Question for the group. Can you turn a Small Bay Flex condo sale into a defensible lease comp? Here’s the problem: In many markets, there are virtually no leasable flex units under 2,000 square feet. Not because there’s no demand. Because the product barely exists. Yet those same markets may have individually condoed flex units selling to owner-users. Can those sale prices be reverse-engineered into a credible market lease rate? For example, if 1,500-square-foot units are consistently selling for $300 per square foot, can you use prevailing financing costs, ownership expenses and a reasonable return on equity to determine what a tenant should be willing to pay? Or does owner-user pricing reflect tax benefits, control and scarcity that make the comparison unreliable? I’d especially like to hear from developers, brokers, appraisers and lenders who have dealt with this in the real world: How are you establishing lease rates when there are no true sub-2,000-square-foot lease comps?

I know there’s a lot of limitations with cold form (span restrictions, load limits) compared to red iron, but has anyone used it? We are developing in DFW so snow isn’t that much of an issue and we are targeting smaller unit sizes anyway. In all likelihood I wouldn’t go this route, but wanted to get other opinions.

Are you seeing an increase in distressed assets or foreclosures in your market? If so, what are the primary drivers? For example, are you seeing properties become distressed due to loan maturities, borrowers being unable to refinance, bridge the equity gap, or transactions no longer penciling at today's cost of capital compared to the financing environment of 2021 and 2022?

Other than small bay summit, anyone know of any other conferences both nationally and local (Philadelphia PA/NJ)?

If you need ideas on building or industrial park, we are always touring and showcasing great properties and highlighting what helps them thrive. Here is one Austin and I sold not long ago. This was a 19 building small bay industrial park with a mix of options from your basic efficient build to showroom quality units and to individual buildings with yard space. Because this area is growing so rapidly, the owner built this property to accommodate a wide range of tenant types.