June Newsletter: There’s A New Business In Town…
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What to Expect When Selling Commercial Real Estate
Comments Off on What to Expect When Selling Commercial Real EstateHave you been thinking about selling your commercial real estate asset?
To some, it can be an overwhelming process. At Black Diamond Realty, we educate our clients about what to expect while working diligently to prevent “deal potholes,” such as transactional surprises. When selling your commercial property, it is important to be prepared for the process and informed about the fees associated with the deal.
Selling a parcel for $1,000 does not mean you get to deposit $1,000 into your bank account. Below is a list of some of the standard commercial real estate transaction fees you can expect in West Virginia (other states have additional nuances – for example, PA has school taxes that run on a 7/1 – 6/30 basis) with a notation indicating which party is typically responsible. A common saying in commercial real estate also applies to this list…everything is negotiable.
Closing Costs (State Customs) First American
Generally speaking, all due diligence expenses are the buyer’s responsibility. On the seller side, transfer taxes/stamps and the real estate brokerage commission are the primary line items in closing a commercial transaction. Real estate transfer taxes (aka stamps) are taxes imposed by states, counties and municipalities on the transfer of the title of real property within the jurisdiction. Real estate transfer taxes (aka stamps) are taxes imposed by states, counties and municipalities on the transfer of the title of real property within the jurisdiction. Each state has varying regulations which affects the responsible party. In addition, the rate can vary from county to county within any given state. In WV, the transfer tax is the seller’s responsibility. The rate is $1.65/$500 ($1.10 state, $0.55 county). A county may levy an optional excise tax up to $1.65. On the brokerage side, you get what you pay for. Black Diamond Realty adds value via presentation, process (aggressive/teamwork approach), and our people (knowledge, skills, abilities). Black Diamond’s clients are happy to pay the transactional fee. Brokerage commission rates can be fairly standard but some percentage adjustment can be expected based upon the value and scope of the project.
May Newsletter: Black Diamond Gives Back
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Retirement Community To Open In Fall
Comments Off on Retirement Community To Open In FallA new, state-of-the-art retirement community is slated to open during this fall, at 2996 Point Marion Road, Morgantown.
The Crossings at Morgantown is managed by Harmony Senior Services. Harmony is a fully integrated management service company led by proven senior care professionals with a record of providing great care and service at numerous senior living communities across the mid-Atlantic.
The Crossings at Morgantown will provide independent living, assisted living and memory care on a private campus located within 4 miles of the area’s three main hospitals. The facility has not yet obtained a license from the state of West Virginia. Pursuant to WV Code § 16-5D-6(a), no assisted living – including memory care – can be occupied until such license is obtained.
Employees are actively taking tours at the welcome center, located below the construction site. This is a 79-unit senior living community with 84 suites for independent living 59 suites of assisted living 36 secured memory care suites. The independent living suites have 32 floor plans to choose from and are either one bedroom one bathroom, or two bedroom and two bathrooms.
“With affordable monthly costs and no large buy-in, all it takes is a one-time deposit to secure your suite in our independent living community,” said Kelly Drayer, director of Sales and Marketing. She added the apartments are the region’s largest. The Crossings at Morgantown prides itself on the many resort-like amenities included in month-to-month leasing. The community extends the living space with common areas, outdoor courtyards and access to popular amenities, such as a movie theater, pup, salon, billiards, library and bistro. “March-Westin is our construction company on this project, between their reputation for solid workmanship and consistently staying within our timelines, we are on schedule to open this fall,” Drayer said.
For more information, contact The Crossings at 304.212.4939 or visit thecrossingsatmorgantown.com.
Article By: The Dominion Post.
April Newsletter: Deals Closed Record, New Offerings and Grand Openings
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White Oaks continues development in 3-phase build-out
Comments Off on White Oaks continues development in 3-phase build-outWhite Oaks continues development in 3-phase build-out. The White Oaks planned business community comprises 470 acres that are home to offices, FBI support services, medical support services, oil ad gas businesses, national retailers, restaurants and vital amenities.
Located at the intersection of Interstate 79 and W.Va. 279, the busy corridor sees an estimated average of 48,500 vehicles per day. It is adjacent to the $350 million United Hospital Center, at the doorstep of the FBI’s CJIS Division and the Biometric Center of Excellence. White Oaks is also located in the heart of Marcellus Shale play.
Retail Village Building 1 is fully occupied, with the newest tenants being Rominger Dental, Bonnie Belle’s Pastries and Hermasilla’s Deli. They all opened their doors in 2017.
Retail Village Building 2 is under construction, with the first tenant to be Starbucks, Bridgeport Community Development Director Andrea Kerr said.
Starbucks occupies 2,200 square feet of the 8,749-square-foot building located directly across from Building 1, she said.
“Starbucks is estimated to cost about $175,000, while the entire Retail 2 shell is $884,320. The second building will be similar in size to the first one, with room for additional tenants,” Kerr said.
Thrasher said Starbucks will be located in the far right end of Retail Village 2 and feature a drive-through.
“We are looking to turn over that portion of the building to the company by June 1,” Thrasher said. “It will also have a 550-square-foot patio. I anticipate it opening late this year.”
Cove Run Construction is doing the site work on Retail 2. Lee Reger Builds is the building construction contractor.
“There are four more bays available, with interested parties in discussion. We have no final contracts at this time,” Thrasher said.
Clear Mountain Bank will be located directly behind Retail Village 2. Cove Run is doing the site work.
“They are about ready to bid the architectural work,” Thrasher said. “Regional Eye Associates will be located near Friday’s, with Cove Run preparing the site and Elite Custom Builders doing the construction.”
Phase II and Phase III are being marketed now, with Elite Custom Builders to be located across from the W.Va. 131 entrance to White Oaks near Bear Express and the Shell fuel station in an area referred to as The Wedge, Thrasher said.
A large vehicle dealership, Freedom Kia, opened in 2017 in Phase III of White Oaks, located off W.Va. 131.
Hermasilla’s Deli Market, a longtime staple of the Fairmont community, recently opened the doors to a 32-seat second location at White Oaks.
Along with its signature sandwiches — which feature hand-sliced meats, a wide selection of cheeses and an array of toppings, condiments and vegetables — the establishment also offers salads and sells meats and cheeses in bulk.
“White Oaks has been very aggressive in developing their property. They don’t stop in the winter. It is a year-round operation,” Kerr said. “It is good for them and great for us. It is a fantastic partnership that we hope to see continue for many more years.”
Craig Baker, Architecture Division manager for the Thrasher Group, agreed with that sentiment.
“White Oaks should be commended for their steadfast commitment to the architectural design covenants of the park. They had a vision of what they wanted the park to be and stuck with it,” Baker said. “One thing that makes White Oaks special is how they continually strive to maintain their identity as one of West Virginia’s premier business locations. With the addition of the park and trail system, White Oaks has maintained its identity as a great place to work and play.”
White Oaks Phase II does not currently have any lots sold. It is located just past the Manchin Clinic Assisted Living Facility that opened late last year.
Thrasher explained that while Phase I and II are primarily billed as a high-end business park, Phase II will also be for industrial use. Freedom Kia is the first business to locate in that area.
Freedom Kia was previously located on Emily Drive. However, it began to outgrow its space and decided to move in October.
“It came to a point where the volume of sales, our service department could not support. It was a situation where to continue to grow and provide our customers the support and service we want them to continue to have, we needed to give them a facility to be able to do that,” General Manager Jadd Buchanan said.
The dealership facility cost around $5 million, an investment that allowed the company to stay local.
“This became our home. We built a business here, and we didn’t want to abandon the customers we had sold to or serviced over the years,” Buchanan said. “We wanted to provide a location that was much more user-friendly as far as access — now it’s right off I-79, Exit 125 on Saltwell Road. It’s easier to get to for our employees who live in the area, and our residents in this direct area, so I think that was an easy decision.”
In its new location, Freedom Kia has tripled the size of its service department, having gone from four lifts to 12, and added a substantial amount of inventory. The space also includes a car wash, which is complimentary when a car is brought in for servicing, and it’s generally more accessible.
General Sales Manager Dorsey Larew said the larger facility has several perks.
“We can house more mechanics, and therefore get you in and out faster. Sales display was a little tough when you’re parking in a parking lot versus an actual dealership that was built for that, so that’s been good,” Larew said. “With the lot, you can drive around and be able to look at all of our cars without having to get out of yours.”
Located at 97 Joy Lane near Bridgeport, accessibility is a prime feature of the new location.
“We’re a lot more convenient to get in and out of,” Larew said. “Going down Emily Drive, it was tough to get in and out.”
In addition to offering online credit applications and service appointments, a two-year maintenance plan and a lifetime of state inspections on every car purchased at the location, Freedom Kia also has people who truly enjoy their work, said Jeannie Boyles, who has been the receptionist for six years.
“We have great people who work here. They’re dedicated, friendly, and are happy to be here,” Boyles said. “That’s important for the company — to be able to come to work and know what you’re doing. It brings a lot of customers in from around the area, and the customers appreciate that, knowing we care about them that much.”
For the future, Buchanan is looking forward to continued growth and being able to enhance customer service even more, staying focused on giving every individual personal help. At the new location, Freedom Kia offers several complimentary amenities, including local transportation, a kids entertainment room, and more.
Baker-Hughes owns a parcel in Phase III, but there has been no word on the future plans of the company for the site, Thrasher said.
“We work with other developers, but own main developer is White Oaks Business Park and we work with Black Diamond Realty, Morgantown.
Staff writer Darlene J. Swiger, The Exponent Telegram
FBI’s headquarters project to bring hundreds of positions to Clarksburg facility
Comments Off on FBI’s headquarters project to bring hundreds of positions to Clarksburg facilityHundreds of jobs are expected to be shifted to the FBI’s Criminal Justice Information Services (CJIS) facility in Clarksburg as part of the FBI Headquarters Consolidation Project.
The U.S. Senate Committee on Environment & Public Works held a hearing Wednesday morning to discuss that project with representatives of the FBI Finance Division and the General Services Administration (GSA) Public Buildings Service.
“In the revised plan, there is a plan if consolidation occurs downtown, the CJIS Center in Clarksburg would have several hundred jobs moving into West Virginia,” U.S. Sen. Shelley Moore Capito said during the hearing. “That would be an important development for me, obviously, as that facility continues to grow and become more professional and more highly technological. We would welcome that prospect of having those employees move out into West Virginia, as many have moved there before and have realized the wild and wonderful live is a pretty good one out in West Virginia.”
The FBI Headquarters Consolidation Project began as a means to replace the J. Edgar Hoover (JEH) building that the FBI has occupied since 1974.
Richard L. Haley II, assistant director of the FBI’s Finance, Facilities and Real Property Division, said while the mission of the FBI has evolved, the building itself has not kept pace and is instead falling apart as evidenced by crumbling facades and deteriorating infrastructure.
“This makes it difficult to address rapidly developing threats and collaborate across divisions and programs,” Haley said. “As an organization, we must be able to stay current with constantly changing technologies that make our jobs both easier and harder.
“Simply put, the existing J. Edgar Hoover building is obsolete, inefficient, and faces a number of security vulnerabilities,” he said.
Thus the current J. Edgar Hoover building would be demolished and the construction of a new building would occur on the same site.
During the construction phase, FBI employees would relocate to “swing space,” such as the Clarksburg facility while the existing facility is under construction.
In total, the FBI will be moving more than 2,500 positions — both employees and contractors — to its owned facilities across the nation, which includes not only Clarksburg but also Huntsville, Alabama, Pocatello, Idaho, and Quantico, Virginia.
“It is anticipated that several hundred positions could be shifted to FBI facilities in Clarksburg, West Virginia and Pocatello, Idaho, while the remainder would be realigned to Huntsville, Alabama,” Haley said. “The FBI already has a substantial presence in each of these communities.”
The FBI previously proposed a procurement that would have moved forward with constructing a new suburban facility, but upon a review of real estate costs and footprints, it was decided that demolition and reconstruction would be less costly.
Together, the FBI and GSA began to review and seriously consider the possibility of staying at the current location, determining multiple advantages to doing so, including the property’s proximity other departmental headquarters, inspection facilities, utility plants, Metro lines and road and bus networks.
Thus, a plan to rebuild on the site began. As part of the evaluation, three options were considered: a phased renovation of the existing building, a renovation of a fully vacant facility or a demolition of the current facility and construction of a new building on the site.
“A phase renovation, we determined, would take 15 years, cost more money and deliver you a less successful product than demolishing and rebuilding a new structure,” said Daniel Mathews, commissioner of the GSA’s Public Buildings Service. “New construction allows us to build a facility that can house 8,300 people, instead of a smaller number in a renovated facility. In addition, new construction can mitigate security threats more effectively with tailored designs, newer materials and current construction techniques.”
Overall, Mathews said, the demolition-rebuild allows for the facility to be built faster, cheaper and with less risk than a renovation.
However, the demolition-rebuild is estimated to cost $3.3 billion and require 6 years to occupancy, which makes the relocation of employees to facilities such as Clarksburg’s CJIS vital.
“These other sites that we have identified have been part of our physical portfolio for many years, and while the way forward includes enhancing the use of these sites, these sites are not new to the FBI,” Haley said. “The FBI’s long history at these locations suggests that the functions and staff realigned to those locations can be successful in performing mission operations.”
Posted by Brittany Murray, AJR NEWS NETWORK
March Newsletter: Black Diamond Reveals Its Top 5 Assets
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An Increase In Leads Generates Closed Deals
Comments Off on An Increase In Leads Generates Closed DealsHistorically, the commercial real estate market tends to slow during the winter season. At Black Diamond, we can confidently report the trend is quite the opposite this year. The new year has brought a vibrant market filled with deal making attitudes. For example, Black Diamond Realty has gained nearly 100 unique leads between industrial, investment, office, land and retail. These statistics are from folks who specifically reached out to us. There are countless others our team has targeted for product specific offerings.
Leads translate into deals. Deal velocity is trending up. In quarter 1, Black Diamond Realty closed five deals in 2016 versus eight deals in 2017. With several weeks to go, Black Diamond Realty has already closed (leases and sales) 12 deals with a strong pipeline. Check out next month’s newsletter to get a snapshot of our Quarter 1 deals.
Leads and deals have picked up across all sectors of commercial real estate, but there are shining stars setting the pace. Black Diamond Realty’s Top 5 Performers are revealed below. These statistics are provided by LoopNet and represent a 90 day period from December 1, 2017 through the end of February.
Investment: 160 Fayette Street in Morgantown, WV
45,146 Search Displays
743 Listing Views
Special Purpose/Event Center/Land: Heston Farm (Upper Level) in Pleasant Valley, WV
42,462 Search Displays
401 Listing Views
Industrial Land: Ventura Drive in Fairmont, WV
20,460 Search Displays
289 Listing Views
Sabraton Plaza: 1397 Earl Core Road in Morgantown, WV
18,202 Search Displays
219 Listing Views
Industrial/Land: 1524 Grafton Road in Morgantown, WV
17,590 Search Displays
171 Listing Views
A “search display” means a property was displayed as a potential fit based upon the criteria input by a specific buyer/tenant. A “listing view” means that an individual clicked specifically on the property. All of Black Diamond Realty’s Loopnet listings are directly linked to its website (www.blackdiamondrealty.net) which generates even greater exposure.
At Black Diamond, we feel the regional market is heading in a positive direction on many different fronts. Momentum is quickly building with tremendous economic excitement to come in the months and years ahead. Buckle up and enjoy the ride.
Distillery, tourist attraction up for sale – Heston Farm
Comments Off on Distillery, tourist attraction up for sale – Heston FarmHeston Farm is being sold in two lots for a total of $2,383,000 and comes with three buildings, a storage bunker and access to the Tygart River on 26.07 acres.
Owners Mickey Heston and Julie Smith said they are committed to working with whoever purchases the property to continue developing Heston Farm ad a regional attraction. There are also an additional 132 acres that are not part of either parcel, but selling them isn’t out of the question, the couple said.
Between the winery, distillery, restaurant and hosting events, the property attracts around 16,000 people per year, Smith said. Despite being only a mile from the highway, Smith said the farm really does feel like your grandparents’ farm. “You don’t have to travel two hours to get that West Virginia experience,” Heston said. Smith said people love being able to get away without having to go far, and visitors told her they can’t believe they found something like Heston Farm in the area.
Before Smith and Heston turned the farm into a tourism attraction, it primarily raised cattle, Heston said. A single pavilion built for family to use was the start of attracting visitors and eventually, the creation of the event hosting aspect of the business, Heston said. The farm has been in Heston’s family since World War II, and his family has a long history of making alcohol, he said. His grandfather was busted for making whiskey even before his father was born and learned to make wine and beer from his great uncles at “10, 11, or 12, somewhere in there,” he said “They were teaching me a trade,”
Heston laughed. Heston said he plans to continue making wine after the sale, moving off-site if needed while smith said her newly started health care communication business will keep her busy. The property is being listed by Black Diamond Realty and interested parties can contact Jeff Stenger, at 304.413.4350 or JStenger@BlackDiamondRealty.net
Click the following link to view the detailed marketing flyer for this property: https://www.yumpu.com/en/document/view/59769682/heston-farms-marketing-flyer
Article by William Dean, The Dominion Post
February Newsletter: Local Business For Sale Creates Big Opportunity
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The Dominion Post – From the Desk of Mark Nesselroad
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Legislators Updated on China Energy Deal
Comments Off on Legislators Updated on China Energy DealCommerce Secretary Hopes China Energy Project Will Begin This Year.
CHARLESTON – Commerce Secretary Woody Thrasher offered legislators a few new tidbits — though still no specifics — on the $83.7 billion China Energy agreement. Thrasher addressed a Jan. 9 joint meeting of the interim Natural Gas Development and Energy committees. Answering a question if this is a deal to simply sell off our resources, he said no. “It is bricks and mortar facilities for the purpose of generating value-added products in the petrochemical industry.”
The immediate goal is a single project, though he wouldn’t say what it is. “We are working actively on that project one step at a time.” He continued, “Our goal is to expedite the initial project as quickly as we can for a variety of reasons. And I’m hopeful that the details of that begin to unfold in the next few months.” He hopes to see some construction by the end of this year, he said.
Most people guess that the unspecified projects are some sort of manufacturing facilities that would use the products generated from cracker plants being developed for the region. Thrasher speculated that the majority of the market for the China Energy-related projects would be overseas, predominately China. But the focus is on employing local residents in businesses that pay taxes to West Virginia, and selling the products those businesses produce. “It makes sense from a business model.”
Thrasher said he had no specific timeframe for any aspect of what’s unfolding, but during three visits with the people from China Energy, he’s seen a “great sense of urgency.” He’s heading back to China on Saturday, he said, to meet the company’s new board. “These are big projects. They’re significant.”
Thrasher said last week’s announcement from Appalachia Development Group – a subsidiary of Charleston-based high-tech firm MATRIC – provides an important step forward. The group announced on Jan. 3 that it was invited to submit a Part II Application for a $1.9 billion U.S. Department of Energy loan guarantee to support the development of infrastructure for the Appalachia Storage & Trading Hub, which would store natural gas liquids for a regional plastics industry.
The group said that the American Chemistry Council believes the hub would serve as a catalyst for the creation of an estimated $36 billion in follow-on petrochemical investments and more than 100,000 new long-term jobs, drawing resources from Marcellus, Utica and Rogersville shale deposits.
Thrasher said that the Department of Energy’s action “has significant impact in terms of the risk level of folks coming in.” Jim Crews, vice president of business development for MArkWest Energy Partners, offered the legislators additional prospective on the region’s potential.
“The United States, and the Appalachian Basin, is the Saudi Arabia for the production of natural gas liquids,” he said.
Colorado-based MarkWest is a midstream gas processor with three West Virginia facilities. It’s Sherwood plant in the Doddridge County is the nation’s fourth largest and will soon be expanded to become the largest. He offered a somewhat technical slideshow on how the gas liquids – ethane, propane and butane – are separated from the methane and sent on for further production.
The wet natural gas in this region, he said, contains enough ethane – used in light plastics – to feed six cracker plants. Some of it now gets shipped south to the Gulf for processing, but most goes to waste because it’s too expensive to ship and there’s no industry here yet to process it.
Article By David Beard, The Dominion Post
January Newsletter
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Happy 2018! Another Year Is In The Record Books
Comments Off on Happy 2018! Another Year Is In The Record BooksWe hope you and your family had an enjoyable holiday season. The new year is a time to reflect and project. This monthly Black Diamond Realty newsletter reflects on 2017 while providing our projections pertaining to north central West Virginia’s economic activity in 2018.
It was a record breaking year for Black Diamond and many other companies in north central WV. While north central WV remains consistently vibrant, the tides are slowly turning for the state as a whole, and WV’s entire economic fleet appears to be heading toward brighter days. Several critical sectors led the charge with positive economic announcements in 2017.
Energy was the cream that rose to the top. Several large pipeline projects are at various stages of construction with the finish line inching closer. Pipelines open up regional, metropolitan markets to WV’s gas production. A cracker plant is under construction in Beaver County, PA with rumors of potentially two additional crackers being built in OH and WV (Parkersburg area). Crackers dissect elements of natural gas into various chemicals which should result in a manufacturing expansion for companies who want to be near critical elements of their production process. Pipelines and crackers are creating a newfound buzz for the energy sector. Black Diamond can testify to the energy sector’s expansion in 2017: Industrial sector leads paced other sectors with a total of 133 unique leads. Black Diamond closed 13 deals with energy related entities.
The buzz does not stop at our state or even national borders. China Energy Investment Corp signed a memorandum of understanding with WV leadership to invest $83.7 billion over 20 years in various energy related ventures. Power plants are one potential investment angle. Two gas fired power plants are at varying phases of approval to be constructed in the region. One is in Harrison County. Click here to learn more: http://harrisoncountypower.com/ Oil and gas activity is energizing our regional economy by bringing high paying jobs to our market. The money from these jobs is spent on housing (hotels, apartments), food (grocery stores, restaurants) and entertainment.
Infrastructure has been a hot topic in West Virginia for many decades. Band-aids have been our state’s application of choice. However, 2017 brought a different style of leadership aimed at changing WV’s story. Governor Justice and his team formulated a plan to use future promised tax dollars to secure ~$3 billion worth of funds to complete road infrastructure improvement projects. Our roads have already benefitted from the Roads to Prosperity Amendment and should improve further over the next decade. Infrastructure is a critical variable for many sectors considering economic expansion.
Since accepting his role as WVU’s 24th President, Dr. E. Gordon Gee has been focused on expanding the university’s outreach while maintaining its mission of supporting prosperity for the mountain state. WVU Medicine has been aggressively expanding with 2017 announcements that include a $150 million, 10-story children’s and women’s tower on WVU Medicine’s main campus, a $12 million inpatient residential drug treatment facility near Mylan Park (Morgantown), plus it opened a $13.9 million, 25,000 square foot new outpatient facility in Fairmont, WV. Mon General Hospital is also in expansion mode. North central WV should welcome this “medical arms race” as it directly results in a higher quality of life via greater healthcare access, plus economic benefits, including high paying jobs.
So, what do we have to look forward to in 2018? The energy sector will carry 2017’s momentum into the new year and we will begin to see the fruits of the road bond’s labor as construction projects start. with the additional expansion by WVU Medicine and two prominent interstate developments (White Oaks Business Park in Bridgeport and West Ridge in Morgantown), north central WV will see significant growth with many positive announcements. As the aforementioned economic drivers come to fruition, other areas in the state are also poised for growth. Also, since businesses will have greater discretionary capital to put to work under Trump’s new tax plan, look for businesses to be more aggressive with expansion efforts and hiring practices.
Best wishes for a joyous and prosperous 2018!
December Newsletter
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The Retail Apocalypse Is Not Among Us All
Comments Off on The Retail Apocalypse Is Not Among Us All“The Retail Apocalypse” is a great catch phrase that grabs attention. News outlets make sensational claims that Amazon is destroying the retail sector and that, across the board, retail real estate is in big trouble. These claims are overstated and misguided. The retail industry isn’t dying, but rather evolving. The following article will explore three topics: retail real estate that is in trouble, retail real estate that is well positioned and the perceived 400-pound gorilla in the room, Amazon.
Enclosed malls are facing the most trouble right now. While foot traffic in enclosed malls continues to decline1, the significant operating expenses from expansive common areas remain. Assets in secondary and tertiary markets are particularly at risk. Businesses most affected by the retail apocalypse are retail clothing and electronic stores in enclosed malls. We will see malls close soon. However, many malls will be reinvented with new and innovative uses. Across the country we are already seeing “dead malls” get new life with unique uses such as: satellite college campuses, sports complexes, multifamily, etc. The Google Glass headquarters occupies a 500,000-square foot office that was previously an abandoned mall in Mountain View, California. Locally, Mylan Pharmaceuticals was recently approved for a 24,000-square foot lab in the former JC Penny at the Mountaineer Mall. Enclosed malls are in the most trouble, but have significant opportunity for reinvention.
Retail sectors that remain healthy include: single tenant properties (free standing businesses such as banks, fast food, convenience store, etc), neighborhood retail (including grocery stores), power centers (developments with home improvement/ Walmart as anchors), and strip centers. Think about some of your local retail strip centers. How many of the tenants are truly threatened by Amazon? Many, if not all, of the tenants are service providers: medical, financial, insurance, restaurant, cell phone store, hair salon, etc. Even if the few retail users within a strip center leave, conversion to the next use is fairly easy.
Amazon and the growth of online shopping have certainly affected the retail landscape and hurt some sectors. However, only 8.5% of retail sales take place online. Amazon only accounts for 1.5% of the retail sales in the US2. In fact, most retail sales still occur in brick and mortar stores. A bigger factor than Amazon is changing consumer preferences. In 2016, for the first time ever Americans spent more eating out and at bars than on groceries. Americans’, especially millennials, crave experiences over material goods. Millennials spend less on clothing and more on dining, concerts, and travel. Naturally, clothing retailers are going to feel the pain of these changing consumer demands.
Creative destruction is a perpetual force. Just as Netflix destroyed Blockbuster, we are seeing some retail industries being destroyed. However, the decline in one industry creates opportunity and space for new businesses concepts to satisfy new consumer needs. Visionary developers will find solutions based on what the market demands.
(1) (https://retailnext.net/en/benchmark/retail-performance-pulse-july-2017-store-results/)
(2) (http://www.businessinsider.com/amazon-shouldnt-be-blamed-for-retail-apocalypse-2017-7)
Defense In Depth to cater to new and experienced shooters
Comments Off on Defense In Depth to cater to new and experienced shootersMORGANTOWN — Defense In Depth, a new firearms education/training center and retailer in Morgantown, aims to cater to the needs of new and experienced shooters alike with its state-of-the-art facility.
Located in Sabraton Plaza, Defense In Depth is a 20,000-square-foot, $11 million center featuring a 75-foot long indoor gun range with 16 lanes, classrooms, a 30-foot long computer simulation screen and retail showroom.
In the end, Leech said they wanted the business to focus on education, training and situational awareness regarding firearms, with actual gun sales being thrown into the mix last.
“You can buy a piano or a guitar, but that doesn’t mean you know how to play. The same thing applies with guns,” Leech said. He noted that Defense In Depth will offer friendly expert advice regardless of a shooter’s level of experience so they feel comfortable and can improve.
Leech said Defense In Depth has 26 specialists on hand, all of whom have experience working with firearms via the military, law enforcement and other agencies. He said 2,000 job applications were filed and of the 26 who were hired, they bring a collective 300 years of experience.
Brett Wingard, one of the range safety officers, has trained more than 10,000 Boy Scouts in the use of firearms.
Lew Soccorsi, Defense In Depth’s general manager and director of training, said the ultimate goal of any situation is to avoid conflict. However, that isn’t always an option, which is why the center focuses just as much emphasis on when and when not to use a firearm as much as how to use one.
These lessons can be brought to life on the Ti Training simulator, which has more than 800 scenarios and 30,000 potential outcomes. Adding to atmosphere is the use of actual firearms that have been tweaked to fire compressed air, generating actual recoil. New scenarios can be generated simply by taking a photo of a real place and integrating it with the simulation system.
“It takes away the first-time jitters for people that never held a gun and its fun, kind of like a video game,” he said.
Soccorsi said Defense In Depth will host an active shooting information seminar from 11 a.m. to noon, and from 1-2 p.m. and 3-4 p.m. on Dec. 2, and everyone is welcome.
During the 2012 mass shooting in a Colorado movie theater, he explained many people only had one option to keep their loved ones safe and that was to lay on top of them. Some died as a result.
“We are teaching another option,” Soccorsi said. “We see these tragedies on the news, but I don’t think we give them much thought as to how this might affect us in little old Morgantown.”
Soccorsi said 30 different classes will be held at Defense In Depth, including those for women led by a female instructors to those who have never held a firearm before.
Nick DeMedici, former Monongalia County deputy and state trooper, is the director of sales and training for the center. He said that personalized attention also applies to firearms sales.
Defense In Depth will work to make sure the shooter and the gun match up in terms of size and the role that gun is intended for. He added that guests can rent from the 130 firearms set aside for use on its indoor range. Among them is the Sig Sauer P320, the 9mm pistol recently ordered by the U.S. Army to replace its current stock of Berettas.
The range boasts a state-of-the-art ventilation system that removes lead particulates and the smell of burnt powder almost immediately. This, he said, allows shoppers to effectively test drive the guns they’re thinking about buying, something very few shops can provide. Various programmable settings means shooters can set up timed exercises in which the targets are shrouded in strobe lighting.
DeMedici said Defense In Depth has about $7 million worth of inventory up for sale — new guns, used guns, ammunition, holsters, magazines, rifle cases, targets, apparel and other accessories. Anything that isn’t available in the store, he said, can be viewed and ordered at their kiosk and shipped directly to the customer’s home.
Also on the retail floor is the workshop of gunsmith Malcolm Rogers, who can clean guns after patrons practice, customize their guns, re-barrel them for a different caliber and even take a look at guns that aren’t functioning to their full capacity.
“We can modify things in any way — as long as it’s safe — to make them more comfortable,” he said.
With the simulation setup, gun range, rental services, retail space and gunsmith all in one location, Soccorsi said there isn’t anything like it within 500 miles of Morgantown or the East Coast.
As a thank-you to veterans, military personnel, law enforcement and emergency service workers, Defense In Depth will have a soft opening day for them from 10 a.m. to 11 a.m. Nov. 28. The grand opening and ceremonial ribbon cutting will be held at 10 a.m. Dec. 1. An entire month of opening specials, giveaways and events will follow.
by Conor Griffith STAFF WRITER. Click here to view this article at Theet.com
WVU Medicine Children’s Announces $152-Million Project
Comments Off on WVU Medicine Children’s Announces $152-Million ProjectWVU Medicine Children’s growing into new tower to be added onto J.W. Ruby Memorial Hospital
Three-year, $152-million project to add 150 beds
MORGANTOWN, W.Va. – WVU Hospitals announced today (Nov. 16) plans to construct a 10-story tower dedicated to WVU Medicine Children’s to address capacity issues and better serve the healthcare needs of all of West Virginia’s women and children. As a result of the project, 150 beds will be added to J.W. Ruby Memorial Hospital.
“As West Virginia’s leading academic medical center, we have a responsibility to the children of our state and their parents to provide the highest level of care close to home,” Albert L. Wright, Jr., president and CEO of the West Virginia University Health System, said. “The demand for our services has increased so that we must grow in order to meet their needs.”
The $152-million tower will take three years to complete. It will include:
- Entry, registration, administration, outpatient clinics, and building services
- Loading dock, dietary services, diagnostic imaging, and connection to the Southeast Tower (the WVU Heart and Vascular Institute tower)
- Operating rooms, cardiac catheterization, and endoscopy facilities
- A 20-bed Pediatric Intensive Care Unit (PICU) and 10-bed procedure/sedation unit
- A 50-bed Neonatal Intensive Care Unit (NICU)
- A 40-bed pediatric acute care unit
- A 30-bed obstetrical unit with potential for expansion
- Pediatric subspecialty and maternal-fetal medicine clinics
All of the inpatient rooms will be private. The tower will also include a satellite pharmacy, laboratory, respiratory therapy, and a cafeteria.
“This new building will allow us to match our expanded programs for the women and children of West Virginia with a state-of-the-art facility,” J. Philip Saul, M.D., executive vice president of WVU Medicine Children’s, said. “The goal is for no child who needs us to leave the state for care.”
PHOTO CAPTION: (From left to right) Albert L. Wright, Jr., president and CEO of the West Virginia University Health System; Gordon Gee, WVU president and chair of the West Virginia University Health System Board of Directors; J. Philip Saul, M.D., executive vice president of WVU Medicine Children’s, and Natalie Jefferis, former WVU Medicine Children’s patient and member of the WVU Medicine Children’s Leadership Council
The new Children’s tower will be attached to the southeast tower (WVU Heart and Vascular Institute). The building will extend southward to Medical Center Drive.
The construction of the tower will be subject to Certificate of Need approval by the West Virginia Health Care Authority. Construction costs are estimated to be $105.8 million with the remaining $46.2 million for financing and other related costs. A capital campaign will be launched to raise $60 million for the project. WVU Hospitals will finance the remainder of the cost. No state funds will be sought, and no extraordinary rate increase is anticipated as a result of the construction.
“This is a necessity, not a nicety,” Gordon Gee, WVU president and chairman of the West Virginia University Health System Board of Directors, said. “The children and families we serve will be relying on our friends and alumni, our businesses, the people of West Virginia, and the Mountaineer Nation – wherever they may be – to pitch in and to make this project a reality. We’re launching this campaign right now, right here.”
The tower is anticipated to be open to its first patient in late fall/early winter 2020.
Click hear to read the article at WVUMedicine.org
The Tides Are Turning For West Virginia
Comments Off on The Tides Are Turning For West VirginiaWest Virginia announces $83.7 billion gas development deal with China Energy
CHARLESTON, W.Va. — The state Department of Commerce announced overnight an agreement with China Energy to invest $83.7 billion in shale gas development and chemical manufacturing projects in West Virginia.
Gov.Jim Justice touted it as the largest private investment in West Virginia’s history. West Virginia’s gross domestic product last year was $73.4 billion.
“I realize it’s close to the unbelievable range, but we really have, I think, landed something that’s going to significantly impact and dramatically change the face of the petrochemical industry within West Virginia,” state Commerce Secretary Woody Thrasher said in an interview today with MetroNews’ Hoppy Kercheval.
The agreement was the biggest among several deals signed during President Donald Trump’s state visit to Beijing. The total value of the deals done during Trump’s trip could be as much as $250 billion, Reuters reported.
Natural gas demand in China is on the rise and poised to boom in coming years as the world’s second-largest economy aims to reduce its reliance on coal-fired power.
U.S. capacity to process liquefied natural gas is set to grow nearly seven-fold by 2019 as five export terminals open.
Thrasher, West Virginia’s Commerce secretary, signed a Memorandum of Understanding with China Energy President Ling Wen Thursday as President Trump looked on.
Photo Caption: Courtesy of the West Virginia Press Association West Virginia Commerce Secretary participates in a signing ceremony with China Energy as President Donald Trump observes.
Some national energy analysts cautioned that agreements such as a memorandum of understanding would represent a less firm commitment than a contract and the actual amount being invested could wind up being less than originally described.
The state Department of Commerce sent out a news release about the announcement just after midnight. China Energy officials had made several trips to West Virginia and the memorandum represents the first of several expected commitments by the company, the Commerce Department said.
Planning for the projects is underway and will proceed in phases over the course of 20 years, according to the release from the Commerce Department.
The projects will focus on power generation, chemical manufacturing and underground storage of natural gas liquids and derivatives.
“The plans clearly demonstrate a total value change approach, integrated from raw materials through the production of useful chemical intermediates locally,” according to the release.
The signing occurred during President Trump’s recent tour of Asia and the U.S.-China Business Exchange trade mission to enhance relations between the two countries.
Thrasher, Governor Justice and members of the state’s congressional delegation all praised the agreement.
“This is a great day for the state of West Virginia,” Justice stated. “I’ve been saying for the last couple months that the tides are turning in West Virginia and this is proof. Today is another sign as we joined with my good friend President Trump to announce the largest investment in our state’s history.”
Thrasher called the announcement the latest sign of strong partnerships with overseas companies.
“West Virginia has actively sought direct foreign investment to strengthen and diversify our economy,” Thrasher stated. “Toyota Motor Manufacturing, Hino Motors, Gestamp, Sogefi and other solid corporate citizens with international parent companies create jobs, generate incomes and support communities in West Virginia. In that same spirit, we welcome China Energy and the mutual benefits our energy collaboration will bring.”
China Energy is the recent creation of a merger between China’s state-owned coal mining company Shenhua Group and energy producer Guodian Group. The merger positions China Energy as the world’s largest power company with more than 200,000 employees.
West Virginia enjoys a strong relationship with China Energy, including ongoing research initiatives with West Virginia University. WVU and then-Shenhua Group began their relationship in 2002 with joint research on direct coal liquefaction technology.
China Energy selected West Virginia for this project because of the State’s position as a key energy-producing state and home to one of the world’s largest shale gas reserves, underpinned by a longstanding relationship between the two entities.
“The massive size of this energy undertaking and level of collaboration between our two countries is unprecedented,” Thrasher stated.
“It required cooperation between state and federal level officials. Senator Shelley Moore Capito has worked hand in hand with the West Virginia Development Office for months to ensure this unparalleled economic development opportunity was realized for the state of West Virginia.”
Capito, in her own release, said the investment announced today is a direct result of a series of meetings and calls her office had with Energy Secretary Rick Perry and Commerce Secretary Wilbur Ross.
“Expanding Appalachia’s energy infrastructure, including developing a regional storage hub and market for natural gas liquids, will have a transformative effect on our economy, our security, and our future,” stated Capito, R-W.Va.
“From driving growth and creating jobs to maximizing America’s energy potential, the benefits for West Virginia and the country from this new investment will be significant and long-lasting.”
“I am thrilled Secretary Thrasher and China Energy have signed the Memorandum of Understanding today in Beijing. I have always said that West Virginians are the hardest working people in the world. I’m glad China Energy recognizes this and is working with us to create jobs and economic growth in our state,” Manchin stated.
Sen. Joe Manchin also provided a statement expressing support for the investment.
Congressman David McKinley also stated his enthusiasm.
As Reuters reported, many of the deals announced on the China trip were packaged as “non-binding” agreements, gave scant details or rolled over existing tie-ups.“This investment in shale gas resources located here in West Virginia will spur tremendous economic growth in our communities,” stated McKinley, R-W.Va. “Secretary Thrasher has been in constant contact with my office as his team has worked out the details for this project. We commend him for his dedication to bringing new jobs to the Mountain State, and we look forward to the opportunities created by this new partnership.”
“I am somewhat skeptical of such a large number,” Alex Wolf, senior emerging markets economist at Aberdeen Standard Investments, told the Reuters Global Markets Forum, adding that the overall tone of the visit so far had been “positive”.
“I suspect they might be primarily MOUs (memorandum of understandings) instead of actual contracts and the actual contract amount may be substantially less.”
By MetroNews Staff in News | November 09, 2017 at 6:02AM
November Newsletter
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October Newsletter
Comments Off on October Newsletter
Roads to Prosperity
In 1971, West Virginia’s country roads became a main stream topic when John Denver released his international hit song. The serene views and natural beauty are challenging to enjoy without proper infrastructure to access them. Governor Justice’s “Roads to Prosperity” plan has the potential to positively influence West Virginia’s future. The goal is embedded in the plan’s slogan: No New Tax. Better Roads. More Jobs. Simple, straightforward and packed with tremendous opportunity to change our state’s story.
West Virginia residents are on the precipice of a monumental opportunity. New/Improved roads could be the stimulus for an economic boom via job creation plus greater accessibility and safety. Click the following links to see the: 10 Good Reasons to Say Yes! provided by TRIP, and the: Roads to Prosperity Amendment of 2017 provided by the WV Chamber of Commerce.
How could this vote positively affect the northern part of the state? Click the following link to review the proposed road projects that will be completed after the road bond is approved: Proposed Road Projects
Polls are open from now until October 7th. Now is the time to positively influence West Virginia’s future can help change our state’s story. New/Improved “country roads” will make it easier for people to enjoy our state’s beauty.
Crossings Construction Continues – The Dominion Post
Comments Off on Crossings Construction Continues – The Dominion PostLuxury Living
Construction continues on a new senior living community on Point Marion Road.
Scheduled to open in fall 2018 near The Pines Country Club, the 8.9-acre Crossings at Morgantown will include 175 senior living units — 84 of them independent, 59 units of assisted living and 32 secured units of memory care. The Crossings at Morgantown will be operated by Harmony Senior Services, a management services company with experience in senior living based in Roanoke, Va.
The Dominion Post reached out to the company to find out if anyone has yet expressed interest in the community, but representatives from Harmony Senior Services declined to comment, noting that advertising for the Crossings hasn’t begun yet.
According to the Crossings’ website, the community’s amenities will include an on site fitness center, a pub, beauty/barber shop, library, and a computer lab. According to Black Diamond Realty, this $35 million development will create about 45 full-time-equivalent jobs initially. The Crossings at Morgantown is expected to generate 100-130 part-time and full-time jobs over time.
View additional photos at The Dominion Post.
Black Diamond Prepares Dinner for the Rosenbaum Family House – 9/11
Comments Off on Black Diamond Prepares Dinner for the Rosenbaum Family House – 9/11On September 11th Black Diamond Realty prepared dinner for the guests of Rosenbaum Family House, a place for adult patients and their families to stay while receiving medical care at WVU’s Ruby Memorial Hospital. The team served hot meatball subs with a fresh garden salad and warm cookies for dessert. As always, the overwhelming joy and gratitude was a wonderful gift in itself.
For information about the Rosenbaum Family House, and how you can help, click the link below.
http://wvumedicine.org/services/rosenbaum-family-house/
September Newsletter
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Infrastructure paves way for Morgantown’s retail growth – The State Journal
Comments Off on Infrastructure paves way for Morgantown’s retail growth – The State JournalWhen David Lorenze was growing up in Morgantown, there were roughly a dozen restaurants to choose from in the whole town.
“Now, you have a dozen restaurants within a half-mile radius,” said Lorenze, principal at Black Diamond Realty. “The same holds true for retail.”
Growing almost as fast as shopping centers is the excitement as residents speculate on what new business may be opening soon.
Eldon Callen, vice president of Governmental Affairs, Community/Economic Development at the Morgantown Area Chamber of Commerce, said he has recently celebrated a number of grand openings, including Fusion Japanese Steakhouse, which has locations in Parkersburg and Wheeling, plus, Washington and Grove City, Pa.; and WV Box and Ship in Sabraton.
“There’s a whole new strip mall up there across from Suncrest Towne Centre that has MVB Bank, a new Starbucks and Penn Station East Coast Subs,” Callen said. “There are a number of things coming.”
Callen is always hesitant to say that a business is coming for sure.
“It’s up to the companies to release their plans,” Callen said. “They may just have shown an interest or given a letter of intent. Amazon was looking here and ended up going to Berkeley County. That’s why I’m hesitant to give credence to rumors. Some are true, and some are not.”
Callen did confirm that Dave & Buster’s, a nationwide chain of restaurant-arcades, looked at WestRidge Business and Retail Park at the new Interstate 79 Exit 153. As far as Callen knows, the company hasn’t done more than look. Calls to Dave & Buster’s corporate office were not returned.
The North Central West Virginia Economic Outlook 2017-2021, compiled by the West Virginia University Bureau of Business and Economic Research, says the build-out of major developments, such as University Town Centre, Suncrest Towne Centre and Fort Pierpont off Interstate 68 Exit 7 will drive growth in new retail, dining, lodging and entertainment businesses.
“To put it in perspective, in 2013, at University Town Centre, the road ended at Walmart on the east side and at Ashley Furniture next to Dick’s Sporting on the west side. Now it’s developed almost all the way down to the new interchange on the other side,” Callen said.
“That whole area is possible, really, because of the interchange (Interstate 79 Exit 153). That is the first interchange in the country that was a collaboration and cooperation between the state and county government. It was funded half by county and half by the federal government and designed by the local, state and federal people. That shows the importance of infrastructure.”
In that area, one of the newest developments under construction is WestRidge, a 1,000-acre mixed-use development that will have five neighborhoods, two medical office buildings, a shopping center and a corporate office park.
Holly Childs, WestRidge’s director of business development and external relations, said despite road and utility construction just getting underway, there is substantial pre-leasing interest in the development.
“There are currently 149 acres under construction, 90 of which have letters of interest, signed purchase agreements or have already been sold,” Childs said. “WestRidge is currently negotiating with many new and exciting retail offerings for the market, while also planning close to 100 acres of a Class A Business Park that is currently being marketed on a national level to attract and recruit businesses to Morgantown.”
That area on Morgantown’s north side is not the only development that’s growing.
Lorenze said Black Diamond Realty expects to announce 14-15 deals it has closed this quarter in October.
“Quarter 3 has been Black Diamond Realty’s strongest quarter in its short four-year history,” Lorenze said.
Backdoor Bargains, which sells merchandise at up to a 70 percent markdown, opened this summer in the former Fastenal store in Sabraton. In June, BDR announced a developer will build an 8,300-square-foot Family Dollar Store on 1.14 acres near Mountainview Elementary on Green Bag Road.
“A lot of announcements will happen in the coming months,” Lorenze said.
One might be about a restaurant on the upper level of the new Par Mar Retail Store/Restaurant on Oakland Street near WVU’s Evansdale Campus.
Callen said when a business is looking to locate in a community it evaluates the local schools and what entertainment and other things there are for workers and their families to do.
“Jobs are only part of the equation attracting folks to Morgantown,” Lorenze agreed. “Monongalia County is flush with amenities that support a strong quality of life. From beautiful public parks to quality schools to world-class sports’ facilities, Morgantown is blessed with a well-rounded offering of amenities. And, the beautiful thing is, the momentum appears to only be increasing.”
Article by Cynthia McCloud, Correspondent
WVU-led research team lays foundation for natural gas storage ‘hub’; opportunity for economic growth in the region
Comments Off on WVU-led research team lays foundation for natural gas storage ‘hub’; opportunity for economic growth in the region
It is no secret that the region around West Virginia, Pennsylvania and Ohio has abundant natural gas resources, but can the three states uncover the keys to turning those resources into economic growth? West Virginia University-led research may have some of the answers.
On August 29, WVU is releasing to the public a study that shows how the region can support storage facilities that are critical for attracting petrochemical and related industries to the area. Researchers will present the data at a technical workshop in Canonsburg, Pennsylvania, hosted by the Eastern Petroleum Technology Transfer Council, PTTC, at WVU.
Led by Doug Patchen, director of the WVU Appalachian Oil and Natural Gas Consortium and the Eastern PTTC, researchers from the geological surveys in West Virginia, Pennsylvania and Ohio studied geologic formations that could offer suitable locations for developers to build underground facilities to store natural gas liquids from Marcellus and Utica wells.
The team identified and mapped all potential options for subsurface storage of natural gas liquids along the Ohio River from southwestern Pennsylvania to eastern Kentucky, and the Kanawha River in West Virginia. The researchers focused on three options for subsurface storage.
One option includes areas where the Salina F Salt is at least 100 feet thick and suitable for solution mining, a type of mining that uses a liquid such as water injected through a borehole to dissolve and extract salts and minerals.
Another option includes areas where the Greenbrier Limestone is present 1,800 to 2,000 feet below the surface and is at least 40 feet thick. Converting existing sandstone reservoirs in depleted gas fields and inactive gas storage fields to natural gas liquids storage is the third option.
Previously, the consortium had conducted studies of the Marcellus and Utica shale gas plays. Results from those studies have been used by both small producers such as Northeast Natural Energy and large multinationals such as Exxon and have helped fuel the region’s shale gas boom. This latest work was conducted as part of the Tri-State Shale Coalition, an innovative cross-border collaboration among Ohio, Pennsylvania and West Virginia and a critical key for unlocking the region’s economic opportunity, according to its members.
The Coalition was created following a collaborative agreement signed in October 2015 by Governors’ offices in West Virginia, Pennsylvania, and Ohio. Charter members include the Benedum Foundation, a charitable organization, and Team NEO, the Allegheny Conference on Community Development and Vision Shared, all non-profit economic development organizations in Ohio, Pennsylvania, and West Virginia.
A public-private partnership, the coalition brings together workforce development organizations, academic institutions such as WVU, and economic development groups to strategically advance the area as a “super-region” for petrochemical, plastics fabrication and advanced manufacturing jobs and investments.
“Recognition of the enormous opportunity for economic development based upon shale gas, including downstream modern manufacturing, was the motivation for the Governors of West Virginia, Ohio, and Pennsylvania to agree to collaborate to maximize the opportunity,” said William Getty, Benedum Foundation president.
The WVU Energy Institute secured $100,000 from the Benedum Foundation to support the study. That amount was matched by a total of $100,000 more from AEP, Antero, Blue Racer, Charleston Area Alliance, Chevron, Dominion, EQT, First Energy/Team NEO, Mountaineer NGL Storage LLC, Noble Energy, Southwestern Energy, XTO Energy and the West Virginia Oil and Natural Gas Association.
Click here to view the article at WVUToday.
Opening Day – WV Box & Ship – The Dominion Post
Comments Off on Opening Day – WV Box & Ship – The Dominion PostA ribbon-cutting ceremony was held Friday for WV Box & Ship, a new business at 1405 Earl. L Core Road. WV Box & Ship is a center for packaging, shipping, printing, and business service needs. Its goal is to save people and businesses money with quality products and customer service.
Hours are from 9 a.m. – 7 p.m. Monday-Friday and from 10 a.m. – 4 p.m. Saturday. Find out more info at wvboxandship.com or call 304.322.2192.
– The Dominion Post
Business Beginnings – Family Dollar
Comments Off on Business Beginnings – Family DollarConstruction is underway for a new 8,300 square foot Family Dollar store on Lucky Lane, near Mountain View Elementary.
$40 Million Center for Aquatics Announced – The Dominion Post
Comments Off on $40 Million Center for Aquatics Announced – The Dominion Post$15 Million donation, loan to finance a 55-acre project. ![40_Million_Center_For_Aquatics_Announced_[The_Dominion_Post]](http://www.blackdiamondrealty.net/wp-content/uploads/2017/08/40_Million_Center_For_Aquatics_Announced_The_Dominion_Post.jpg)
Industrial Park to Expand – The Dominion Post
Comments Off on Industrial Park to Expand – The Dominion PostThe Morgantown Industrial Park is approved for a second phase of development. See the article below or visit dominionpost.com.
![The_Dominion_Post_[Industrial_Park_to_Expand_8.10.17]](http://www.blackdiamondrealty.net/wp-content/uploads/2017/08/The_Dominion_Post_Industrial_Park_to_Expand_8.10.17.jpg)
2017 Sectors In Demand
Comments Off on 2017 Sectors In DemandOur team is often asked, “How is the market?” Some brokers may respond with a generic, “good”. If you are interested in a general response, we are happy to report the market is currently “great.” Black Diamond Realty’s pipeline is the busiest it has been in its four-year history. That said, we suspect you are more interested in a sophisticated, detailed response. Look no further; we have your answers.
What…. Sectors?
At Black Diamond Realty, one of our competitive advantages is our thorough and detailed process. We track every single lead. This allows us to present you with accurate statistics that serve as a reflection of market demand across all sectors. Keep in mind our statistics are influenced by Black Diamond Realty’s current inventory of assets. The following statistics provide the number of sector leads since January 1, 2017:
Industrial = 83 Office = 59 Retail/Restaurant = 58 Land = 32 Investment = 32
Why… Macro vs Micro?
Do you believe in the mantra that tells you to focus on what you can control? We do, too. However, we also believe it is not wise to bury your head in the sand. It is critical to think about how macroeconomic factors influence regional market demand. Two positive influencers are currently in play.
Historically speaking, interest rates remain near all-time lows. This bodes well for investors looking to get into investment opportunities. Although cash is king, we are seeing a lot of companies and individuals levering up to take advantage of favorable bank rates. Refinances have flocked through banks’ doors. Sellers also like low interest rates because funds are cheaper to secure which results in higher valuations while still clearing bank debt-coverage ratios.
The second macroeconomic factor relates to the reenergization (pun intended) of Marcellus Shale activity. Oil and gas pricing is fluid, literally and figuratively. Pricing has seen nominal rises over the past 12 months. However, recent industrial space demand leads us to believe many companies on the front lines sense prices moving north in the coming years. We suspect their goal is to get established in this area while industrial real estate values are still relatively inexpensive. This will heighten their ability to capture the market and capitalize on contracts as things ramp up. Many articles reference cracker plants and pipelines as the saving grace to lowering the current supply glut. These two variables are currently progressing in a very big way. The O&G industry has potential to replace job losses from coal. Time will tell if this is a long-term regional industrial revolution.
Where?… Concentrated Areas of Development
Jobs drive economic growth, and there are plenty of jobs coming to two booming exits along the I-79 corridor. University Town Center/West Ridge and White Oaks Business Parks are the two distinct front runners when considering development hubs in north central WV. University Town Center and WestRidge, both located at I-79, Exit 153, lead the charge as driving forces behind retail and office development in Monongalia County. Simply put, this new exit has created significant buzz in Monongalia County which is expected to remain in play for the next three to five years. A lot of announcements will happen in the coming months. 2018 is slated to be a heavy construction year for this development.
Thirty miles south of Morgantown, White Oaks Business Park is leading the development charge for Harrison County. Numerous Class A office buildings, spanning a plethora of services, hotels, retail space and several restaurants round out the line-up for this state-of-the-art development. White Oaks is an upscale development, which includes sidewalks throughout and pristine landscaping, while serving as “the talk” of Harrison County as it capitalizes on close proximity to the interstate, UHC and FBI’s Campus. Growth and positive economic announcements are projected to continue in the coming years.
August Newsletter
Comments Off on August NewsletterView our August Newsletter: NEW Par Mar Store + Restaurant Opening Soon In Morgantown
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First Look: The Crossings at Morgantown
Comments Off on First Look: The Crossings at Morgantown
We shared the breaking news with you in our April newsletter; now you can watch the The Crossings at Morgantown come to life! CLICK HERE to watch a video will take you on a visual tour of Morgantown’s newest senior housing project and give you a taste of the luxurious community that is to come. This $35 million, state-of-the-art facility will service an increasing need in this region. Spread the word if you would live here or know someone who would!
Visit The Crossings at Morgantown by clicking the following link: http://www.thecrossingsatmorgantown.com/
July Newsletter
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Clearwater Facility Preparations Continue for Projected Fall Opening – The State Journal
Comments Off on Clearwater Facility Preparations Continue for Projected Fall Opening – The State Journal![The_State_Journal_[Clearwater_Facility_Preparations_Continue_for_Projected_Fall_Opening]](http://www.blackdiamondrealty.net/wp-content/uploads/2017/06/The_State_Journal_Clearwater_Facility_Preparations_Continue_for_Projected_Fall_Opening.jpg)
See the article on The State Journal website by clicking here.
Valley Worlds of Fun Searches for New Owner – WBOY12
Comments Off on Valley Worlds of Fun Searches for New Owner – WBOY12PLEASANT VALLEY – Valley Worlds of Fun has been part of Marion County’s history for decades. Now, the property is for sale and it has residents worried about what it means for the future of the entertainment center.
Since 1972, Bruce Martin’s family has been the name behind Valley Worlds of Fun. It started as Valley Lanes, a 32-lane bowling alley. Then came the entertainment center, which Bruce’s father, Bob, started with a purpose. “He just had always felt some kind of a mission in life to provide the kids in the neighborhood a place to play. He thought we were pretty lacking in recreational stuff in the area and he just always wanted to give back in that way,” said Bruce Martin, Co-Owner of Valley Worlds of Fun. But several years ago, Bob suffered a stroke. It was around the time of the recession, when families cut expenses for recreational activities. Bruce said the aging population did not help, either. “One of the challenges we’ve had over the years is since the population doesn’t change on a regular basis, we needed to change so that it didn’t become boring or old had to people. We needed to make it new and exciting all the time and that’s certainly a challenge,” said Bruce Martin.
Now, it is for sale for $1.9 million, plus $200,000 for the attractions. The Martin family is looking for someone who will buy the property as is and improve it as a family entertainment center. Within the last several years, new attractions like archery tag, knocker balls and a new laser tag system have been installed. “We’ve just reached a point where I’d love to find somebody that this is their primary focus want to carry on the tradition for the neighborhood,” Bruce Martin said.
Bruce said all events scheduled at Valley Worlds of Fun will continue as planned and his family will continue with ownership until a sale is finalized.
Click here to view the article and video at WBOY.
Fun For Sale – The Dominion Post
Comments Off on Fun For Sale – The Dominion PostValley Worlds of Fun center up for sale
Click Here to View the Marketing Flyer for Valley Worlds of Fun.
June Newsletter
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Thrillist.com Names Morgantown the Best Small Town in West Virginia
Comments Off on Thrillist.com Names Morgantown the Best Small Town in West VirginiaWest Virginia: Morgantown – Population: 31,073
No small town in WVA is more worthy of a visit than the home of West Virginia University. Game days in Mo-Town are no joke, and the bar scene here rivals any major-conference college town. Suds and sports aside, Morgantown sits near the Cheat River, one of the premiere whitewater destinations in America. And a hike to the top of Coopers Rock gives you a jaw-dropping, vertigo-inducing peek into the 1,200ft gorge below. — M.M.
White Oaks Continues to Expand, Attract Variety of Industries – The State Journal WV
Comments Off on White Oaks Continues to Expand, Attract Variety of Industries – The State Journal WVNearly a decade after construction first began to develop White Oaks off Jerry Dove Drive, the Bridgeport business park continues to live up to the expectations of Woody Thrasher and Jack Keeley.
“When I started to work with high tech, there were no buildings here,” said Ron Stanley, manager of the White Oaks development. “Steptoe & Johnson had just closed on their parcel, and shortly thereafter, Premier Bank did. It has really, I think, for our area, exploded.”
Stanley said the boom of the oil and gas industry in the late 2000s significantly helped the complex take off. Click Here to continue reading.
Click Here to View the Marketing Flyer for White Oaks Business Park.
Businesses Anticipate Next Oil, Gas Boom with Projects on Horizon
Comments Off on Businesses Anticipate Next Oil, Gas Boom with Projects on HorizonMultiple projects and more drilling rigs are sure signs that the oil and gas industry is going to have a very big presence in West Virginia for years to come, according to officials. Click here to read more, or continue reading below. 
May Newsletter
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April Newsletter
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BDR’s March Newsletter
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Real Estate Investing 101
Comments Off on Real Estate Investing 101Are you putting all of your eggs in one basket? What is the first rule of thumb your financial advisor will work hard to instill into your investing DNA? Diversify your assets! Parents often gloat when they feel their kids are well-rounded; the same holds true for your investments. In theory, a portfolio with stocks in multiple sectors can better withstand one industry tanking, if another sector rises.
Investors encouraged to pick investments that are a comfortably balanced between risk and reward. Have you considered real estate investments? Do you currently own some assets and want to expand your portfolio?
Income-producing assets can offer a nice diversification play to your portfolio. The bullet points below highlight the key perks to real estate investing.
- Appreciation: Similar to other investments, you are aiming to buy low and sell high. Real estate is the same. It is important to complete proper research and due diligence on any investment asset to understand the risks. We are proponents of buying across stable, diversified (there’s that word again) markets. We also like value-add opportunities.
- Cash Flow: As is the case with a blue chip stock that pays a dividend, your goal in purchasing an investment property should be to have a monthly surplus of cash after all expenses are paid. Value-add opportunities offer room for cash flow growth.
- Tax Benefits: Nobody likes paying taxes. Real estate offers effective, legal ways to lower your yearly tax exposure. Two of the most prominent tools include depreciation and interest. These are paper write-offs allowable by the IRS. When you receive “an offer you cannot refuse,” remember/consider four important numbers: 1.0.3.1. Under Section 1031 of the United States Internal Revenue Code, a taxpayer may defer recognition of capital gains and related federal income tax liability on the exchange of certain types of property. This allows you to effectively kick the can down the road and leverage into larger assets over time.
- Building Equity: As an owner of leveraged real estate, every month, you will write the largest expense check (in most cases) for your LLC in the way of a mortgage payment. This is a positive thing; you are building equity in yourself. That’s right; think of your mortgage payment differently. You are leveraging other people’s money (banks, alternative forms of financing, etc.) to make money. Each monthly payment results in a slightly lower overall balance, which means you are building your net worth.
At any given moment, Black Diamond Realty has on and off market investment opportunities. Call us to explore the concepts above further and/or to discuss our current inventory of income-producing assets.
Disclaimer: Black Diamond Realty LLC and its agents do not provide tax, legal, or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. Prospective investors/purchasers should consult their own tax, legal, and accounting advisors before engaging in any transaction. We will work with your independent tax/legal/accounting advisors to help tailor a real estate transaction specific to your needs.
Black Diamond Volunteers to Support Empty Bowls Monongalia
Comments Off on Black Diamond Volunteers to Support Empty Bowls MonongaliaAre you feeling hungry? Is your stomach growling? No problem. There are, most likely, plenty of food options in your refrigerator and kitchen cabinets. Running low on food? Morgantown has hundreds of restaurant options. A quick drive will satisfy your need. It seems simple. For 16,000+ Monongalia County residents, the equation is much more complicated. That’s right, Monongalia County’s food insecure population would fill WVU’s Coliseum with a line of 2,000 standing outside.
Empty Bowls Monongalia is celebrating its 11th year. Empty Bowls’ mission is to raise food, money and resources to support local food pantries and back pack programs in Monongalia County. Every year, Empty Bowls has multiple fundraisers. Its biggest event, Soup and Bread Luncheon, was held at Mylan Park on February 25th. Over 1,700 people attended. As a 100% volunteer-run organization, 92% of the funds raised are given to support non-profit organizations focused on helping Monongalia County’s food insecure population. In addition to Black Diamond Realty’s annual donation at the Emerald Level, Murphy Holloway and Dave Lorenze volunteered their time at the annual luncheon. For more information, please visit www.ebmon.org
Black Diamond Realty Attends the 2017 WVU Children’s Gala
Comments Off on Black Diamond Realty Attends the 2017 WVU Children’s GalaOn Saturday, February 11, 2017, the Black Diamond Realty team attended WVU Medicine Children’s 14th Annual Gala. The night consisted of live music, silent auctions, dinner, raffles, and for the second year in a row, the talented Hines Ward! The event was a tremendous success. The event had a wait list of 200 which resulted in the event committee reorganizing the seating to accommodate approximately 1,200 people. Although the final numbers are not yet in, the amount raised is expected to exceed last year’s contributions. The funds generated for WVU Medicine Children’s Hospital will help to support patient services, research and various pediatric programs.
To learn more about WVU Medicine Children’s and how you can help, visit: http://wvumedicine.org/childrens/giving/
BDR’s February Newsletter
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A Strong Outlook for Industrial Demand
Comments Off on A Strong Outlook for Industrial Demand
As real estate professionals, the BDR team is often asked these two questions: How are things going in our market and what are you seeing? Here’s what we have to say in response to these popular questions:
BDR has experienced unseasonable demand during what is traditionally the slowest time of year in commercial real estate. Although demand has increased in all sectors, the industrial sector is leading the charge in 2017. There are so many factors that affect a market. Most of these factors are outside of our regional control. Each sector under the commercial real estate umbrella is different and driven by varying economic forces which can also be directly affected by macroeconomic factors stemming from federal policy and regulation.
Many believed Trump’s surprising presidential election would result in pro-business policies. Time will tell on that one. Many also thought Trump’s election would result in pro-energy policies. In less than two weeks in office, we are already seeing this bear some truth. Within his first week of office, President Trump signed an executive order to encourage federal review folks to pass Trans Canada’s resubmittal of the Keystone Pipeline project in the Dakotas. According to Marcellus Drilling News, “On January 19, 2017, the Federal Energy Regulatory Commission voted to approve and issue a certificate to Columbia Pipeline’s Leach Xpress and Rayne Xpress pipeline projects. This is fantastic news for the Marcellus/Utica region.” While traveling in Morgantown, have you looked over at the acres upon acres of green pipe being stored in Morgantown Industrial Park? We are not getting the world’s longest water slide, but we will begin to hear about progress relating to Atlantic Coast Pipeline, a 600-mile interstate natural gas transmission line. The project will begin in 2017 and stretch from Harrison County, WV to Chesapeake County, VA and Robeson County, NC.
What does all of this mean for the region? Commodity pricing has been suppressed due to an oversupply of natural gas in the market. Two factors will increase demand: Pipelines and cracker plants. We have already touched on pipelines. There are currently three cracker plants being consider in the region. One is moving forward in Monaca, PA with two additional cracker plants still in the planning stages. Cracker plants effectively isolate the molecular components (think chemistry class) in natural gas which are then used in other manufacturing processes such as the development of various plastics. Due to high usage needs and the expense of transportation, many believe manufacturing will follow and locate within close proximity of the cracker plants. This results in more jobs for the region and will undoubtedly have a trickle-down economics effect on various sectors. When looking to open a location, many energy companies have a need for industrial space.
How can you tell demand has increased in the industrial sector? Black Diamond Realty records and tracks every lead that comes into our office via phone and internet. Since Election Day (November 8, 2016), there have been 27 unique leads that have come into our office. This number is in line with the number of industrial leads we typically see in an entire year. Things are looking bright for the industrial sector. Act now before pricing increases.
BDR’s January Newsletter
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Reflecting & Projecting
Comments Off on Reflecting & ProjectingREFLECTING ON 2016
There were some economic positives in 2016. Interest rates remained low while capital slowly became more attainable, resulting in a demand for investment/income-producing assets. Education and health care remained strong in Morgantown and other parts of north central WV. Respectively, the West Virginia University Board of Governors unanimously approved a $1.04 billion budget for the fiscal year which began on July 1, 2016. (WVUToday) Ruby Memorial Hospital built a 10-story tower, totaling $220 million, that will be home to 750 new jobs, and Mon General Hospital opened a three building, 150,000 square foot, office campus.
These recession-resistant sectors make Morgantown, and other communities in north central WV, such as Bridgeport, attractive investment options that garner attention from out-of-state money. This is evidenced in several large deals in 2016. We would be remiss without mentioning the new I-79 interchange in Morgantown. Metro News states, “A study of the entire development on both sides of the interstate predicted a $1 billion economic impact on the region annually. The impact study indicated the TIF district and incoming developers could support 9,900 jobs by 2025.”
Jobs lead to disposal income which ultimately drives an economy. Although there were economic spotlights to be proud of, 2016 was a challenging year for many commercial real estate sectors. Much of the sluggish business climate in WV and southwestern PA can be attributed to the energy sector slowdown. The rapid decline of coal, coupled with the oversupply of natural gas/oil, negatively affected this region’s economy. Decreased energy-sector demand for office and industrial space led to increased vacancy. As a direct result of this climate, restaurant receipts, retail sales and hotel occupancy all followed suit. Energy sector downturn hurt. In our home base of Morgantown and much of north central WV, there was enough positive economic activity to downplay these challenges.
2017 OUTLOOK
What is on the horizon for 2017? Well, for many, the presidential election was seen as a pro-energy and pro-business election. Time will tell on both. However, in the last two months, BDR saw an uptick in office and industrial demand via phone call leads. We feel this trend will continue as we move into what we believe will be a healthier economic year with less regulation and greater consumer confidence. OPEC’s announcement to reduce oil supply is a major win for our region. Rising oil and gas prices result in greater drilling activity which leads to more jobs. Average consumers dislike paying more at the pump, but for WV and the Marcellus/Utica Shale territory, paying a little more in gas results in hundreds of high-paying jobs that support regional economic growth.
Looking to the new year, BDR is poised to capitalize on north central WV’s growth potential, including the energy, education, medical, and government sectors.
As you sit down to set your 2017 personal and company goals, remember this important quote: “Yesterday is history. Tomorrow is a mystery. Today is a gift. That is why it is called the present.” From our team to yours, we wish you a healthy, prosperous and joyful 2017.
Black Diamond Prepares Dinner For The Rosenbaum Family House – 2016
Comments Off on Black Diamond Prepares Dinner For The Rosenbaum Family House – 2016
One of Black Diamond’s annual traditions is to cook dinner for the guests of Rosenbaum Family House, a place for adult patients and their families to stay while receiving medical care at WVU’s Ruby Memorial Hospital. Last Monday, each BDR team member cooked a delicious pot roast that accompanied fresh baked rolls. For the roughly 40 people we served, the overwhelming joy and gratitude was a wonderful gift. This experience exemplifies one of our favorite quotes: “We make a living by what we get. We make a life by what we give.” -Winston Churchill
For information about the Rosenbaum Family House, and how you can help, click the link below.
Black Diamond Prepares Dinner For The Rosenbaum Family House
Comments Off on Black Diamond Prepares Dinner For The Rosenbaum Family House
One of Black Diamond’s annual traditions is to cook dinner for the guests of Rosenbaum Family House, a place for adult patients and their families to stay while receiving medical care at WVU’s Ruby Memorial Hospital. Last Monday, each BDR team member cooked a delicious pot roast that accompanied fresh baked rolls. For the roughly 40 people we served, the overwhelming joy and gratitude was a wonderful gift. This experience exemplifies one of our favorite quotes: “We make a living by what we get. We make a life by what we give.” -Winston Churchill
For information about the Rosenbaum Family House, and how you can help, click the link below.
BDR’s December Newsletter
Comments Off on BDR’s December NewsletterView our December Newsletter: You’re Invited! We Have Exactly What You Have Been Searching For!
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BDR’s November Newsletter
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Defense In Depth, D.I.D. You Shoot Today?
Comments Off on Defense In Depth, D.I.D. You Shoot Today?Range. Simulators. Training. Firearms.
Two years ago, Marstiller’s Gun Shop and Range sold their property on Collins Ferry Road to Monongalia County’s Board of Education. Today, Suncrest Elementary is under construction. For many gun enthusiasts, a positive development for Monongalia County’s school system has left a significant market void. Black Diamond Realty is pleased to announce that void will be filled in 2017.
The facility will truly be a 360 degree approach to self-defense catering to all types of people (women, beginners, firearm enthusiasts, young, elderly, students, hunters, law enforcement, military, etc.). The facility will be upscale, safe, attractive, secure, and inviting.
D.I.D. will include classes and training (concealed carry, firearm selection & safety, NRA classes, self-defense, hand-to-hand, hunting license, marksmanship, etc.), home/office/building safety & defense assessments, interactive simulators (live and non-live fire) with hundreds of customizable scenarios (emergency situations, law enforcement, self-defense, zombies, wild west, Call of Duty, target practice, etc.), a ten 25-yard pistol lanes and six 50-yard rifle lanes, member lounge with lockers, retail sales, etc.
The facility will be open to the public and also include memberships with perks and discounts. The ranges will be available for group bookings, team building events, date nights, competitions, private training sessions, etc.
The scope of the project is grand, including a major building façade, lighting, and signage upgrade. The staff will be comprised of personable instructors with top-flight credentials. The facility will meet or exceed all applicable NIOSH and EPA regulations, City of Morgantown and State Fire Marshal building codes, and ATF requirements. D.I.D. has conducted extensive due diligence with industry-leading experts within the gun range building, HVAC, and acoustical professions. They also attended the 2016 NRA Range Development & Operating Conference. There will be no compromises when it comes to developing and operating a safe, clean, and professional facility.
Could your business benefit from cohabitating with a destination-oriented use that drives traffic? If so, we encourage you to consider leasing space at Sabraton Plaza. For more information, check out the following link: Sabraton Plaza – Marketing Flyer
D.I.D. Mission Statement:
Defense In Depth is a 360 degree approach to self-defense. Personal security is maximized by layering a series of complementary defensive tactics that increase security as a whole. Our team focuses on customizing diverse defensive strategies for individuals, families, businesses, and institutions designed to create an effective system of independent protection strategies intended to work together to increase their dependability as a whole.
BDR’s October Newsletter
Comments Off on BDR’s October NewsletterView our October Newsletter: Black Diamond Realty Celebrates its 3rd Birthday!
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A Positive Outlook for the Oil and Gas Industry
Comments Off on A Positive Outlook for the Oil and Gas IndustryFor generations, West Virginia’s economic lifeblood has been dependent upon the energy sector. The coal industry is declining primarily due to challenging environmental policies and the push for cleaner burning fossil fuels. Many believe coal output will never return to the previous production numbers from the mid-2000s. A recent Dominion Post article cited the following predictions, “The WVU Business School’s outlook for coal was bleak. Its new 2016 outlook is bleaker. In 2015, the Bureau of Business and Economic Research (BBER) projected a short-term decline from 104 million tons to 98 million tons. The 2016 report saw just 95 million tons produced in 2015 and looks for a total of 68 million tons produced this year – 30 million tons (30.6 percent) below the previous prediction.” The reduction in production output leads to job cuts, which ultimately has a trickle-down effect throughout our economy.
The outlook is not all doom and gloom. There is a silver lining in WV buried deep beneath the coal seams our hard-working residents have mined for generations. New fracking technology has allowed oil and gas producers to tap into an immense resource. The Marcellus and Utica Shales constitutes some of the largest gas reserves in the United States. In WV, many began hearing about “Marcellus” in 2008-2009. Marcellus-related jobs, plus the downstream (gasoline, oils, fuels, plastics, lubricants, etc.) and midstream (transport, pipeline, trucking, etc.), and lifestyle service provider (hotels, restaurants, retailers, etc.) industries result in the creation of thousands of jobs. Shell also recently committed to building a $4-7 billion cracker plant in Beaver County, PA is also more great news. It anticipates bringing 6,000 temporary construction jobs (for 2-3 years) plus 600 permanent jobs. Is there more good news? Over the next several years, gas pipeline projects will come online and allow producers to distribute the driller gas/oil to large markets along the east coast and mid-west. All of this creates a positive outlook for our beloved state…and region.
Black Diamond Realty is excited to broadcast additional positive news: Industrial demand is already increasing, as evidenced by an increase in inquiries by end users. One recent inquiry disclosed a company pursuing 50,000 square feet of industrial space and 5 acres of yard. They will bring 100 jobs out of the gate with a 1-2 year ramp up period resulting in 200-250 jobs. Companies who lease/buy industrial buildings in the region bring jobs and economic benefits. Many of these jobs supply hard-working, West Virginia families with high-paying jobs and strong benefits. Black Diamond Realty is pleased to introduce you to a new listing that provides many of the bells and whistles heavy manufacturers and Marcellus/Utica Shale (oil and gas) service providers are seeking. Check out the following link for more information.
Marketing Flyer – 2009 Pleasant Valley Road
Getting Started in Real Estate
Comments Off on Getting Started in Real EstateWhen we speak with clients and investors who are looking to get into real estate investing for the first time, there are typically two obstacles that stand in their way: One, they lack the funding to do their first deal. Two, they lack the knowledge to execute the deal. These obstacles are not mutually exclusive. Real estate investing is complicated and one bad deal can result in substantial financial losses.
Equipped with the right knowledge and appropriate funding, successful real estate investing can result in excellent cash flows while simultaneously building equity and net worth. Add in the tangibility of an asset, and it is truly unlike any other investment.
Here at Black Diamond Realty, we have decided to release a series of blog posts detailing the ins and outs of real estate investing. These posts will paint a detailed picture of how to get started in real estate investing and ways to lessen the exposure and financial risk. As always, we highly recommend you consult your financial advisor or accountant prior to beginning your real estate investing career.
Sources of Funds
Simply put, finding the funding to get a deal started is difficult, especially in the current financial climate. Prior to the financial collapse of 2007-2008, investors could more easily get banks to lend and provide leverage. Today’s banking climate is much more restrictive and thorough in the vetting of real estate opportunities. This should be seen as both a positive and a negative for new investors. Banks tightening their underwriting guidelines prevents novices from engaging in a bad deal, but it also makes it much more difficult for an investor getting started. This has forced investors to get creative. Below are some of the ways to get a deal funded.
Equity
Cash is king. The easiest way to get started in real estate investing is to have a sizable amount of cash on hand for the down payment on an investment property. This allows flexibility when it comes to analyzing deals, negotiating terms with a lender and managing risk. Those with substantial net worth oftentimes negotiate more favorable terms with the lender to increase leverage and the potential rate of return on the investment. Some institutional investors only engage in all-cash deals, which minimizes the potential returns but simultaneously minimizes risk for the investors.
Conventional Financing
In this lending environment, banks typically lend around 75 percent of the property’s value, requiring the buyer to come up with the remaining 25 percent down payment. Lenders will want to see all the pertinent information on the property’s financial performance to be able to accurately underwrite the deal. At the very least, as an investor, it is important to request the following information:
- Profit and loss statements for the previous two years
- The property’s current rent roll
- A trailing twelve months of financial performance
- Letters of compliance (if applicable)
- Property disclosure statement
- List of capital improvements over the past 5-10 years
(We will show you how to analyze a deal using this information in an upcoming blog post.)
Mezzanine Financing
Mezzanine financing or a “mezz” is a loan that bridges the gap between the balance of the first mortgage and the purchase price. A “capital stack” with the inclusion of mezz financing is illustrated below:
In this example, the purchaser is coming to the table with $5,000 in equity (cash), the primary lender is issuing a note for $75,000, and the mezz lender is issuing a note for $20,000. The mezz lender understands that it is taking a subordinate position to the primary lender, and will justifiably charge a higher interest rate and shorter loan term for taking on the risk of a second position. However, if executed correctly, mezz financing can be an attractive option for investors that are short on equity.
Seller Carry-Back Note
Some sellers are anxious to unload a property. Maybe they’re in a tough financial situation or simply ready to liquidate and retire. If, after analyzing a property, you determine it’s a worthy investment, ask the seller if they are willing to “carry-back” a note on the property. A “carry-back” note is simply owner-financing on a portion of the purchase price. For example, say the lender is willing to pledge 75 percent towards the purchase price. As the buyer, you would approach the seller and ask him if he’s willing to finance the remaining 25 percent to get a deal done. This can be an attractive option for the seller for two reasons. One, he liquidates his investment and receives a substantial portion of his equity back as cash. Two, he will receive interest payments on the remaining 25 percent for a specified term, leading to a larger final payout. The drawback to this type of deal structure for the seller is that he is still financially tied to the property, and a default by the purchaser leads to a complicated legal situation. It should also be noted that many banks want an investor to have some “skin in the game”. They may require a collateral pledge and/or not permit you to 100 percent leverage an asset.
Sponsorship/Syndication
A real estate sponsor or syndicator is someone who finds a real estate deal, pools together multiple passive investors, and puts together an investment structure that rewards those investors profit from the real estate investment each year while managing the property. The syndicator makes money via their small equity stake and management of the property. This is a more sophisticated type of investing structure, but can be highly profitable if one has the connections to those with substantial net worth.
Friends and Family
This type of funding is least recommended. While we know of many investors who got their start using a loan from a friend or family member, this type of funding can permanently ruin relationships if the investment fails. Ensure that you have the proper legal loan documentation in place before accepting funds from friends and family.
While there are other ways to get your deal funded, these are sources we see most often here at Black Diamond Realty. In order to obtain financing for a real estate venture, one must have some cash on hand, an attractive balance sheet and solid credit. Once you’re financially ready, our Black Diamond Realty team will be able to assist you in finding the ideal property to get the ball rolling. In our next blog post, we will talk about how to analyze a deal. If you have questions you may contact the Black Diamond Realty team at (304) 413-4350.
The Internal Rate of Return and Measuring Real Estate Investments
Comments Off on The Internal Rate of Return and Measuring Real Estate InvestmentsWhen looking to invest in real estate, it is a good idea to establish a “hurdle rate” or minimum rate of return expected from a real estate investment. Thus, opportunities that do not meet this hurdle are immediately discarded as not worth the time or investment. When it comes to establishing a hurdle, many investors like to use an investment’s Internal Rate of Return or “IRR” when analyzing potential investments.
The IRR is the Discount Rate that makes the Net Present Value (NPV) of an investment equal to $0.00 (discount rate and NPV are explained in an earlier blog post titled: The Importance of the Time Value of Money in Real Estate). To accurately measure an investment property’s IRR, the investor needs to factor in the initial cash outlay and a series of projected cash flows over a specific period of time. Furthermore, these cash flows should include the cash proceeds from the sale of the investment property (equity reversion) to accurately gauge the IRR. Once these figures are deduced, an investor can weigh the worthiness of the investment.
For example, let’s say the investor is looking at two single family investment properties in which to invest. The investor plans to hold on to the investment property for five years. Both properties would require a 20% cash down payment (outlay) with the remainder financed by the bank with an the assumed terminal capitalization rate of 8.50%. The investor’s hurdle rate is 12%. Given these assumptions, we can begin to compare the investments using the following information:
Investment Property A
Total Acquisition Cost (including all closing costs): $208,973
Total Yearly Rental Income: $22,410
Yearly Operational Expenses: $6,750
Net Operating Income (before debt): $15,660
Knowing the initial cash outlay, projected income and projected before-tax equity reversion, the investor is able to determine the investment’s projected IRR, which is 14.01%. This also creates a positive NPV of $3,114, providing further indication that the investment’s return meets the investor’s hurdle of 12%. How does a comparable investment stack up?
Investment Property B
Total Acquisition Cost: $229,259
Total Yearly Rental Income: $23,760
Yearly Operational Expenses: $7,000
Net Operating Income: $16,760
Property B, while having a higher net operating income, requires a greater initial cash outlay and thus doesn’t have quite as high an IRR as Property A at equity reversion. The property also does not meet the investor’s 12% hurdle with an IRR of 11.73%, which results in a negative NPV of $450. Investment Property A is the better investment based on these assumptions.
While IRR is a great tool to measure the worthiness of an investment property, there are some pitfalls to consider when using IRR.
- IRR cannot measure the reinvestment of cash flows. The reinvestment of cash flows gained from an investment during the hold period would have to be measured using an alternative method.
- IRR does not measure the magnitude of an investment. It looks at $50,000 and $5,000,000 investments the same. Thus, the amount of cash flow is not taken into consideration.
- Investments cannot have different hold periods when running a comparison. Comparing an investment property with a 5 year hold period to an investment property with a 10 year hold period is not a financially accurate way to gauge the investments.
An investment’s IRR is a helpful tool to determine its worthiness, but shouldn’t be the only figure to rely on when looking to invest in real estate. When looking to invest, it is prudent to discuss your financial goals with your account or financial advisor. Whether you’re a new investor ready to dive into the real estate investing world or a seasoned investor looking to expand your portfolio, the team here at Black Diamond Realty has multiple investment properties that could be a fit. Call us today at 304-413-4350.
Anytime Fitness Opens at University Park
Comments Off on Anytime Fitness Opens at University ParkBlack Diamond Realty and Glenmark Holding LLC are proud to announce the newest tenant of University Park on the Evansdale campus has opened its doors. Anytime Fitness opened its newest health club facility on Monday, May 9th on the ground floor of the mixed-use residence hall.
Anytime Fitness is the world’s largest 24-hour gym and co-ed fitness center chain. For a low monthly fee you can exercise anytime you want, 24 hours a day, 7 days a week, 365 days a year, using your own security access key.
The club offers personal training, fitness classes, cardio TVs, HDTVs, tanning, private showers. Members have use of cardio equipment including treadmills, elliptical machines, exercise cycles, and stair climbers; and strength equipment including free weights, racks, and plate loaded machines.
University Park is a public-private partnership project between University Park at Evansdale, LLC and West Virginia University for on-campus student housing owned and managed by WVU. University Park consists of a 902-bed residence hall and 408 apartment beds, of which 66% is replacement housing. It opened in August 2015 for fall semester occupancy.
The $112 million multi-purpose development creates a campus village designed to enhance campus life and provide modern accommodations to students as part of WVU’s Master Housing Plan.
For residential leasing questions, contact WVU Housing at 304-293-PARK or http://universitypark.wvu.edu/
For more information please see this article in WVU Today: http://wvutoday.wvu.edu/n/2016/05/09/anytime-fitness-opens-at-wvu-s-university-park
Smoothie King Coming to University Park
Comments Off on Smoothie King Coming to University ParkBlack Diamond Realty is proud to share that it has brokered a transaction for another great addition to to WVU’s University Park development in Evansdale. Smoothie King, which originated the smoothie bar concept in 1973, will open its first Morgantown location in early spring in University Park.
University Park is a public-private partnership project between University Park at Evansdale, LLC and West Virginia University for on-campus student housing owned and managed by WVU. University Park consists of a 902-bed residence hall and 408 apartment beds, of which 66% is replacement housing. It opened in August 2015 for fall semester occupancy.
The $112 million multi-purpose development creates a campus village designed to enhance campus life and provide modern accommodations to students as part of WVU’s Master Housing Plan.
For residential leasing questions, contact WVU Housing at 304-293-PARK or http://www.universitypark.wvu.edu.
For more information please see this article in WVU Today: http://wvutoday.wvu.edu/n/2016/02/10/smoothie-king-coming-to-university-park
UNIVERSITY PARK IHOP® RESTAURANT HOSTS GRAND OPENING BENEFITING WVU MEDICINE CHILDREN’S
Comments Off on UNIVERSITY PARK IHOP® RESTAURANT HOSTS GRAND OPENING BENEFITING WVU MEDICINE CHILDREN’SUniversity Park – IHOP Grand Opening Celebration
Pancake Eating Competition to Follow Formal Ribbon Cutting Ceremony
WHAT: IHOP® Restaurants will celebrate the Grand Opening of its University Park location on January 29, with 10 percent of the day’s sales benefitting WVU Medicine Children’s from 7am – 10pm. The fun filled event will feature an official ribbon cutting ceremony, words from IHOP Franchisee Bob Sharp, WVU Medicine Children’s Vice President, IHOP’s President, as well as a representative from the Morgantown Chamber of Commerce. The event will conclude with a pancake eating competition showdown.
WHERE: 475 Oakland Street, Morgantown, WV 26505
WHY: The new IHOP location boasts the restaurant brand’s new contemporary design and is one of the first IHOP restaurants to also feature an IHOP Coffee Bar. It is located on the ground floor of the new contemporary mixed-use residence hall and apartment complex known as University Park and next to WVU Medicine Children’s which improves and saves the lives of children in the Morgantown area. IHOP restaurants nationwide have raised $20 million for Children’s Miracle Network Hospitals through its annual National Pancake Day celebration.
WHEN: FRIDAY, January 29, 2016
- Ribbon Cutting Ceremony 9:30 a.m. to 9:45 a.m.
- Pancake Eating Competition to follow at 10 a.m.
- 10% of sales benefitting WVU Medicine Children’s from 7 a.m. – 10 p.m.
WHO:
– West Virginia University President, E. Gordon Gee
– WVU Medicine Children’s Vice President, J. Philip Saul, M.D.
– IHOP President, Darren Rebelez
– IHOP Franchisees, Bob Sharp and Tommy Tsitouris
– Morgantown Chamber of Commerce Representatives
– West Virginia University Student Organizations
ABOUT INTERNATIONAL HOUSE OF PANCAKES, LLC
For over 57 years, International House of Pancakes, LLC has been a leader, innovator and expert in all things breakfast, any time of day. The chain offers 65 different signature, fresh made-to-order breakfast options, a wide selection of popular lunch and dinner items as well as meals under 600 calories. IHOP restaurants offer guests an affordable, everyday dining experience with warm and friendly service. As of September 30, 2015, there were 1,667 IHOP restaurants in 50 states and the District of Columbia, Puerto Rico, the U.S. Virgin Islands, and Guam as well as Canada, Mexico, Guatemala, the Kingdom of Saudi Arabia, Kuwait, the United Arab Emirates, Bahrain, Qatar and the Philippines. IHOP restaurants are franchised and operated by Glendale, Calif.-based International House of Pancakes, LLC and its affiliates. International House of Pancakes, LLC is a wholly-owned subsidiary of DineEquity, Inc. (NYSE: DIN).
Morgantown Board of Realtors Holiday Luncheon
Comments Off on Morgantown Board of Realtors Holiday LuncheonThe Black Diamond Realty team had a great time celebrating the holiday season at the Morgantown Board of Realtors Holiday Luncheon on December 10, 2015. The BDR team spent the afternoon mingling with fellow realtors, enjoying a fabulous meal, and congratulating their peers who were recognized by MBOR. Proceeds of the event benefited Christian Help. In the photo, Mark J. Nesselroad is sporting the elf hat, David Lorenze is rocking the guitar, and Ryan Smyth fashionably appears in the large blue sunglasses. In the other photo, Ryan was chosen to dress up like a present. Murphy Holloway does not appear in these photos due to an Aspen ski trip.
Black Diamond Cheers on the Mountaineers
Comments Off on Black Diamond Cheers on the MountaineersIt was a great day to be a Mountaineer, wherever you may be! The Black Diamond Realty team took in West Virginia University’s upset of the #1 ranked Kansas Jayhawks on January 12. With a final score of 74-63, it was the first time WVU’s men’s basketball team had upset a top ranked squad since 1983. The WVU student body stormed the court as the buzzer sounded, but the Black Diamond team partook in the singing of “Take Me Home, Country Roads” from the safety of the stands. Let’s Go Mountaineers!
The Basics of Commercial Leasing (Pt 2)
Comments Off on The Basics of Commercial Leasing (Pt 2)My previous blog post detailed the basics of the most common types of lease agreements. However, there can be much more to a commercial lease, including important clauses that can be very impactful to the bottom line and one’s success. Those clauses will be outlined in this entry.
One important clause within a commercial lease is the Escalation Clause. The escalation clause establishes a base rental amount for the initial year, with an escalating base rent throughout the life of the lease. Landlords will build in an escalation clause to allow a new business to build their customer base while incurring less overhead to help assist the tenant in starting up the business, or as a hedge against inflation and in consideration of the time value of money. For example, the base rent may be $10.00 in year one, $11.00 in year two, $13.00 in year three, etc. A landlord-favorable clause will use an escalation based on the Consumer Price Index (CPI) without a cap. The CPI measures the change in pricing of market-based consumer goods and services and uses market factors via the Bureau of Labor Statistics provided by the U.S. Department of Labor to determine the index. The percentage of rental rate increase is determined by the percentage increase of the CPI.
Another vital clause in many commercial leases is the Non-Compete Clause. The non-compete clause is essential for both tenants occupying space in a multi-tenant building, and for the landlords leasing out the building. Non-compete clauses typically address retail uses. The non-compete clause restricts landlords from permitting future tenants from entering a commercial building or geographic area that includes current tenants that already satisfy the immediate market area. For example, if Joe’s Burgers wanted to lease a space in a strip center, yet Amy’s Burgers already rents a space and has a non-compete clause in her lease, this clause protects Amy and disallows Joe’s Burgers from being able to rent a space in the building, since it would be a direct competing use. The non-compete clause is important for a business to have in place to protect its market area. However, the clause should be structured in way that is mutually beneficial to both the tenant and the landlord. For example, a non-compete clause that states “establishments serving frozen yogurt” is less restrictive than one that states “establishments serving food”. The latter phrasing would severely limit a landlord’s ability to attract tenants. It is important that both the tenant and landlord agree on a clause that is mutually beneficial to both parties.
Leasehold Improvements, Trade Fixtures and Personal Property
When building out space for a business, it is important as a tenant to know what is classified as a leasehold improvement, trade fixture or personal property. Leasehold Improvements are improvements made to the building or space by the tenant that cannot be removed at the expiration of the lease agreement and therefore revert to the landlord. Examples of leasehold improvements are drywall partitions, electrical work, HVAC and floor covering.
Trade Fixtures are classified as fixtures relevant to the tenant’s trade or business that may or may not be removable at the end of the lease agreement depending on how the agreement is structured. If the removal of the trade fixture will cause damage to the building, most landlords will classify it as a non-removable fixture that shifts ownership to the landlord at lease expiration. For example, a fire suppression (sprinkled) ventilation hood installed over an open flame grill would be considered a non-removable trade fixture, as the removal of the hood and water lines running to the hood would more than likely cause significant damage to the building. A back bar that a restaurant uses to store items would most likely be a removable trade fixture, as the removal of the bar would not cause significant damage to the building.
Personal Property is classified as all property inside the space that can be easily removed, typically because they are unattached to any structure, at lease expiration. Items such as furniture and appliances would be considered personal property.
It is important to have an up-front discussion with the landlord to determine what would be considered a leasehold improvement, trade fixtures or personal property.
Before signing any commercial lease, it is highly recommended to review it with a qualified real estate attorney. An attorney can provide valuable feedback on the provisions contained within the lease and how to further protect your business. If you’re ready to take the first step in finding a space that suits your business needs, contact us at 304-413-4350. We can assist in negotiating lease terms that are fair for you and your business.
Rosenbaum Family House
Comments Off on Rosenbaum Family HouseBlack Diamond Team Serves Dinner to the Guests of Rosenbaum Family House
On October 15, 2015, the Black Diamond Realty team was honored to once again be able to visit the Rosenbaum Family House to prepare and serve dinner for approximately 30 house guests. The menu included two types of chili, cornbread, apples with caramel, pumpkin bars, pumpkin tarts, and numerous drinks.
Rosenbaum House plays such a vital role in our community. Rosenbaum Family House is a member of the National Association of Hospital Hospitality Houses (NAHHH). Facilities such as Family House are able to provide affordable family lodging, meals, support groups and other services and activities to families and their loved ones who are receiving medical care at least 50 miles away from their home. Rosenbaum House is able to provide the service through support received from businesses, nonprofit organizations, volunteers and the local communities.
If you would like more information on the Rosenbaum Family House or would like to lend your support, you can get more information at the following:
http://wvuhealthcare.com/wvuh/Hospitals-Clinics/Rosenbaum-Family-House/Rosenbaum-Family-House
Black Diamond Participates in The Mountain Mama 8K
Comments Off on Black Diamond Participates in The Mountain Mama 8KBlack Diamond team members David Lorenze and Ryan Smyth were proud to take part in the inaugural Mountain Mama 8K race that was held September 19, 2015 as a kick off to the Morgantown Marathon Weekend. Proceeds of the race go to Operation Welcome Home, which provides veterans with employment assistance, peer support, and links them with other support and services they may need or be entitled to when returning home from the service. Black Diamond is proud to be a sponsor for such a worthy organization.
Black Diamond congratulates the winners of the Mountain Mama 8K race and thanks everyone who participated in such a phenomenal event for our city. Pictured below are David Lorenze and Ryan Smyth in the Pace Car following the race.
The Basics of Commercial Leasing
Comments Off on The Basics of Commercial LeasingNearly everyone has experience with residential leasing at some point in their life. Residential leases are typically straightforward, outlining the responsibilities of the landlord and the tenant, the stated rent due date and the inclusion or exclusion of utility costs within the stated rental amount. However, when it comes to commercial leasing, the process can be exponentially more complicated and complex. Here at Black Diamond Realty, we’ve interacted with some clients that have found themselves in tenuous circumstances due to signing or being presented a lease that they did not, or do not, fully understand. Many of these people are first time business owners, with no prior experience in commercial lease negotiation. One oversight can become the difference between growing a successful business and failure. It is absolutely imperative to understand the basics of a commercial lease to limit potential future pitfalls.
There are multiple lease structures with the commercial leasing world, but I will outline the four most common. The first type of lease structure is a Gross Lease. This type of lease is somewhat similar to a standard residential lease. The tenant is responsible for a total rental amount, with all real estate expenses being covered by the landlord. These expenses include real estate taxes, insurance, common area maintenance, and utilities. This makes things easy on the tenant, as they only have to worry about one amount per month.
The second type of lease structure is a Modified Gross Lease. This type of lease structure is similar to a gross lease, only the tenant is responsible for a portion of the expenses on top of the otherwise bundled rental rate. Instead of being a monthly fixed amount, these expenses are variable and usually consist of the building utilities, with the possible addition of the property taxes, insurance or common area maintenance charges.
The third type of lease structure is a Triple Net Lease. This type of lease structure relieves the landlord of all expenses related to the property excluding certain building repairs. Under this lease structure, the tenant is responsible for the utilities, real estate taxes, insurance, and common area maintenance charges.
The fourth type of lease structure is an Absolute Net Lease. This type of lease structure is usually reserved for credit tenants (Whole Foods, Wal-Mart, Macys, etc.) engaged in long-term lease agreements (10 or more years). Under this lease structure, the tenant is responsible for all expenses related to the property including all maintenance and repairs. This is the most favorable lease structure for a landlord, as they have very little responsibility during the life of the lease.
When looking for space, it is important to understand the lease structure being offered by the landlord. Space is usually advertised via the base rent amount per square foot per year. This is very different from residential leasing, which advertises a fixed monthly amount for the life of the lease. If a 1,000 square foot space is advertised at $12.00 per square foot (PSF), that equals to $12,000 a year or $1,000 a month in rent (1,000 SF X $12 = $12,000/12 months = $1,000). In commercial leasing transactions, where the tenant is additionally responsible for a portion of the real estate expenses, that additional amount is usually exhibited via its own per square foot amount. For example, if a tenant is responsible for roughly $2,000 in real estate taxes, the landlord would advertise the 1,000 square foot space at $12.00 PSF with $2.00 PSF in additional expenses for a total rental price of $14.00 PSF. This is important to remember, because this additional amount is the difference between paying $12,000 a year in rent, and $14,000 in rent, which can have an impact on a business’s bottom line at the end of the year. Depending on the lease structure (Gross, Modified Gross, Triple Net, or Absolute Net), this additional amount may be fixed or variable.
In addition to the financial aspects of the lease structure, it is equally important to understand the duties of the landlord and tenant. Repair and Maintenance (R&M) obligations are a critical component. Unlike a residential lease, under which the landlord must statutorily cause the premises to meet a minimum standard of habitability, the duties placed on landlords and tenants of commercial premises are different and often contractually based. Tenants have all R&M duties under Absolute Net leases, but tenant R&M duties often decrease when comparing a Triple Net Lease to a Modified Gross Lease and finally to a Gross Lease. Landlords are often responsible for capital, structural, and major mechanical items, while tenants are often responsible for day-to-day maintenance/cleaning and damages caused by the tenants or their customers; however, the details, boundaries, and amounts are often determined on a lease-by-lease basis. Thus, it is important to carefully review the repair and maintenance language and clarify, if necessary, each party’s responsibilities.
In addition to the core items described above, there are other important factors involved in the negotiation of commercial leases. It is always best to have a knowledgeable commercial real estate associate working with you throughout the negotiation process, and a sound real estate lawyer to look over all the lease documents before signing. If you’re ever in the market to lease industrial, retail or office space, give Black Diamond Realty a call at 304-413-4350. We can help to make sure that the lease you’re signing is fair and equitable.
The Time Value of Money (TVM)
Comments Off on The Time Value of Money (TVM)The Time Value of Money (TVM) is an important factor when analyzing commercial real estate opportunities for investment. The TVM is the idea that money in hand is worth more than money given or earned in the future. For example, if someone were given the option between $5.00 today or $5.20 a year from now, one would most likely ask for the $5.00. Why? Because if they were to take the $5.00 and pick an investment with a modest five percent annual return, they would have $5.25 a year from now.
While the TVM is a basic factor when analyzing real estate, it is the building block on which an investor can measure project and investment profitability. Many real estate investments are viewed as mid-term to long-term investments, and the TVM becomes increasingly important in these situations as an investor tries to gauge whether an investment’s future earning potential justifies the risk of its initial cash outlay.
Since the cash flows earned from an investment in future years are worth less than cash at the present, these cash flows must be ‘discounted’ at the minimum return rate a real estate investor is willing to take when looking at an investment or competing investments. This rate, called the Discount Rate, helps an investor measure an investment’s Net Present Value (NPV).
If the present value of these future cash flows (the NPV) exceeds the present value of the initial cash outlay, this means that the investment’s return will exceed the investor’s minimum acceptable return rate (oftentimes called the investor’s ‘hurdle rate’) and that the investment is acceptable. Illustrated below are two $100 investments that both net the same overall cash flow of $24.00 and demonstrate the importance of the TVM concept and how the discount rate and NPV factor into the analysis of real estate.
Both investments cash flow the same amount of money over the same period of time, but Investment A has a positive net present value when both cash flows are discounted at 12 percent. Why? Because Investment A earns a greater amount of its cash flow earlier on in the investment cycle, while Investment B earns a greater amount of its cash flow later on in the investment cycle, which are discounted more heavily due to the later timing. Investment B’s cash flow pattern actually results in a negative net present value, indicating to the investor that Investment B does not pass the ‘hurdle’ and that the discounted cash flows will not net the minimum 12 percent return over the life of the investment. This scenario demonstrates the power of the TVM.
These financial concepts are crucial when measuring risk in real estate investing. Knowing how these concepts work helps to mitigate one’s risk and make an informed and educated decision on where to deploy capital most efficiently. One should contact their certified accountant when deciding to invest in real estate. For more information on how Black Diamond Realty can help with your search of income-producing properties, call Ryan at 304-413-4350.
Capitalization Rates in Real Estate
Comments Off on Capitalization Rates in Real EstateCapitalization rates in real estate are used to determine the purchase price of real estate investment property. They are a common tool used by real estate investors to get an initial grasp on the performance of the property and to understand what it will cost to buy in to an income stream. Capitalization rates are also commonly referred to as the property’s “cap rate” or simply “cap”. While a property’s capitalization rate isn’t the sole determining factor when analyzing an investment for purchase, it is important and should be researched and weighted heavily before acquisition.
The formula for determining a property’s capitalization rate is a simple equation:
Net Operating Income/Purchase Price = Capitalization Rate
For example: Assume an investor purchases a real estate investment property for $100,000 and it has a net operating income of $10,000. The investor is purchasing the property at a 10 percent capitalization rate.
How do investors determine an acceptable cap rate for their investment? Three factors that help to determine this are the market, the investment strategy and the type of the property. The higher the cap rate, the less an investor is willing to pay for the income stream.
Items that typically justify a lower capitalization rate:
- Strong, stable markets (major metropolitan areas)
- A high-end property in an excellent location (oftentimes called a “trophy property”)
- Financially strong long-term tenants for office/industrial space
- Extremely low or zero vacancy for Class A multifamily space
Items that typically justify a higher cap rate:
- Smaller, weaker markets (tertiary markets)
- Older properties and properties with deferred maintenance
- Less than creditworthy tenants for office/industrial space
- Multifamily properties with vacancies above the industry standard (expected to be 4.8 percent in 2015 according to Freddie Mac)
Because cap rates are typically one of the first financial factors to be analyzed when considering a property for investment, the vetting of the property’s net operating income is extremely important. If the income is inflated, it can result in overpayment for the property when comparing properties with similar cap rates.
When determining if a real estate investment property is right for you, call Black Diamond Realty. We can help by showing you the current going in cap rates in the market and assist you in evaluating a purchase. Call Ryan at 304-413-4350.
Section 1031 Exchanges
Comments Off on Section 1031 ExchangesMany successful real estate investors take advantage of Section 1031 Exchanges.
A 1031 Exchange can best be described as a real estate sale without immediate tax implications. This benefits the seller by providing a window of opportunity to replace the sold real estate with a like-kind property and reduce the tax basis of the replacement property by the deferred gain. This defers the tax on the property to a future date.
For example, if XYZ Company sells a real estate asset and realizes a gain of $100,000, the company can defer this gain on the sale of the property by executing a 1031 Exchange. In order to do this, XYZ Company could acquire a replacement property for $200,000. Then to defer the gain, XYZ Company must reduce the basis of the replacement property:
New Property Value: $200,000
Minus Deferred Gain: -$100,000
Basis of Replacement Property: $100,000
However, to be able to execute this exchange, the property must be exchanged for “like-kind” property. Like-kind properties encompass a wide range of property types. For example, an office building can be exchanged for a piece of land and vice versa. Real estate cannot be exchanged for a partnership interest of an entity that holds real estate.
As mentioned earlier, there is a window of opportunity in identifying and acquiring the like-kind property. The property must be identified no later than 45 days after the taxpayer transfers property. The taxpayer must also take title either within 180 days of the transfer or by the due date for the taxpayer’s tax return for the tax year in which the transfer of property occurred.
1031 Exchanges can be a great way for real estate investors to invest proceeds from the disposition of real estate into new investments while deferring the tax implication to a later date. When determining if a 1031 Exchange would work for you, please consult a CPA or legal counsel that has prior experience in handling this type of transaction.
If you are a real estate owner or buyer interested in executing a 1031 exchange, contact the Black Diamond Realty team of professionals to assist with the transaction. Our real estate team is experienced in strategically aligning 1031 exchange buyers and sellers and positioning their properties for purchase and sale. Call (304) 413-4350 for more information or you may e-mail me at: RSmyth@BlackDiamondRealty.net.
Source: Rosenfeld, Joel (2014) Principles of Real Estate Accounting and Taxation. San Diego, CA: Cognella, Inc.
Off-Market Property
Leave a CommentCash flowing properties are excellent wealth builders that can add a tangible asset to an investment portfolio. Unlike stocks, investors can see and touch their properties. In addition, real estate offers tax advantages not available in other investment vehicles. Cash flowing properties allow investors the opportunity to have their tenants pay down debt and build equity in a tangible asset. At Black Diamond Realty, when we are asked to market a strong, cash flowing property, we consider various strategies to personalize a plan that ensures the success of both the buyer and the seller. In many cases, these strategies involve varying levels of confidentiality.
Black Diamond Realty offers multiple real estate investment listings that we keep off-market and in-house, rather than publicly advertised. In terms of traditional real estate sales, this might seem counterproductive. However, when it comes to investment property, this type of strategy can actually have negative consequences on the value of the asset, or eliminate the marketability of the asset altogether. There are multiple reasons for this occurrence:
- Investors Want to Have the Inside Track on an Asset
Investors actively seeking to acquire large assets can be turned off by on-market investment properties. Why? Well, the first question we typically get asked is, “Why has this property been on the market so long?” Many investors strive for exclusivity when looking at deals. Having the property on-market can create a stigma, an inclination that others have already passed on the asset. Investors want to know that they may be one of only a few parties looking at the deal. Because of this, here at Black Diamond Realty we have a targeted list of investors we reach out to when our company acquires the exclusive listing on an investment property. Typically, these investors already have a fair amount of investment property in their portfolios.
- NIMBY-ism
Some particular properties we’ve been asked to market offer a great development opportunity, or the opportunity to add value to the existing asset. New development is a contentious topic in many communities, and we’ve encountered instances in the past where a few people can torpedo the sale of a property simply because they don’t want to see anything built on the property, or they have competing interest in surrounding property. When it comes to highly desirable developable property, it is a good idea to keep a tight lid on the circle of communication. As the saying goes, “Loose lips sink ships.” It is no different when it comes to confidential real estate transactions.
- Can Give Wrong Impression to Public
Oftentimes, income producing properties are sold while occupied by tenants in good financial standing. If a commercial building with occupying businesses is listed publically for sale, it can give the false impression to the public that the occupying businesses are selling and/or that the landlord is looking to get out. This is typically not the case, but this false impression may actually cause the businesses to suffer, as current customers may look elsewhere for alternative purchasing options.
- Tenant Conflict
Desirable cash flowing properties are typically occupied with paying tenants. While rare, tenants who learn of an impending sale may begin to slack on rent payments or stop paying rent altogether. This usually applies to multi-unit investment property, where a property owner may be dealing with less sophisticated tenants that believe their obligation to pay rent ends with the current landlord’s ownership of the property. When this happens, the current net operating income is negatively affected, which can ultimately undermine the property’s valuation and make the asset less marketable.
Black Diamond Realty currently has multiple in-house listings that offer a good investment vehicle for potential investors. If you have interest in being added to our list of preferred investors, please e-mail us at: RSmyth@BlackDiamondRealty.net. (more…)
Habitat for Humanity Work Day for Black Diamond
Leave a CommentMembers of the Black Diamond Team, David Lorenze, Murphy Holloway, and Ryan Smyth, didn’t let a little rain stop them from enjoying a great work day volunteering on April 17, 2015 with the work crew for the Mon County Habitat for Humanity. They spent the day helping the crew with the construction of new homes on Jersey Avenue in Morgantown.
Mon County Habitat for Humanity was established in 1990 and is part of a global, nonprofit housing organization dedicated to eliminating substandard housing through the construction of new homes and rehabilitation of existing homes. The organization is operated on Christian principles that promote dignity, hope and the belief that everyone should have a safe place to live.
Mon County Habitat for Humanity operates based on monetary donations, material donations and over 13,000 volunteer hours per year by individuals, churches, local company, and civic organizations. The Mon County Habitat for Humanity also operates ReStore which accepts donations of new or reusable furniture, appliances, residential and commercial furnishing and fixtures, and building materials. ReStore encourages the use of reusable items to lower the cost on building and the impact on the environment. ReStore is open to the public to purchase these donated items at thrift store prices and the proceeds are then used to further the mission of Mon County Habitat for Humanity.
For more information on Mon County Habitat for Humanity or how you may volunteer, you may visit their office at 251 Don Knotts Blvd, Morgantown, WV or visit their website at http://moncountyhfh.org/.
IHOP Coming to University Park at Evansdale
Leave a CommentBlack Diamond Realty is proud to announce that it has brokered a transaction with Country Road Restaurants, Inc. to bring an IHOP restaurant to WVU’s new University Park development in Evansdale. IHOP will serve as an anchor retail tenant and seat approximately 132 customers in the first floor of the mixed-use facility, which is one of five structures that comprise University Park.
IHOP will open at University Park during the 2015 fall semester and will be easily accessible for students, hospital staff and guests, Morgantown residents, and visitors to enjoy great pancakes, coffee, sandwiches, and more. Dedicated parking will be available adjacent to the mixed-use building for commercial tenants and their customers.
University Park is a public-private partnership project between University Park at Evansdale, LLC and West Virginia University for on-campus student housing owned and managed by WVU. University Park consists of a 902-bed residence hall and 408 apartment beds, of which 66% is replacement housing. It is on schedule to open in August 2015 for fall semester occupancy.
The $112 million multi-purpose development creates a campus village designed to enhance campus life and provide modern accommodations to students as part of WVU’s Master Housing Plan.
For residential leasing questions, contact WVU Housing at 304-293-PARK or http://www.universitypark.wvu.edu. For retail leasing inquiries, contact Black Diamond Realty LLC at 304-413-4350 or visit www.blackdiamondrealty.net.
For more information you may also see: http://wvutoday.wvu.edu/n/2015/04/27/ihop-restaurant-to-open-at-wvu-s-university-park.
Team Enjoys Attending Pittsburgh Penguins Game
Leave a CommentOn March 12, members of the Black Diamond Realty team enjoyed a great evening together in Pittsburgh attending a Pittsburgh Penguins game. This afforded them a great time for team building, and to network and unwind, while enjoying a great game. Black Diamond is active in the western PA real estate market, with its Broker and Principal Agent both being licensed in Pennsylvania. Go Pens!
Pictured L-R: Mark J. Nesselroad, Broker; David Lorenze, Principal Agent; Ryan Smyth, Agent; Murphy Holloway, Agent.
Black Diamond Serves Dinner At Rosenbaum Family House
Leave a CommentBlack Diamond Realty was pleased to once again be able to visit the local Rosenbaum Family House on February 17th to prepare and serve dinner for 30-40 house guests. The guests are so appreciative of just a simple dinner when they are going through such a difficult time with a loved one in the hospital. Black Diamond is proud to support nonprofit organizations in our community such as Rosenbaum Family House.
Rosenbaum Family House is a member of the National Association of Hospital Hospitality Houses (NAHHH). Facilities such as Family House are able to provide affordable family lodging, meals, support groups, and other services and activities to families and their loved ones who are receiving medical care at least 50 miles away from their home by support received from businesses, nonprofit organizations, volunteers and the local communities.
If you would like more information on the Rosenbaum Family House or would like to lend your support, you can get more information at the following: http://wvuhealthcare.com/wvuh/Hospitals-Clinics/Rosenbaum-Family-House/Rosenbaum-Family-House
Hats Off to Pizza Al’s
Leave a CommentHats off to Albino Roperti, known as “Pizza Al” or “The Pizza King” by his many fans for yet another year of being recognized as some of the best pizza you can eat in Morgantown. Pizza Al’s has two locations in Morgantown – on University Avenue, and on Earl L. Core Road in the Sabraton Plaza, and also a location in McMurray, Pennsylvania.
Al immigrated to the United States more than 50 years ago. He opened his first pizzeria in Pittsburgh just a few years after making his home in America. He later moved to Morgantown and has been making pizzas in Morgantown since 1969 with the opening of Pizzeria Italia.
After many years of being Morgantown’s favorite pizza maker, Al decided to retire and sold Pizzeria Italia. The new owners did not continue the great success Al had seen and were losing customers. Al did not like seeing this happen to his pizza empire and came out of retirement and opened “Pizza Al’s” as we know it today. His New York-style crust, special homemade sauce, and fresh ingredients make everyone one of his pizzas a work of art and a favorite that keeps customers coming back.
Pizza Al, we celebrate your hard work and wish you continued success as the Pizza King of Morgantown!
Black Diamond Realty Joins Morgantown Area Chamber of Commerce
Leave a CommentBlack Diamond Realty LLC is proud to be a new member of the Morgantown Area Chamber of Commerce. Members of the team, Mark J. Nesselroad, David Lorenze, Ryan Smyth, and Murphy Holloway attended the Annual Chamber dinner held on Friday, January 30, 2015.
Black Diamond congratulates the many businesses and business leaders who were recognized by the Chamber at this year’s dinner and presented with awards. Thank you for your example and leadership in the community.
Black Diamond Team – Pictured L to R: Mark J. Nesselroad, Broker; David Lorenze, Principal Agent; Ryan Smyth, Agent; Murphy Holloway, Agent
Dunkin’ Donuts Coming to Suncrest Area of Morgantown
Leave a CommentDo you remember the Hardee’s on Chestnut Ridge Road in Morgantown? Black Diamond is proud to announce that it brokered a transaction to bring Dunkin’ Donuts to this location. http://www.blackdiamondrealty.net/properties/closed-properties The property, consisting of a 4,500 square foot building on .91 acre, is undergoing a complete overhaul. Construction has been moving ahead at a steady pace since fall of 2014.
We are pleased to announce Dunkin’ Donuts coming to the Suncrest area of Morgantown! Morgantown residents and visitors will soon be able to secure fresh coffee, donuts, sandwiches and much more in the Suncrest area. With 44,000+ vehicles per day, this site is in a prime location for a quick service restaurant. Opening day is tentatively scheduled for mid-Fedruary. Be sure to get your DDPerks Reward Card or download the Dunkin’ Mobile App.
Black Diamond Welcomes Ryan Smyth To The Team
Leave a CommentBlack Diamond proudly welcomes Ryan Smyth as the newest member of their team. A Morgantown native, Ryan began his career in the residential real estate industry where he rose to be one of the top grossing agents in North-Central West Virginia as a Sales Manager for Dan Ryan Builders. Mr. Smyth also opened and operated multiple small businesses in the Morgantown, WV and Columbus, OH areas.
Mr. Smyth is a graduate of WVU with a B.S. in Advertising. He also holds a Master’s from the University of Maryland in Real Estate Development. Smyth was a recipient of the school’s Academic Achievement Award. While at Maryland, Mr. Smyth gained valuable work experience with Lock 7 Development, specializing in condominium conversion and construction in Washington, D.C.
Mr. Smyth understands the development, sales, and marketing of commercial and residential real estate. With his background and education in urban design and development, leasing, negotiation, and asset management, Mr. Smyth is a great addition to the Black Diamond team.
University Park is Part of WVU’s Expansion Projects
Leave a CommentUniversity Park is a public-private partnership project between West Virginia University and University Park at Evansdale, LLC. The $112 million multi-purpose development is an integral part of WVU’s current student housing master plan adopted by the WVU Board of Governors to provide modern accommodations on the University’s campus. University Park will replace current housing located nearby at Fieldcrest Hall and the Medical Center Apartments, both of which will be demolished, and Pierpont Apartments, where the lease will not be renewed. To see details on this and other WVU expansion projects, see the following: http://www.constructionequipmentguide.com/WVU-Expands-With-250M-Worth-of-Projects/23963/
Black Diamond Team Helps Support the Rosenbaum Family House
Leave a CommentBlack Diamond Realty believes that support by businesses in the local community plays a vital role in the success of nonprofit organizations, which operate facilities such as Rosenbaum Family House in Morgantown. The team from Black Diamond was honored to visit the new Rosenbaum Family House on August 13, 2014 to prepare and serve dinner for 30-40 house guests.
Rosenbaum Family House is a member of the National Association of Hospital Hospitality Houses (NAHHH). Facilities such as Family House are able to provide affordable family lodging, meals, support groups, and other services and activities to families and their loved ones who are receiving medical care at least 50 miles away from their home by support received from businesses, nonprofit organizations, volunteers and the local communities.
If you would like more information on the Rosenbaum Family House or would like to lend your support, you can get more information at the following: http://wvuhealthcare.com/wvuh/Hospitals-Clinics/Rosenbaum-Family-House/Rosenbaum-Family-House
Black Diamond Welcomes Murphy Holloway to Their Team
Leave a CommentBlack Diamond proudly welcomes Murphy Holloway as the newest member of their team. Originally from Wheeling, West Virginia, Holloway has a clear understanding of the region’s real estate market. Mr. Holloway is a recent graduate of Elon University in North Carolina, where he earned dual degrees in Finance and Entrepreneurship. Holloway served as a summer intern under Black Diamond’s Principal Agent, David Lorenze, during Lorenze’s tenure at Petroplus Lane, LLC. Further, Holloway is well-versed in public policy’s effects on West Virginia’s business climate through his internship with the Public Policy Foundation of West Virginia.
China King Takeout Opening Soon in Sabraton Plaza
Leave a CommentBlack Diamond Realty LLC proudly served as broker for Glenmark Holding LLC and welcomes their newest tenant, China King Takeout, to the Sabraton Plaza. Expected to open for business by June 1st, the restaurant will feature both Chinese and Thai cuisine. Owner Fang Yao He will operate the restaurant as a takeout eatery with on-line ordering and delivery service available.
China King Takeout is located at 1383 Earl L. Core Road, the former location of Ray’s Pastries.
Morgantown Named Among Top 10 Cities for Affordable Health Care
Leave a CommentMorgantown, WV has been named one of the Top 10 Cities for Affordable Health Care by Livability.com, a national website that ranks quality of life and travel amenities of America’s small and mid-sized cities. Morgantown was 34 points below the national average and was the second lowest in spending on health care among this list of cities. Chosen because of its low health care costs on everything from dentist visits to heart surgery, Morgantown also offers access to multiple area hospitals, including Ruby Memorial Hospital, the largest facility in the WVU Hospitals family. To read the full article or see the complete list of cities making the Top 10 you may go to: Top 10 Cities for Affordable Health Care.
Black Diamond Realty Execs Featured As Top 30
Leave a CommentWV Living Morgantown magazine named Mark J. Nesselroad and David Lorenze among the top “Thirty Under 30” brightest young talent in the Morgantown area. The two were among thirty individuals to receive this title in various fields. The magazine boasts Morgantown’s thriving community and predicts the future to be even brighter with these up and coming “movers and shakers” at the helm. Read the full story at http://www.morgantownmag.com/morgantown/December-January-2014/Thirty-Under-30/
America’s Best College Towns: Morgantown
Leave a CommentMorgantown was recently ranked number eleven on Travel & Leisure’s Best College Towns list.
“It’s odd to celebrate a place for its public transportation, but Morgantown wouldn’t be Morgantown without its Personal Rapid Transit system. Connecting the five campuses of West Virginia University and downtown, the PRT helped boost the university’s enrollment (from 10,000 in 1960 to almost 30,000 today), which transformed the town. When they’re not at a WVA game, locals split their time between downtown (The Blue Moose Café is a favorite for coffee), the Wharf District (grab a pint at Mountain State Brewing Co.), and the trails just outside of the city limits.”
Read the full article here: http://www.travelandleisure.com/articles/americas-best-college-towns-2013
Closed Transaction – 2345 White Hall Blvd., South Fairmont
Leave a CommentThe Black Diamond Realty team recently procured a 5 year lease for 4,200 square feet at the former Middletown Tractor location in South Fairmont, WV. The address is 2345 White Hall Blvd. – South Fairmont, WV 26554. This commercial-use office space is in a prime location, including adjacency to several major roadways. Black Diamond Realty is proud to have recently finalized the lease terms for the space, which means that a new business will soon open its doors in Marion County.
Coming soon to 2345 White Hall Blvd:
Mountaineer Cabinet Company, Inc., d.b.a. Fairmont Kitchen Center, will transform the first floor space into a retail showroom center. In addition, the space will be utilized by their Formica division. Black Diamond Realty LLC wishes Fairmont Kitchen Center the best of luck in their new location!
New Website Launched
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Black Diamond Realty recently launched its new website, as part of a continual marketing blitz to establish and build the company’s brand as it becomes a leading player in the Morgantown real estate market. Focusing solely on commercial properties and spaces, Black Diamond’s new site was designed to reach, engage and retain website visitors through an intuitive, modern design (including a specialized responsive design for visitors on mobile or tablet devices), a simple, easy-to-follow navigation, and allows for the full presentation of Black Diamond’s available properties to the viewing public.
This website arrives on the heels of Black Diamond’s current promotional blitz, which includes promotion through several different media formats as it announces its services to the region.
Do you have questions, comments or suggestions for our new site? Contact BDR today to learn more!
Black Diamond Realty celebrates WVU’s upset of Oklahoma State
Leave a CommentAfter a somewhat rocky start to the season, the Mountaineers edged out a solid win against an incredibly talented and #11 ranked Oklahoma State team. The Black Diamond Realty team was in attendance for both the pre-game tailgate and to cheer on the Mountaineers to victory at Milan Puskar Stadium.
The rejuvenated Mountaineers play Baylor on October 5, 2013.
Morgantown business owners to talk with Congress, White House officials
Comments Off on Morgantown business owners to talk with Congress, White House officialsMorgantown small business owners will join 16 entrepreneurs from 15 states in Washington, D.C. Sept. 17 to talk about small business issues with members of Congress and key White House officials. Click this link to read more of this story in the State Journal:
Construction continues at WVU
Leave a CommentSeveral construction projects have broken ground or are nearing completion in the city of Morgantown as the students and faculty eagerly anticipate the new educational buildings.
The new Advanced Engineering Research Building, pictured, is just one of the many ongoing projects. It will add 22,000 square feet of flexible and environmentally safe new laboratory and research space as well as an 8,000 square feet clean room to meet the needs of high-technology learning and discovery in the new millennium. Offices, classrooms, computer classrooms, learning center, and graduate student space will use 29,000 square feet in the new building. The new building will be 60,000 assignable square feet with an unfinished space for future completion of 15,000 square feet. The building will form a key quad border in addition to the agricultural science building, the Evansdale Library, NRCCE, and ERB. It will be 4 stories total and 95,000 GSF. The building will be fully integrated into the utility infrastructure for the Evansdale Campus and will have energy efficient systems.
Learn more about WVU’s Construction Efforts
Morgantown Listed #4 Small City in Job Growth for 2013 by Forbes
Leave a CommentMorgantown, which not only lists as the #23 small city in America for business and careers, ranked at #4 in Job Growth in Forbes’ annual poll. Morgantown, annually a contender in Forbes’ list of Best Small Cities, ranks highly in several other galleries.
Visit Forbes’ Website to Learn More.
