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 fell 31.57 points, or 0.2%, to close at 17,685.09. The Standard & Poor’s 500 shed 4.21 points, or 0.2%, to 2,059.74 The NASDAQ composite index rose 0.55 points to 4,869.85.
Benchmark U.S. crude rose 2 cents to $38.34 per barrel in New York. Brent crude, used to price international oils, added 34 cents, or 0.9 per cent, to $39.60 a barrel in London. In other energy trading, wholesale gasoline dipped 1 cent to $1.43 a gallon. Heating oil rose two cents, or 2 per cent, to $1.18 a gallon. Natural gas fell 4 cents, or 1.9 per cent, to $1.96 per 1,000 cubic feet.
New Tucson Police Chief officially sworn in - Even though he assumed the position in January, Chris Magnus officially was sworn in yesterday as Tucson's 25th police chief. Magnus recently passed all of his needed certification tests to become a peace officer in Arizona.
Major Grocer to become part of City’s Food Scrap collection program - Fry’s Food Stores will add commercial food scrap collection at all Tucson stores through the City of Tucson’s FoodCycle Program. A formal announcement will be made by Mayor Jonathan Rothschild Friday at 10 a.m. in the Fry’s at 7812 E. Speedway Blvd. The addition of the Fry’s stores will bring the number of Tucson food scrap collection locations to 50. Tucson’s Environmental Services Department estimates 80 percent of what is disposed of in landfills is compostable or recyclable, and about 50 percent of food thrown away is compostable. The City of Tucson's composting pilot program began in 2014 with the University of Arizona, 16 restaurants, grocery stores, and hotels. The FoodCycle program has grown incrementally since then. Businesses interested in compost collection service should call (520) 791-3171.
Fourth Avenue Street Fair Begins Friday - The Fourth Avenue Spring Street Fair opens tomorrow and runs through Sunday, 10 a.m.-6 p.m., each day. The event takes place on Fourth Avenue between Ninth Street and University Boulevard. The street fair includes more than 400 arts and crafts booths, more than 35 food vendors, street musicians, food, jugglers, street performers, and a hands-on art pavilion for kids. There also will be face painting, balloons, demonstrations, sidewalk entertainment, and other activities. You can ride the Sun Link streetcar to the fair to avoid parking hassles, but please note there will be temporary route adjustments. The streetcar will operate on the east end of the route from the eastern terminus at Helen Street to University Boulevard and Third Avenue and back. On the western terminus, the streetcar will operate from Avenida del Convento, through downtown, to Fourth Avenue and Eighth Street and back. Sun Tran buses will be used to shuttle streetcar passengers from temporary stops at Fourth Avenue and Ninth Street, and University Boulevard and Third Avenue. Follow the links below for more information.
Fourth Avenue Street Fair:
Tucson offering 'Coffee and a Cuddle' - Cuddle with some therapy dogs and drink coffee downtown tomorrow to help relieve any stress you may be feeling. The event will be held from 10 a.m.-1 p.m. at the Downtown Tucson Partnership, 100 N. Stone Ave., Suite 101. A $10 donation at the door supports Arizona Gives Day for the Humane Society of Southern
Interactive Maps Provide Valuable information about Tucson - ZoomTucson is an interactive mapping site that allows citizens to find government information and services, such as political representatives, trash and recycling collection schedules, zoning, and school boundaries. ZoomTucson's clean and simple map interface allows users to search by an address or click on a location to display a wealth of information. It's also good for people interested in moving to Tucson. Meanwhile, ZoomBiz is an easy-to-use, map-based website providing developers and property owners with location-specific information on incentive programs for which they may be eligible.
Distorted Markets: Why Banks Are Better Off Than You Think, and Real Estate Isn’t “Since the market bottomed in 2009, prices have risen more and the rally has lasted longer than the run-up leading to the financial crisis, according to Green Street Advisors LLC, a real-estate research firm. Driven in part by strong fundamentals, prices have doubled from their lows. Capitalization rates, the yield generated by properties, are just above 5% and are now just above triple-B bond yields, which Green Street sees as a good proxy for risk.” (Wall Street Journal)
The Buildings Behind Real Estate’s Richest Barons “Earlier this month, Forbes published a list of the 20 richest real estate billionaires in the world in 2016. CrediFi went beyond the rankings to see which U.S. commercial real estate properties are in the portfolios that helped these billionaires make it to where they are today. Here’s what we found.” (Forbes)
Is Trader Joe’s Starting a Price War with Whole Foods? “Grocery store chain Trader Joe’s appears to be girding for a price war with rival Whole Foods Market. A basket of 77 items at Trader Joe’s, a fast-growing privately held specialty grocer, was 26% cheaper than its equivalent at Whole Foods, according to a price comparison recently conducted at New York area stores by Deutsche Bank. That was a larger difference than in previous store checks.” (Fortune)
Pennsylvania REIT Sheds Rest of Mall Laggards “A retail real-estate company has sold four lower-quality malls for $92.3 million, completing its effort to unload the 13 worst-performing assets in its portfolio. Pennsylvania Real Estate Investment Trust, or PREIT, sold two malls in Alabama and one in Christiansburg, Va., to a fund managed by Farallon Capital Management LLC of San Francisco. It sold Lycoming Mall in Pennsdale, Pa., to Kohan Retail Investment Group of Great Neck, N.Y.” (Wall Street Journal)
Private Real Estate Funds Have a Record $231B to Spend—but Few Places to Put It “Private real estate funds have more money to spend than ever before, but that’s not necessarily good news for the real estate market. As of March, private real estate investment funds worldwide had $231 billion in aggregate dry powder – or capital commitments from fund investors ready to be spent – according to research firm Preqin. That’s the highest figure in history and a 10 percent increase since December.” (The Real Deal)
Housing Costs for Low-Income Renters are Up a Crushing 50% Since 90s, New Study Says “Housing costs in particular stand out for lower-income families as a significant and growing burden. The cost for lower-income renters rose nearly 50% between 1996 and 2014, according to the Pew study. A decline in homeownership rates among the middle and upper-income households since the housing crisis in 2007 is contributing to the tight supply in the rental market with vacancy rates at a historical low below 7%, according to Pew.” (Forbes)
Wells Fargo Shopping Downtown, Uptown Real Estate Market for Potential Move “One of downtown Dallas’ big banking tenants is shopping the real estate market for a new location. Wells Fargo has its downtown offices in the landmark Fountain Place tower – the 60-story green glass rocket of a building on Ross Avenue. Real estate brokers say that Wells Fargo has been looking at new office buildings in Uptown as well as other downtown buildings for a possible move.” (The Dallas Morning News)
Real Estate Lending: Bad Boys, Bad Boys… Whatcha Gonna Do When They Come Tax You? “’Bad boy’ guarantees are often used in real estate lending transactions to discourage bankruptcy filings in the event that a project fails. While bankruptcy attacks on these clauses have failed, a recent IRS memorandum threatening the tax treatment of such guarantees may make them less attractive as bankruptcy-proofing devices.” (The National Law Review)
Detroit’s Billionaires Hope to Change Downtown with Development Spree “On a recent drive through Detroit's Brush Park, Melissa Dittmer paused to consider the expectations of a city whose spirit had been beaten down by decades of decay and abandonment. Dittmer was talking about plans to transform an 8.4-acre section of Brush Park, once home to the city's elite before being all but abandoned in Detroit's decline, into a new neighborhood with a fresh mix of architecture.” (Curbed Detroit)
Why American Tower Corp. Is Overleveraged “The problem with having huge debt levels is that it gives the company a small margin for errors and any industry headwinds would put pressure on its financial position. The good news is that management is aware of this situation and reportedly plans to continue de-leveraging over the coming years. Given the recent run-up of the share price over the past year, it is advised to stay on the sidelines.” (Seeking Alpha)
US applications for jobless aid rise, but still near lows — More Americans sought unemployment benefits last week, but applications still stayed near historic lows that point to a stable job market. Applications for jobless aid rose 11,000 to a seasonally adjusted 276,000, the Labor Department said Thursday. The less-volatile four-week average rose 3,500 to 263,250. The number of people receiving unemployment checks has fallen 6.3% over the past year to 2.17 million. Employers are confident that the U.S. economy will continue to grow, after global pressures and an uneven stock market stirred concerns at the start of the year. Applications are a proxy for layoffs, so the steady lows indicate that businesses are still looking to hire.
California Assembly OKs highest minimum wage in nation — The California Assembly on Thursday approved a plan that would create the highest statewide minimum wage in the nation of $15 an hour by 2022. The proposal now moves on to the state Senate for consideration. The state of New York is considering a similar measure. Gov. Jerry Brown and Democrats who control both legislative chambers hailed the increase as a boon to more than 2 million of California’s poorest workers and an example to the nation as it struggles with a growing gap between rich and poor.
GE asks US to drop “systemically important” tag for Capital — General Electric Co. asked the U.S. to drop the “too big to fail” tag for GE Capital, saying that its financing operations are a shadow of what they were. The company has been in broad retreat over the past year from its financial ventures, returning to its industrial roots. GE Capital was listed as a “systemically important financial institution,” by the government following the financial collapse of 2008, a company deemed to be so large and entwined with the U.S. financial system that it could threaten the entire economy if it failed.