Real Estate Daily News Buzz June 22, 2017
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.
Energy stocks dove again on Wednesday as oil dropped to its lowest price since last summer. Gains for health care and technology stocks helped hem in losses for broader market indexes.
On Wednesday, the Standard & Poor’s 500 index dipped 1.42 points, or 0.1 percent, to 2,435.61. The Dow Jones industrial average fell 57.11, or 0.3 percent, to 21,410.03. The Nasdaq composite rose 45.92, or 0.7 percent, to 6,233.95. The Russell 2000 index of smaller company stocks fell 3.71, or 0.3 percent, to 1,399.25.
For the week, the S&P 500 is up 2.46 points, or 0.1 percent. The Dow is up 25.75 points, or 0.1 percent. The Nasdaq is up 82.19 points, or 1.3 percent. The Russell 2000 is down 7.47 points, or 0.5 percent.
For the year, the S&P 500 is up 196.78 points, or 8.8 percent. The Dow is up 1,647.43 points, or 8.3 percent. The Nasdaq is up 850.84 points, or 15.8 percent. The Russell 2000 is up 42.12 points, or 3.1 percent.
US Home Sales Up in May along with prices — The May home sales report released Wednesday by the National Association of Realtors shows a housing market unable to meet the demand from would-be buyers. Sales edged up 1.1 percent in May to a seasonally adjusted annual rate of 5.62 million, a decent gain amid a relatively stable job market with a robust 4.3 percent unemployment rate. But many possible buyers are finding their ambitions thwarted because there aren’t enough homes for sale. Sales listings have plummeted 8.4 percent over the past 12 months to 1.96 million. On an annual basis, the number of homes for sale has declined for the past 24 months. Homes are staying on the market for a median of just 27 days, the briefest period since the Realtors began tracking the measure in 2011.
How T.J. Maxx Is Bucking the Crisis in Retailing “Traditional retailers are in crisis, damaged by rapidly shifting consumer tastes, technological change and cut-throat price competition. And then there’s TJX Cos., which is defying gravity with the simple idea that under the right circumstances people still like to shop in stores. The owner of T.J. Maxx and Marshalls has seen sales at stores open at least a year rise for 33 straight quarters.” (Wall Street Journal, subscription required)
Commercial Real Estate Owners Are Missing Their Big Opportunity “What is the biggest, most obvious opportunity for the future of commercial real estate? What? Not enough patience or time? Do you just want to scroll until you see the bold type and figure it out in two sentences? I could lay it out in fifty words or less but would you understand it completely? Here is my problem, I have been screaming about this as loud as I can for how long now? It’s to the point where I’m starting to question your ability to see what’s right in front of your face. It’s also obvious to me that the rest of the world has already figured out what you have not.” (cre.tech)
Kroger Should Challenge Amazon and Make Whole Foods a Sweeter Offer “Watch out, Amazon. Kroger could give Jeff Bezos a run for his money. At least that’s what one analyst is saying, issuing a note to clients Wednesday morning explaining why a competing bid by Kroger for its rival grocer Whole Foods makes sense. This, after Amazon announced plans last Friday to acquire Whole Foods for $13.7 billion — a deal that’s expected to close in the second half of 2017. Unless, of course, a rival bidder steps into the picture.” (CNBC)
Deep in the Malls of Texas, a Vision of Shopping’s Future “Several shopping centers in Texas give a peek into how mall owners and developers are responding. In spots where the shopping activity has slowed, the response is clear: Move away from strictly shopping, and expand the mix to include more restaurants and entertainment, or health care and education. Or, in the case of Valley View Center, start over from scratch.” (The New York Times)
Despite a $17B Valuation and Expanding Business, How Long Can WeWork Work? “Its success—and potential for more—has divided real estate professionals in New York: Those who are willing to accept WeWork’s vision of its place in the real estate firmament and those who are not willing. Sam Zell, the chairman of Equity Group Investments, which includes major office properties, put it like this during a May appearance on CNBC: ‘We have yet to find out what happens to WeWork when the office market softens, which is probably not too long from now.’” (Commercial Observer)
New York REIT Taps RKF to Sell Retail Holdings “New York REIT hired RKF’s investment sales division to oversee the selloff of its standalone retail properties as the troubled real estate investment trust liquidates its $2.78 billion office-and-retail portfolio. RKF vice chairman Jeff Fishman will lead a team marketing the assets, the bulk of which are concentrated on Bleecker Street. The buildings are located in such neighborhoods as Midtown West, Tribeca and Greenwich Village.” (The Real Deal)
Vanke Founder Wang Shi, Chinese Property Developer, Steps Down “The chairman and founder of China’s largest property developer said on Wednesday that he would step down, ending a career that mirrored the country’s giddy embrace of privately owned real estate but stumbled after his company became the target of an unprecedented Chinese corporate takeover battle. Wang Shi, the chairman of China Vanke Group, said in a post on a personal social media account that it was time to let the next generation take over.” (The New York Times)
LA Job Growth Spurs Office Leasing Activity “While one may think sound stages and theaters would be most in demand in Los Angeles, office space is thriving in the area due to a growing presence in the tech, engineering and financial sectors. The U.S. capital of the entertainment industry is also one of the largest markets in the country, with almost 254 million square feet of office inventory, according to Yardi Matrix’s second quarter report on the Los Angeles office market.” (Commercial Property Executive)
Plan Would Bump Playground for $1B Real Estate Project “In a move critics say circumvents zoning laws to assist powerful developers, state and city officials plan to relocate an East Harlem children’s playground to accommodate a $1 billion project that would include one of the tallest buildings outside midtown. At the request of the City Council and the de Blasio administration, state Sen. Jose Serrano (D-Bronx) and Assemblyman Michael Benedetto (D-Bronx) are pushing bills that could be approved as early as Wednesday to discontinue the use of the Marx Brothers Playground on Second Avenue and East 96th as parkland.” (New York Post)
Atlanta’s ACS Building Commands $166M “Carter Validus has acquired the American Cancer Society Building, a 995,728-square-foot property in downtown Atlanta, Ga., from Cousins Properties for $166 million. Cushman & Wakefield represented the seller in the transaction. Cushman & Wakefield’s equity, debt & structure financing group, led by Mike Ryan and Brian Linnihan, arranged the acquisition financing.” (Commercial Property Executive)