Niche Focus on the End-User of Real Estate

As we celebrate over eight years in business, people sometimes ask me why I left the large company environment to start IAG Commercial.  This is a fair question and there are days where I realize it would have been easier to remain with a large company and it's many resources and strong brand recognition.  These resources and brand recognition definitely allow a person to avoid activities not directly related to revenue production.

The core of our struggle was the inherit conflicts of working for a company that primarily generated revenue from institutional clients that hire the company to manage multiple buildings in multiple cities.  These clients become a primary source of recurring revenue for large commercial real estate service companies.  Throughout our careers, we have experienced times when our end-user clients come in conflict with these institutional relationships.  It is not comfortable within the service companies, as the leasing and managing teams are measured around their ability to "keep or recruit" these new tenants.  

Adversely, our focus is to educate our clients on the market so they make an educated decision they feel good about at the end of the day.  When this decision contradicts the leasing and management teams focus within your own company, it becomes a point of contention internally.  While many of our clients are medium to large companies, they are small in comparison to the revenue generated by these institutional clients.  Recently, I was reminded of the times we were "encouraged" to do what was best for the company vs. what was best for our clients.  From our perspective, the client "always" comes first because without clients, there is no company or end-user division within a larger service company.

In creating IAG Commercial, we wanted to avoid these internal conflicts, much like the legal field manages conflicts so as not to compromise their ability to service an existing client.  We knew it would be harder to pursue new business opportunities without the name recognition of our larger competitors but we felt it was the right thing to do for our clients.  We believe time will prove this out even though each day we have to work hard to create awareness of our company in the marketplace.  Yes, we still lose business pursuits to our larger competitors but our clients appreciate our approach as they utilize our services. 

We certainly appreciate avoiding the internal conflicts between our own companies internal divisions.  We remain true to our focus!  Whether your company is looking for tenant/buyer representation, disposition of facilities, development services or project management, keep us in mind.  We may be smaller than the industry giants, but we are knowledgeable and committed to helping your company make and deliver upon a wise commercial real estate decision.  

 

 

Greater MSP Transit Facts

Recently we attended a session on the Greater MSP transit system.  We found the session to be informative and helpful.  Here are some quick facts about the Greater MSP transit system.  They serve as reminders that our investment in transit, as taxpayers, is helping people gain access to jobs and education.

The Metropolitan Council that regulates bus and light rail transit for the area, recorded over 100 million trips last year.  One bus is the equivalent of 40 cars.  One 3-car LRT train is the equivalent of 600 cars.  At rush hour, buses will transport the equivalent of 1.5 lanes of traffic.  80% of riders are going to work or school and 40% of downtown St. Paul and Minneapolis workers use transit.

As a commercial real estate advisory firm that completes many tenant and buyer representation assignments, we like the access to jobs provided to employees of all wage rates.  We feel this need for public transportation will continue to be important as labor becomes more scarce and the cost to own a vehicle continues to soar.

 

The Future of Data Centers

Data centers are becoming a thing of the present as cloud computing applications and social media continue to grow. Data centers are large groups of networked computer servers. They are primarily used for remote storage, processing and distribution of data. Many large companies have applications (apps) and services that rely on a data center to keep things running smoothly. In 2018, data center space is expected to grow to 1.94 billion square feet in comparison to 1.58 billion square feet in 2013. Having a data center under the control of the corporation can be a great asset. For companies that choose to own their data center, it helps to ensure reliability, access and security of mission-critical information. For companies who contract with cloud application providers, shared data centers offer a cost structure at a fraction of the individual support costs.

Minnesota is one the most ideal places to locate a data center for the following reasons:

Leading-edge broadband infrastructure: Minnesota is heavily connected to fiber, cable, DSL and wireless broadband networks, with the infrastructure in place to help prospective data centers locate and expand.

Named America’s Top State for Business by CNBC (2015): Based on 60 measures of competitiveness in 10 categories, MN was ranked top 10 in education, technology and innovation, quality of life, infrastructure, economy.

Valuable data center tax breaks and no personal property tax: tax exemptions for 20 years on: computers and servers, cooling and energy equipment, energy, software. Companies that build data or network operation centers of at least 25,000 square feet and invest 30 million in the first four years, qualify for the tax break.

Domestically competitive, reliable power: Electricity is exempt from sales tax for qualified data centers. Commercial and electric rates have been historically below national average. Minnesota power companies are reliable and get high approval ratings from business customers. Minnesota also offers a naturally cool, safe climate for business that decreases the cost for cooling data centers.

For help with your next Data Center decision, call IAG Commercial at 612-868-7429.

GET TO KNOW OUR TEAM: Jeff LaFavre

We at IAG Commercial Real Estate are a team. We work closely together and support one another in order to provide a comprehensive solution for our clients. We thought you might to know our team a little better.  After all, we are not JUST about work!

 

Jeff is a former D1 middle distance runner, which has helped him go the extra mile for our clients. As he describes himself to his children, “I was a poor middle distance DI runner!” These days Jeff enjoys a round of golf with clients, made better with a frozen Snickers around hole #12. He also enjoys being a sports spectator of many sports but especially the Vikings and the MN Gophers basketball team.  Jeff enjoys gaining new clients and tackling complex real estate challenges. He enjoys new relationships and helping people excel in their careers. He especially enjoys  commercial real estate because it involves creatively solving tangible problems for clients.  Throughout the majority of Jeff’s 28 year career, his focus has been working with end-users typically based  in the Midwest.  He has worked  on every continent for these clients to help them find 500-1,000,000 sq. ft. of space. This includes industrial, office, land and some retail space, for our medical and financial related customers. 

On behalf of his clients, he has closed several hundred transactions through the years. For Jeff, the best part is the feeling you receive when a client says “thank you, I could not have solved it without your help!"   He enjoys the feeling of sincerely helping our clients do something that would have been difficult for them to achieve on their own.

Besides sports, he enjoys spending time with his wonderful family, serving on professional association and non-profit  and community boards and being involved with his local church.  He and his wife, Maxine, have two children. Their favorite vacation spot is Hawaii, but they enjoy traveling the world. (Jeff does anyway.  For Max, a beach and sunshine is all she needs!)  Jeff’s vises are ice cubes and graham crackers and if he could be a super hero he would be Flash Gordon. As a former runner he wishes he could move that fast!

Favorite Commercial Real Estate Success Story:

There are many that I have enjoyed along the way.  One of my favorites is representing Ecolab in purchasing the former, approximately 500,000 sq. ft. Cray Research H.Q. in Eagan, MN and then representing Travelers, a number of years later, in selling their 485,000 sq. ft. high-rise St. Paul office building to Ecolab for a new H.Q..  It was a small world kind of thing, separated by at least eleven years.

Update: Operation Christmas Child

Operation Christmas Child is a wonderful non-profit bringing joy to children around the world. They partner with local organizations, families, and businesses to provide children with a “shoe-box" of gifts and hygiene items. Each year we help them to secure space for their seasonal distribution center. Thanks to one of our many great industry partners, we were able to able to secure them space in a plant in Lakeville for this holiday season. We hope they have another great season collecting and shipping out these boxes! If you would like to put together a shoe box with your family or business please see the link below.

https://www.samaritanspurse.org/operation-christmas-child/pack-a-shoe-box/

What Does an Amazon HQ2 Mean to MSP?

We have all heard the numbers, $5 billion dollars, and 50,000 new jobs. It has enticed 238 cities and regions around North America to put together proposals luring the economic giant. Greater MSP has a lot going for them in the selection process. They are worthy cities for development, innovation, and industry. The transportation system is great, constantly improving and could meet the demands the Amazon HQ2 would bring. They are also home to 17 Fortune 500 companies in diverse industries. 

Proposed locations include Minneapolis both in Downtown and the Northloop, the former Ford plant site in St. Paul and an undisclosed location in Maple Grove. All of these places provide Outstanding opportunities for Amazon. The Twin Cities rank high in national reviews of best places to live. The cost of living to average salary makes the area very affordable. The Twin Cities also has great schools. Our lowest performing schools are doing better than many acceptable schools nationwide. 

Combined with our quality educational system, we enjoy a top ranked “quality of life” measured through a number of criteria. Our parks and trails provide  easy access to outdoor enjoyment. Minneapolis is consistently ranked the most “bike friendly” city in the country and St. Paul is following closely behind. Mass transit is becoming a new-found strength for the area and current approved plans will only make it better in the years to come.  

The Minnesota’s economy was built on people who value education and the outdoors. This has not changed over the years and  Minnesotan’s still value these strengths. This focus will continue to provide a strong workforce that is well-educated with a passion for the environment. This could be an attractive opportunity for Minnesota. We believe  it is an even better opportunity for Amazon.

 

North Metro Connection = Opportunity for business

The long anticipated 610 connection was completed last fall. It connects Interstate 94 to Interstate 35W via Hwy 610/10. This connector provides greater access and convenience across the north metro. It has resulted in a great opportunity for commercial real estate development. At almost every exit there are new commercial developments. Many warehouses, charter schools, shopping developments, distribution centers, and Target North Campus have been built along this Highway. There is still a lot of undeveloped land available along 610 in both Maple Grove and Brooklyn Park. It may even be part of the site that Maple Grove submitted for Amazon’s second corporate headquarters. With access points at HWY 252, HWY 169, HWY 10, and I-94 it is a great place for greater access to the region. It will also be connected at West Broadway and 610 to downtown with the Blue Line extension.