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 Dow Jones industrial average slid 195.79 points, or 1.1 per cent, to 18,143.45. The Standard & Poor’s 500 gave up 20.24 points, or 0.9 per cent, to 2,151.13. The NASDAQ composite fell 49.39 points, or 0.9 per cent, to 5,269.15.
U.S. crude picked up 78 cents, or 1.7 per cent, to $47.83 a barrel in New York. Brent crude, the international benchmark, added 55 cents, or 1 per cent, to $49.24 a barrel in London. In other energy trading, wholesale gasoline fell 1 cent to $1.47 a gallon. Heating oil rose 2 cents to $1.51 a gallon. Natural gas shed 4 cents to $2.96 per 1,000 cubic feet.
Applications for US unemployment aid tick higher to 254,000 — More Americans sought unemployment benefits last week but the number of applications remained low, the latest sign that layoffs are scarce. The Labor Department said Thursday that weekly applications for jobless aid rose 3,000 to a seasonally adjusted 254,000. The four-week average, a less volatile measure, ticked down to 256,000, matching a 43-year low first reached in April. The number of people receiving aid dropped 46,000 to 2.1 million, the smallest number since July, 2000. Even in a healthy economy some people lose jobs as companies restructure. (AP)
US pending home sales slump in August — Fewer Americans signed contracts to buy homes in August, as a shortage of properties for sale is weighing on the market. The National Association of Realtors said Thursday its seasonally adjusted pending home sales index fell 2.4 per cent last month to 108.5, its lowest reading since January. The number of signed contracts slumped sharply in the South, the nation’s largest housing market. But pending sales improved in the Northeast, Midwest and West. Home purchases and prices have risen much of this year but a slowdown surfaced in August as a lack of inventory has hurt the market. (AP)
Average US 30-year mortgage rate slips to 3.42 per cent — Long-term U.S. mortgage rates slipped this week to the lowest level since mid-July. Mortgage giant Freddie Mac says the average for a 30-year fixed-rate mortgage dropped to 3.42 per cent, down from 3.48 per cent last week. The benchmark rate is down from 3.85 per cent a year ago and is close to its all-time low of 3.31 per cent in November 2012. The 15-year fixed-rate mortgage, popular with homeowners who are refinancing, slipped to 2.72 per cent from 2.76 per cent. The rates tumbled after the Federal Reserve decided against raising short-term rates at its meeting last week. (AP)
Your Voice, Our Future General Plan adopted by Oro Valley Town Council and will appear on the November ballot – The Oro Valley Town Council adopted the Your Voice, Our Future General Plan, confirming its readiness to go to the public vote. This plan, which will guide Oro Valley’s future over the next 10 years, was developed by residents and community members over the last three years. Now, in the November 2016 general election, final ratification will be up to the Oro Valley voters. In the coming weeks, an extensive public education campaign will commence. Your Voice volunteers and staff will be at community events to talk with residents about the Plan. Information will also be shared on the Town of Oro Valley Facebook page, in the VISTA newsletter and the Explorer Newspaper. The Your Voice, Our Future General Plan can be viewed online at www.YourVoiceOV.com. You may also view hard copies at Oro Valley Town Hall (11000 N. La Cañada Drive), the Oro Valley Public Library (1305 W. Naranja Drive) or the Oro Valley Community Center (10555 N. La Cañada Drive). Hard copies are available for purchase ($30) at Town Hall.
Trump’s Real Estate Blues: The Biggest Reason He’s Down $800 Million This Year “The presidential hopeful lost the most in New York City, home to roughly 53% of his fortune. Cooling markets for retail and office space in Manhattan helped lop about $300 million off the net value of some of his most notable buildings, including Niketown and Trump Tower (which also experienced an estimated 20% decline in net operating income). Plus a slowdown in the city’s luxury residential market hurt the value of high-end properties, such as the two dozen apartments Trump still owns in Trump Park Avenue, a former hotel he converted into condos in 2002, and his personal residence.” (Forbes)
China’s Richest Man Warns of ‘The Biggest Bubble in History’ “Chinese billionaire Wang Jianlin, whose vast property and entertainment empire reportedly brought in $44 billion in revenue last year, appeared on CNN Wednesday to warn about what lies ahead for the country’s overheated real-estate market. Jianlin pointed to the troubling fact that real estate prices just keep rising in the major cities, like Shanghai and Beijing, while falling across the rest of the country, where smaller cities are littered by properties that lie vacant.” (MarketWatch)
Detroit Housing Rises from the Ashes “The current rehabilitation of Detroit’s downtown is nothing short of fierce. Quicken Loans founder and mega real estate developer Dan Gilbert is behind the city’s biggest residential development in half a century, Brush Park, which is slated to break ground this fall. Old buildings are being transformed into residential apartments and lofts, and new micro-units are rising. The first downtown condominium project in decades is expected to begin construction in 2017: The Ashton Detroit will have 78 condos and five penthouses.” (CNBC)
Seeking Buyer: 650 Walgreens Stores “In order for its $17 billion deal with Rite Aid Corporation to close, Walgreens Boots Alliance, Inc. must meet regulatory requirements, which calls for either selling or closing up to 1,000 stores. The exact number of stores Walgreens is attempting to sell is 650, however nobody is biting. Regardless of this dilemma, Walgreens still expects its Rite-Aid deal to close in the second half of this year. According to the New York Post, private equity firms are not interested in the aforementioned Walgreens stores because they don’t see those them as high quality prospects. This doesn’t mean Walgreens stores themselves are low quality, but it likely refers to poor locations.” (Investopedia)
‘The Current Housing Recovery Could Stall’ “’The current housing recovery could stall’ if new construction does not pick up, according to the National Association of Realtors. The NAR said in its monthly report on Thursday that pending sales of single-family homes, condos and co-ops fell 2.4% in August. Economists had forecast that sales were flat, according to Bloomberg. Because pending sales reflect contract activity, they’re a good indicator of how many existing homes will eventually be sold.” (Business Insider)
Two Moody National REITs Plan to Merge “Moody National REIT I Inc. and Moody National REIT II Inc. jointly announced Tuesday that, if all goes according to plan, they will merge, with REIT II acquiring REIT I. The gross merger consideration is to be $11.00 per share of common stock of REIT I before the payment of various fees and costs, but in any case no less than a net $10.25 per share. The non-binding letter of intent between the two REITs provides that any definitive merger agreement will include go-shop and termination fee provisions.” (Commercial Property Executive)
Cosi Restaurant Chain Files for Bankruptcy “Fast-casual restaurant chain Cosi filed for Chapter 11 bankruptcy protection Wednesday in federal court in Massachusetts. The Boston-based publicly traded sandwich chain listed between $10 million and $50 million in liabilities and between $10 million and $50 million in assets, according to its bankruptcy petition. Cosi said it had reached a tentative deal to sell itself to its lenders and investment firm Milfam II L.P. in an arrangement known as a “stalking horse” bid, which sets a floor for bidding on the company’s assets.” (CNBC)
Related and Vornado Named Co-Developers of New Moynihan Station “Despite a multibillion-dollar bid-rigging scheme implicating some of his closest associates, Gov. Andrew Cuomo tried to shift the focus to an ambitious infrastructure program—a $1.6 billion plan to transform the historic James A. Farley Post Office into a world-class transportation hub that would entail revamping Pennsylvania Station, which he called the ‘train version’ of LaGuardia Airport. Cuomo announced the selection of a developer-builder team that includes three companies—Related Companies, Vornado Realty Trust and Skanska—to redevelop the Farley Building, creating the new, 250,000-square-foot Moynihan Station.” (Commercial Observer)
NYC Lawmakers Ramping Up Fight Against Section 8 Proposal “In June, the U.S. Department of Housing and Urban Development proposed changing how rental subsidies for Section 8 low-income tenants are allocated. Under the proposal, subsidies for those renters would decrease in low income neighborhoods, but increase in high-income neighborhoods. The idea of the proposal, which would apply to poor areas in New York City and 30 other metro areas, is to encourage subsidy recipients to move into wealthier areas and have access to better schools, jobs and opportunities. The plan has been criticized by New York State and City officials, who say there aren’t enough apartments in the city’s neighborhoods to accommodate the 119,000 voucher holders.” (The Real Deal)
Colorado’s a Top Bioscience Cluster: What it Means for Real Estate “Colorado is one of the nation’s top 16 major bioscience industry clusters, according to a new report by JLL, putting it in the same league as Boston, San Francisco, Raleigh-Durham and other heavyweights of the industry. Thus Colorado real estate markets are going to share the benefits of the industry’s growth. For instance, continued acquisition and consolidation in bioscience will offer small and mid-sized businesses opportunities for space in tightening clusters, and some secondary markets will do well as tenants look for affordable options outside core markets.” (Bisnow)