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.
HOME SHOW THIS WEEKEND - The Southern Arizona Home Builders Association (SAHBA) presents its 2017 Spring Home & Patio Show this Friday-Sunday at the Tucson Convention Center (TCC). You'll find the latest in home improvement trends, remodeling ideas, and outdoor living. Be sure to visit Tucson Water's booth in aisle 1200 for water information, giveaways, and more. Parking will be free at the TCC each day of the event, which runs from 10 a.m.-6 p.m. Friday and Saturday, and 10 a.m.-5 p.m. Sunday. You can find a $2 discount admission coupon online at the link below. Children 12 and under get in free.
Pima County, PAG, and Metropolitan Pima Alliance launch web-based economic development aid – In the highly competitive world of economic development, sometimes speed can make the difference between landing a prospect or being passed over. Companies looking to relocate or expand, or the site selectors representing them, need to know what a community has to offer. The size of available parcels, zoning, utilities that serve (or can serve) a site and nearby transportation networks are some of the first things a company needs to know. In an effort to rapidly and seamlessly provide this and much more vital data to expansion and relocation prospects, Pima County and our regional partners have developed PimaParcels.com, a web-based map that compiles all the information in one place using the vast wealth of information included in the county’s GIS system. The Pima Parcels map pulls in publically available information from Pima County’s GIS system as well as information from other public sources to provide a one-stop resource. The result is a visual representation publicly and privately owned parcels 100-acres in size and larger. Users can zoom in for greater detail on each parcel, including address, size and ownership. The site also can generate reports on the individual parcels for greater detail. The site is a collaboration of Pima County, the Metropolitan Pima Alliance, Pima Association of Governments and its member jurisdictions, Sun Corridor Inc., and several utilities, including Tucson Water, TEP and Trico.
McLane Company to Open 600 New Burger Kings - McLane Company, Inc., a leading supply chain services company providing grocery and foodservice supply chain solutions, today announced an expanded agreement between McLane Foodservice Inc., and Burger King. Under the new agreement, McLane Foodservice, Inc., will provide support to an additional 600 Burger King restaurants located in Tennessee, Georgia, Florida, and Alabama. This addition brings the total number of Burger King stores McLane services to 2,467 locations from eight distribution centers across the U.S. Since 2000, Burger King has counted on McLane Foodservice as its primary distributor. The extended relationship ensures the restaurant chain will continue receiving McLane’s dependable service offerings and support as the business grows. “In the highly competitive [quick-service] industry, Burger King continues to up its game in terms of menu offerings and the locations served,” says president of McLane Foodservice, Inc. Tom Zatina. “We are honored the company has entrusted us with their foodservice supply chain needs over time and we look forward to further contributing to their success.” (QSR)
McDonald’s Announces Senior Leadership Changes -- McDonald’s USA announced the appointment of three new senior leaders: Morgan Flatley as U.S. Chief Marketing Officer; Farhan Siddiqi as Head of U.S. Digital; and Linda VanGosen as new Head of U.S. Menu. All will begin their new roles this month. (QSR)
McDonald's Next Big Change: Fresh Beef Quarter Pounders -- The word “change” has surrounded McDonald’s lately. From mobile ordering to increased delivery, the fast food leader has promised significant innovations in the coming months. On Thursday, it delivered another “part of a continuing food journey.” By mid-2018, all Quarter Pounder burgers at the majority of McDonald’s U.S. restaurants will be made with fresh beef, prepared to order. (QSR)
Panera Bread Sold for $7.5 Billion to Krispy Kreme Owner -- It didn’t take long for the Panera Bread rumors to turn into reality. After a hectic day of trading Monday, where talks of a potential sale skyrocketed shares, JAB Holding announced Wednesday morning that it agreed to buy the brand for $7.5 billion in cash. Following the close of the transaction, Panera will be privately held and continue to be operated independently by the company’s management team, including CEO and founder Ron Shaich. The deal, if completed, would be the second largest in the history of the restaurant industry. Only Tim Hortons August 2014 sale to 3G Capital Partners LP, Burger King Worldwide Inc. for $12.64 billion would be higher. (QSR)
Karma Automotive Buys Former Kawasaki USA Headquarters in Irvine CA for $56.2M — Karma Automotive has purchased the 262,463-square-foot Kawasaki USA headquarters in Irvine for $56.2 million. The facility is located at 9950 Jeronimo Road. The luxury hybrid plug-in vehicle manufacturer had previously leased the facility in August 2016. The company plans to add a Branded Experience Center for its new Revero luxury sedan and employee amenities to the facility. Kevin Leonard of Heathwest Realty represented Karma Automotive. CBRE’s Gregg Haly and Jeff Carr represented the seller, Bixby Land Co., in this transaction.
American Bank Building in Portland OR Trades for $53M — ScanlanKemperBard Cos. (SKB) has sold the historic American Bank Building in Portland’s central business district for $53 million. The 15-story creative office building is located at 621 S.W. Morrison St. The American Bank Building was built in 1914.The property was 61 percent leased to tenants like Wells Fargo and The Department of Justice. HFF’s Nick Kucha represented SKB in the transaction. The firm also recapitalized the property with Lionstone Investments, arranging a four-year, floating-rate loan through CIT Bank for the new partnership. The amount of the financing was not disclosed.
New realities make teammates of hoteliers, home-sharers -- Rivalry is making room for collaboration between the home-sharing business and traditional hotel and travel industries. Acquisitions and partnerships are emerging as both camps adapt to a changing landscape. (JLL Real Views)
Northbound Alvernon Way / Golf Links Road Overhead sign replacement - On Saturday, April 8, 2017, beginning at 3 a.m., travel lane restrictions will be in place on northbound Alvernon Way/Golf Links Road to allow crews from the City of Tucson Department of Transportation (TDOT) Streets and Traffic Maintenance Division to remove and replace overhead directional signage. The work is scheduled to be complete in about 10 hours. At least one lane of travel will remain open during the work. The traveling public can expect delays when driving in this work zone. Please obey all traffic control signs and watch for work crews in the area.
Ryan Says Tax Reform Could Take Longer Than Healthcare Overhaul “House Speaker Paul Ryan said on Wednesday that tax reform will take longer to accomplish than repealing and replacing Obamacare would, saying Congress and the White House were initially closer to an agreement on healthcare legislation than on tax policy. ‘The House has a (tax reform) plan but the Senate doesn't quite have one yet. They're working on one.’” (Reuters)
Are Real Estate Investors and Developers No Longer Buying? “For the last several days I’ve been speaking at an investment conference organized by my friends Robert Helms and Russell Gray. It’s been great so far, and my fellow speakers here include the legendary Robert Kiyosaki, G. Edward Griffin, Peter Schiff, and many more. One of the key themes so far in the event is that there are likely problems ahead for the US real estate market. On the first day I had a great conversation with the Chief Economist of Fannie Mae, who was also speaking at the conference. I asked him point blank– what do you think of US housing right now? He answered succinctly: ‘It’s overpriced.’” (ValueWalk)
Walgreens CEO ‘Still Optimistic’ FTC Will Clear Rite Aid Deal “Walgreens Boots Alliance CEO Stefano Pessina said Wednesday he was “still optimistic” the company would be successful completing its acquisition of Rite Aid, which sits before regulators at the Federal Trade Commission waiting for approval. ‘I’m still positive on this deal,’ Pessina told Wall Street analysts Wednesday morning on the company’s second-quarter earnings call. ‘I believe we have a strong argument to defend this deal.’” (Forbes)
More Retail Closures Add to Gloomy Outlook for Malls “A fresh round of distress signals sounded in the retail industry this week, as another big-name chain announced hundreds of new store closings and still others moved aggressively to recalibrate their businesses for the online shopping stampede. Payless ShoeSource filed for Chapter 11 bankruptcy and outlined plans to immediately close nearly 400 of its 4,400 stores globally. Ralph Lauren is shuttering its flagship Polo store, a foot-traffic magnet located on tony 5th Avenue in Manhattan, the latest step in a massive cost-cutting effort.” (The Washington Post)
Interest Rates Are Rising Again. Here’s How It Affects Commercial Real Estate “With the Federal Reserve raising its benchmark short-term interest rate in March for the third time since December 2015 and two more rate hikes expected by the end of 2017, interest rates are becoming an increasingly relevant factor in analyzing the near-term future of U.S. commercial real estate. Higher interest rates make borrowing more expensive for owners, which can have a constraining effect on the commercial real estate market. All else being equal, cap rates will go up and property prices will come down.” (Forbes)
The 8 States Suffering the Most from the Affordable Housing Crisis “While there is a nationwide shortage of affordable housing, some states are worse off than others. That's a reality reflected in a new report by the National Low Income Housing Coalition, which analyzed the availability of affordable housing in every state. The report defines an affordable housing deficit as when ELI households must spend more than 30% of their incomes on rent and utilities. Eight states have fewer than 30 affordable homes available per 100 households in extreme poverty, according to the report.” (Business Insider)
Hudson’s Bay Considering Acquisitions During Cost Cutting Plan “Toronto-based retailer Hudson's Bay is said to be considering more acquisitions, even as it undertakes an aggressive cost cutting plan. The company, which owns Hudson's Bay, Saks Fifth Avenue and Germany's Kaufhof, "is very focused on our core operations," executive chairman Richard Baker said, the Financial Post reports. The company's cost cutting efforts follow disappointing fourth quarter earnings results.” (The Street)
The 50 Most Important Figures of Commercial Real Estate Finance “Was it a sweet ‘16? Only for some of the industry’s powerhouses. Most banks saw a decrease in lending activity last year, as did some of the larger institutional private funds. It was, undoubtedly, the year of the alternative lenders, who filled the construction and transitional debt void nicely, upping their originations significantly on the way. Life companies didn’t fall far behind and, in several cases, outperformed their 2015 figures. That said, we added a few private lenders to our rankings.” (Commercial Observer)
Cooling U.S. Tech Sector Office Demand Having National Impact in 2017 “According to Cushman & Wakefield, commercial tenant demand for U.S. office space continued to cool off in the first quarter of 2017. Occupancy levels remained stable, though, and rents continued to rise in most markets. First quarter net absorption (the change in occupied space) totaled 6.8 million square feet (msf), down 39% from levels observed in the same quarter one year ago and the smallest amount of space absorbed in just under five years. While slower, the record streak of positive absorption continues.” (World Property Journal)
Hines, Oaktree Sell 2 Buildings in Utah’s Silicon Slopes “A joint venture between Oaktree Capital Management and Hines recently sold South Towne Corporate Center in southern Salt Lake City to a partnership between EverWest Real Estate Partners and Independencia Asset Management. NGKF Capital Markets’ President of West Coast Capital Markets Kevin Shannon, Executive Managing Director Ken White, Managing Director Rick Stumm and Eli Mills with CBRE represented the sellers of the two-building, Class A asset totaling 262,219 square feet.” (Commercial Property Executive)