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.
Wednesday, the Dow Jones industrial average picked up 224.18 points, or 1.3%, to close at 17,749.09. The Standard & Poor’s 500 index jumped 29.66 points, or 1.5%, to 2,073.07. The NASDAQ composite rose 75.77 points, or 1.5%, to 5,071.13.
Benchmark U.S. crude dropped $1.83, or 4.9%, to close at $35.52 a barrel in New York. Brent crude, a benchmark for international oils, lost $1.26, or 3.3%, to $37.19 a barrel in London. Natural gas lost 3.2 cents to close at $1.79 per 1,000 cubic feet. The price of wholesale gasoline fell 1.2 cents to $1.233 a gallon and heating oil lost 3.5 cents, or 3%, to $1.112 a gallon.
Stocks jump after Fed finally raises interest rates — Stocks climbed Wednesday after the Federal Reserve raised interest rates, a long-expected vote of confidence in the U.S. economy. At the same time investors were encouraged that the Fed emphasized that further increases will be gradual. The market was slightly higher at midday and rose steadily through the afternoon after the Fed released its policy statement and as Fed Chair Janet Yellen gave a news conference explaining the Fed’s decision. The market finished higher for the third day in a row, something that hadn’t happened in almost two months.
November home construction recovers after October slide — A big jump in apartment construction in the Midwest and South boosted the pace of homebuilding in November, marking a solid bounce back after tumbling in October. Construction of single-family houses also increased and reached an eight-year high. The Commerce Department said Wednesday that total housing starts — both houses and apartments— climbed 10.5 last month to a seasonally adjusted annual rate of 1.17 million homes. The increase reversed much of drop in stars during October. There has been a sharp growth in homebuilding, with starts having increased 11 per cent so far this year.
US industrial production registers worst month since 2012 — U.S. industrial output fell for the third straight month in November, another sign that American manufacturers are under stress. American industrial production dropped 0.6 per cent last month, the Federal Reserve said Wednesday. It was the biggest drop since March 2012. Manufacturing output was flat after expanding 0.3% in October. American industry is being hurt by economic weakness overseas and a strong dollar that makes U.S. goods more expensive in foreign markets. Still, the American economy is relatively healthy thanks to solid consumer spending.
Rate Hikes Will Not Hurt Real Estate, Says CBRE’s Mary Ann Tighe “CEO for CBRE's New York tristate region looks forward to midtown east rezoning plan passing. If the midtown east rezoning plan is passed in 2016, how will it immediately affect the neighborhood? You can’t go into the ground until your building is empty, so the word on the street is certain buildings are already putting demolition clauses in their leases. They’ll only do a lease with a right to terminate the deal if they decide to demolish or redevelop the building.” (Crain’s New York Business)
The Science of Dan Goodwin’s Rise in Real Estate “Bill O'Reilly headlined Dan Goodwin's annual holiday party for his Chicago-area friends and associates a few days ago. The bombastic Fox News commentator had an opinion on everything. Little did the 500 party guests know that it was Goodwin who had the biggest story to share. Inland Real Estate, a company founded by Goodman's Inland Group in the 1990s, just agreed to be bought by DRA Advisors for $2.3 billion. Goodwin is Inland's second largest shareholder, with 12.1 million shares, or 12.1 percent of the company.” (Crain’s Chicago Business)
Is Party Over for Real Estate Investment Trusts? “In the barren yield landscape of the last five years, real estate investment trusts have been one of investors' favorite places to find income. The MSCI U.S. REIT Index, which has a current yield of just under 4 percent, was up 30 percent last year. It has returned an average of more than 12 percent over the last five years — with close to half of that paid out in cash dividends to investors. This year is a different story.” (CNBC)
Sun Setting on Jehovah’s Witnesses Brooklyn Empire “For the longest time, the religious group was one of the biggest landlords in Brooklyn. That was until about 10 years ago, when the religion’s governing body, the Watchtower Tract and Bible Society of Pennsylvania, started dumping its holdings in the borough. It’s about to come to a head after the Associated Press reported that the organization is selling its headquarters at 25 Columbia Heights in the Brooklyn Heights section of the borough along with other pieces of its New York City portfolio. Business experts put the cost of the on-the-market buildings at $1 billion, the AP reported.” (Commercial Observer)
Kohl’s to Stay Open More Than 170 Straight Hours “Kohl's is pulling out all the stops in the hopes of increasing holiday sales this season by staying open through Christmas Eve. Kohl's plans to keep its doors open for more than 170 hours straight from 7 a.m. on Thursday, Dec. 17 through 6 p.m. on Christmas Eve, Thursday, Dec. 24 as an added convenience to holiday shoppers. In addition to extended store hours for last-minute shopping, customers will find special savings opportunities on Super Saturday, Dec. 19, and time-saving conveniences such as buy online, pick up in store for last minute gifts.” (Chain Store Age)
Hunt Mortgage Lends $114M Fannie Mae Loan Against San Francisco Apartments “The national non-bank commercial real estate lender Hunt Mortgage Group provided a Los Angeles-based real estate owner and manager with a $113.7 million Fannie Mae loan to refinance a 722-unit apartment complex in San Francisco, Calif., Commercial Observer has learned. The 30-year, full-leverage agency financing on Lakewood Apartments replaces a Merrill Lynch-sponsored commercial mortgage-backed securities loan taken out on the property in 2006.” (Commercial Observer)
NGKF’s Barry Gosin on Playing in the Real Estate Big Leagues “With a 6,000-broker company with 370 different offices to look after, it’s no wonder Mr. Gosin wants to get a charge. NGKF is doing a lot more than just spiffing up its offices: in July the company acquired Excess Space, which is ‘a dominant force in the niche area of real estate dispositions and lease-restructuring for retailers, with an excellent industry reputation,’ Mr. Gosin said.” (Commercial Observer)
Florida Third in Nation with Number of Shopping Malls “According to data from the International Council of Shopping Centers, the Sunshine State is one of the top places to shop. Florida is third in the nation for shopping malls, with more than 10,500. California has the most with more than 15,000 and Texas comes in second with more than 12,500. But per capita, Florida wins over the other two warm-weather states. It has about 20 malls for every 100 square miles, compared to roughly 10 malls in California per 100 square miles and about five malls per 100 square miles in the nation's second-largest state (behind Alaska) Texas.” (Bradenton Herald)
Neiman Marcus Hit by Department Store Slump “The strong dollar’s influence on tourism and store traffic led the Neiman Marcus Group to report a decline in same-store sales for the first time in six years. For the first quarter ended Oct. 31, the retailer reported total revenue of $1.16 billion, a decrease of 1.8% compared to total revenue of $1.19 billion for the first quarter of fiscal 2015. Same-store sales decreased 5.6% and the company reported a net loss of $10.5 million compared to net earnings of $0.2 million for the first quarter of fiscal year 2015.” (Chain Store Age)
Independent Mortgage Bank Profits Dip in U.S. “Based on the Mortgage Bankers Association's latest Quarterly Mortgage Bankers Performance Report, independent mortgage banks and mortgage subsidiaries of chartered banks reported a net gain of $1,238 on each loan they originated in the third quarter of 2015, down from a reported gain of $1,522 per loan in the second quarter of 2015. ‘Production profits dropped slightly in the third quarter of 2015 compared to the second quarter of 2015. However, on a year-over-year basis, production profits were up," said Marina Walsh, MBA's Vice President of Industry Analysis.’” (World Property Journal)