Real Estate Daily News Buzz is designed to give news snippets to readers that our (yet to be award winning) editors thought you could use to start your day. They come from various business perspectives, real estate, government, the Fed, local news, and the stock markets to save you time. Here you will find the headlines and what the news buzz of the day will be.
Friday, the Dow Jones industrial average lost 390.97 points, or 2.4%, to 15,988.08. The S&P 500 index slid 41.51 points, or 2.2%, to 1,880.33. The NASDAQ composite fell 126.59 points, or 2.7%, to 4,488.42.
Benchmark U.S. crude fell $1.78, or 5.7%, to $29.42 a barrel in New York. Brent crude, a benchmark for international oils, fell $1.94, or 6.3%, to $28.94 a barrel in London. In other energy trading, wholesale gasoline fell 5 cents to close at $1.02 a gallon, heating oil fell 5 cents to close at 93 cents a gallon, and natural gas fell 4 cents to close at $2.10 per one thousand cubic feet.
Never before has Wall Street gotten off to a worse start to a year --The stock market capped the first two weeks of 2016 with a steep slide Friday that sent the Dow Jones industrial average down nearly 400 points. All three major stock indexes — the Dow, the Nasdaq composite index and the Standard & Poor’s 500 — are now in what’s known as a correction, or a drop of 10 per cent or more from their recent peaks. The market has been on a stomach-churning ride since the start of the year, wrenched up — but mostly down — because of alarm over a slowdown in China and the plunging price of oil.
Walmart to shutter 269 stores, 154 of them in the US — Wal-Mart is doing some rare pruning. The world’s largest retailer is closing 269 stores, including 154 in the U.S. The other big chunk is in its challenging Brazilian market. The stores being shuttered account for a fraction of the company’s 11,000 stores worldwide and less than 1 per cent of its global revenue. Wal-Mart Stores Inc. said the store closures will affect 16,000 workers, 10,000 of them in the U.S. It has a global workforce of 2.2 million. Click here for © 2016 CBS Interactive Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report. Click here for complete list of Walmart stores closings, none are in Arizona https://www.cbsnews.com/news/walmart-to-shutter-269-stores/
America’s Next Boom Towns “Which cities have the best chance to prosper in the coming decade? The question is a complex one, and as the economy changes, so, too, will the best-positioned cities. To identify the cities most likely to boom over the next 10 years, we took the 53 largest metropolitan statistical areas in the country (those with populations exceeding 1 million) and ranked them based on eight metrics indicative of past, present and future vitality.” (Forbes)
GE’s Move Raises Questions about Fairfield, Conn. Campus “General Electric Co.’s announcement this week that it will be moving its headquarters to Boston has raised concerns about the future of the Fairfield, Conn., campus that it will be leaving. GE has said it intends to sell the property, which spans more than 60 acres. While Connecticut Gov. Dannel Malloy said the company has received offers, a company spokeswoman declined to specify whether there were potential buyers.” (Wall Street Journal)
Activist Jonathan Litt’s Real Estate Picks “Litt likes to write and talk about his stock picks, which makes it easy to track what he's doing. Rather than conduct closed-door meetings with management, Litt sends (and makes public) letters that outline the problems he sees and how he recommends fixing them. These ‘fixes’ often involve an outright sale of the company, which can lead to nice profits for investors who glam on to investment moves. I went through Litt's portfolio recently and found a few gems worth considering.” (The Street)
Department Stores Have a Big Problem: Stores Filled with Apparel “Disruptions in the retail eco-system call for department stores to rethink how they work with vendors and consider reducing the massive amount of space they devote to clothing, Oliver Chen, retail analyst with Cowen & Co., told Forbes. ‘The market has changed.’ Today, department stores lack sufficiently differentiated, compelling merchandise to consistently resonate with consumers, including those younger, coveted Millennials.” (Forbes)
Taking a Closer Look “TruAmerica Multifamily’s Bob Hart took an important lesson from the 2008–2009 recession that he’s beginning to apply in this frothy market. ‘The lesson is, ‘Don’t buy on pro forma only,’’ Hart says. Hart says TruAmerica underwrites ‘fairly conservatively,’ looking at growth rates of 3% to 4% for primarily Class B buys.” (Multifamily Executive)
City Moving Ahead with Plan to Seize Coney Island Property “The city is moving ahead with plans to seize 75,000 square feet of Coney Island beachfront property after a public review found it would help spur stalled economic development there. The land that would be grabbed through eminent domain includes a long-neglected 60,000-square-foot tract that once housed the original Thunderbolt roller coaster immortalized in Woody Allen’s 1977 film ‘Annie Hall.’” (New York Post)
Federal Agent Says Iraqi Refugee Wanted to Bomb Texas Malls “An Iraqi refugee who is facing charges that he tried to help the Islamic State group wanted to set off bombs at two Houston malls and was learning how to make electronic transmitters that could be used to detonate explosive devices, a federal agent has testified. Omar Faraj Saeed Al Hardan, who came to Houston from Iraq in 2009, was indicted last week on three charges, including attempting to provide support to a designated terrorist organization.” (Associated Press)
One Housing Maverick’s Plan for Investors to Tap Homeowner Equity “Eight years after the bubble burst, leaving foreclosed homes, dented equity, and failed financial institutions in its wake, one housing expert is pursuing a radical new approach to financing. Allan Weiss, who helped create the closely-watched S&P/Case-Shiller home price index, has a new idea based on a long-held belief that Americans are dangerously exposed to real estate as an investment. Weiss has created a platform that will allow homeowners to tap the equity in their homes.” (MarketWatch)
Goldman Taking $1.5B Hit on Q4 Earnings to Settle Mortgage-Bond Case “Goldman Sachs said Thursday that its fourth-quarter earnings will take a roughly $1.5 billion hit as it has reached an agreement in principle to resolve an investigation related to its ‘securitization, underwriting and sale of residential mortgage-backed securities from 2005 to 2007.’” (CNBC)
Holiday sales report shows challenge for 2016 — Holiday shoppers did not make retailers merry during this critical season — overall sales in November and December were disappointing. Sales rose 3% to about $626.14 billion, according to The National Retail Federation. That’s below the forecast for a 3.7% gain the group had expected. The group blamed the shortfall on unusually warm weather that led to discounts on cold-weather items. It also pointed out that stores don’t have the ability to raise prices in a still tough spending environment.