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.
Tuesday, the Standard & Poor's 500 index fell 1.90 points, or 0.1 percent, to 2,425.53. The Dow Jones industrial average inched up 0.55 points, less than 0.1 percent, to 21,409.07. The Nasdaq composite gained 16.91 points, or 0.3 percent, to 6,193.30.
Benchmark U.S. crude picked up 64 cents, or 1.4 percent, to settle at $45.04 a barrel on the New York Mercantile Exchange. Brent crude, used to price international oils, rose 64 cents, or 1.4 percent, to $47.52 a barrel in London. Wholesale gasoline inched up 2 cents to $1.52 a gallon. Heating oil added 2 cents to $1.48 a gallon. Natural gas rose 12 cents, or 4 percent, to $3.05 per 1,000 cubic feet.
Energy companies lead US stock indexes mostly higher -- Another day of listless trading on Wall Street ended Tuesday with the major stock indexes closing out having shifted marginally from the day before. Gains in energy and technology companies were canceled out by losses among banks, phone companies and other sectors. A rebound in crude oil prices helped lift energy stocks, which led the gainers. Banks posted the largest losses. Investors were making modest moves ahead of Federal Reserve chair Janet Yellen's testimony before Congress.
SUN TRAN AND TEAMSTERS REACH CONTRACT AGREEMENT - Sun Tran and Teamsters Local 104 representatives reached a new three-year contract agreement over the weekend, meaning bus service will continue uninterrupted. A tentative agreement on the new contract was reached late Friday, and the new contract was ratified Saturday by 90 percent of the Teamsters. The agreement applies to 544 employees in the bargaining unit, including bus operators, mechanics, fare box and fleet technicians, fleet service attendants, parts clerks, and custodians. It includes a general wage increase in the first and third years of the contract, with the base wage increase varying based on job classification and years of service. The economic package in the contract is valued at approximately $2.485 million over three years. The first year of the economic package in the contract is generally equivalent to the cost of last year's one-time distribution to City employees and the cost the City absorbed for increases in its health insurance premiums for employees. The agreement also brings all Sun Tran employees in the bargaining unit into compliance with the statewide mandatory minimum wage provisions.
COMMUNITY WATER FORUM SET FOR SATURDAY - Tucson Vice Mayor/Ward 1 Council Member Regina Romero and Ward 5 Council Member Richard Fimbres will host an open house on Saturday, July 15, regarding the Tucson International Airport Area (TIAA) Superfund Site and Tucson Water's commitment to clean and safe drinking water. The United States Environmental Protection Agency (EPA) will be available to share information about groundwater cleanup at the TIAA site and its recent proposed plan for Area A, north of Los Reales Road. Tucson Water will discuss its state-of-the-art Advanced Oxidation Process (AOP) Water Treatment Facility and the delivery process for safe drinking water. Saturday's open house will take place from 11 a.m. to 2 p.m. at the El Pueblo Activity Center, 101 W. Irvington Road. For more information, please contact the Ward 5 Council Office at (520) 791-4231.
LEARN HOW TO USE SMART METERS - Motorists parking in Downtown Tucson, 4th Avenue and around the University of Arizona campus can pay for metered parking via the GoTucson smartphone app from Park Tucson. Payment also can be made via a mobile website or local phone number. In the video linked below, Tucson 12 shows you different ways you can use the smart meters.
FASTPASS ACCELERATES ENROLLMENT AT PCC - Pima Community College will hold a series of “PCCFastPass” events this month to help students enroll more quickly and efficiently for the fall semester. The goal is to allow students to complete the enrollment process in one day. PCC staff will be on hand to help students with admission, placement tests, orientation, paying tuition, and registering for classes. Students can attend any PCCFastPass event, regardless of which campus they plan to attend in the fall. For information on dates, times, and how to sign up, please follow the link below.
Experts: Scrapped electric-car plant may mean industry woes — Experts say an electric-car maker's decision to scrap a $1 billion manufacturing plant outside Las Vegas comes amid industry changes that could drastically affect companies that offer uniquely all-electric lineups. Faraday Future called the move a shift in business strategy. Those who watch the industry say established car companies are releasing more electric options and it's unclear whether the U.S. government will continue tax breaks that incentivize the industry and motivate buyers.
Federal Persecutors Step Up Probe of Land Deal Pushed by Wife of Bernie Sanders “A half-dozen people said in interviews in recent days that they had been contacted by the FBI or federal prosecutors, and former college trustees told The Washington Post that lawyers representing Jane Sanders had interviewed them to learn what potential witnesses might tell the government. The investigation centers on the 2010 land purchase that relocated Burlington College to a new campus on more than 32 acres along Lake Champlain.” (Washington Post)
REITs Have Complicated Relationships Status with Interest Rates “Many investors associate REITs with interest-rate risk. As an income-oriented sector, REITs can be negatively affected by interest-rate increases in a similar vein to fixed income. As interest rates rise, all else being equal, the income produced by REITs at the current stock price is worth less, and so prices generally fall in order to increase the yield of those stocks relative to other income producing instruments. Note the qualifier ‘all else being equal.’” (Forbes)
Startups Help Landlords Turn Apartments into Hotel Rooms “A handful of startups are betting they can help apartment-building owners convert empty units into hotel rooms, a controversial practice that could help landlords generate more revenue. The rise of home-sharing services such as Airbnb Inc. has been a boon for owners of single-family homes looking to make extra money.” (Wall Street Journal, subscription required)
Leasing Out Federal Land Could Provide Free Money for All Americans “The US government owns over $150 trillion of federal land and resources. Most of it is unused and sitting idle. If you divide $150 trillion by America's 325 million citizens, you get nearly a half-million dollars per person. If the US could just figure out how to monetize that federal land and distribute its equity equally, Americans could forever overcome poverty, healthcare issues, and the impending "robocalypse" — where increasing automation replaces tens of millions of human jobs.” (Business Insider)
Columbia Teams with Allianz Real Estate in New JV to Acquire Class-A Office Property “Seeking to acquire more office properties in its core markets without resorting to issuing stock or raising leverage, Columbia Property Trust (NYSE:CXP) has formed a joint venture with Allianz Real Estate to pursue Class-A office acquisitions in certain U.S. markets. The two investors have initially contributed three of their respective properties to the joint venture with a combined gross asset value of $1.26 billion.” (CoStar News)
Retailers Tap Consultants to Wiggle Out of Mall Leases “Consultants who help store owners wring concessions from landlords are seeing brisk business these days, another ripple of the shifting retail landscape across the U.S. economy. The rise of online shopping and changing consumer preferences are forcing retailers to rethink virtually all aspects of their operations.” (Wall Street Journal, subscription required)
Alexander & Baldwin to Convert to a REIT, Hires New CEO “Alexander & Baldwin, one of Hawaii’s largest owners of commercial real estate, said Monday that it is converting to a real estate investment trust and has hired an experienced REIT executive to serve as the Honolulu-based company’s chief financial officer. Alexander & Baldwin had been evaluating the conversion since last fall and reported spending a total of $14.3 million on the process, as of the end of the first quarter. The board of directors voted unanimously on Monday to approved the conversion, the company said.” (Pacific Business News)
One Way to Hedge Against Retail REITs “In my recent newsletter I explained that one way to hedge against retail REIT exposure is by investing in shares of industrial REITs. As I mentioned, there is a risk-reward tradeoff associated with hedging—it reduces risk but there is a cost for the so-called ‘insurance.’ It’s kind of like buying flood insurance for your house. The monthly payments add up over time, yet it certainly beats the headache if there is a total wipeout scenario.” (Forbes)
Here’s Where Amazon Is Planning to Open its Next NYC Bookstore “Jeff Bezos: Alexa, find me a space in Soho to open another Amazon bookstore in New York City. Alexa: Finding 72 Spring Street. Sources tell The Real Deal that the e-commerce colossus will be taking the 7,354-square-foot space between Crosby and Lafayette Streets, currently home to a pop-up store for bra maker Aerie. The retail spot at 72 Spring includes 5,200 square feet on the ground floor and 2,154 square feet in the basement. It wasn’t immediately clear whether a lease has been finalized yet.” (The Real Deal)