Friday, March 15, 2024

Seyfarths 2024 Commercial Real Estate Sentiment Survey (Video)

 

Trouble Spots in the Commercial Real Estate Sector (Video)

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Apartment Rent Growth in Pennsylvania Exceeds National Average

By Brenda Nguyen and Veronica Miniello

Pennsylvania's largest apartment markets have demonstrated resilience, surpassing both national and statewide rent growth trends in the first quarter of 2024, except for Pittsburgh.

Lancaster, Scranton and York posted impressive annual rent increases exceeding an average of 3%, making them the top performers in the state. These tertiary apartment markets, along with the state capital Harrisburg and Reading, have benefitted by not seeing the same level of new apartment construction as larger cities such as Philadelphia. Limited supply, alongside a modestly growing population and an influx of residents from costlier areas like New Jersey and New York, has contributed to stable rent growth.

What's more, Harrisburg, Reading, Lancaster, Scranton and Allentown were recently recognized as the nation’s top places to retire in 2024 by U.S. News. This publicity, combined with the region’s existing affordability, has attracted renters seeking a slower-paced lifestyle near amenities like healthcare, local shops, restaurants and community events. The appeal of smaller towns with limited development has created an increasingly competitive apartment market for renters seeking alternatives to costlier cities.

Philadelphia presents a contrasting picture. Rent growth has softened more significantly, dropping from an average of 3.4% in the first quarter of 2023 to 1.5% in the first quarter of 2024. Despite experiencing the highest level of development since the 1970s, Philadelphia's annual rent growth has outperformed national and state averages, although marginally.

This performance can be attributed to robust rent growth in Philadelphia's suburbs, where construction has been limited. Meanwhile, the city has seen stagnant rent growth in some neighborhoods due to a high concentration of new development. However, Greater Center City's residential population has grown by 3% in the last four years, helping buoy rent growth in the city’s downtown neighborhoods amid a surge of apartment completions.

On the western side of Pennsylvania, Pittsburgh posted positive annual rent growth of 1%, outperforming the national average but falling slightly below the statewide average of 1.3%. Pittsburgh is the only metropolitan area in Pennsylvania that has consistently lost residents since 2020. Similar to Philadelphia, an influx of new units in downtown Pittsburgh has weighed on rent growth, which has been negative in the downtown area over the past six months.

Overall, Pennsylvania's apartment market offers a mix of opportunities for renters and investors alike, with Central Pennsylvania emerging as a region to watch for continued rent growth and stability.

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Commercial real estate experienced stages of grief, 'now we're at acceptance' (Video)

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Thursday, March 14, 2024

Netflix plans two-story Netflix House at King of Prussia Mall with themed experiences and dining

By Emma Dooling – Reporter, Philadelphia Business Journal

Netflix is targeting Philadelphia for one of the first locations of its new retail, dining and live entertainment experience.

The streaming giant plans to open a Netflix House in the former Lord & Taylor space at the King of Prussia Mall. The brick-and-mortar concept aims to immerse customers in their favorite Netflix shows and movies through themed merchandise, food and activities.

Netflix has previously created several temporary activations around the world based on its content, including the "Stranger Things Experience" and "The Queen's Ball: A Bridgerton Experience," as well as a pop-up restaurant called Netflix Bites. Netflix House gives the streaming service a permanent venue to host its themed experiences.

"This isn't a place that folks are going to travel to once a year," Brent Nikolin, senior program manager for Netflix's live experience team, told members of the Upper Merion Township Planning Commission during a presentation Wednesday night. "We want to be in the communities. We want to be in city centers. We want to be in great malls like King of Prussia where people come over and over again."

Nikolin said Netflix expects to open the venue in late 2025. Bloomberg reported in October that Netflix plans to open its first two Netflix House locations that year.

Netflix is seeking approval from the Upper Merion Township Board of Supervisors for conditional use of the former department store as a performing arts facility and movie theater to host the proposed activations within Netflix House. The Planning Commission unanimously recommended the application for approval during the Wednesday meeting. The entertainment company will go before the Board of Supervisors for final approval on April 11.

Full story: https://tinyurl.com/yck46dne

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