A New Generation of Leaders-Meet Laura Frerichs

Laura Frerichs is Associate Director of Research Park and Incubation Facilities. She is responsible for managing incubation services at EnterpriseWorks, marketing the Research Park and supporting the University’s economic development efforts. The EnterpriseWorks incubator has 35 startup companies and offer labs, offices, and support services for entrepreneurs. Laura manages programming of events and services to support entrepreneurs and businesses in the Research Park.

Prior to her current role, Laura was Vice President of Business Development & Marketing at Fox Development Corporation. Laura was responsible for marketing the Research Park and supervised the leasing and marketing staff. She interacted with University of Illinois faculty and administration to attract companies to the Research Park. Laura worked with company officials to finalize lease terms and establish new research and development operations within the Research Park. Her business development accomplishments in the Research Park include new offices in Champaign for Yahoo, Qualcomm, John Deere, ADM, and Abbott as examples.

Prior to working for FDC, Laura was the Senior Account Manager of the East Central Illinois Region for the Illinois Department of Commerce and Economic Opportunity. She worked with small businesses, local economic development organizations, and local government on increasing job opportunities in the region. Prior to joining DCEO, Laura was a Media Supervisor for five years at Starcom, a division of the Leo Burnett Company in Chicago. She was responsible for national media strategy for Allstate and Pilsbury brands while working at Starcom.

Laura is a graduate of the University of Illinois College of Communications and served as Student Body President at the Urbana-Champaign campus. Laura Frerichs was named “Woman of the Year” by Central Illinois Business Magazine for the Forty Under Forty business awards. She is active in the community and serves on the Board of Directors of the Champaign County Economic Development Corporation and Tech Advisory Board, Executive Club of Champaign County, University of Illinois Campus Alumni Advisory Board, Junior League of Champaign-Urbana, Parkland College Foundation Technology Division Head, Korean Culture Center Board of Directors, and volunteers in the community.

Laura and her husband State Senator Mike Frerichs live in Champaign, Illinois. They are proud parents of one year old daughter, Ella Frerichs. To watch the entire interview with Laura click here: WATCH LAURA'S TV INTERVIEW

A Word From Peter Colvin-Nation NNN Team Leader For Sperry Van Ness

2010 Sperry Van Ness Year End Summary

Single Tenant Investments

By Peter Colvin

National Director of Single Tenant Investments

Sperry Van Ness

Many owners of strip centers and office buildings got their first taste of single tenant investments in 2010, and they liked it…a lot. No vacancies, little or no management and no phone calls from tenants that could no pay their rent. What a refreshing change!

As a result, many buyers focused on finding and purchasing quality single tenant assets, leased long term to credit companies, with little or no landlord responsibilities. This shift increased the demand and the supply of good properties was gobbled up quickly. Prices increased as cap rates lowered across the board, rivaling 2007 rates. Low interest fueled the demand.

For investors in the $4,000,000 + range, the stars of the show were Walgreen’s and CVS. Cap rates dropped nearly ½ point in the last quarter as REITS, trusts and families outbid each other to win the assets. The average drug store cap rate was approx 7.7% at year end. Sperry Van Ness had several successful drug store transactions. Some listings drew as many as 10 offers, driving up the price for our listing clients. One offer in Miami secured a purchase price $500,000 higher than the other nine offers on the same property. We found the best buyer.

In the $2-$4M range, restaurants like Applebee’s and Macaroni Grill were gobbled up. Over 100 Applebee’s were bought by investors as the Dine Equities sale/leaseback of Applebee’s and the Mac Acquisitions LLC sale/leaseback of Macaroni Grill units were placed with individual investors. Cap rates dropped nearly ½ point in the last quarter as the supply tightened. Average cap rates ended the year at approx 8.25%. Sperry Van Ness sold a large share of these properties.

In the $1-$2M range (the most active price range) bank deals, especially ground leases, were sought after. Advance Auto and O’Reilly’s topped the discount auto parts arena. Small portfolios of Burger Kings, Pizza Huts and other brand name QSR’s were sold one-off as investors hunted for well located sites leased to popular brands. Average cap rates ended the year at approx 7.7%. Sperry Van Ness advisors were major players in this arena, selling numerous portfolios.

In the under $1M range, dollar stores became more and more attractive to investors seeking strong credit at an affordable price point. Family Dollar and Dollar General were the most active in that niche. Dollar General adjusted to investors’ needs and introduced the Triple Net 15 year lease. This brought first time dollar store buyers off the sidelines. Average cap rates were higher on dollar stores than other types, mainly due to many being in smaller town locations with less land value. The cap rates ended 2010 at 9.2%. Sperry Van Ness was a market dominator in Dollar Stores.

What to expect in 2011: The key word will be “Sale/Leaseback”. The pent-up demand for growth and remodels by companies and growing multi-unit franchisees is strong. Instead of taking on more debt, many will fund their growth and remodels by using their real estate equity, especially since it has increased due to rising values. Many institutional buyers that would not buy franchise backed credit in the past are now more than happy to do so.

Sperry Van Ness has anticipated this explosion and has formed “Easy Leasebacks”. (www.EasyLeasebacks.com) This innovative group of single tenant specialists is matching portfolios of single tenant properties with the best buyers. It is helping growing companies sell their assets in the fastest, most affordable and confidential way possible to fund their growth without taking on additional debt. Easy Leasebacks is having great results.

Reverse sale/leasebacks caught on as fast growing trend in 2010. Sperry Van Ness Advisors helped many developers build new single tenant properties by bringing in investors to buy the land and fund the construction. This kept things going while banks stopped lending or required too much cash from the developer. This trend should continue for a long time. Investors get a little better cap rate as a bonus for coming in early, so it is a win-win for both investors and builder/developers.

Dollar stores should continue to sell briskly as more and more people make a decision to cash in their low yielding bonds and CD’s for a long term 10% + cash on cash return. Investors continue to seek bank and fast food ground leases, well located restaurants, discount auto parts and drug stores. 2011 should be a continued healthy market for high quality, well located single tenant properties. Banks seem to agree and got more aggressive in lending on these in the 4^th quarter of 2010.

Sperry Van Ness gained a much larger market share of Single Tenant transactions in 2010 as sellers realized that to get the best offers, a property needs to get maximum exposure. The buy pool changes often, with new investors coming into the market every day. The platform of exposing properties through new social media networking and unselfishly sharing commissions with the entire brokerage community has worked very well. It helped investors to find their deals and sellers to meet their pricing goals.

Some of the top single tenant specialists from Marcus and Milichap and other national companies joined Sperry Van Ness in 2010 and enjoyed great success in their new-found sharing and team support. Many of the 2010 transactions involved multiple advisors teaming up for the greater good.

As a single tenant specialist and leader of a fantastic team of professionals that put their clients’ needs ahead of their own, I look forward to another great year in 2011!

Peter

Peter Colvin

National Director of Single Tenant Investments

Sperry Van Ness

New Episode of One on One with Alex Ruggieri featuring David Hodge

When I first met David I had invited him to come on my radio show Central Illinois Business to talk about his recent acquisition of Porter Athletic. It was then that I got the opportunity to learn about him and his personal story. I was particularly impressed with his sincerity, his humility and his disarming charm. He started working for Gill Sports in accounting at a very tumultuous time. The company was struggling and even though Gill had a long and storied history in the industry, during that period, it looked like the entire enterprise might not even make it. One day the owner (Vince Atkins) called him into his office. David was sure he would be fired but that's not what happened. Instead Vince made David the president of the company! And he also made him a promise. He told him that if he would do all in his power to make the company work, to turn things around successfully, then at the end of ten years he would sell the company to him. Well it wasn't as easy as it sounds. Those ten years were sometimes harrowing and difficult but this quiet unassuming man exercised all his faculties and his faith and did turn the company around. Today David Hodge with his holding group Litiana Sports, Inc. is a major force in the industry and a significant employer in our community. Take the time to watch his interview I promise if nothing else it will leave you inspired! Watch Now!!

A Word On The Economy

Recently the president of our national franchise Kevin Maggiacomo of Sperry Van Ness sent an open letter summing up his thoughts and reflections on 2009 and the coming new year. I thought it would be good to share a few of his comments with you as I greatly value his perspectives. As follows:

The Economy At the year’s close, it is apparent that our worst fears for the economy and our industry have thankfully not been realized. Instead of a protracted period of economic malaise, the weight of evidence now shows that the economy returned to modest growth in the third quarter. Temporary employment numbers (a leading indicator of permanent employment conditions) have improved and job losses have eased substantially, narrowing to a small fraction of the cuts reported at the beginning of the year. As anxiety over record job losses has subsided, consumer and business confidence has improved.

Looking forward, the consensus amongst economists and industry leaders calls for measured growth over the next year. Lagging the stabilization in the health of businesses, and barring any unexpected shocks, sustainable job growth is anticipated towards the end of the 2010. This is, of course, welcome news for the commercial real estate industry, since improvements in demand for space depend critically on new jobs replacing the millions that have been lost.

To read the rest Kevin's article go to : http://www.maggiacomoblog.com/new-years-message

Is there a 1031 Exchange in Your Future?

That is a question that I have heard an awful lot lately. Why 1031 exchanges and why now? I would like to share a few thoughts with you on this topic. As many of you know Section 1031 of the IRS tax code contains provisions which allows deferral of taxable gains when the proper conditions are met under the code. I am by no means a tax attorney or an accountant but in layman terms what it amounts to in its simplest form is a tax deferred event when you sell real property, provided that you purchase another property of equal or greater value and you do it according to the rules set forth by IRS to qualify for the deferral. The implications of this are staggering and can mean the difference of thousands of dollars in taxes and possibly millions in equity when even a little planning is done in order to qualify for this aspect of the tax code. Let me be the first to say that this kind of thing is highly technical and the details of any given transaction should properly be reviewed by your tax advisor, your attorney and the other professionals who make it their business to protect your interest and guide you in such matters. Having said that the 1031 rules are something that you may want to learn more about. I see this aspect of the tax code becoming more and more important in the future. For instance, if I were to ask your opinion of the direction of capital gains taxes in the future what would you say? Do you think they will go down? Stay the same? If you are like me you might believe that they have a very good chance of going up. Even if the legislators do nothing the sunset provisions under existing law will take affect within the months ahead and capital gains tax will automatically revert to 20%. I happen to think that there is pressure to drive it higher than that depending on the economy and political climate next year. All the more reason to learn how to use the provisions of Sec. 1031 of the revenue code. I had the privilege of sponsoring a series of webinars for my clients recently hosted by Bill Exeter of EXETER 1031. He did an amazing job of explaining many aspects of the code that allows for tax deferral on all types of transactions not normally thought of as qualifying transactions. If you would like more information about the opportunities provided under this provision of the tax code give me a call I will be happy to make a personal introduction to Bill Exeter, a consummate expert in his field and a man I admire as a true professional.

SVN's Asset Recovery Team

SVN's Asset Recovery Team provides immediate underwriting nationwide and disposition solutions to financial institutions and real estate clients with distressed portfolio assets. Collaborative teaming with our Senior Accelerated Marketing Advisors and over 900 local market experts and professional brokers create, design, implement and execute customized marketing plans for the repositioning and disposition of assets to insure the maximum return for our clients. The diverse services we offer include: Market Research Asset evaluation Property preservation Asset management Prevention and Protection Risk Management Brokerage Acquistion Leasing Accelerated marketing Loan workouts Auction Sealed Bid Online Sales Loan Sales

E-mail Alex Ruggieri to get connected with the appropriate SVN's Asset Recovery Team advisor for your area.

Our Value Proposition The hundreds of years of experience represented by the Sperry Van Ness Asset Recovery Team includes successful disposition of assets as contractors for the Resolution Trust Corporation and private-sector disposition of distressed and recovered assets. That experienced team is part of a recognized national framework of real estate professionals unmatched in the industry for providing immediate and successful solutions. Time to market is vastly reduced through extensive technology facilitating the required underwriting, packaging and marketing of assets in a seamless process designed to maximize exposure resulting in maximum recovery value. The Sperry Van Ness Asset Recovery Team consists of twenty real estate professionals that specialize in asset disposition solutions for distressed assets and portfolios across the United States. The team designs and implements custom marketing initiatives for the disposition of assets that insure maximum return to our clients. We are able to provide our clients with national reach and local expertise through our network of over 900 Sperry Van Ness advisors located in 150 markets throughout the nation.