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2020 Q1 Sacramento Industrial Report

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The Sacramento industrial market saw a record amount of new speculative development deliver in 2019. As a result of this new supply delivered, the market vacancy rate has increased 80 basis points year over year. Much of this new development will be absorbed by the end of this year with 562,000 square feet leased at 2019-completed projects in the first quarter of 2020. While the vacancy rate is poised to fall later this year, uncertainty is the name of the game these days during the COVID-19 pandemic. Many buyers have asked for extensions and new leases are being put on hold as landlords deal with a growing number of rent relief requests from tenants. Though net absorption was minimal this quarter, it will likely pick up by the end of the year due to previously signed leases at new developments. While two new projects broke ground this quarter, new speculative development could be delayed for the foreseeable future. Expect a drastic slowdown in new leasing and sales activity throughout the market in the second quarter with many deals delayed indefinitely. There are large users still circling the market, but many transactions remain in limbo. Sacramento’s industrial market fundamentals are sound but are now being put to the test. 

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2020 Q1 Sacramento Industrial Report

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Related Experts

Andrea Nelson

Associate

Sacramento

As an Industrial Advisor with Colliers, I have a deep knowledge of the local market and current trends which allow me to better serve my clients.  

Before coming to the Commercial Real Estate industry, I spent 15 years in sales and education for an international supplement manufacturer.  I focused on educating retailers and business owners, helping them achieve higher profits and an increased knowledge base to help them strengthen the relationships they had with their customers.

I pride myself on working hard and the success I bring to my clients.  I listen to the needs of my clients and put their best interests first.  I think like an owner. Whether you own a business or a property, I will prioritize finding the best opportunity to create a more profitable outcome for you. I’m committed to achieving the best results for each and every deal

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Spencer Applegate

Senior Vice President

Sacramento

I grew up in the family trucking business - working on the docks and in the dispatch office.  I enjoyed understanding the supply chain and how everything ended up on our table. After being immersed in this world throughout my childhood, I decided to study Regional Development and Geographical Information Systems (GIS) at the University of Arizona. Following my graduation, my uncle, who has +25 years’ experience in commercial real estate, agreed to become my mentor.

Together, Bud Applegate and I help industrial property owners and industrial tenants from Sacramento to Marysville make informed real estate decisions in this dynamic and changing market. Every deal has its own unique challenge. Communication is key to ensuring I understand my client’s business goals, both long and short term. As an advocate for my client, I take on the stress of a relocation or finding a new tenant. My commitment to your goals and thorough analysis of your business needs allow me to position you for success. I afford each client relationship and real estate transaction the same attention, care, and commitment that I would apply if working with my own family and their business.

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Hannah Crandall

Transaction Manager

Sacramento

As a transaction manager, I recognize the most favorable and profitable strategies to maximize negotiation leverage and win the best economic terms for my clients, as well as position the assets for the highest returns should they choose to sell.

Having spent the last decade in the real estate industry, progressing from traditional residential transactions, distressed asset acquisitions, appraisal, and commercial real estate, I understand how to value investment properties from a multi-faceted approach. This unique background positions me to specialize in leasing and sales of industrial product with an emphasis on Landlord representation, acquisitions, dispositions and market analysis.

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Matt Lofrano

Executive Vice President

Sacramento

Industrial property owners throughout the Western region rely on Matt’s accountable, communicative, and forward-thinking approach to develop successful marketing and leasing strategies. From initial marketing campaigns through the successful sale or lease negotiations of their assets, Matt directly handles every aspect of the transaction cycle for the projects he is involved with. This experience has allowed him to also be an asset to the region’s institutional landlords as a consultant for new development. Matt focuses on the delivery of service excellence by leveraging his +20 years of market knowledge, offering consistent communication, and anticipating needs. His deep understanding of the challenges his clients face has proven to be instrumental in many completed lease & sale transactions and development projects.ough market insight, consistent communication, and a deep understanding of the challenges his clients face has proven to be instrumental in many completed lease & sale transactions.

Prior to re-joining Colliers as Executive Vice President, Matt served for eight years as Executive Vice President at JLL, ten years as a Senior Vice President in the industrial department at Colliers International, and three years at CB Richard Ellis.

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Mark Demetre

Executive Vice President

Sacramento

Throughout my tenure in commercial real estate, I have specialized in advising property owners in the marketing of their industrial assets for lease and sale. This has included several major industrial developments, to potential prospects throughout the nation. I called Colliers home from 1999 to 2010 and am excited to be back. Over the last 20 years, I have averaged more than 125 transactions per year and sold or leased over $1 billion in industrial transactions.

Having been entrenched in the Sacramento commercial real estate market since 1985, I have developed rapport with the community’s brokers, developers, landlords, and tenants. The Colliers and SIOR network allow me to connect with other experts throughout California & the United States and leverage their expertise. This collaboration is key to providing exceptional service to my clients. By fully understanding your goals, I can bring the right team together to provide customized solutions for your evolving needs.

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Michael Hoo

Associate Vice President

Sacramento

Industrial tenants and investors rely on me for my thoughtful and honest advice about the Sacramento real estate market. With my partners, who primarily focus on landlord representation, I provide the complementary services of tenant advisement and investment sales. I help my clients make highly informed decisions by providing strategic connections between the many data points surrounding real estate decisions and translating them into an actionable strategy.

After finishing my collegiate baseball career at Cal Poly, San Luis Obispo, I pursued my MBA. While working to complete my graduate degree, I found a passion for underwriting deals and it was then I knew real estate was the career for me.  Throughout my athletic and academic careers, I learned valuable lessons about teamwork, hard work, and perseverance which have guided my professional growth. 

I consider myself a lifelong student and enjoy any opportunity to learn something new.  By obtaining a deeper understanding of my clients' goals, I look beyond the short-term and position my clients for long-term financial and business success.

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Spencer Bones

Vice President

Sacramento

As Vice President within our industrial department, I advise property owners and industrial tenants by providing market intel, financial analysis, and creative strategy. I specialize in the leasing, disposition, and acquisition of industrial properties throughout the Greater Sacramento Area including Power Inn, Highway 50 Corridor, and Placer, Sutter, and Yuba counties. I offer an intricate knowledge of our submarkets and understanding of the specific policies and ordinances that affect progressive industrial property use. Whether you are an investor hoping to reposition an asset or a manufacturing company looking to expand to the Sacramento area, my clients partner with me because of my energy, determination to get the job done, and track record of success.

I started my career in commercial real estate after developing and operating a successful eCommerce business. Prior to that I spent 4 years with The Conco Companies managing large scale projects including the Sutter Health hospital in Sacramento and over $20 million in improvements to the Stanford Linear Accelerator.  My project management and eCommerce experience allow me to provide a unique perspective to my client’s challenges and develop a strategy to overcome them.

Outside of the office, you can find me spending time with my family. I am a licensed pilot and enjoy being outdoors.

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Tom Tyer

Executive Vice President

Sacramento

Since starting my commercial real estate career with Colliers International in 1987 I have helped clients with all aspects of their industrial real estate. I have also assisted many quality companies that have been refered to me by Colliers and SIOR associates, In the last decade, I have been involved in almost 500 industrial transactions totaling over 7 million square feet.

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Tommy Ponder

Executive Vice President

Sacramento

As executive vice president in Colliers’ Sacramento office and market leader, my team specializes in sales and leasing of industrial product primarily in the greater Sacramento region.  Colliers’ unique and collaborative culture gives me the ability to service accounts across the Western United States. 

I began my career in industrial real estate in 2003 after owning and operating a business in the Czech Republic. Running a business in a foreign country was both challenging and exhilarating.  The experience helps me connect me with business owners and decision makers regionally and at institutional and corporate levels.  It is the partnerships and personal connections with each owner-user, tenant, and landlord, that drives me to form lasting relationships. I pride myself on always putting the needs of my clients first, treating each deal as my top priority with integrity, energy, and attention to detail.   

Bringing value to my client’s real estate transactions is key, however, it’s very satisfying knowing their experience with me and my team will make a lasting impression. I pride myself on always putting the needs of my clients first and treating each deal as my top priority.

In my free time, I enjoy the outdoors with my wife, two children, and dogs. My all-time favorite reset buttons include racing motorcycles in the cross-country AMA D36 series and coaching little league.

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