Staff writer, Northeast Real Estate Business
Continuing interest in stable real estate assets combined with a generally positive leasing market helped to stimulate Hartford's investment sales market in the first quarter of 2005 - though not at the same strong pace as the previous few years. Investors are still aggressively looking to place capital, but the lack of product offered has had an impact on actual transactions completed.
In 2004, 16 Class A office buildings traded hands in the Hartford area, marking the most activity in the market since 2000. This year, in contrast, relatively few investment offerings are currently available in the market as most sellers faced with a decision have already divested or refinanced. Sale volume in 2005 activity, therefore, will most likely not reach the same heights as the previous year.
Properties on the market, however, will still garner a lot of attention. Players expected to remain active in the market include Grunberg Realty, Mark Greenberg, Northland, The Fremont Group, Nutmeg Management and Professors Capital. New Boston Fund will also remain among the more prominent groups, while continuing to divest itself of certain properties in central Connecticut. More and more capital is also originating from New York-based investors, which are rapidly becoming a significant force in the Hartford market as prices in Manhattan and surrounding areas continue to rise. Grunberg Realty, for example, purchased 280 Trumbull Street, a Class A asset, in late 2004 for $65 million, or $100 per square foot. With the increase of LIBOR over the past few months, a growing number of these investors are financing their purchases with long-term fixed debt. As long as the leasing market continues to improve, the investment market should remain strong, even amid rising interest rates. The city of Harford, in particular, continues to attract attention from investors, especially for non-office properties. With 650 multifamily units either recently completed or currently under construction, and the addition of the newly constructed convention center and hotels such as the Marriott and Homewood Suites (slated to open later in 2005), the market is poised for growth that has not been seen in more than 15 years.
- Patrick Mulready is a vice president and John McCormick is an executive vice president in the Hartford, Connecticut, office of CB Richard