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.
The Standard & Poor's 500 index climbed 9.77 points, or 0.4 percent, to 2,399.29. The Dow Jones industrial average rose 55.47 points, or 0.3 percent, to 21,006.94. The Nasdaq composite jumped 25.42 points, or 0.4 percent, to 6,100.76, which beat a record it set earlier this week.
Benchmark U.S. crude oil jumped 70 cents, or 1.5 percent, to $46.22 a barrel in New York. Brent crude, the standard for international oil prices, added 72 cents, or 1.5 percent, to $49.10 barrel in London. Wholesale gasoline rose 2 cents to $1.50 a gallon. Heating oil added 2 cents to $1.44 a gallon. Natural gas jumped 8 cents, or 2.5 percent, to $3.27 per 1,000 cubic feet.
US jobs report points to a healthy drop in underemployment — A burst of hiring in April provided reassurance for the U.S. economy after a slow start to the year: Job growth returned to a healthy pace. Unemployment hit a decade low. And the number of part-time workers who want full-time jobs reached its lowest point in nine years. Employers last month added 211,000 jobs, more than double the weak showing in March, the Labor Department said Friday. And the unemployment rate dipped to 4.4 percent from 4.5 percent in March.
US consumer borrowing rises solid $16.4 billion in March — Americans stepped up their borrowing in March, taking out more loans for cars and school. The Federal Reserve reported Friday that total consumer borrowing rose by $16.4 billion, or 5.2 percent, in March, up from a $13.7 billion increase in February and the biggest uptick since November's $25.5 billion jump.
Feds probe Uber's use of fake app to stymie city inspectors — The Justice Department is probing allegations that Uber used phony software to thwart city officials looking at whether the ride-hailing company was following local regulations. The city of Portland, Oregon, said in an April audit report that it was notified of the federal inquiry by the U.S. Attorney's Office in San Francisco. Portland says it is cooperating. Uber and the U.S. Attorney's Office both declined to comment. Reuters and other news outlets have reported that the investigation is a criminal probe currently before a grand jury.
Job Opportunity: SENIOR HEAVY EQUIPMENT OPERATOR - The City of Tucson Environmental and General Services Department's Fleet Services Division is seeking skilled mechanics to perform maintenance, repair, and overhaul work on heavy-duty vehicles and construction equipment with diesel, gasoline, and natural gas engines. Shift schedules may include weekends and holidays, and on-call work is required. The deadline to apply is May 23.
Read the job description: https://bit.ly/2pOEIds
NEED HELP STARTING OR EXPANDING A BUSINESS IN TUCSON? CALL THE SMALL BUSINESS ASSISTANCE LINE - The City of Tucson's Small Business Assistance Line, (520) 837-4100, is available from 8 a.m. to 5 p.m. Monday through Friday. Help is available in both English and Spanish. Staff members from the City Manager's Office of Economic Initiatives answer the calls. The Small Business Assistance Line is one of a number of City initiatives to make the City of Tucson more business-friendly, along with many business incentives, streamlined permit processes, and more.
Board OKs continued partnership between Southern AZ VA Health Care System and Pima County Workforce Center -- Military veterans who are enrolled in the Southern AZ VA Health Care System (SAVAHCS) Department of Housing and Urban Development-Veterans Affairs Supportive Housing (HUD-VASH) program will benefit through job training and other services to secure employment, thanks to a partnership between SAVAHCS and Pima County’s Kino Veterans Workforce Center. The Pima County Board of Supervisors at its May 2 meeting approved a no-cost Memorandum of Understanding between the two partners that allows HUD-VASH Vocational Development Specialists to provide employment and other services to the HUD-VASH job ready population at the Kino Vet center on 2801 E. Ajo Way. HUD-VASH combines rental assistance for homeless veterans with case management and clinical services provided by the VA, generally at medical centers and community-based outreach clinics. The partnership here marks the first collaboration in which VA Vocational Development Specialists are embedded in a county facility to better provide these services, said David Balderrama, who oversees the Kino Veterans Workforce Center. Michael Arinello and Matthew Staples, Vocational Development Specialists with HUD-VASH who have been working out of the Kino Center for a little over a year, said the partnership with the county offers opportunities via the Workforce Innovation and Opportunity Act that the VA wouldn’t be able to provide. The Veterans Center, for example, has several computers that vets can use for job searches and also hosts twice-monthly networking sessions with employers where they can explain in detail what they’re looking for in employees. By partnering with the Kino Veterans Center, the HUD-VASH team expanded the range of services available to them through agencies like the Primavera Foundation, La Frontera and the Community Food Bank. That prompted the team to organize a resource roundtable with more than 50 community agencies attending to give veterans a better understanding of what programs and services each agency provides in support to veteran employment. Learn more on the outreach offered to veterans, call 520-724-2646.
Several Tucson Saguaros ball players need host families for 2017 Season in PIMA COUNTY–Opening day is three weeks away and several Tucson Saguaros ball players still need a place to call “home” for the 2017 season, which gets underway at Kino Sports Complex May 25. To help match the remaining ten players with local families, the team has organized two informational sessions where families can go to meet the players and ask questions. The first is set for 6 p.m. Thursday, May 11 at the Quincie Douglas Library, 1585 E. 36th St. and the second is at 5 p.m. Thursday, May 18 at the Joel D. Valdez Main Library, 101 N. Stone Ave. Tucson Saguaros players, generally between 21-25 years old, earn a minimum salary for their play time and depend on host families to get them through the season. Most of them play for an opportunity to move up to higher-level leagues or extend their baseball careers. The team seeks potential families that can house one to two players and provide them with a bedroom to share, access to a bathroom, kitchen, and washer and dryer when possible. In return, the team will offer the families $1.50 game tickets and discounts on select Saguaros merchandise. In addition, the families must commit to house the player for the entire summer season, which runs from May to August, depending how far the team makes it during playoffs. In 2016, the Tucson Saguaros won the Pecos League Championship. Due to away games scheduled Sunday to Wednesday, the players generally only live with their host families four days out of the week. Interested families should attend the informational sessions. However, for more information on becoming a host family they may also contact Ken Weir at (575) 491-3216 or weirken61@hotmail.com. The team must have all players assigned to families before the team’s first game on May 25. To see the Tucson Saguaros 2017 schedule and purchase general admission game tickets or season passes, visit the Tucson Saguaros website.
The House Gets One Step Closer to Scrapping Dodd-Frank “On Thursday, the House Financial Services Committee approved the Final Choice Act, thus helping President Donald Trump move one step closer to his long-stated goal of repealing the Dodd-Frank Act. The bill now must be passed by the full House and Senate before becoming law. The Choice Act—which stands for Creating Hope and Opportunity for Investors, Consumers, and Entrepreneurs—is in some ways a repeal-and-replace initiative for the financial sector. For instance, the bill would do away with Title II of Dodd-Frank, the section that created the Orderly Liquidation provision and provides a government guided wind-down process for banks facing bankruptcy. In its place, Republicans would create a new section of the bankruptcy code specifically targeted at large financial institutions. But overall, the Choice Act is heavier on repeal than it is on replace. The Act would do away with Title IV of Dodd-Frank, which gives the Financial Stability Oversight Council (FSOC) the ability to designate financial organizations as systemically important and impose more rules and regulations on them. The Act would also call for the dissolution of FSOC, repeal the portion of the law responsible for the Volcker Rule (which a major bank just got caught breaking for the first time), and kill the fiduciary rule once and for all.” (The Atlantic)
Why Chipotle May Never Make a Big Comeback “The good news for Chipotle is that its food doesn’t appear to be making customers sick anymore. The bad news is that investors should be sick over the embattled company’s unrealistic growth expectations and financial mismanagement. Many investors are still buying expensive Chipotle shares in hopes that the company returns to its prosperous days in 2014. That’s not going to happen. Before 2015, Chipotle was the envy of restaurant operators across the country. Many industry participants were convinced Chipotle had cracked the code on an industry operating model that led to outsized margins. But the outbreak of foodborne illnesses that broke out coast to coast for five months in 2015 has permanently impaired the profitability of its business model. Simply put, the company’s lack of investment in basic food safety procedures violated the first rule of running a restaurant: Don’t get the customer sick.”(Fortune)
When Your Game Needs a Boost, Call the Commercial Real Estate Coach, Rod Santomassimo “If you’re a broker pulling in an extremely respectable $8 million in gross commissions a year, what do you do to jump to the next level? If you’re Cushman & Wakefield’s Robert Knakal, you call real estate coach Rod Santomassimo.” (Commercial Observer)
Gramercy Europe, AXA Trade $1.1B Portfolio “Gramercy Property Europe plc, a Europe-focused real estate investment fund sponsored by Gramercy Property Trust (GPT) and managed by a GPT subsidiary, has entered into an agreement to sell 100 percent of its assets to a consortium of clients managed by AXA Investment Managers – Real Assets, GPT announced Tuesday. The deal’s total gross valuation reportedly is about €1.0 billion ($1.1 billion), with an exit cap rate of approximately 6.2 percent. Simultaneously, GPT will dispose of its 5.1 percent direct minority interest in eight Gramercy Europe properties. The two transactions are expected to result in net distributions to the REIT of about ˆ90.7 million ($96.6 million). Gramercy Europe (Jersey) Ltd., Gramercy’s Jersey-based investment and asset management subsidiary, will manage the assets for the buyer for one year following the closing date.” (Commercial Property Executive)
Goldman, Deutsche Bank and Morgan Stanley Lend $760M on Olympic Tower “Crown Acquisitions has nabbed a $760 million refinancing for the commercial portion of the Olympic Tower plus three surrounding Midtown properties, according to property records filed with the city this afternoon. The debt was provided by a trio of lenders: Goldman Sachs, Deutsche Bank and Morgan Stanley. The loan consolidates a $250 million Deutsche Bank loan on the building from March 2012 and a $510 million new mortgage provided by the threesome. The financing covers the Olympic Tower’s retail and office condos, located at 641 Fifth Avenue between East 51st and East 52nd Streets, and the neighboring seven-story office building at 10 East 52nd Street and two retail properties at 647 Fifth Avenue and 649 Fifth Avenue.” (Commercial Observer)
Why Hudson's Bay is shopping for a takeover among 2017's bloodbath “The first quarter of the year has deepened a period of bloodletting in the retail industry: Over the last few months, nearly a dozen retailers have filed for Chapter 11 bankruptcy protection and many more have announced major store closure plans and financial restructuring efforts. As retailers slim down their store counts — and in some cases buckle under mounting debt burdens — analysts anticipate a period of consolidation for the industry, in which similar retailers will merge in order to survive. Retailers that position themselves as conglomerates stand to gain, making Hudson’s Bay Company’s growth strategy — leveraging the prime real estate of luxury department stores — particularly intriguing.” (Retail Dive)
Cousins Continues $300M Disposition Plan with Atlanta Sale “Cousins Properties and Gables Residential have completed the $199 million disposition of Emory Point I and II, a mixed-use property in Atlanta. The asset features 750 apartment units and 125,000 square feet of first-floor retail space. Located at 855 Emory Point Drive, the community offers one-, two- and three-bedroom units ranging in size from 393 to 1,469 square feet. Community amenities include granite countertops, tiled flooring, washer and dryer appliances and 10-foot ceilings. The property also features controlled access, fitness and business centers, clubhouse, playground, three swimming pools with spa, media room and 858 parking stalls. Emory Point is located close to Emory University, Atlanta VA Medical Center and Tuco Hill Shopping Center.” (MultiHousing News)
Soon-to-be Witkoff-owned project will add to SaMo’s affordable housing supply “A fully affordable apartment complex is underway in Santa Monica, the biggest project of its kind in three years. The five-story, 64-unit complex, which broke ground last week, is being developed and financed by KRE Capital in an agreement with the city. As part of the deal, the city approved its 249-unit market-rate project nearby at 500 Broadway. New York developer Steven Witkoff is in talks to acquire both complexes, The Real Deal reported in March. The “Arroyo” affordable apartments will span 55,700 square feet and contain one-bedroom, two-bedrooms, and three-bedroom units. The Community Corporation of Santa Monica will manage the complex. KRE will bankroll the $44 million project, Santa Monica Lookout reported, with the help of a construction loan and low-income housing tax credits. Construction is slated to be complete within 18 months.” (The Real Deal Los Angeles)
Pennsylvania Real Estate Investment Trust (PEI): Ignore the noise and focus on the technical “With all other things going on, Pennsylvania Real Estate Investment Trust (NYSE:PEI) has been on a free fall — declining -22.91 percent in just three months. It looks like traders are not happy with the stock. On the other side, analysts now consider Pennsylvania Real Estate Investment Trust a neutral, and a technical analysis of the stock is setting somewhat neutral outlook for now. Let’s talk about the gap between analyst price targets for the next 12 months and Pennsylvania Real Estate Investment Trust (PEI)‘s current share price. Normally this spread should be in positive territory, indicating that analysts expect an investment’s value to increase over time. So is with Pennsylvania Real Estate Investment Trust. The median target of analyst views collected by Yahoo Finance was as much as $4.5 below PEI’s recent stock price. That’s the optimistic view from Wall Street.” (USA Commerce Daily)