of pocket and rich in experience) who are enthralled with the character and charm of downtown Frederick and chomping at the bit to develop innovative mixed-use multifamily projects here.  Without exception, they would all like to see a high-end grocery store located in the east end first, but that may be putting the cart before the horse.
  • Jobs potential: The Frederick region has long been nurtured as an incubator for the bio tech industry, and with our highly education population has the potential to become a hot-bed of start ups and entrepreneurs.

Combine developer money, TIF financing, political clout, cultural shifts to urban living, a charming historic town in a highly-desired location, and steady job growth…and what do you get? A sweet spot where the impossible begins to seem possible.

The Urban Land Institute conducted a workshop to develop recommendations for implementing the vision of the project, and presented its findings to the City of Frederick yesterday.  Judging by the comments of aldermen and the public alike, most saw the potential in the project, and understood the importance in having a vision and a plan to ensure that the fate of east Frederick isn’t left to the vagaries of market forces.

It goes without saying, East Frederick Rising will need a stalwart champion (or champions) with the vision, determination, patience, and clout of the Carroll Creek Linear Park advocates lead by Ron Young decades ago.  And of course, this is a project that will also take decades–perhaps as many as five of them–to come to full fruition.

If executed true to the vision, East Frederick Rising has the potential to be an astounding mixed-use community that rivals anything Maryland has ever seen:  a modern marvel in urban renewal that compliments and co-exists intimately with Frederick’s historic heritage and is locally sustained by its rich agricultural assets.

It’s enough to make even the Dutch a little envious.

The author:  Kathy Krach is a commercial sales and leasing agent with MacRo.  Thanks to this post, she’s been afflicted with a strong hankering for international travel.

City Economic Development Advisory Council Formed

Can 16 members of the Frederick community provide BOLD ideas to enhance and attract more businesses to the City?  

It was early May of this year that I received an email from Richard G. Griffin, Director of Economic Development for The City of Frederick. 

The message was to inform me that Mayor Randy McClement was going to “appoint a 16-member Economic Development Advisory Council (EDAC) for the City of Frederick composed of business owners/representatives, developers, and commercial brokers,” and I was identified “as an individual whom he would like to serve on the Council.”

The goal of this new entity is provide “advice and specific recommendations to help ensure that the City of Frederick, both today and into the future, is the preferred community in the Baltimore Washington region for attracting private business investment, jobs, and economic opportunity.”

Of course I was honored to be asked and very willing to serve.  I was also very impressed by the others who accepted the Mayor’s invitation.

It is hoped that this crew of “EDAC-ers” will be able to provide advice and recommendations to the Department of Economic Development and city elected officials regarding the development of:

> Sound regulatory policies affecting business and industry

> Annual economic development work program and budget

> Business development incentives

> Evaluation methodology to determine efficacy of economic development program

> Special issues/projects assigned by the Mayor and Board of Aldermen

> Community education on economic and business development topics

The first meeting was held on Monday, June 30, 2014.  It was and will continue to be open to the public.

City Alderman Josh Bokee was introduced by the Mayor to provide and overview of the City’s hopes for the council.  Bokee stated that he seeks BOLD ideas for the group to increase what many may believe is an already vibrant economy.

Richard Griffin and his staff outlined a detailed overview of the many positives that they have found draw new business to the City, as well as a number of real and perceived impediments to business development.

Issues like the fact that real property taxes are costing city owners up to $2.00 more per square foot than similar buildings located outside the city limits in the county.  The City also has a business personal property tax, while the county does not.

Traffic congestion, lack of transit options, the City’s zoning ordinance, and its seemingly cumbersome development review process were also listed, among other things.

Clearly the City of Frederick has many attributes that have caused any number of businesses to relocate within its boundaries.

Consider Leidos Biomedical (formerly SAIC-F), Wells Fargo Home Mortgage, State Farm Insurance and AstraZeneca (formerly MedImmune) to name a few.  But as the national economy has struggled to recover, many of our neighboring jurisdictions on Maryland’s outskirts have ramped up their efforts to attract business to their door steps.

Having recently served on the Economic Development Task Force in 2012 and 2013 that was appointed by the Board of County Commissioners with similar goals, it will be interesting to see how BOLD this City version is willing to be … or maybe the question will be how far the Mayor will let these EDAC-ers go?

Stay tuned … this could be fun!

The author: Rocky Mackintosh, President, MacRo, Ltd., a Land and Commercial Real Estate firm based in Frederick, Maryland. He has been an active member of the Frederick, Maryland community for over four decades.  He has served as chairman of the board of Frederick Memorial Hospital and as a member of the Frederick County Charter Board from 2010 to 2012, to name a few.  

Corporate Franchise Purchases Boost Frederick’s 1st Quarter Retail Property Sales

7-Eleven purchased two local convenience stores last quarter, nearly doubling dollar volume of sales in the commercial retail segment.

As far as my kids were concerned, the big news in Frederick’s commercial retail segment last quarter was Sonic purchasing a 1-acre retail pad near Walmart on Guilford Drive for $790,000 and opening the county’s first Sonic restaurant.  We have yet to try it because the line at the drive-through always seems to be wrapped around the building at lunch time on the weekends.  Now that school is out, maybe we’ll have our chance.

Frederick’s retail segment was a mixed bag of results during the first quarter.  Fewer square feet of retail space sold, but at a much higher dollar volume.  The doubling of dollar volume sales was due to 7-Eleven Inc. purchasing two local convenience stores in Libertytown and Thurmont for $1,220,639 ($541.30/SF) and $1,245,808 ($562.70/SF), respectively.  Convenience stores (particularly those with gas stations) tend to sell at a generous price per square foot, so these two purchases also bumped up the median price per square foot for the entire segment last quarter as compared to the first quarter of 2013.


Frederick’s retail leasing market had a lackluster first quarter in terms of the number of transactions and square footage leased, much like the same time period last year, and not unexpected given the first quarter contraction of the economy:

The good news in local retail leasing is that vacancy rates are holding below 5% on average.  New retail pads near  Wegmans and Francis Scott Key Mall have leased up fairly quickly, at rates between $30-35 per square foot before expenses.  Prime retail spaces in the heart of Frederick’s downtown historic district are hard to come by, and if the past few lease deals are any indication, average retail lease rates in that area are creeping up  into the mid teens to high teens per square foot, before expenses.

Note: Statistics provided for commercial property sales in this report are based on thorough research of every recorded commercial sales transaction listed in SDAT for the first quarter of 2014, and are deemed reliable.  Lease transactions are not recorded with Frederick county government.  Lease rates for this report were researched in CoStar.  Lease rates, if reported at all, are usually estimated.  Median lease rate calculations for the quarter are based upon available estimates and are meant to be used as a baseline trend versus hard data.  

The author:  Kathy Krach is a commercial sales and leasing agent with MacRo.

2014 Frederick County Primary Election Endorsements — Part 2

With less than a week to go before final votes are cast, let’s take a deeper look into the Republican primary election ballot.

A little less than a month ago, I put a bi-partisan endorsement for voters to consider of three Republican candidates and three Democrats for to consider on their respective ballots for this coming Tuesday, June 24th.

I have re-listed these six candidates at the end of this article, but you can read about more detail on each in Part 1 of 2014 Frederick County Primary Election Endorsements.

Looking over the competitive races in Republican primary, the following are the candidates I like:

County Executive:           Blaine Young

I figured that I best tackle the topic of our current and final President of the Frederick County Board of County Commissioners right off the bat.  I did support Blaine in his 2010 successful run for office.  He made some campaign promises and kept them … that is something in and of itself.  Have I liked the manner in which he has handled himself in certain situations with the public?  No, not always.

Despite that he has been publicly plummeted of late for just about everything he says or does,  the onetime Republican gubernatorial wannabe has openly challenged the state Democratic establishment over any number of issues, including the incredible financial mandates placed on Maryland counties from the EPA and MDE.  He has also butted heads with the state and many in our community over the planned sale and privatization of the Citizen and Montevue Nursing homes.

His style has often been tough and offensive to some, but with that said, I stand by him in his bid to be first County Executive for Frederick County.

Many have claimed him to be too friendly with the development community. As I have written in several MacRo Report Blog posts, I believe that his work to replenish the housing pipeline that was run dry by the Jan Gardner administration four years earlier has been wisely implemented.  Facts and statistics make it clear that even with what appears to have been a flood of approvals, the county is still behind in filling the pipeline.  Then approved by the Gardner administration to meet the mandates of Governor O’Malley’s goal of adding  36,000 new housing units in Frederick County by 2030.

Some may say that my endorsement may be self-serving, but after nearly 42 years in the real estate business in our community, I have dedicated countless hours of time to all aspects of the businesses, people and organizations that make give Frederick its pulse.  And I have experienced firsthand how many others have run county and city government, including his primary opponent David Gray, as well as Jan Gardner, who will be Democratic challenger in November.

Many want to believe that there will be greener pastures ahead, if Young is defeated.  All I can say is that those years would surely be different … but very likely even more contentious among and between neighboring jurisdictions … not to mention heavily laden with new and strict regulations and restrictions on businesses, as they were just four years ago.

Surely no candidate is perfect, and for some voters none of the county executive choices will be pleasant, but I stand by Blaine Young.

OK, so that is enough on my thoughts about the County Executive race!

~~~

The following are the other candidates in the Republican contest worth considering:

  • House of Delegates — District 3B:  Darren Wigfield
  • House of Delegates — District 4:  Kelly Schulz & Wendy Peters
  • County Council — At Large:  I lean toward Billy Shreve … however,  there are three other candidates worth serious consideration — Wayne Creadick, Dick Johnson &Jennifer Charlton
  • County Council — District 1:  This is another tough choice.  I lean toward Grace Hallenbeck with her experience of working for years with the charter government structure of Montgomery County … I really think she gets it.  A very close second is Carol Sepe, who would bring an interesting perspective to the office.
  • County Council — District 5:  Yes, I like Kirby Delauter and his no nonsense style, sure he has caught a lot of flack of late from his opponents, but as a commissioner, he has proven to be a very thoughtful decision maker.
  • Sheriff:  Chuck Jenkins
  • Republican Central Committee:  Mike Bowersox, Michael Catoe, Daniel Cowell, Joe Parsely, Cindy Schaff, Billy Shreve & Darren Wigfield

The candidates endorsed in the May 28th post are as follows:

  • Maryland State Senator, Republican, District 4:  David Brinkley
  • County Council — District 2, Republican:   Anthony Chmelik
  • County Council — At Large, Democrat:  Linda Norris-Walt
  • Circuit Court of Frederick County:  Danny O’Connor
  • County Council — District 3, Democrat:  Dwaine Robbins
  • County Council — At Large, Republican:  Bud Otis

As I always say, don’t take my word for it, do your own research on all the primary candidates and then get out and VOTE!

Once the dust settles and all the primary votes are counted, it will be time to re-vet all those standing and do this all over again … Good Luck to all candidates!

The author: Rocky Mackintosh, President, MacRo, Ltd., a Land and Commercial Real Estate firm based in Frederick, Maryland. He has been an active member of the Frederick, Maryland community for over four decades.  He has served as chairman of the board of Frederick Memorial Hospital and as a member of the Frederick County Charter Board from 2010 to 2012, to name a few.  

Frederick County Board of Education Candidate Primary Election Endorsements 2014

How does the outcome of a Board of Education primary election have anything to do with land & commercial real estate in Frederick County?

The answer is very simple: A whole lot!

Please consider that Frederick County Public School system (FCPS) projects that it will educate 40,667 students in the 2014-2015 school year at a cost of $13,098 per pupil.

To save you time in doing the math, that totals $539,697,886 in county government approved funding. Put another way, that is over one half of a billion dollars county in real estate property taxes.

Consider that in 2013 there were 92,347 households and about 25,000 businesses within the boundaries of this county. If we figure that each of these are located a parcel of real estate (not sure where else they would be found!), the budgeted tax payer amount for each of these units totals over $4,500, whether the individuals have children or not.

Based upon adjusted statistics from the National Center for Education Statistics the average cost to publicly educate a student in the United States is about $11,800 (2010-2011 average of $11,153 compounded by 1.8% per year). So Frederick County is paying about 10% more than the national average.

Don’t get me wrong here, our children are a precious commodity to the people of Frederick County and making an investment in their education is vital to the future of our community and nation. So I am not challenging any of the above budget numbers.

That stated, all Frederick County voters should pay close attention the weight of the responsibilities that are placed on our elected BOE members. All too often voters don’t take the time to pay attention the individuals who file for these races, and then just follow the recommendations of the local teachers’ union.

With all due respect to my Facebook friend Gary Brennan, President of the Frederick County Teachers Association (FCTA), he has done a great job over the years looking out for the union he represents. In addition he has generally had a very strong influence on how the FCPS budget is crafted for the last several years.

Over the years I have paid close attention to many aspects Frederick County Public Schools, and I generally give them good grades, but it is always good the elect candidates to the Board of Education who are not afraid of challenging the education bureaucracy and the union’s strong lobby.

The candidates for the Frederick County Board of Education run on a non-partisan ballot, so all will appear on both the Democratic and Republican ballots.

Three of my endorsements go to incumbents who have proven their worth while in office: Brad Young, April Miller and Colleen Cusimano.

Jonathan Carothers is my fourth choice. He is new to local politics, but well versed in the issues surrounding the issues facing the BOE.

I believe each of these candidates to be the best for the five qualities I look for to lead the Frederick County Board of Education: Fiscally Responsible, Provide Parents with Educational Choices, Willing to hold themselves and FCPS accountable for their actions, Provide full transparency in all decisions that are made, and keep our student safe.

You don’t have to take my word for these endorsements, check all these hopefuls out for yourself … and then VOTE!

The author: Rocky Mackintosh, President, MacRo, Ltd., a Land and Commercial Real Estate firm based in Frederick, Maryland. He has been an active member of the Frederick, Maryland community for over four decades.  He has served as chairman of the board of Frederick Memorial Hospital, as a member of the Frederick County Charter Board from 2010 to 2012 and the Board of Directors of the Community Foundation of Frederick County … to name a few.  

Frederick’s Strong Industrial Market Reflects Nationwide Demand for Warehouses

Low interest rates, steady consumer demand, and record high industrial production is fueling strong demand for industrial real estate despite stunted first quarter GDP.

Rumor has it that the U.S. economy will at long last reach full employment recovery–a gain of 9 million jobs from the trough of the recession–this summer.  At five years, this recovery from “The Great Recession” has been twice as long in the making as that from the dot com bust in the early ’90s.

The Great QE Taper doesn’t appear to be putting heavy pressure on interest rates, so let’s all hope that the abysmal first quarter GDP growth of 0.1% was a weather-related anomaly.  Economists are banking on a combination of less drag from the government sector and more fuel from the housing sector to boost overall 2014 GDP into a more tolerable 3% range.  (Economists are betting on the housing market because the U.S. is creating households at a faster clip than housing stock, which is pushing  inventories to critical lows in many markets.  However, I wonder if they are taking into account the impact of a trillion dollars of student loan debt on the economic capacity of those new households.)

In the meantime, both industrial production and truck tonnage indexes posted all time highs during an otherwise lackluster first quarter, both of which translate into local demand for warehouse space.  Frederick’s industrial market had a much stronger first quarter than the same time period last year.  MacRo Report covered the top three industrial deals in Frederick’s Top 5 Commercial Deals for 1st Quarter 2014.  Below are basic statistics on Frederick’s warehouse market for 2013 and the first quarter of this year:

 

The second quarter of 2013 results were boosted by a First Potomac REIT portfolio sale that included $38 million and 545,000 square feet worth of Frederick County warehouse properties.

Nationwide, industrial vacancy rates have dipped below levels not seen since the height of the real estate boom back in the mid ’90s.  According to CoStar (the most comprehensive database of commercial real estate in the U.S.), Frederick’s industrial vacancy rate dropped to 11% for the first quarter of this year from 12.6% during the same time period of 2013.  Properties that range in size from 0-100,000 square feet fall into CoStar’s “light industrial” category; most of Frederick County’s industrial properties fall under into this category.  Nationwide, light industrial enjoyed the strongest rent growth and vacancy rate improvements of the warehouse segment during the past quarter.

Anecdotally, we are noting at MacRo that lease rates for industrial properties appear to have stabilized, and lease concessions are less generous than they were a year ago.  That coupled with low inventories of warehouse properties in Frederick could be setting the stage for lease rate increases, assuming the economy gets back into a stable growth rate.

Following are Frederick industrial leasing statistics gathered from CoStar for the first quarter of 2014:

 

Note: Statistics provided for commercial property sales in this report are based on thorough research of every recorded commercial sales transaction listed in SDAT for the first quarter of 2014, and are deemed reliable.  Lease transactions are not recorded with Frederick county government.  Lease rates for this report were researched in CoStar.  Lease rates, if reported at all, are usually estimated.  Median lease rate calculations for the quarter are based upon available estimates and are meant to be used as a baseline trend versus hard data.  

The author:  Kathy Krach is a commercial sales and leasing agent with MacRo.

The Origins of Real Estate Insanity

Was it really Albert Einstein who coined the phrase: “Insanity is repeating the same mistakes and expecting different results” … Or was it a commercial real estate broker?

Many may think that someone truly has to be a bit insane to remain in the Land & Commercial Real Estate brokerage business year after year for over four decades.  Crazy or not, I have enjoyed the work I do and am proud that I have mentored so many into the insanity of this career track.

But looking from the inside out, we commercial real estate brokers often wonder the same about some of the folks we meet along the way … who seem to have a tried and true (unsuccessful) marketing strategy all figured out to sell or lease their property.

The only problem is that they can’t find the right broker to carry out that plan; so they list with one broker under required terms (price, condition, terms, etc.) for a while, then after no success they move on to another and another and so on … often for years … and many times for decades.

Could it really be that there are that many inept land & commercial real estate licensees out there, or could it be the property owner? …. maybe a combination of both!

Without a doubt when a Google search is run on that famously trite phrase “Insanity is repeating the same mistakes and expecting different results,” it seems that Einstein wins big time, if you count the one who gets the most hits. But there are a number who have attributed it one of our founding fathers, Benjamin Franklin … another wise choice.  Then again, legendary writer and satirist Mark Twain also earns ranking.  Who would ever question that such a quote is attributed to the man who said “To succeed in life, you need two things: ignorance and confidence.”

After doing a bit more digging, I came across a blog entitled Throw Grammar from a Train, Notes from a recovering nitpicker, by Jan Freeman.  Ms. Freeman is an author and writer for the Boston Globe and is nationally known for her wisdom and research on the use of the English language.

In her October 2010 post entitled “The definition of insanity,” Freeman finds the origin not to be with any of the famous above noted trio. But not that far back in time, she found that the quote is used in a 1983 book by Rita Mae Brown, and then earlier in 1979 ~ 1981 it is found as a phrase in the second step of a Narcotics Anonymous work book.  The NA program, as it is called, has roots that originated with “AA” — Alcoholics Anonymous that was co-founded in the 1930′s by Bill Wilson (1895~1971).  So it could be that it was Wilson who first coined the phrase.

Then again Freeman cautions that many widely used and/or trite phrases rarely originate from famous people.  Therefore maybe, just maybe, the quote first popped upon the scene from a regular ol’ crazy person, who began his (surely not “her”) journey to recovery after realizing that he was doing something wrong by attempting to sell his commercial investment property unsuccessfully off and on for a decade or so by listing it with ten different commercial brokers over that period.

But why stop with property owners!  It just as easily sprouted from a commercial real estate brokers, who after years of banging his head against the wall, repeating the same mistakes, woke up and realized that there is a better way to success.

Over the years, I have experienced real estate insanity from all different angles.  Yes, I have banged my head against many a wall, but I have also come to recognize that many seasoned would-be clients, who often throw the blame on their last broker, are equally to blame.

All too often as has been written among the posts of the MacRo Report Blog, when we agree to engage a frustrated property owner who has followed such a path, it is important that our new client bring an open mind to the table.

There is no question that a seasoned land & commercial real estate broker needs to first listen carefully to understand the experiences and goals of those they commit to.  After considering all that information and thorough market research, by using the expertise of a proven professional, there should be no reason to not to expect different results!

 ~~~

The author: Rocky Mackintosh, President, MacRo, Ltd., a Land and Commercial Real Estate firm based in Frederick, Maryland. He has been an active member of the Frederick, Maryland community for over four decades.  He has served as chairman of the board of Frederick Memorial Hospital, as a member of the Frederick County Charter Board from 2010 to 2012 and the Board of Directors of the Community Foundation of Frederick County … to name a few.  

Frederick Office Market Posts Modest Gains First Quarter 2014

Buyers snapped up Frederick office condos , while tenants leased four times as much flex space as office.

It’s apparent when viewing the chart reporting square footage of commercial real estate transactions by segment in Frederick Commercial Sales Jump 66% during 1st Quarter, that warehouse properties were the darling of Frederick’s first quarter commercial real estate market.  The office segment, on the other hand, continues to face a difficult climb out of the recession, as office use continues to evolve dramatically and inexpensive flex spaces absorb tenants who would have been class A or B office tenants less than a decade ago.

That said, the office sales market in Frederick appears to be making some modest gains, at least in terms of sales price and volume.

The median price per square foot of Frederick office space increased about 10% compared to Q1 2013, while total square feet sold jumped 135%.  There were no purchases of flex properties by traditional office owner/users during the first quarter of this year, and only one sale of a flex condo during the first quarter of 2013 at a price of $106.12/SF.  Medical office condominiums fetch higher prices; a medical office condominium at Conley Farm sold for $237.51/SF last quarter.

Small businesses and medical practices seeking office condos represented most of the activity in office sales last quarter, as low interest rates and loosening credit markets tipped the scales in favor of owning versus leasing.

But speaking of leasing, flex was the clear winner last quarter with office tenants.   Vacant flex properties like those offered by St. John Properties continue to put pressure on the office leasing market, mainly due to the affordability factor:  compare the median per square foot lease rate for flex of $7/NNN versus $11/NNN for office space during the past quarter.  On a square foot volume basis, flex outpaced office by nearly 4 to 1 during the first quarter of 2014.

 

St. John Properties, which about 18 months ago had 1/4 million square feet of vacant flex space in Frederick, appears to be leasing that inventory at a brisk pace, which is good news for the traditional office segment in Frederick.

Note: Statistics provided for commercial property sales in this report are based on thorough research of every recorded commercial sales transaction listed in SDAT for the first quarter of 2014, and are deemed reliable.  Lease transactions are not recorded with Frederick county government.  Lease rates for this report were researched in CoStar.  Lease rates, if reported at all, are usually estimated.  Median lease rate calculations for the quarter are based upon available estimates and are meant to be used as a baseline trend versus hard data.  

The author:  Kathy Krach is a commercial sales and leasing agent with MacRo.

2014 Frederick County Primary Election Endorsements — Part 1

Endorsements are not easy to give in any election, but here are a few for you to consider!

For long time Frederick County, Maryland residents, Tuesday, June 24th represents a new era in local politics.  For as long as Frederick has had a county government, voters entered the primary election polling booths with the option to cast their votes for county commissioner candidates to represent their political party in the November general election.

Now, with the new Charter Home Rule form of government adopted in 2012, voters will see a different format on their ballot.  But when it comes to casting votes for State Delegates, Senators, Judges, etc. things will look the same.

Being the political junkie that I am, and one who has given his time and money to the Frederick community to countless charitable causes over the last four decades, I thought I’d offer a few endorsements (for what that is worth) of a few of the candidates on both the Democratic and Republican ballots next month.

Since there are so many hopefuls, I’m only offering up a few at a time for folks of both parties to consider.

So in this week’s Part 1, I ask that voter consider the following six, each of whom I believe, if elected will place our community’s welfare without personal agendas and rabid single issues:

David Brinkley, Incumbent Maryland State Senator, Republican, District 4, Frederick and Carroll Counties.

Senator Brinkley has served our community in Annapolis since 1994 — first as a member of the House of Delegates and then as a State Senator.  I have personally known David for all those years, and he has a very strong and proven track record of being able to collaborate with the other side of the aisle, while keeping Frederick and Carroll Counties his priorities.  He knows how to get things done.  While I have been a supporter of his opponent in his election to the House of Delegates, I feel strongly that Brinkley should remain in the Senate for years to come.

Anthony Chmelik, Republican Candidate  for County Council — District 2.

I got to know Tony during  his unsuccessful bid for a seat on the Frederick County Board of Education.  He is an independent businessman who has been married for 23 years and a father of 11 (yes, eleven) children.  I have worked with Tony on a number of issues, including educational causes.  His takes a very collaborative approach to problem solving, which is what is needed as the new Charter form of government will require serious team work to add structure and process during the early transition years.

The Urbana/Monrovia region has experienced a lot of tension as new development projects have met resistance over the last few years.  Tony’s style is not confrontational, but he knows how to apply a firm hand when needed to stand up for the concerns of a community, especially when it appears that too much happens too soon.

Linda Norris-Walt, Democratic Candidate  for County Council — At Large.

If I was a registered Democrat, I’d cast my vote for Linda in the primary.  I’ve gotten to know her over the last 5 years as she campaigned for a seat on the Board of County Commissioners during the 2010 race.  She has experience working in county government and currently provides professional services in the field of communications, writing, research, public relations and marketing.  Linda understands how business works, but is also very conscientious in her process of making decisions.  She is thoughtful and  listens to and researches all sides of the issue.  There are no hidden agendas with Norris.

Judge Danny O’Connor, Incumbent, Circuit Court of Frederick County.

I have known Danny (Oops, Judge O’Connor), for over twenty-four years.  When he was in private practice, he was one of the first lawyers I called upon when complex legal challenges arose.

Judge O’Connor was appointed to his position in 2013 after a very thorough vetting process that began with the Frederick County Bar Association.  Unfortunately his opponent never made the cut in a similar process of his peers in his bid for the position.

It is his very deliberative process of making decisions that makes Danny O’Connor the excellent judge that he has already proven to be.  He exudes trust with this style, and voters can trust that he has no greater ambition than to serve the citizens of Frederick County in this way.

O’Connor has been a lifelong Democrat, but since this is a non-partisan election process for his position, both he and his opponent will appear on both the Democratic and Republican primary ballots.  If Judge O’Connor is fortunate enough to better his opponent in the primaries of both parties, he will be the sole candidate for Circuit Court Judge on the ballot in November.

Dwaine Robbins, Democratic Candidate  for County Council — District 3.

If elected, Mr. Robbins will bring a wealth of experience to the new Charter form of government.  He has served on the Planning Commissions of both the City and the County governments.  He is a humble independent business person, who has shown a practice of being very conscientious and deliberative in his decision making process (can you see the theme here?).

District 3 basically comprises of all of the City of Frederick west of Market Street.  It includes a diverse part of the city that will require a representative who will listen to all of his constituents and craft his decisions accordingly.

Robbins is a graduate of Frederick High School and understands the educational needs of his community, but education is not the only issue that from which he has built his campaign platform.  With his intimate knowledge of both city and county planning and zoning processes, he will work to ensure that the relationship between these two governments will remain collaborative — unlike explosive relationships that festered up until just 4 years ago.

I have known Dwaine and his family for a number of years and found him to be a well rounded and thoughtful leader, who the citizens of District 3 will be proud of.

Bud Otis,  Republican Candidate  for County Council — At Large.

Harold “Bud” Otis served the citizens of Frederick County on Capitol Hill for a number of years as the Chief of Staff for former Congressman Bartlett.  His background in this arena alone is one of the primary reasons I believe that Bud is ideally suited for a seat on the County Council.  As has been written in the pages of this blog several weeks ago, Charter Home Rule brings a different kind of structure to the processes of government than our county has ever known.  His experience has been to work through and collaborate with the legislative and executive levels of  government.

Having known and worked with Otis over the years, I have found him to be a strong, but quiet leader who knows how to get things done.  He listens … really listens to what his constituents have to say.  I find this to be a unique quality among candidates for office, as more often than not, they are spouting off their platform positions before taking the time to understand the person to whom they are “talking to” (verses “talking with”).

Bud is trustworthy, fiscally responsible and balanced in his approach to addressing controversial issues such as growth, development, educational and public safety needs.

~~~

These are my views on the above candidates, what do you think?  Who are your choices in next month’s primary?

… and stay tuned, as more political thoughts and endorsements will appears in the coming weeks and months on the MacRo Report Blog.

The author: Rocky Mackintosh, President, MacRo, Ltd., a Land and Commercial Real Estate firm based in Frederick, Maryland. He has been an active member of the Frederick, Maryland community for over four decades.  He has served as chairman of the board of Frederick Memorial Hospital, as a member of the Frederick County Charter Board from 2010 to 2012 and the Board of Directors of the Community Foundation of Frederick County … to name a few.  

© Copyright MacRo Ltd, Real Estate Services
Web Design by Wood Street