Investment activity among Skyline product has picked up steam recently. After a five year period (2007-2011) where no investment activity occurred, 40.0 percent of the Skyline has traded hands in the last three years. The most recent transactions include Regions Tower and Market Tower trading in 2014. These properties total more than 1.2 million square feet and sold for an average of approximately $98.00 per square foot.
Investors are scooping up these Skyline properties because they see a value-add opportunity in the near future. Downtown Indianapolis is undergoing a residential renaissance with more than 3,200 new condominium and apartment units under construction. Millennials are the driving force behind this development. As more workers take up residency within the downtown core, more companies are interested in locating there in order to attract these young professionals.
In fact, the Skyline recorded more than 300,000 square feet of leasing through either new lease, renewal or expansion activity. Similar to last year, the majority of this tenant activity came in the legal services and financial services sectors. However, we are starting to see increased activity in the burgeoning creative, media and tech sectors as well.
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