FOMC Rocked Stock Market World
Wednesday, Sept. 18, 2103 – The Dow Jones industrial average jumped 147.21 points, or 1%, to 15,676.94. The S&P 500 surged 20.76 points, or 1.2 per cent, to 1,725.52, slicing through its previous all-time high of 1,709.67 set on Aug. 2. The NASDAQ composite rose 37.94 points, or 1 per cent, to 3,783.64.

Stocks traded slightly lower throughout the morning, but took off immediately after the Fed’s decision in the early afternoon. Bond yields fell sharply — their biggest move in nearly two years. The price of gold had its biggest one-day jump in four years as traders anticipated that the Fed’s decision might cause inflation.

US Dollar weakened with the news today. The New Zealand and Australian dollars were the biggest beneficiaries of U.S. dollar weakness but the Canadian dollar wasn’t far behind. Thanks to the Federal Open Market Committee (FOMC) announcement, the EUR/USD strengthened, breaking through 1.35 to the US Dollar, this its strongest level since February (1.35255) while the British pound rose to its strongest level against the U.S. dollar in 7 months (1.61407). The NZD closed at 1.19252, the AUD was at 1.05286; Canadian dollar strengthened to 1.02226 over the US dollar.

Policymakers Say “Expect Slower Growth & Increased Spending Next Year”
Wednesday morning, FOMC reported a more downbeat outlook on the U.S. economy for 2013 and 2014 than it did three months ago. The Fed predicts that the economy will grow by just 2% to 2.3% this year, down from its previous forecast from their last meeting in June of 2.3% to 2.6% growth. But the Fed’s policymakers expect the unemployment rate to fall to 7.1% to 7.3% by the end of 2013, slightly below its June forecast of 7.2% to 7.3%. It predicts that unemployment will fall as low as 6.4% next year, down from 6.5% in its June forecast. The unemployment rate is now 7.3%. For full report click here.

Wednesday afternoon, the Center for Medicare and Medicaid Services Office of the Actuary chimed in and projected modest health spending growth for the nation’s health care spending. Government experts predict a jump by 6.1% next year as the big coverage expansion in President Obama’s overhaul kicks in. That’s more than 2 percentage points higher than the growth rate forecast for this year, and compares with a growth rate that has hovered under 4%, historically low, for the past four years. Much of the increase projected for next year is attributed to the new health care program. Without it, the estimated growth would be 4.5%, according to Wednesday’s report. The full findings were published online by the journal Health Affairs and can be found by clicking here.

Walgreen shifts health coverage over to Employees to choose from Exchange
Walgreen Co. is joining a growing push from big businesses to shift more responsibility for finding insurance onto their employees as health care costs continue to climb. The nation’s largest drugstore chain said Wednesday that it will send its 180,000 workers and dependents to a private health insurance exchange where they will pick from as many as 25 plans instead of having the company give them two to four options. Walgreen’s employers normally pay most of their coverage cost, and Walgreen’s contribution toward the benefit won’t change. The company said the move will give its workers more choices and help them become better consumers.

Court ruling: Clicking ‘Like’ on Facebook is exercise in First Amendment Right
Clicking “Like” on Facebook is constitutionally protected free speech and can be considered the 21st century-equivalent of a campaign yard sign, a federal appeals court ruled Wednesday. The 4th U.S. Circuit Court of Appeals in Richmond reversed a lower court ruling that said merely “liking” a Facebook page was insufficient speech to merit constitutional protection. Exactly what a “like” means — if anything — played a part in a Virginia case involving six people who say Hampton Sheriff B.J. Roberts fired them for supporting an opponent in his 2009 re-election bid, which he won. The workers sued, saying their First Amendment rights were violated.

Coal’s future becoming more uncertain globally
Economic forces, pollution concerns and competition from cleaner fuels are slowly nudging nations around the globe away from the fuel that made the industrial revolution possible. The U.S. will burn 943 million tons of coal this year, only about as much as it did in 1993. Now it’s on the verge of adopting pollution rules that may all but prohibit the construction of new coal plants. And China, which burns 4 billion tons of coal a year — as much as the rest of the world combined — is taking steps to slow the staggering growth of its coal consumption and may even be approaching a peak. According to the World Coal Association, coal provides around 30% of global primary energy needs, generates 41% of the world’s electricity and is used in the production of 70% of the world’s steel. Click here for coal statistics from around the world the US as a net coal exporter.

Commerce Department Reports August permits increasing pace
U.S. builders started work in August on the most single-family homes in six months and requested permits to construct even more in future months. Building permits in August 2013 were at a seasonally adjusted annual rate (SAAR) of 918,000, down 3.8 percent from the revised July rate and up 11.0 percent from August 2012. Housing starts in August 2013 were at a SAAR of 891,000, up 0.9 percent from the revised July estimate and up 19.0 percent from August 2012. The figures suggest housing remains a driver of economic growth despite rising mortgage rates. Construction of single-family homes rose 7% last month to a seasonally adjusted annual rate of 628,000, the Commerce Department said Wednesday. That’s the fastest rate since February. And builders sought 627,000 permits to construct future single-family homes, 3% more than July and the best pace since May 2008.

FedEx says quarterly profit up 7%
FedEx Corp. boosted quarterly profit by 7% this summer despite a dip in revenue at its express-delivery unit, and it will raise prices on many U.S. shipments in January. The weak global economy is still creating turbulence in FedEx’s air-shipment business. But its ground-shipping unit continues to churn out strong profit — operating income was twice that of the express business. FedEx said Wednesday that it earned $489 million in the June-through-August quarter, which topped analysts’ expectations. Click here for full report.

McDonald’s Dividends Announced Wednesday
McDonald’s announced it is raising its quarterly cash dividend by 5%, bringing its fourth-quarter payout to more than $800 million. The world’s largest hamburger chain says its quarterly dividend increases to 81 cents from 77 cents, for an annual total of $3.24 per share. It will make the next payout on Dec. 16 to shareholders of record at Dec. 2. McDonald’s Corp. expects to return between $4.5 billion and $5 billion to its shareholders through dividends and stock repurchases in 2013. McDonald’s has raised its dividend every year since making its first payout in 1976. In July, the Oakbrook, Ill., company reported a 4 per cent rise in second-quarter profit but missed expectations and warned of a tough year ahead, given heightened competition and rough economic conditions around the world. Click here for full report.

Founded in 1957, the International Council of Shopping Centers (ICSC) is the premier global trade association of the shopping center industry. Its more than 60,000 members in over 90 countries include shopping center owners, developers, managers, marketing specialists, investors, retailers and brokers, as well as academics and public officials. As the global industry trade association, ICSC links with more than 25 national and regional shopping center councils throughout the world. This year, the Western Division Conference kicked off Wednesday in San Diego.

We’ll be covering news from the conference each day as reported to us by news releases and attendees.

Announcements from the ICSC Conference on Sept. 18, 2013 DAY ONE:

Westfield sells 7 malls to Starwood for $1.64 billion
San Diego, Sept. 18, 2013 – Australia-based Westfield Group will sell seven U.S. malls totaling 7.9 million square feet to a Starwood Capital Group affiliate for $1.64 billion. Starwood will own and manage the majority interest in the centers with Westfield retaining a 10% common equity interest. The assets include the 826,140-square-foot Westfield Belden Village, in Canton, OH; the 779,268-square-foot Westfield Capital, in Olympia, WA.; the 1.2 million-square-foot Westfield Franklin Park, in Toledo, OH; the 1.1 million-square-foot Westfield Great Northern, in North Olmsted, OH; the 1.3 million-square-foot Westfield Parkway, in El Cajon, CA.; the 1.3 million-square-foot Westfield Southlake, in Merrillville, IN.; and the 1.1 million-square-foot Westfield West Covina, CA.

“We are focused on redeploying our capital into superior retail destinations in major cities through divesting non-core assets and introducing joint venture partners into our high quality portfolio of assets,” said Westfield Group Co-CEO Peter Lowy, in a press release. After the transactions close in the fourth quarter 2013, Westfield will own and operate 40 centers in the U.S.

Marcus & Millichap predict California vacancy levels falling fast
San Diego, Sept. 18, 2013 – A rebounding housing market is boosting the retail outlook in California, according to attendees at the ICSC Western Division Conference. San Diego, site of the conference, is at the forefront of the state’s retail recovery. Developers are starting to build again to accommodate expansion-minded retailers that are having trouble finding locations, locals say. According to Marcus & Millichap, retail stock in San Diego will grow by nearly 1% with the addition of about 800,000-square-feet of new space.

Despite the new construction, Marcus & Millichap is expecting that San Diego’s retail vacancy level will ease by an additional 70 basis points year-on-year, to 3.6%, for 2013. In Los Angeles Marcus & Millichap is projecting that vacancy will be about 5.8% for this year, the lowest since 2008 and a 50-basis-point improvement over 2012. An increase in blue-collar jobs is expected to spur even more improvement as retailers serving that population move into empty spaces at strip centers in the city’s outlying communities, according to the firm. Vacancy levels are easing also in the East Bay Area. Marcus & Millichap says vacancy levels there will probably dip below 6% for the first time since 2008, thanks to demand from expanding retailers and a reduction in new development. In Sacramento, meanwhile, job growth is outpacing the nation’s average and is set to help push the market’s retail vacancy level down 90 basis points year on year, to 8.7%, for 2013, Marcus & Millichap reports.

Home sales are up by some 15% from a year ago in Orange County, driving shoppers into stores for big-ticket purchases. Retail sales there surpassed prerecession levels at the beginning of 2012 and are set to balloon to some 20% above the recessionary trough by the end of this year, says Marcus & Millichap. In the fourth quarter of 2012, the Orange County retail market absorbed some 730,150 square feet, the largest increase since 2007, reports Jerry Holdner, vice president of market research at Voit Real Estate Services, in Newport Beach. “Another 68,621-square-feet was absorbed in the first quarter,” said Holdner. The Orange County vacancy rate at the end of the first quarter was 5.53%, down from 5.9% for the year-ago quarter, according to Holdner. “As job growth expands, the retail market will continue to recover,” Holdner said. “I wouldn’t be surprised if the vacancy rate gets down to 5% within the next 12 months.”

Wash Depot Holdings, Inc. of Malden, MA dba Simoniz Car Wash is selling a portfolio of 30 car washes of the company’s 80 total properties. Twenty of these have sold or are under contract within the one month of coming on the market; properties are located in AZ, TN, TX, GA, MN, MO, IA, IL and FL.

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[mepr-show rules=”58038″]Mister Car Wash of Tucson (Ron Peterson, Chairman) acquired two Simoniz locations and businesses from Wash Depot at 4941 N Oracle Rd in Tucson for $2 million ($430 PSF) and 2409 N Kolb Road in Tucson for $832,000 ($126 PSF).

“This deal is going to strengthen our position in Tucson and allow us to better serve a very strategic market for us” said Peterson in a press release. Mister Car Wash now operates six carwashes in Tucson and 123 carwashes nationwide. Mister Car Wash has added 21 locations in 2013. It was Mister Car Wash that also acquired the four local Capin car washes last year, making Mister the largest car wash owner in the country based here in Tucson.

The third Simoniz location was at 3410 N 1st Avenue in Tucson. It sold to UC Associates, LLC of Tucson dba Octopus Car Wash  for $425,000 ($192 PSF). This will be car wash number four for Octopus in Tucson.

Vinny Carfora with Car Wash King of Florida is a licensed real estate broker in 38 states. In an exclusive interview with the editor of Real Estate Daily News, Carfora  told us he is marketing the Wash Depot portfolio and represented seller and both buyers in these transactions. Carfora told us there are three other properties as part of the portfolio in Tucson and one in Phoenix, of these, two are under contract and expected to close at the end of month. Carfora also handled the sale of the four Capin properties last year.

For more information contact Carfora at (954) 540-3330 or at visit www.carwashking.com

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4941 N Oracle: sale date: 9/12/2013. APN: 105-08-014E, lot size 66,706 SF. All cash transaction. 2409 N Kolb: sale date 9/12/2013, APN: 135-10-150X and 150W, lot size 32,094 SF. All cash transaction. 3410 N 1st Ave: sale date: 9/11/2013. APN: 13-04-227 thru 229 and 230 and 231. Lots size was 30,208 SF. All cash transaction.[/mepr-show]