Founded 7 years ago, Bay Property Group has been providing exceptional real estate, property management and legal service throughout the Bay Area. Daniel Bornstein, Broker for Bay Property Group, said the new office space was necessary due to Bay Property Group’s explosive growth. “We have more than doubled in size and scope in the last 30 months.”

“With Bay Property Group’s relocation, we are making an investment into the continued emergence of this part of Oakland. With the massive Kaiser Permanente hospital development almost complete, MacArthur BART Transit Village in the initial phase of construction and Bay Property Group’s presence, the area is poised to attract further investment and attention,” Bornstein said.

The 6400-square-foot building will provide the home for Bay Property Group’s continued expansion throughout the Bay Area. The new location provides Bay Property Group the opportunity to offer workshops to the community. In addition, Bay Property Group anticipates inviting community groups to access meeting rooms should the need arise. The company’s goal will be to ensure that any individual or entity seeking property investment guidance can rely on Bay Property Group to handle all aspects of the real estate cycle including purchasing, management, legal, strategic planning, post-sale and exchange.

“We are thrilled to become a part of this vibrant Oakland community and we embrace the opportunity to serve Bay Area residents and promote growth,” Bornstein said. “With this 6400-square-foot building inhabited by Bay Property Group, we will be part of the evolution of this area for decades to come.”

About Bay Property Group

Bay Property Group is the Bay Area’s premier commercial real estate, professional property management and residential leasing company. Bay Property Group’s mission is to develop lasting relationships built on trust and integrity, and to help clients gain wealth through real estate. Bay Property Group’s well-trained, professional staff strives to provide the highest level of service, with the goal of exceeding its client’s expectations. With three convenient office locations, Bay Property Group serves the entire Bay Area, including San Francisco, Oakland, Berkeley, Alameda, Fremont, Newark, Union City, South Bay and beyond.

Contact: Daniel Bornstein, Bay Property Group Managing Broker (510) 836-0110 Daniel@baypropertygroup.com http://baypropertygroup.com/

SOURCE Bay Property Group

Article source: http://www.heraldonline.com/2013/05/28/4897489/bay-property-groups-explosive.html

One real estate sector is still booming; is it about to bust?

^{A version of this article originally appeared on our US site, Fool.com.}

Real estate. They’re not making any more of it. Demand is only increasing. Those arguments helped fuel an epic real estate boom and bust over the past decade — except when it comes to Internet data centres, which have continued to boom on explosive growth in cloud computing. They haven’t been able make those fast enough. But that may be changing, too.

A warning shot over the bow

On its recent earnings call, Akamai (NASDAQ: AKAM.US) was asked about co-location price trends in Internet data centres. Here’s what the company had to say:

… it’s like a real estate market. There are some places where our prices are holding. There are other places where there are very aggressive price declines, and we try to take advantage of that gain in terms of how we deploy our network assets. … The other lever we have on co-location costs, of course, is to make our servers more efficient and get effectively more throughput for our footprint in the co-lo facility.

Based on Akamai’s comments, co-location supply is still constrained in some markets. In others, it’s starting to meet demand. That brings to mind a classic real estate maxim: location, location, location.

Economics 101 teaches us that supply and demand affect pricing. When supply is constrained, prices rise. Internet data centres have been benefiting from that situation. But high prices attract more supply, and eventually supply will catch up with demand. When that happens, prices — and profits — are destined to fall. And that’s starting to happen. What’s more, increasingly efficient IT equipment can offset much of the growing demand for more processing, bandwidth, and storage. What’s good for Akamai can be the opposite for co-location and hosting companies.

Growing up

One factor affecting demand is companies that are shifting from the consumer equivalent of renting to buying their own home. Much like a young adult moving out of Mom and Dad’s place for the first time, companies moving onto the cloud often rent a temporary meets-my-needs-for-now space with no intention of a long-term commitment. As the companies mature, gain a better understanding of their needs, and gather cloud assets, they often began building their own data centres.

Generally, it’s the largest, most attractive tenants that make that shift. Recent examples include Apple (NASDAQ: AAPL.US) and Facebook. They’re following the example of Google (NASDAQ: GOOG.US), which has built its own data centres for some time. As the horde of young companies pursuing cloud strategies gain scale and mature, many more are likely to follow in Google’s, Apple’s and Facebook’s footsteps.

Other tenants are likely to go bust. From a co-location landlord’s perspective, that’s the corporate equivalent of having a tenant lose his or her job and move back in with Mom and Dad. Too much of that, and rental rates take a hit.

Build it and they will come?

Many data-centre developers are doing the equivalent of building on speculation that there will be a tenant. To wit, the CEO of Equinix, a large data-centre operator, has acknowledged that overbuilding is a “main concern.” 

Equinix invests heavily in the IT infrastructure used to serve its clients. Given the rapid depreciation on IT equipment, pricing pressure could make Equinix’s capital expenditures less profitable than anticipated. Pricing pressure is potentially a huge risk for the company.

Say when

When might co-location and hosting supply catch up with demand? Tier1 Research estimates that data-centre utilization in key markets is currently running between 81% (Northern Virginia) and 88% (Silicon Valley). That’s less than I’d expect in an exceptionally tight market.

And it’s a fast-moving market. In the San Francisco Bay area, which includes the Silicon Valley, rental rates for large tenants have reportedly declined 20% over the past 18 months thanks to new supply that’s coming online. A fresh surge of supply is expected in the area before year’s end. In the coming two quarters, data-centre landlord CoreSite Realty predicts that the new supply will outpace demand by as much as 50%.

A recipe for getting burned

With the sector viewed as a cloud play, valuations are sky-high. P/E ratios typically exceed EPS growth rates — that is, when EPS is positive. Over the last four quarters, CoreSite’s EPS was -$0.31 while Internap’s was -$0.10.

The trouble is, supply will catch up with demand sooner or later… and it looks like it might be sooner. When that happens, prices, profits, and P/E ratios are likely to plummet. A UBS analyst stated last December that data-centre developers were grappling with slowing growth, rising competition, and pricing pressure that made their valuations “unsustainably high.”

Foolish takeaway 

When prices sneeze, revenues catch a cold and profits catch pneumonia. Akamai’s comment about pricing trends in co-location centres signals that it may be time for investors to break out the handkerchiefs.

More on US shares:

• Where Should You Invest? This Indicator Will Tell You
• This Oil Stock Has Incredible Opportunities
• A Tale Of 2 Silicon Valleys

The Motley Fool owns shares in Google.

Article source: http://www.fool.co.uk/news/investing/2011/08/01/the-coming-digital-real-estate-bust.aspx