2/18/21 Hampton Roads Mastermind Group Meeting

Hampton Roads February 2021 – Key Take-Aways

• • • Jeff Parker with Colliers is starting to see some more tenant activity on the retail front, but not a whole lot of development.  Getting some traction at Summit Point, Dollar Tree development, getting some interest from restaurants and smaller users, starting to take shape. Broke ground on block three which is going to be 230 apartments and a bunch of retail.
    • John Berotti with Whiting-Turner said they are in heavy pursuit of a few projects out there – new hospital in NC and some senior living stuff in VA beach.  Starting to see some good traction with Davis Center work.  Their offices are still closed due to COVID and hoping that sometime soon they will get some clarification when we can all get vaccinated and return to the office, probably looking at May or June.
    • Dan Shelton added that he is seeing less reporting of COVID cases with sub-contractors and believes this is a good sign.
    • Mike Moore with London & Norfolk is busy with renewals as a lot of people renew before hurricane season, so they have several policies that they are shopping all over the place this year because the market is so hard right now, they are seeing increases across the market.  On a different, fun note, he has a company building a boat in Ireland, trying to set a world record to transport over to Nova Scotia and trying to get coverage to protect the boat and crew as they make their way.
    • Danielle Pinto with CoStar Group said that she knows personally from a lease she was involved in, if there are any kind of occupancy limits, they built into the lease that only 25% of the rent is due for that month, thought that was very interesting as people are getting creative out there.   Their Signature Ad series is very valuable tool and they are adding in a feature that you can look at competitive properties, but on the back end you can see what tenants have looked at it and of those tenants what other properties they have considered in that area.
    • Tony Horton with CoStar Group shared a couple of exciting things happening at CoStar as they have rolled in CMBS data, adding 100,000 different loans worth about a trillion dollars, with that everything from top tenant lists, full financials. and delinquencies all rolled into one platform.
    • Emiliano Flores with Costar Group has been focusing on Multi-family in the Hampton Roads area, the vacancy rates have never been lower and reporting high rent growths, the only caveat is the moratorium on eviction.  When that expires will there be enough stimulus money for people to pay back rent, how bad is it going to be?  About 70% of the jobs lost have been recovered.   Industrial vacancy is about 2% and lot of build to suit coming.   Hampton Roads is outperforming places like Richmond and DC, however only slightly better than the Richmond area.
    • Joe Lowery with Cohen Investment Group is primarily focusing on multi-family, self-storage, and some flex office and industrial.  They are keeping our finger on the pulse with respect to Retail and Office but there is a just a lot of risk now based on what is happening with tenants.  Multi-family is challenging environment from a buyer standpoint but a good place to be if you are seller.   In Hampton Roads, which is not unlike anywhere else in the Southeast, they are seeing rent growth and positive demographic trends some may be short term.  This trend has been happening for years now, however, he thinks COVID accelerated this trend.
    • Keith Slattum with Dollar Bank continues to be busy with PPP loans and loan forgiveness.  $2M plus loans require loan review and questionnaires to be completed and we have about 30 of those at the bank most in Cleveland and Pittsburgh.  Retail and restaurant are a struggle right now, lot of properties l have looked at that are 100% occupied and everybody is paying rent on time, maybe a few deferrals, and the real question on retail is going to come up later this year after the ‘helicopter’ money stops falling in that direction.  He believes we are about a year out before we will have an idea of what the retail sector is going to look like.