John Black says real estate investors are on the hunt this year for projects in a popular new market centered on hospitality and resorts.
Black is president of Lutherville-based MacKenzie Capital and said last week during a wide-ranging discussion on investment trends for the second half of the year that a focus on shore points like Ocean City, the Eastern Shore’s Kent Island and the Delaware coastline have overtaken the once-hot refinance market. Another strong target for investors this year are distressed properties like retail and office space.
Black’s perspective offers a glimpse into the often silent real estate investment market in the second half of the year. The seasoned real estate executive who heads the MacKenzie investment division said brokers and REITs will spend the rest of 2022 seeking out resorts, hotels and restaurants for their investments, offering double-digit returns of up to 20% because the market is now saturated with travelers and event planners as the pandemic lifts.
The trend will hold through the end of the year despite a sagging labor market for workers, Black predicted. And it’s not limited to resort towns. The pending redo of Harborplace by MCB Real Estate could also serve as a potential magnet for investors to other areas downtown.
“With long-term fixed rates trending in the low 4% to 5.5% range, we are reverting to a more normalized world and investors need to adjust their mentality and expectations,” Black said. “What’s old is now new again and, if investors simply take the time to step back and reflect on the current conditions, they would realize how much opportunity awaits them.”
He cited private investments in the 120-room Hyatt Place Kent Narrows Marina now in the works just over the Chesapeake Bay Bridge as an example. The resort is expected to open by late December and is being financed through MacKenzie Capital.
“I think the rest of the year will be a busy time for investors,” he said. “We are following our clients to the Southeast U.S. as well as the Eastern Shore. We are, no doubt, operating in an interesting time with rapidly-changing conditions but we remain in a good place and expect a robust second-half of the year.”
Stressed about finding an apartment you can afford as rents are rising? You’re not alone.
A new national survey by online real estate group Zillow found two in five recent renters said they lost sleep during their apartment search while fretting over cost and competition. The typical monthly rent across larger and mid-sized U.S. markets has jumped 24% since 2020 to $2,031, Zillow researchers say.
That has caused renters to stress over not being able to find an affordable unit, especially as U.S. Census data shows the typical rental household earns about $3,800 a month. The Zillow survey found that most renters settled for fewer amenities and bells and whistles inside their units, like washers and dryers and balconies, when they signed a lease.
The Bozzuto Group remains in growth mode.
CEO Toby Bozzuto said this month that the company has hired 1,000 new employees this year — with about 8,000 resumes hitting its inbox.
“And that was from across the country in different jurisdictions,” Bozzuto said, of the applicant pool. “It speaks well for our economy. We feel extraordinarily fortunate about what we’re seeing.”
Greenbelt-based builder and property manager Bozzuto has developed several Baltimore projects over the years, including Anthem House in Locust Point and The Liberty in Harbor East. The firm has a total of 3,000 workers and 500 have been with the company for a stretch of seven years, Bozzuto said. The company remained open during the pandemic and in full growth mode with projects in Chevy Chase, on the West Coast, in Chicago and in the Boston area.
“If we’re fortunate, we’ll continue to grow into more states in the Southeast and the west like Denver and even into Texas,” Bozzuto said.
As for his hometown of Baltimore, Bozzuto said the company is building the new Guardian House project for Landmark Properties downtown and a second affordable apartment project at the former Somerset Homes site. He remains bullish on the city despite its struggles with crime, high vacancy rates, and more.
“I’m cautiously optimistic,” he said. “I hope it moves forward soon. There is a core group of people out there working to make Baltimore better and we are all sort of bumping into each other. It’s a lot better than trying to throw stones at it from the outside.”
Enterprise Community Development recently closed on financing for the redevelopment of Howard County’s Roslyn Rise affordable and market-rate apartments.
The nonprofit is in charge of the ground-up redo of the popular development that was first built in the 1960s. The new Roslyn Rise will offer 153 mixed-income apartments with a slate of amenities including a club room, fitness center and a dog park. The development is located in Columbia at 10339 Twin Rivers Rd. Harkins Builders is the contractor for the redevelopment.
Sherwin-Williams has just signed two leases to expand its local footprint.
The national paint chain based in Cleveland, Ohio will open stores at the Timonium Exchange and Magothy Beach Plaza. Both retail strips are owned and managed by Woodlawn-based St. John Properties.
The shop in Baltimore County is aimed at commercial customers, St. John officials said, while the Anne Arundel County store will serve residential weekend warriors.
Michael Sacks brokered the Timonium Exchange deal while Eric Llewellyn brokered the Magothy Beach Plaza deal for St. John. Matt Copeland and Cooper Henry of KLNB represented Sherwin-Williams in the Anne Arundel County deal.
Roland Park Place recently inked a deal with MedStar Health to serve its residents.
MedStar will set up shop to treat residents in the ambulatory care center and in-house health care center, officials said last week. The services will allow residents optional access to MedStar healers five days a week and the partnership will allow an option to have their medical records streamlined with MedStar Union Memorial Hospital nearby if emergency care is ever needed.
The upscale retirement and assisted living community in North Baltimore has been in growth mode. Last year it expanded with the opening of an eight-story tower with 58 new apartments. The $60 million project added several new amenities to the independent living portion of the complex. The new development has four levels of underground parking.
ICYMI: Recent Baltimore-area real estate news
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