Looking at the "big picture," Deveraux, who has sold $650 million in investment properties during the past decade, notes that office owners are not bringing the product to market.
At the same time, investor focus is capital preservation and security. To that end, investors like office buildings with small-tenant diversification or credit-preferred tenants.
If you have 30 tenants in a building, he notes, and if one 1,500-square-foot tenant goes under, it won't materially hurt the building, unlike a 50,000-sf "dot.bomb" that could devastate a building's cash flow.
Deveraux also notes that capital is waiting for "value-added" opportunities, which he says could materialize later this year.
Indeed, "value-added" office buildings are in the "buy box," along with newly constructed offices with creditworthy tenants or limited rollover.
High-cube industrial and low office finish flex buildings are also hot properties, as well as grocery anchored retail, Deveraux says.
What's not in the buy box?
Investors are not interested in flex space with high-office finish; older product with deferred maintenance; properties with quick lease rollover; and properties with credit concerns, he says.
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