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 fell 37.05 points, or 0.2 per cent, to 18,576.47. The S&P 500 index lost 1.74 points, or 0.1 per cent, to 2,184.05. The NASDAQ bucked the trend, adding 4.50 points, or 0.1 per cent, to 5,232.89.
Benchmark U.S. crude was rose $1, or 2.3 per cent, to close at $44.49 a barrel in New York. Brent crude, used to price international oils, added 93 cents, or 2 per cent, to close at $46.97 a barrel in London. Wholesale gasoline added a penny to $1.37 a gallon, while heating oil rose 2 cents to $1.41 a gallon. Natural gas gained 3 cents to $2.58 per 1,000 cubic feet.
US stock indexes edge mostly lower; oil rises -- Wall Street capped a record-setting week with a day of mostly listless trading Friday that left the three major U.S. stock indexes essentially flat. The Dow Jones industrial average and the Standard & Poor’s 500 index closed slightly lower. The Nasdaq composite eked out a tiny gain, giving the tech-heavy index its fourth record-high close in a week. Investors mostly focused on the latest batch of company earnings from retailers and other companies, as well as new data indicating that U.S. retail sales in July were more sluggish than expected. (AP)
Hostess launches “Deep Fried Twinkies” as first frozen treat — The deep-fried Twinkie is jumping from the state fair to the home freezer. Hostess Brands, the maker of lunchbox treats like Ho Hos, is launching packaged “Deep Fried Twinkies” starting Friday that mark its first foray into frozen foods. The cream-filled snack in vanilla or chocolate is the result of a yearlong collaboration between Hostess and Wal-Mart, as both companies look to spark food sales with innovative products. Battered and partially fried before being frozen, the Twinkies need to be finished for a short time in the oven, toaster oven or frying pan. They’ll cost $4.76 for a box of seven and for the first three months are available only at Wal-Mart. (AP)
Tepid retail sales lower expectations for US economic growth — A sluggish month of retail spending has tempered expectations for the U.S. economy’s growth in the coming months. Consumers pulled back on shopping and eating out in July after three straight solid monthly gains, the government said Friday. Those declines were offset by increases in auto sales and online and catalogue sales. Many economists credited the surge in online and catalogue spending, which rose 1.3 per cent, mainly to deals offered during Amazon’s “Prime Day” on July 12. Amazon said its sales rose 60 per cent on Prime Day compared with a year earlier. (AP)
J.C. Penney reports smaller quarterly loss as sales improve — After a tough start to the year, J.C. Penney’s business enjoyed a bounce in the second quarter, fueled by efforts to bring back appliances and spruce up other sections of the store. The Plano, Texas-based department store chain reported a smaller loss for the second quarter compared to a year earlier as sales improved. CEO Marvin Ellison believes the company can maintain the momentum with a slew of new brands and other enticements coming in the next few months. In addition to its own efforts, Penney is benefiting from store closings by Macy’s and Sears Holdings Inc. Ellison told analysts Friday the company has seen sales improve in malls where its rivals shuttered their stores. (AP)
Wall St. Banks Ask Fed for Five More Years to Comply with Volcker Rule “Big Wall Street banks are asking the U.S. Federal Reserve to grant them an additional five-year grace period to comply with a financial reform regulation known as the Volcker rule, people familiar with the matter said. If the Fed agrees, the extension would give banks more time to exit fund investments that are difficult to sell, but no longer allowed by the law. The added grace period, which follows three one-year extensions, would start next year and run through 2022.” (Reuters)
9 Cities That Can’t Seem to Recover from the Housing Crisis “Thousands of homeowners are being left behind by the housing market recovery. In nine cities in the U.S., more than one in five homeowners owns a home that is seriously underwater (compared with only about one in 10 across the nation) — and few who live in those markets have built up a lot of equity. ‘Those are markets that have been left behind,’ says Daren Blomquist, vice president at real-estate research firm ATTOM Data Solutions.” (MarketWatch)
Why Shutters Are Coming Down at Macy’s “The moves represent a dramatic shift for the retailer, which has for years been weighing potential strategies for monetizing its real estate. They are an important defensive step as it tries to prevent itself from being further squeezed between Amazon.com and discounters such as TJX Cos. Shares rose 18% Thursday afternoon. They remain down by 40% over the past year. The urgency of the situation has become increasingly clear for Macy’s as same-store sales have fallen for six consecutive quarters.” (Wall Street Journal)
City Launches Loan Program for Budding Developers “Financial assistance is on the way for smaller developers. The city launched a new low-interest loan program that will help builders acquire sites and prepare new residential, commercial or industrial projects for construction, the city Economic Development Corp. announced Thursday. The program, called the Emerging Developer Loan Fund, will be run by a partnership between the city and a subsidary of Basis Investment Group, a Manhattan-based lender.” (Crain’s New York Business)
REIT Stocks Rocked by Store Closure Fears “Shares of real-estate investment trusts were broadly lower Thursday, as investors viewed Macy’s Inc.’s plan to close about 15% of its full-line stores as a threat to mall operators. The iShares U.S. Real Estate exchange-traded fund IYR, slumped 1.2% in afternoon trade, with 100 of its 117 equity components losing ground. That contrasts with the 0.6% surge into record territory by the S&P 500 index SPX, which had about three-quarters of its components trading higher.” (MarketWatch)
Clarion Partners Severs Ties with Boston Office Assets “For $100.5 million, John Hancock Real Estate has bought the two interconnected 13-story office buildings at 535-545 Boylston St., in Boston’s Back Bay area, John Hancock announced Tuesday. The buildings total 184,000 square feet and are home to a diversified roster of tenants. The acquisition, according to John Hancock, builds on its commitment to Boston and the Back Bay, where the company currently owns 197 Clarendon and 200 Berkeley and recently announced a $350 million redevelopment at 380 Stuart St.” (Commercial Property Executive)
Housing Official in Silicon Valley Resigns Because She Can’t Afford to Live There “The Downings’ housing struggle in the northern California region that is home to many of the world’s wealthiest tech companies carries a special irony due to Kate’s second job: up until this week, she served as a planning and transportation commissioner for Palo Alto – a position in which she pushed city officials to build more housing and pass pro-development policies that could help solve the growing affordability crisis. Kate vented her frustrations about the dangerous housing shortage in Silicon Valley in a Wednesday post on Medium announcing her formal resignation from the Palo Alto planning and transportation commission.” (The Guardian)
Falling Profits Force Department Stores to Reinvent Sales Pitch “Department stores trying to recapture their appeal to consumers are making plans to provide more experiences like spas and restaurants, and offer exclusive selections to transforms the store into more of a destination. With shoppers increasingly buying online or from niche retailers and discount stores, the onetime pillars of retail are trying to rethink their business to keep up with consumers who want a different experience in stores than they find on their phones.” (Associated Press)
San Francisco’s Northernmost Suburb? Tales of Seattle Housing and Real Estate “July wasn’t short on surprises in the Seattle region’s real-estate market. Farms are now hot properties; half a million dollars gets you a mold-infested tear-down, and maybe not much more; the average Seattle home price has taken on the sign of the devil. But there’s some potentially good news buried in there: The local housing market might be cooling somewhat and, as bad as we seem to have it, it’s still not as bad as San Francisco.” (The Seattle Times)
Midtown’s Coming Exodus “By now the headlines are familiar: Tenant X is heading Downtown or Tenant Y is taking space on the Far West Side. But what’s often left out of the headlines is that those tenants are leaving behind giant blocks of office space elsewhere. And, more often than not, those empty sites are located in Midtown. While Midtown has been losing its competitive edge for some time, the slippage has accelerated in the last few years as new office supply has come on the market in other parts of Manhattan and the Midtown stock has become dated.” (The Real Deal)
3 years into nation’s hemp experiment, crop’s future is hazy — Three years into the nation’s hemp experiment, a 20-acre farm in southern Colorado exemplifies the crop’s hazy potential. Hemp could be enormously profitable, but right now there are just as many questions as answers for Will and Ally Cabaniss, two Florida natives who moved to southern Colorado to embark on the hemp business. “Every day brings something new and different,” said Will Cabaniss, holding up a red plastic cup containing a hemp seedling awaiting planting. “Right now we’re just building data for the industry, seeing what works and what doesn’t.” (AP)
Chinese auto sales accelerate in July — China’s auto sales growth accelerated in July, an industry group said Friday, while General Motors Co. and Ford Motor Co. reported record demand for the month. Sales in the world’s biggest auto market rose 26.3 per cent to 1.6 million units, the China Association of Automobile Manufacturers said. Total vehicle sales, including trucks and buses, rose 23 per cent to 1.8 million units. Sales of SUVs, whose explosive popularity has helped to buoy demand as other categories sagged, soared 47.4 per cent to 580,000 vehicles. (AP)