TNP Yearly Leases Top $60M Mark

COSTA MESA, CA-Real estate advisory company TNP has completed more than 760,000 square feet of new and renewal leases for the year, valued at more than $60 million. The firm is set to dispose of more properties in 2014.

“We are pleased to report another strong year of leasing and driving asset value for our portfolio,” says Ronnie L. Miranda, SVP for TNP. “As we make our final push for 2013, we have already surpassed target leasing objectives and, as a result, have a number of properties now groomed and ready for disposition in 2014.”

Miranda tells GlobeSt.com that sometimes the firm is sweating out the last days of December in attempt to reach its leasing goals, but this year its goals were reached before the end of November. “This is the third year of meeting or beating projections. About two years ago, we started seeing things turn in a landlord-friendly way, and now many markets are in a landlord-favorable situation like we saw in 2004-2005. It's driven by the business climate being better, profitability is up—companies are back to expanding and growing—and also the dearth of development of properties over the last couple of years. Developers are now fighting to get back up and develop. Building permits are up. It's a sweet spot for landlords right now.”

The firm, which specializes in acquisitions for high-net-worth investors and their joint-venture partners, has a portfolio of largely suburban-office properties coast to coast. Miranda says this breed of investors is looking for quality tenants and properties in well-located areas. “Years ago, they were looking for added value and for things to turn around. Now, it's a flight to quality. They're looking for solid tenants in strong markets with long-term leases. In suburban-office markets, they're looking for strong economic drivers.”

In Houston, where Miranda is based, one of the biggest drivers is oil and gas, and some of TNP's portfolio is located in the oil and gas corridor, which is helping to boost leasing success in those markets. “Engineering and environmental firms, as well as medical, are strong in Texas. Investors, REITs and investment funds are looking for properties located in strong economic markets where those drivers are located.”

Miranda adds that being patient and not dropping lease rates until better days came also led to the firm's success. “Better days have come, and it's all driven by NOI. We have many properties groomed for profitable sale.”

As GlobeSt.com reported earlier this month, according to recent research from Jones Lang LaSalle, average asking rents vary quite noticeably in the greater suburban market in Sacramento. Folson, for example, has newer class-A product that is located in close proximity to Highway 50, whereas the class-B product is older with the typical three-story suburban-office space layout, says JLL research.