The Livery-South Bend

Work on The Livery restaurant at Eddy St Commons in South Bend has begun.  The Livery will replace the previous restaurant, The Mark, near Notre Dame.  As you can see, demo of the previous improvements is well underway.

Cressy Commercial Website

Livery Website

Livery demo


Commercial Industrial Space Shortage

WR Photo

If you are one of the many business operators in the local manufacturing or distribution industry that has experienced the business growth over the past couple years and are in need of additional space for your operations, you are not alone.  The struggle now is find additional quality manufacturing or distribution properties for lease or for sale.  With the local St Joseph County industrial vacancy near all time lows of 4.6% and Elkhart County vacancy below 1%, industrial space is nearly non-existent.  The result is many companies are choosing to build new facilities either by adding on to existing or at a new location.

The shortage of industrial buildings has caused some developers to consider constructing speculative buildings in hopes that they will be able to quickly lease 80% of the construction.  While it would seem this would be a natural reaction and happen out of pure supply and demand, the pace at which speculative building has happened has be relatively slow.  The reason likely has to do with investors memories from 7-10 years ago and the great recession.  Around 2010 industrial availabilities were plentiful as buildings sat vacant and on the market for months or even years.  Today the overall national and local economy is still good, but there is much uncertainty in the economy due to a long sustained economic recovery, potential international trade tariffs, new tax structure and potential interest rate hikes.  Another reason for the slow growth of spec building is construction costs.  There has been tremendous construction activity in the past couple of years and costs of construction has increased significantly

If you are one of those business owners looking for expansion, there are still a few opportunities and lease rates for existing space have only crept up slightly while rates on new construction have risen more quickly.

The office of NAI Cressy Commercial Real Estate has the only complete database of all commercial properties in the region.  Find out more by checking out our 2018 Annual Report or using our website to search properties.

Cressy Annual Report

Cressy Property Search

Is Now the Time to Sell Your Business

2017 saw a record number of small businesses being sold. According to leading sales website,, 9,919 small businesses were reported sold in 2017, a 27% increase over2016 volumes.1 The increase in sales volume can be attributed to the steady improvement in the economy, sales growth and increasing profitability of small businesses. Since an owner’s cash flow is the primary determinant of value for a business sale, the increasing profit has brought more sellers to the s table and has allowed owners to get maximum value for their company.

2018 is expected to be catalyzed by the positive buying momentum from 2017, a strong economy and an increasing population of Baby Boomers looking to retire. Along with the volume of potential sellers come a large and strong pool of buyers. Interest rates continues to be low and buyers have an appetite for investing in businesses with potential for return on their investment.

If you do not have a succession plan in place, deciding to sell your business is a major but inevitable decision. There are several factors to consider prior to selling that will increase your value and increase the probability of a successful closing.

  1. Clean up financials. The largest factor in determining if your business sale will be successful is having an accurate and well-prepared set of financial statements. Buyers are essentially purchasing cash flow from your business and will spend significant time looking into the financials that are presented. Ensuring that the financials are accurate and stand up to the due diligence of the buyer and underwriters is worth the time of preparation. Any inaccuracies or inconsistencies will be red flags to buyers and reduce their confidence in the business. It is recommended that a business have a minimum of a three-year financial history along with tax and accountant verified documents.
  2. Increase your sales. A period of declining sales is not the time to sell your business. Too often sellers decide that during the time of worsening business, is the time to exit the business. Since buyers are looking for growth, this leads to a lower valuation of the business owners have invested years of their life in building. Small businesses typically sell at 2 to 6 times the value of the cash flow, so in advance of listing a business for sale, spend time and money in advertising to increase sales. The additional expense of advertising will be worth several times that in return after the sale.
  3. Find a business broker. A qualified business broker will confidentially generate a larger pool of buyers through a network of buyer contacts as well as listing services offered by the broker. A broker will help to determine the value of the business and assemble a package of financial and marketing materials as well as qualify buyers, coordinate due diligence efforts and help negotiate the sale in the interest of the seller. The structure of a sale can take various shapes and having someone familiar with different sale terms and structures can help bridge a gap between buyers and sellers.  While the broker will lead these efforts, it is important that the seller continues to market himself during the selling process.
  4. Prepare to stay on. In most cases, especially if your buyer is a private equity buyer, a buyer will request that the owner or key employee stay on with the business for a limited amount of time. While the seller may be looking to retire and move on, the buyer wants to have a smooth transition and will likely request management remain to train, introduce clients to buyer and potentially continue to run the business while the buyer becomes acclimated. This period can be anywhere from 3 months to 3 years depending upon the complexity of the business and the experience of the buyer.

1Source: Small business transactions reported on during 2017

Starbucks Heritage Square

Improvements for a new Starbucks have started within the west endcap suite of the former Doctor’s Express Suite at Heritage Square.  The expectation is for the cafe to open within the next 90 days.  The building faces the highly trafficked Cleveland Rd and the Starbucks suite will feature a drive-thru window.  There is already a Starbucks within the Martin’s Side Door Deli at Heritage Square, and that will remain in place.

One Michiana Square

The One Michiana Square building, located at 100 E Wayne St in downtown South Bend, came under new ownership in 2016.  The building was built in 1985 and had historic vacancy rates of 20-30%.  Now with ownership partners from Newmark Grubb Cressy & Everett and new tenant partners including Ladue Curran and Kuehn, the building is now 95% occupied and a true class A office building.  Renovations to the common areas and tenant spaces have given the interior a much needed updated modern feel.  The finished lobby is gorgeous and the office space within LCK’s space features collaborative working space, glass office walls and an open break area.  If you are in the area, step into the lobby and check out the work that has been done by Newmark Grubb Cressy & Everett.

LaSalle Hotel nearing completion

The LaSalle Hotel renovation project is noticeably nearing its completion.  The exterior ground and 2nd floor window trim is being scraped and painted, facade is being restored and on the inside, the apartments on the upper floors are now weeks away from completion.  In just over two weeks, the building owners will be accepting a historical preservation award for the building and the project at an exclusive event at the building.

There is definite excitement for the project as inquiries and leasing activity on the apartments has been steady all year.  The retail space on the ground floor still has opportunities for restaurant and bar.  Contact me for details.

Downtown South Bend Booming

Anyone that has visited or driven through downtown South Bend this year, has seen changes and witnessed massive commercial developments.  The Smart Streets project, which is converting the one-way streets into two-way streets with round-a-bouts and new sidewalks and landscaping, is impossible not to notice.  The redevelopment of the Chase Tower and JMS building into condos and the LaSalle Hotel and Amerigo renovations into apartments and commercial retail are also obvious improvements.  Recently the parking lot which will become a new Courtyard by Marriot hotel was also tore up.  All these developments are meant to bring much needed residents into the downtown area but in the meantime have made downtown a virtual construction site.

Has all the construction hurt business?  Local owners say no.  Mark McDonnell, owner of the LaSalle Grille, recently commented that despite the road detours business has been great.  James, the owner of Bruno’s Pizza downtown, stated the same experience in his store.  Recently I stopped in for lunch at the Chicory Cafe at the corner of Jefferson and Michigan St.  I arrived at 11:45 and within 30 minutes the line to order food was steadily 12 people deep.  The staff at Chicory handled the rush beautifully, the line moved quickly and food was brought out with little wait.  Outside the cafe, the streets were a bustle of people enjoying music and food on their lunch break.

On the most recent First Friday Event downtown, people of all ages and backgrounds filled the sidewalks and local restaurants and pubs. Musicians played played in cafes and on the plaza, merchants displayed their wares in windows and on sidewalks, and everywhere people enjoyed the sunshine and atmosphere.  In the evening hours, Latin music on the plaza drew party goers to dance on the plaza…yes even me.  While enjoying a craft beer at Brew Werks, I chatted with a young guy from Dowagiac making his first visit to South Bend.  He had been told that there was nothing going on in South Bend, but his first visit proved just the opposite.  As someone that has worked downtown for the past 13 years, I have to admit that I have been completely amazed by the change in the town.  The increased volume of people working, visiting downtown is amazing.  It’s easy not to notice subtle changes, but the life and quality of new businesses downtown and East Bank is truly quite amazing and sure to continue to grow.

If you haven’t visited downtown recently, get out and make the short trip.  If you have, share your experiences.

Ground breaking on Main St Mishawaka

Construction has finally begun at the site along Main St in Mishawaka adjacent to Lake City Bank and Meijer.  Plans for a multi-unit retail center were announced in early 2015, long enough ago that many may have forgot about the project.

The original announcement was for a 4 tenant retail building that would be anchored by Potbelly and Qdoba restaurants.  Both restaurants are new to our market, though the first Qdoba opened a few months ago at the Shoppes on 6 in Elkhart.  The owners of the property were unable to be reached to confirm both tenants or any other potential retailers.

Heavenly Goat-Heritage Square

A peak in the window on the construction of the latest craft brewer in the South Bend/Mishawaka area.  The Heavenly Goat Brewing Company will be opening in the former Gino’s Pizza in Heritage Square.  This will be an excellent location and a highly anticipated opening.  Good luck to Greg and Joel, we can’t wait!

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