Real Estate Daily News Buzz June 3, 2016
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.
Thursday, the Dow Jones industrial average added 48.89 points, or 0.3 per cent, to 17,838.56. The S&P 500 index rose 5.93 points, or 0.3 per cent, to 2,105.26. The NASDAQ gained 19.11 points, or 0.4 per cent, to 4,971.36.
Benchmark U.S. crude oil rose 16 cents, or 0.3 per cent, to close at $49.17 a barrel in New York. Brent crude, which is used to price international oils, added 32 cents, or 0.6 per cent, to close at $50.04 a barrel in London. In other energy futures trading, natural gas rose 2 cents, or 1 per cent, to close at $2.405 per 1,000 cubic feet. Wholesale gasoline rose 2 cents, or 1.2 per cent, at $1.63 a gallon, and heating oil gained a penny to close at $1.51 a gallon.
Survey: US companies add a solid 173,000 jobs in May — U.S. businesses added 173,000 jobs last month, lifted by strong gains in services industries, according to a private survey. Payroll processor ADP said Thursday that construction firms also hired more workers, while manufacturers shed jobs. Large job gains occurred in retail, shipping, and utilities companies, as well as in professional services such as accounting and engineering. The figures nearly matched a gain of 166,000 in April. That suggests hiring has slowed a bit from an average of about 210,000 a month over the previous six months, according to ADP. Still, last month’s job gains, if sustained, are enough to lower the unemployment rate over time.
Applications for US unemployment benefits dipped last week — Fewer Americans applied for jobless aid last week, the third straight drop in a sign that the job market remains healthy despite a recent slowdown in hiring. Weekly applications for unemployment aid dipped 1,000 to a seasonally adjusted 267,000, the Labor Department said Thursday. The four-week average, a less volatile measure, fell to 276,750. Applications are a proxy for layoffs, so the decline in jobless aid suggests that companies are confident enough to hold onto their workers. When layoffs are low, hiring is usually steady.
Low-Cost Real Estate Financing for Small Businesses: SBA Brings Back 504 Refinancing Program in June “For small businesses with high-cost loans for office buildings, warehouses or other real estate, a new government program offers potential relief: The Small Business Administration’s will begin accepting applications for its 504 refinancing program on June 24. The SBA’s 504 loan program offers small business owners a way to access cheap capital for real estate and other major capital expenditures.” (Forbes)
The Richest Towns in Every State “Urban centers often have at their perimeters small towns with well-educated, wealthy residents. States without such large metropolitan areas tend to lag behind in income and education and as a result, tend to have less rich towns. 24/7 Wall St. reviewed household income levels in U.S. towns with populations under 25,000 people to determine the wealthiest town in each state. The richest town in the United States is Scarsdale, New York where the median annual household income is $241,453 — more than four times the median income nationwide.” (24/7WallSt.)
Construction Spending Plunges 1.8% in April “Construction spending tumbled in April, due in part to a decline in residential spending, the Commerce Department said Wednesday. The 1.8% decline was well below forecasts of a 0.7% gain from economists polled by MarketWatch. The monthly data followed an upward revision to March data of about 1.5%. Weakness in April was widespread. Residential construction declined 1.5%, while public construction spending fell 2.8%. Outlays for highways were down 6.6%.” (MarketWatch)
Manhattan’s Hotel Oversupply Threatens $731M in CMBS Loans: Morningstar “Manhattan hotel developers have overbuilt, and incomes at new and existing hotels are unlikely to hit industry projections, according to a new report from research firm Morningstar Credit Ratings. That could mean trouble ahead for some CMBS investors, as loans worth about $731 million, roughly a fifth of the $3.68 billion Manhattan hotel-backed CMBS market, see elevated default risk over the next two years, researchers found.” (The Real Deal)
From Decaying to Gleaming: Rapid Change for Hudson Yards’ Neighborhood “On Tuesday, the Hudson Yards megaproject officially opened on the Far West Side of Manhattan. Employees of Coach — “a leading New York design house of modern luxury accessories and lifestyle collections,” as it calls itself — began reporting to the company’s new headquarters in a 52-story tower, 10 Hudson Yards. The opening is a reminder that New York City can change in the span of a human lifetime.” (The New York Times)
This is America’s Richest Self-Made Woman in Real Estate “How do you become the richest self-made woman in American real estate? For Dorothy Herman, the path to success includes surviving childhood trauma and raising a daughter as a teenager. Nicknamed Dottie, she joins Forbes’ second annual richest self-made women list this year with an estimated $270 million net worth. It’s all thanks to the real estate brokerage empire she started building in the 1990s.” (Forbes)
Will Target Find its Identity with a Department Store Layout? “Target is running a test in 25 stores in the Los Angeles area, according to the Minneapolis Star Tribune. The test project, titled ‘LA25,’ consists of implementing 35 changes to each store’s look and feel. Some of the individual changes have already been tested in other stores, but the aim of the LA25 tests is to see how all 35 alterations function together within one location.” (Retail Wire)
Once a Den of Prostitution and Drugs, the Cecil Hotel in Downtown L.A. is Set to Undergo a $100-Million Renovation “The Cecil Hotel in downtown Los Angeles is set to undergo a $100-million renovation by a New York City developer, which aims to transform the former den of prostitution and drugs into a hip boutique hotel and micro rental units. The plan for the hotel is yet another example of the development boom sweeping downtown, where old buildings are being revamped and new hotel and condo towers erected.” (Los Angeles Times)
This California Developer is Paying Tenants $100 a Month Not to Drive “Residents of the San Francisco Parkmerced apartments may be able to tap into $100 worth of transportation credit for being environmentally friendly says Fast Company writer Adele Peters. Maximus Real Estate Partners, the developer of Parkmerced, wants to create a car-free living environment in the city, and so has partnered with Uber and Clipper, the local transit card for buses and trains, to provide tenants with $100 of transportation credit per month.” (Multifamily Executive)
Real Estate Boom Pinches a Produce Supply in the Hudson Valley “The the demand for locally grown foods is colliding with another powerful force: a booming real estate market, particularly in the Hudson Valley, driven by waves of newcomers from New York City, perhaps drawn by the region’s natural beauty, more relaxed pace and less expensive housing. The boom is gobbling up family farms as owners choose to cash in on the surging value of land rather than grapple with the perennial challenges of slim profit margins, high taxes, long hours and fickle weather.” (The New York Times)
