By Meagan Nichols – Editor-in-Chief, Albuquerque Business First
May 2, 2023
With two Uptown projects underway and the company’s first out-of-state development in the works, one of Allen Sigmon Real Estate Group’s principals said the current real estate cycle reminds him of a “Wild West movie.”
“Everyone's at the O.K. Corral, and on one side of the corral you have sellers and the other side of the corral you have buyers,” said Lance Sigmon. “Both parties are standing there staring at each other, waiting for the other one to blink. … When someone draws and starts firing, we may see some opportunities. But right now, this stalemate is in the market.”
That standoff, he said, is due to the increase in interest rates, which both buyers and sellers aren’t accustomed to after nearly two years of low rates.
Because of the current environment, Sigmon plans to wrap up the firm’s existing projects that are either under construction or planned and then “sit tight” to see what opportunities arise.
“We're sitting on a lot of capital,” he said. “We want to sit back and let the dust kind of settle on some of this uncertainty and then look for strategic opportunities to purchase some properties.”
Two of the projects they are working to complete are in Uptown.
One, located at 2442 Louisiana Blvd. NE, is a build-to-suit for a “large financial investment institution.” Sigmon said they aren’t yet allowed to disclose the tenant.
Sigmon and his team should be finished with their portion of that project within the next couple of weeks. They will then turn the property over for interior tenant improvements, which he estimated would take about three months.
Construction on the property started in Q4 of 2022 with Wilger Enterprises serving as the general contractor. Construction financing was provided by Bank of Albuquerque.
In addition to the unknown rate environment and ongoing labor shortage in the trades, Sigmon said the other big hurdle continues to be supply chain issues.
March 30 was when the financial building was supposed to be turned over, but nine months after placing an order, they are still waiting on a transformer to arrive. The HVAC, also delayed, should be delivered next week.
“Supply chain constraints are still hampering the development world,” he said.
The second Uptown build, located just behind the undisclosed tenant, will be a Marriott Element by Westin. The first Marriott Element in the state, Sigmon wants to deliver the hotel in the first quarter of 2024.
His partner and general contractor on the development is Prakash Sundaram of Total Management Systems. Southwest Capital Bank provided the financing.
A focal point of the hotel will be a rooftop bar on the seventh floor.
“It will have views of the mountains and the city, and we hope that’s a gathering destination for all kinds of people,” Sigmon said.
Allen Sigmon Real Estate Group is also gearing up to venture outside of the Land of Enchantment for the first time. The firm has plans in place for a 13-story AC Hotel by Marriott that will be in Denver’s RiNo District. Sundaram is part of that, as well.
If Denver is a success, Sigmon said they would be open to more out-of-state work in the future.
Originally reported on ABQ Biz First:https://www.bizjournals.com/albuquerque/news/2022/02/24/developers-break-ground-on-new-uptown-hotel.htmlAllen Sigmon Real Estate Group is a full-service commercial real estate company based in Albuquerque with expertise in acquisitions, brokerage, development, and property management. As a local company, we pride ourselves in our knowledge of the New Mexico commercial market and the relationships we are able to foster compared to larger national firms. Our office works with every kind of commercial property; including office, industrial, retail, land, and multifamily.Our understanding of client needs and concerns not only comes from our experience as an office but also as owners and investors of commercial property ourselves. We have an excellent team in place that is eager to work on your behalf; our results speak for themselves.