Today, the Regional Transportation Alliance (RTA) business coalition hosted an event at the Umstead Hotel & Spa in Cary to welcome Pedro Heilbron, CEO of Copa Airlines.

Copa Airlines will launch international service from Raleigh-Durham International Airport to Panama City in June of this year. The airline has the biggest international network among Latin America-based airlines. According to the Condé Nast Traveler 2023 Readers’ Choice Awards, Copa Airlines is noted as being the most punctual airline in the Americas and the only carrier from the Western Hemisphere to feature among the top 15 international airlines in the world. Copa Airlines services 85 destinations in 32 countries in North, Central, and South America and the Caribbean, linked via the Hub of the Americas® in Panama City, Panama.

Heilbron spoke to the growth and transformation of the airline and the growing Raleigh/Durham market. His hope for Copa’s new route through Raleigh-Durham is that it will “bring Latin America much closer to the Research Triangle area, strengthening business and cultural ties between our regions. We also hope this new route provides the opportunity for more American tourists to visit Panama and enjoy the wonders our country has to offer.”

Michael Landguth, CEO of the Raleigh-Durham Airport Authority, Ellis Hankins, Chair of the Raleigh-Durham Airport Authority Board, and other leaders from RTA were also in attendance. York is proud to be a sponsor of the RTA and continuing to connect with both the local business community and regional leaders.

City of Raleigh has selected Omni Hotels to develop a convention hotel in downtown.

The new hotel is anticipated to include 550 guest rooms and 55,000 SF of meeting space. The hotel will also feature several food and beverage outlets, a rooftop pool, a signature Mokara spa, and a fitness center.

Omni posted on their website that the property will be built on an over one-acre lot across from the Raleigh Convention Center and Martin Marietta Center for the Performing Arts at the end of Fayetteville Street. It is expected to open in 2027.

A recent report released by Wake County Economic Development lists 21 companies collectively investing over a quarter billion dollars and creating nearly 1,200 jobs during the reporting period of October 1, 2022 – June 1, 2023.  Below are the largest “new jobs” creators from the report:

COMPANY                                       INDUSTRY                                                       NEW JOBS

View the full report to learn more about new jobs and companies investing in Wake County.

Last month, Oak City CRE (Commercial Real Estate) asked a group of Raleigh brokers to share their guesses about where the Raleigh market is going to be in 3Q 2023. 24 brokers responded. That survey resulted in the first Raleigh CRE Crystal Ball Report. This unique report is meant to try and look into the future.

The brokers project a tenant market for leasing activity and a buyer market for asset sales in 3Q 2023. For the leasing market, the report predicts that office will be a strong tenant market and industrial will be a strong landlord market. For the asset sales market, the data shows that office will be a strong buyer market and industrial will be a strong seller market.

The report also includes a Leader Board that ranks brokerage firms by the number of qualified submissions they send in for the survey. York Properties tied for 5th place.

Oak City CRE is an online platform created by Jed Byrne to connect and identify any projects he creates related to Raleigh and North Carolina. In addition to a blog, A/E/C job board, and upcoming events page, Oak City CRE offers the Top Five, a weekly real estate newsletter focused on development in Raleigh that curates a list of the top five pieces of CRE content that Jed finds. Jed also runs the DirtNC Podcast, where he talks about the “places and spaces of North Carolina and the people who make them awesome.”

Read the full report here: 3Q2023 Crystal Ball Report Final.

According to a recent CoStar report, the Raleigh retail market is seeing high demand and limited supply as a result of population growth and strong consumer spending. Net absorption over the past year has been around 190,000 SF, while move-outs have been lower than average. However, only -490,000 SF of new retail space has been delivered in the same time period. This has led to historic lows in vacancies and availabilities at 2.2% and 3.1%, respectively.   The report states multiple tenant leasing agents have commented that the market’s absorption would be significantly higher if more space were available for tenants to move into. There is a particular lack of second-generation space, and first-generation space is challenging for tenants to move into due to expensive upfits and long construction schedules. Raleigh’s steady population growth supports the construction pipeline, which is currently the largest it has been in over a decade, with 1.9 million SF of retail space under construction.

Tenant-rep broker, Robert Hoyt, attended a TRAOBA meeting yesterday called “How the Triangle Stacks Up to Other Metros”. Because TRAOBA is Office focused there was some discussion on the state of the office market (bullets below) by the panel.

Panel Members:  Heath Chapman-CBRE; Hooker Manning-Kane; Mat Winters-JLL

State of the Office Market 

• Activity slowly coming back
• They are seeing larger groups touring the market for requirements in late 2021
• Office landlords are all doing well as there have been nominal defaults
• Tenants are able to do business remotely and have been paying rent while only occupying 10% or less of their space
• Any rent relief or deferral requests (few and far between and all at the outset of the lockdown) went away after tenants were asked to provide how the pandemic was impacting their business (nominal impact other than the overall economic slowdown)
• There is a large amount of sublease space hitting the market
• Tenants are trying to determine post pandemic space needs
  • Do they need less space as they have more remote workers?
  • Do they need more space to increase social distancing (and decrease density)?
• Rental Rates have not been negatively impacted; however landlord concessions have increased (in the form of abatement and higher TI allowances)
• Both Heath and Hooker expect a quick recovery once a vaccine has been widely distributed.

One panel member with the Raleigh Chamber shared the attached study done by the Raleigh Chamber and the Wake County Economic Development team.  Overarching message: “The Raleigh metro is the best performing metro in the U.S. and continues to remain one of the top places for business and careers…”

Here are a few of our favorite accolades from the report:

#3 BEST PLACE IN AMERICA TO START A BUSINESS
RALEIGH, NC | INC | 2018

#6 MOST INCLUSIVE METRO IN THE U.S.
RALEIGH, NC | BROOKINGS INSTITUTE | 2019

TOP 10 GLOBAL HUB FOR LIFE SCIENCE INNOVATION
HICKORY & ASSOCIATES | APRIL 2019

#1 STATE FOR WOMEN IN TECH
NORTH CAROLINA | NC TECH | 2019

#3 BEST QUALITY OF LIFE IN THE WORLD
RALEIGH, NC | NUMBEO.COM | 2019

In 1963, the town of Fuquay Springs, site of a hot springs renowned in the region, joined the neighboring community of Varina, crossroads of two timber rail lines. Thus, Fuquay-Varina was born and has become one of Southern Wake County’s fastest growing towns.

According to the US Census, the town has grown 68.3% from April 2010 to July 2019, with no slowing in sight. The estimated current population is more than 33,000 residents, with some 2,000+ housing units actively under construction and many more planned. The construction of the southern loop of 540 will continue to accelerate Fuquay-Varina’s growth and developers have taken notice. Several new major mixed-use developments, including Bengal Town Center and Bellchase, have recently been announced and will add 1,000,000+ SF of office and retail along with hundreds of residential units.

Boasting two charming historic downtowns, Fuquay-Varina retains a small Southern town feeling. However, its adjacency to Research Triangle Park and Raleigh with access to high-paying jobs and Wake County’s excellent school system, Fuquay-Varina is well poised for major growth.

From Our Friends at Jordan Price Law Firm:

While none of us has a crystal ball, some public statements this week from NCDHHS lead us to anticipate that pools will be allowed to open during Phase II of NC’s reopening, and the conditions are yet to be defined.  The link here to the just-published CDC guidance for operating HOA pools this summer is a great tool for HOA managers and boards to start thinking about pool operations, as North Carolina is likely to require compliance with CDC guidance in this area.

We know many of you are apprehensive about how to comply with rules that seem so far afield from what you are set up to do at your community pool.  We want to emphasize that the key to compliance is reasonableness.  The policy goal for changing pool rules and methods of operation is not strictly to abide by a state mandate – the overarching goal is to prevent the spread of the disease.  Keeping that in mind and recognizing that there are certainly limitations to the ability to enforce every guideline in every situation is a reasonable and justifiable approach.

We fully anticipate situations arising this summer where owners who are fearful of community spread of COVID-19 will call the police or health department to report violations of social distancing and gathering limitation rules at the pool or other common areas.  We believe we will be able to work through those issues with the health department and avoid shut downs if the board has a reasonable plan in place for enforcement.  By reasonable, we definitely are not recommending physical confrontations to enforce social distancing or a physical confrontation to force someone to leave the pool.  But the HOA does have reasonable enforcement tools in its arsenal for levying fines and revoking pool privileges after due process.  Those enforcement tools will only be available if you adopt specific rules that owners are expected to follow at the pool – and those are going to be different than the rules you used last summer.  By demonstrating to the local health department that the HOA board (1) has adopted appropriate rules; (2) is tracking noncompliance with periodic drive-bys or acting on owner complaints with evidence as to owners are recklessly disregarding the rules; and (3) is acting to impose consequences for violations, we would hope to work cooperatively with the health department to avoid a shut down in the event they do receive reports of gathering limitation or social distancing violations.

We have attached some suggested disclaimer language for posting signage at the pool entrance and entrances to pool restrooms.  We would also recommend posting safety signs at the facility such as those referenced in the CDC link above.  Including this language in your rules addendum for this summer and on any correspondence you send (by mail or digitally) is also recommended.  If you plan on using sign-up genius or another online reservation system for designated times that members can reserve their spot at the pool, adding this disclaimer language to the registration link would be ideal.  While we have been asked by a number of clients whether they should have every owner using the pool sign a waiver, the disclaimer language posted prominently as we have described is a much more logistically feasible solution, allowing managers and pool personnel to focus on other aspects of pool safety rather than chasing down and tracking those individually signed forms.  Operating a pool always imposes some liability, but we believe posting this signage is a good step toward providing some liability protection.

We have spent a lot of time in our office thinking through possible scenarios posed by managers, board members and pool professionals, as well as ideas we have researched from across the country.  Ultimately, we find it is difficult to create pool rules which are one size fits all, and we certainly would want you to tailor your rules to the guidance that comes out with any new Executive Order or a more restrictive county or municipal order.  We encourage each of your communities to have a “2020 Pool Rules Addendum” reviewed by legal counsel, published to the entire membership, and displayed prominently at the facility prior to opening of any pool.

With a booming housing market, York’s Association Management team has been busy advising developers on drafting strong, realistic HOA budgets.

You might notice that there are actually 6 takeaways below.  No one says “top 6” though….so we went with 5 and you can consider that last one a bonus!

• Get Multiple Vendor Estimates. Increasing labor and material costs mean higher prices for everything from landscaping to pressure washing, maintenance and more.  Make sure to get several estimates and carefully consider the level of service your development will need.  Working with a management company like York can allow you to save on items such as insurance or waste removal by using their bulk purchasing discounts.
• Set the Assessment to Cover Operating Expenses: It’s very common for new developments to set the assessment at a low rate with the developer funding expense shortfalls while building is ongoing. While the low rate is attractive to new buyers, it will eventually mean a large increase in the operating budget. As you can imagine, increased assessments mean unhappy homeowners, particularly if the increase is substantially higher than the original amount listed in the initial public offering.
• Fund the Reserve Account:  Funding the Reserve Account for future expenses in the first and future budgets helps buyers recognize that the association is in good financial standing. We recommend a minimum reserve fund transfer annually equal 10% of the projected assessments, thereby protecting you and the homeowners from underfunded future capital expenses.
• Don’t defer Maintenance. Don’t try to keep your homeowner fees low by deferring maintenance.  We recommend routine maintenance inspections are scheduled for your roofs, gutters, common area mechanical systems, lighting, fencing, parking and building exteriors.   In fact, most warranties require some type of inspection to keep the warranty validate.
• Expect the unexpected. Even though your development will be new, unforeseen issues will arise. Try to anticipate what might need attention within the first years.  In our experience, new developments generally have issues arise around landscaping and pond maintenance Weather related issues that do not warrant an insurance claim can also add up.
• Engage an association attorney to review your documents and budgets. Association Management attorneys are worth every penny to ensure you don’t overlook any items specific to your development.