Datacenter asset sales down in 2023; National HealthCare buying 14 facilities

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The number of datacenter asset sales in North America dropped 33% year over year in 2023 as investors stayed on the sidelines amid rising interest rates and lending volatility, CBRE said in a report.

The value of North American datacenters traded in 2023 totaled $4.8 billion, up 29% year over year, on the back of a number of transactions from a few real estate investment trusts to fund development pipelines, CBRE said in its 2024 Global Data Center Investor Intentions Survey.

"Data center fundamentals remain strong, with record tenant demand, historically low supply and continued positive rental growth," the real estate services company said.

CBRE expects stronger capital markets activity in 2024 due to strong development pipelines, a more stable lending environment and heightened investor interest.

CHART OF THE WEEK: US REITs' at-the-market program proceeds in Q1 up YOY

⮞ US equity real estate investment trusts raised a total of $4.07 billion through at-the-market programs in the first quarter, up 31% year over year.

⮞ Welltower raised the most capital during the quarter, selling $2.43 billion in shares.

⮞ Healthcare REITS raised the most proceeds among the property sectors, at $2.82 billion in aggregate.

Property lane

– A National HealthCare Corp. unit agreed to acquire 14 skilled nursing facilities from White Oak Management Inc. and its affiliated entities for $221.4 million. The agreement also includes a lease assignment for one skilled nursing facility and the purchase of a pharmacy. The deal is expected to close in the third quarter of 2024 and is subject to closing conditions.

– Federal Realty Investment Trust acquired Virginia Gateway, a 110-acre retail center at Linton Hall Rd. in Gainesville, Va., for $215 million. The property comprises 665,000 square feet.

– Hoffman Flagler LLC is selling an office building complex in Miami for $182 million, the South Florida Business Journal reported. The six-story Current property spans 625,000 square feet.

US hotel performance

US hotel performance was up across three key metrics during the week ended June 1, STR reported, citing data from CoStar, which provides information and analytics on property markets.

Revenue per available room (RevPAR) was $93.50, up 1.0% from the comparable week in 2023. Average daily rate (ADR) rose 0.1% to $150.87 and occupancy improved 0.9% to 62.0%.

Among the top 25 markets, New Orleans took the top spot for occupancy, while Las Vegas reported the highest year-over-year increases in ADR. Dallas reported the highest jump in RevPAR and took the second-highest spot in ADR.

Browse key people moves in North American real estate.

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