The purchase stood out in a year where there was relatively little consolidation in thereal estate investment industry. Given the trend of REITs to sell off "non-strategic" assets, industry observers wonder which properties might go on the block this year, according to officials at Bloomington, MN-based United.
Demand far exceeds supply for apartment buildings, the report concludes. Many investors believe that the multi-housing market is in the initial stages of a development phase, and that the market is short on supply.
But investors are shying away from investing in retail properties. The biggest demand is for high-quality centers anchored by grocery stores.
Demand for office and industrial properties is stable, reflecting the maturing of the market, the United report concludes. Bulk warehouse properties are in the highest demand among this type of property.
Land supply is extremely tight in the Twin Cities, especially in the central business districts and the nearby suburbs. Local zoning restrictions, a desire to be located within the Interstates 494 and 694 which ring the cities, and urban sprawl issues are all contributing to the land shortage. As a result, much of the new development is going to the outer-ring suburbs.
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