High quality commercial real estate is in demand, and prices are edging up. Both in Eugene and nation-wide. Why? The lack of alternative investments. Even 6% or 7% cash-flow coupled with appreciation is good compared to minuscule interest paid by banks or bonds.
For instance, a year ago the Mortgage Bankers Association sold it’s glass-walled office building to real-estate data firm CoStar Group Inc. for $41.3 million (they purchased the building in 2007 for $79 million–ouch). Now, a German real-estate fund is buying the building from CoStar for $101 million. Seventy million in a year–that’ll get your attention.
Woodfield Station in South Eugene (Willamette Plaza on 29th and Willamette to old-timers) recently sold for over 25 million dollars to Iowa PERS. The previous owner, an insurance company, purchased the property in 1971 and subsequently redeveloped it over the years. Cap rates weren’t disclosed, but I’d guess they were low.
High quality is back in fashion again. Contact me for your commercial real estate needs in Eugene.