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.
Thursday, the Dow Jones industrial average climbed 217 points, or 1.3%, to 17,141.75. The Standard & Poor’s 500 index rose 29.62 points, or 1.5%, to 2,023.86. The NASDAQ composite rose 87.25 points, or 1.8%, to 4,870.10.
Benchmark U.S. crude lost 26 cents to close at $46.38 a barrel on the New York Mercantile Exchange. Brent crude, used to price international oils, declined 44 cents to $48.71 a barrel in London. In other futures trading on the NYMEX, wholesale gasoline fell 0.1 cents to close at $1.307 a gallon. Heating oil rose 0.3 cents to close at $1.486 a gallon. Natural gas fell 6.5 cents to close at $2.453 per 1,000 cubic feet.
Walmart Outlines Three Year Growth Plan “The world’s largest retailer plans to grow sales by $45 billion to $60 billion in the next three years and spend $20 billion buying back its own shares. The growth targets, stock buyback program and an $11 billion capital expenditure program, down from $12.4 billion this year, were announced Wednesday morning in New York at the retailer’s annual fall investor conference.” (Chain Store Age)
REITs: Are Big Backers Like Sovereign Wealth Funds And Pensions Good Or Bad? “The real estate investment trust, or REIT, sector has had a rough year so far share price wise. That said, operationally things appear to be going well for most REITs. One issue that’s popped up more than once, however, is the high price of acquisitions. And the trend toward partnering up with sovereign wealth funds and pensions could be a part of the problem.” (Seeking Alpha)
Commercial Real Estate: Percolating, Not About to Blow “With capitalization rates near record lows, prices for buildings soaring and rents rising as vacancy rates shrink, talk is spreading that commercial real estate may be in bubble territory. But whereas analysts see signs of frothiness in a few pockets of the market, they say that the situation overall really isn’t overdone.” (Institutional Investor)
What is the Future of Commercial Real Estate Private Investing? “Heather Schwarz Lopes, Co-Founder and Chief Strategy Officer at EarlyShares.com spends some time with me at the CREW Network Annual Convention in Bellevue, Washington and gives a very animated account of crowdfunding and what is big that is going on.” (CRERadio.com)
CMBS Market Steady Despite Widening Spreads “Despite concern from some about widening spreads on investment-grade commercial mortgage-backed securities, metrics on CMBS issuances and falling delinquencies indicate a fairly sunny outlook. In minutes detailing the Federal Reserve’s meeting last month – in which the Fed decided it would maintain interest rates near zero – the central bank noted that spreads on CMBS ‘widened noticeably in August, reportedly a result of heavy issuance.’” (The Real Deal)
Economy Watch: CRE in a Goldilocks Zone? “With the third quarter now finished, commercial property reports focusing on U.S. property markets in 3Q are being released, including the latest from the largest CRE service firm, CBRE Group. CBRE’s Americas chief economist Jeffrey Havsy put it this way in a statement: ‘The commercial real estate markets remain near a ‘Goldilocks’ equilibrium, neither too hot nor too cold. The pace of supply is increasing, but demand remains solid and rent growth is increasing at a sustainable level.’” (Commercial Property Executive)
California Implements Energy Benchmarking Mandate for Commercial and Multifamily Industry “For most properties that require residents to pay utilities, there’s been a slow move towards energy benchmarking because, let’s face it, if it’s not saving you money, why invest in it? Soon, there may be no question whether you measure your energy use or not. Last week, California became the first state to enact a law requiring commercial buildings to benchmark their energy use, which will also be expanded to include large multifamily properties.” (Multifamily Executive)
Boston Global CEO on Lessons From $3.5B Seaport Project “John Hynes III, CEO of Boston Global Investors, is a major force in the metamorphosis of the Boston waterfront from a dying industrial district into one of the hottest and biggest new urban neighborhoods in the nation. His project—the 6.3M SF, $3.5B Seaport Square being developed with Morgan Stanley—will be one of the most valuable new urban districts on the East Coast. How did he and his team do this? What’s happening there now?” (Bisnow)
Beige Book: CRE Great But Labor Market Tightens “The Federal Reserve Bank has released its seventh and next-to-last Beige Book for 2015, chronicling the economic developments in the Fed’s 12 Districts since the last report some six week ago. Surprisingly, given the rollercoaster ride the stock market and global economy has been on, the report shows modest economic growth overall. As for commercial real estate, the prognosis is downright enthusiastic.” (GlobeSt.com)
Brooklyn’s 15 Hottest Retail Corridors “The Real Estate Board of New York (REBNY) has launched its first ever Brooklyn Retail Report, a new study that will analyze ground floor asking rents in 15 of the borough’s top retail corridors. In the inaugural Third Quarter 2015 Brooklyn Retail Report, Williamsburg’s Bedford Avenue, between Grand Street and North 12th Street, registered the highest average asking rent of $347 per square foot.” (Commercial Property Executive)
US budget gap for 2015 at $439 billion, lowest in 8 years – The U.S. budget deficit for 2015 has fallen to its lowest level in eight years, spurred by gains in tax revenue that outpaced greater government spending. The Treasury Department said Thursday that the deficit in the just-completed 2015 budget year fell to $439 billion from $483 billion in 2014. It is equal to 2.5% of the economy, the smallest proportion since 2007, and below the average of the past 40 years. The latest figures coincide with intensifying budget battles in Washington. Congress and the White House face an early November deadline to raise the nation’s borrowing limit. Lawmakers are seeking a separate agreement with the Obama administration on a budget to keep the government open past a Dec. 11 deadline.
Treasury warns Congress: Debt limit deadline now Nov. 3 — The Treasury Department on Thursday told Congress that it needs to act or the government will be dangerously close to being unable to pay all its bills. That is sooner than anticipated but some GOP lawmaker feel Treasury Secretary Jacob Lew is trying to rush them into approving an increase in the governments $18.1 million borrowing limit. If the government runs out of cash, it cannot meet obligations such as interest payments, Medicare payments and Social Security checks. The government has never defaulted on its obligations, and a severe market reaction would be all but certain if it did.