Real Estate Daily News Buzz Aug. 21, 2017

Real Estate Daily News Buzz Aug. 21, 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.

Friday, the S&P 500 lost 4.46 points, or 0.2 percent, to 2,425.55. The Dow Jones industrial average fell 76.22 points, or 0.3 percent, to 21,674.55. The Nasdaq composite shed 5.39 points, or 0.1 percent, to 6,216.53. The Russell 2000 index of smaller-company stocks gave up 1.15 point, or 0.1 percent, to 1,357.79. The index has fallen 6 percent since July 25.

Benchmark U.S. crude oil jumped $1.42, or 3 percent, to $48.51 a barrel in New York. Brent crude, the international standard, added $1.69, or 3.3 percent, to $52.72 a barrel in London. Wholesale gasoline rose 4 cents to $1.62 a gallon. Heating oil added 4 cents to $1.62 a gallon. Natural gas lost 4 cents to $2.89 per 1,000 cubic feet.

11 US states added jobs in JulyHiring increased in 11 U.S. states in July, while the unemployment rate tumbled to record lows in two states. The Labor Department says that unemployment rates were relatively stable in most states. They fell in 15 states and rose in 23, but many of the changes were statistically insignificant.

China to Limit Overseas Investments in Real Estate, Sports “China’s government is moving to curb domestic companies’ investments abroad in property, sports, entertainment and other fields, following a series of high-profile, multibillion-dollar acquisitions by Chinese firms. A document released Friday by the State Council, China’s Cabinet, was the latest move by regulators to tap the brakes on a string of foreign acquisitions, citing concerns that the companies involved may be taking on too much debt.” (Associated Press)

Apartment Fires Are Tied to Cheaper, Wood-Based Construction “Shortly after Independence Day last year, developer Rick Holliday got a call informing him his 105-unit apartment building, under construction in Oakland, Calf., had gone up in flames. Mr. Holliday suspected the fire was sparked by teenagers shooting off fireworks at the crucial point when the structure was fully framed with wood but the sprinkler system wasn’t yet installed. He began a $15 million rebuilding job, again using wood.” (Wall Street Journal, subscription required)

Real Estate Remains Largely Silent on Trump’s Charlottesville Stance, Even as Big Business Slams Him “Top business leaders, including the heads of General Electric and Apple, slammed Trump for equivocating. Real estate leaders, by contrast, have largely stayed mum. In an attempt to take the temperature of the industry, The Real Deal reached out to over 50 leaders of development firms, commercial and residential brokerages and public real estate investment trusts. Overwhelmingly, they either declined to comment or did not respond to requests for comment. Those who did, for the most part, offered up a more general denunciation of racism and bigotry but shied away from addressing the president’s comments.” (The Real Deal)

On Hard-to-Use Brownfields, Property Owners See a New Option Shining Down on Them “Now an alternative to commercial redevelopment is emerging: conversion into solar power installations. Brownfield advocates locally and around the country are touting the unique suitability of many former landfills to host solar panels, thereby wringing at least some value out of even the worst contamination sites. ‘Using capped landfills for solar development is something that has the potential to provide a great amount of energy to the country,’ said Joe Mahowald, a program associate with Minnesota Brownfields, a nonprofit group devoted to promoting the redevelopment of contaminated lands.” (Minneapolis Star Tribune)

Gap’s CEO Just Had a Bizarre Rant on Why He Doesn’t Run a Mall Retailer “Gap is back, mall rats. But it wants to remind you that it’s not just a mall retailer. ‘Really, it’s just flat-out wrong,’ said CEO Art Peck on the Gap Inc. (GPS) earnings call Thursday Aug. 17, urging everyone to refrain from calling Gap a ‘mall-based apparel retailer.’ ‘We have clear points of advantage,’ he said, first and foremost including ‘our portfolio of iconic, profitable brands.’ Iconic? Eh, probably a stretch. But profitable isn’t far off.” (The Street)

QCP Seeking Receivership for HCR ManorCare Properties “Quality Care Properties (NYSE: QCP) has begun legal proceedings to have an independent receiver take over the operations of its skilled nursing and assisted living/memory care communities that currently are being operated by HCR ManorCare. Toledo, Ohio-based ManorCare operates more than 500 skilled nursing facilities (SNFs), assisted living communities, outpatient rehab clinics, memory care communities, and hospice and home health agencies.” (Skilled Nursing News)

GGP Starts Renovation of New HQ “Shortly after signing a lease agreement at River North Point, shopping mall owner GGP tapped Skender Construction to renovate its new headquarters. The developer will work together with design firms ARCHIDEAS and Environmental Systems Design as well as JLL to bring the project to completion by January 2018. GGP, formerly known as General Growth Properties, decided to relocate its 700 employees from its current office at 110 N. Upper Wacker Drive to 350 N. Orleans because developers are planning to tear down the five-story building.” (Commercial Property Executive)

How to Build a Real Estate Brand from Scratch in 9 Months “Figuring out the brand’s purpose and values before creating a logo (or even a name) can be fruitful for broker-owners building from the ground up. Finding the right space and creating an office look and feel that supports the brand can create a sort of community hub. Brand consistency can help put your brokerage at the forefront of your market if you’ve nailed the basics.” (Inman)

Number of Equity-Rich Properties Continues to Grow “ATTOM Data Solutions’ Q2 2017 U.S. Home Equity & Underwater Report shows that at the end of the second quarter of 2017, there were more than 14 million U.S. properties that were equity-rich – where the combined loan amount secured by the property was 50% or less of the estimated market value of the property. This figure was up by nearly 320,000 properties from the previous quarter and up by more than 1.6 million properties from a year ago. The 14 million equity-rich U.S. properties represented 24.6% of all U.S. properties with a mortgage, up from 24.3% in the previous quarter and up from 22.1% in Q2 2016.” (MortgageOrb)

Dominion Names Future HQ; May Unload Fan, Downtown Properties “With the first of potentially two new towers under construction on Sixth Street, Richmond’s resident utility giant has chosen a name for its forthcoming downtown complex – and it’s also mulling the future of two other sizable properties in the city. Dominion Energy this week announced that the 20-story, nearly 1-million-square-foot office building taking shape at its 111 S. Sixth St. headquarters will be called Canal Place, spokesman Ryan Frazier said. That building, being developed by Richmond’s Hourigan Construction and Chicago-based Clayco, will be dubbed 600 Canal Place, due to its address at 600 Canal St.” (Richmond BizSense)


Real Estate Daily News Buzz Aug. 17, 2017

Real Estate Daily News Buzz Aug. 17, 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.

The Standard & Poor’s 500 index picked up 3.50 points, or 0.1 percent, to 2,468.11. The Dow Jones industrial average added 25.88 points, or 0.1 percent, to 22,024.87. The Nasdaq composite gained 12.10 points, or 0.2 percent, to 6,345.11. The Russell 2000 index of smaller companies inched up 0.30 points to 1,383.53.

Benchmark U.S. crude lost 77 cents, or 1.6 percent, to $46.78 a barrel in New York. Brent crude, used to price international oils, dipped 53 cents, or 1 percent, to $50.27 a barrel in London.

In other energy trading, wholesale gasoline lost 2 cents to $1.56 a gallon. Heating oil fell 3 cents to $1.57 a gallon. Natural gas shed 5 cents to $2.89 per 1,000 cubic feet.

US stocks edge higher as retailers rally; oil companies fall — US stocks mostly rise as retailers like Urban Outfitters recover from their stumble a day ago. Energy companies dipped along with the price of crude oil. (AP)

US demands big NAFTA changes, setting stage for tough talks — The United States won’t settle for cosmetic changes to the North American Free Trade Agreement, the top U.S. trade negotiator said Wednesday, as the U.S., Canada and Mexico began to renegotiate the 23-year-old trade pact and fulfill one of President Donald Trump’s campaign pledges. In a statement at the opening of five days of talks, U.S. Trade Rep. Robert Lighthizer said that Trump “is not interested in a mere tweaking of a few provisions and an updating of a few chapters. (AP)

On a chaotic day in DC, Trump goes after Amazon, again — President Donald Trump is renewing his attacks on Amazon, and he says the company is “doing great damage to tax paying retailers.” Trump, on Twitter, said that “towns, cities and states throughout the U.S. are being hurt – many jobs being lost!” He’s often criticized the company and CEO Jeff Bezos, who also owns The Washington Post. Many traditional retailers are closing stores and blaming Amazon for a shift to buying goods online. But the company has been hiring thousands of warehouse workers. (AP)

Protests at Google offices over worker’s firing are canceled — Protests planned at Google offices around the country over the firing of an employee who questioned company diversity efforts have been postponed. A statement on the “March on Google” website says Saturday’s protests are being canceled because of threats from what it called “alt left terrorist groups.” Protest organizers didn’t respond to requests for information about the alleged threats or which authorities were notified about them. (AP)

Walmart’s CEO Joins Group to Rebuke Trump Over Charlottesville “Walmart’s chief executive issued a strong rebuke of President Trump’s response to the protests that turned violent in Charlottesville, Va., saying the president ‘missed a critical opportunity to help bring our country together.’ The criticism came in a statement that the retailer’s chief executive, Doug McMillon, emailed to employees Monday evening, which was reviewed by The New York Times. The statement was later posted on a company website.” (The New York Times)

Amazon Adds ‘Instant Pickup’ in U.S. Brick-and-Mortar Push “ Inc is rolling out U.S. pickup points where shoppers can retrieve items immediately after ordering them, shortening delivery times from hours to minutes in its latest move into brick-and-mortar retail. The world’s largest online retailer has launched ‘Instant Pickup’ points around five college campuses, such as the University of California at Berkeley, it said on Tuesday. Amazon has plans to add the program to more sites by the end of the year.” (Reuters)

In Chicago, Teaching an Old Site New Tricks “For more than 100 years, the A. Finkl & Sons Steel plant on the North Branch of the Chicago River was a big employer in Chicago as it supplied the world with a wide range of steel products. Today a real-estate developer is planning to convert the 22-acre former plant site into office, retail and residential uses as the third largest American city reinvents itself.” (Wall Street Journal, subscription required)

More Than 500 Buildings Across NYC Are Likely Vacant “A title company has used open data to map more than 500 buildings across NYC that are likely vacant. Daniel Price, founder and CEO of OneTitle National Guaranty Company, analyzed 40,000 calls to NYC’s 311 line over the last six years and matched them with other data to identify 541 properties in 137 zip codes that could become targets for developers as well as for nonprofits and affordable housing.” (New York Post)

Kushner Companies Hit with Rent-Stabilization Lawsuit in Brooklyn Heights “Kushner Companies violated rent-stabilization laws at a building the company owns in Brooklyn Heights, a new class-action lawsuit alleges. The legal action comes at a time when the company is already facing scrutiny over its ownership and management of a massive multifamily portfolio with hundreds of rent-stabilized units across the city, and puts a further spotlight on Jared Kushner, the former CEO of the firm and top White House adviser who continues to hold a stake in the Brooklyn Heights property.” (The Real Deal)

In a Retail Storm, Strip Mall Provide Some Cover “Open-air shopping centers are on the upswing. Shares of real-estate investment trusts that own and operate the broad category of open-air shopping centers are up about 7% since June 30 after skidding 19.6% in the first half of this year, according to an index that tracks shopping center REITs by the National Association of Real Estate Investment.” (Wall Street Journal, subscription required)

Here’s Why Bigger, More Expensive Buildings Are Usually a Better InvestmentEver wonder why investors shell out billions for trophy office towers even if cap rates are minuscule? One reason is that they tend to be more profitable than smaller buildings in the medium run. Index provider MSCI dug into annual real estate return data and found that bigger, more expensive buildings outperformed their smaller peers globally in 17 out of the past 18 years (see chart). The catch: the one year they didn’t was 2016, and time will tell whether this is the beginning of a new trend.” (The Real Deal)

Retail Comeback, Or Just a Few Bright Spots? “Good news for retail came out of the Census Bureau yesterday. July turned out to be not just better than expected but also the month with the biggest rebound in retail sales all year, rising 0.6% for the month and 4.2% since July 2016. What’s more, revised data for May and June show a brighter picture than preliminary estimates had indicated, eliminating what had appeared to be a decline in retail sales.” (Forbes)

Understanding the HVCRE Bill “Reps. Robert Pittenger (R-N.C.) and David Scott (D-Ga.) recently introduced H.R. 2148 in an attempt to clarify what qualifies as a high volatility commercial real estate (HVCRE) loan and what doesn’t. The bipartisan bill, titled Clarifying High Volatility Commercial Real Estate Loans, has since been co-sponsored by Republican representatives for North Carolina, Ohio, Florida, Kentucky, Missouri and Colorado.” (Commercial Property Executive)

These Are the 10 Most Expensive NFL Stadiums Your Precious Tax Dollars Paid For “This season, as always, taxpayers are giving NFL owners money whether they watch football or not. If you live in a National Football League market that isn’t New York — where the owners of the Giants and Jets and their investors covered all of MetLife Stadium’s $1.6 billion cost — your tax dollars are likely paying for the home team’s facilities. It isn’t just a minor contribution, either.” (The Street)


Real Estate Daily News Buzz Aug. 16, 2017

Real Estate Daily News Buzz Aug. 16, 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.

Tuesday, the Standard & Poor’s 500 index lost 1.23 points, or less than 0.1 percent, to 2,464.61. The Dow Jones industrial average picked up 5.28 points to 21,998.99. The Nasdaq composite fell 7.22 points, or 0.1 percent, to 6,333.01. The Russell 2000 index of smaller-company stocks shed 11.07 points, or 0.8 percent, to 1,383.24.

U.S. crude oil lost 4 cents to $47.55 a barrel in New York. Brent crude, the international standard, added 7 cents to $50.80 a barrel in London. Wholesale gasoline remained at $1.58 a gallon. Heating oil lost 1 cent to $1.60 a gallon. Natural gas fell 2 cents to $2.94 per 1,000 cubic feet.

US homebuilder sentiment climbs in August — U.S. homebuilders are feeling more optimistic about their sales prospects, reflecting a pickup in demand and positive expectations about further growth the rest of this year. The National Association of Home Builders/Wells Fargo builder sentiment index released Tuesday rose to 68 this month. That’s up four points from a reading of 64 in July and the highest level since May.

US retail sales jumped 0.6 percent in July — Consumers went out shopping in a big way in July, pushing up retail sales by the largest amount in seven months. The Commerce Department says retail sales advanced 0.6 percent last month, the best showing since a gain of 0.9 percent last December.

Opinion survey available on improvements to portion of Santa Cruz River The Sonoran Institute and Pima County are asking for public input on a management plan for a stretch of the Santa Cruz River from Grant Road to Trico Road. Enhanced river conditions and improved effluent water quality have increased the volume of water entering the regional aquifer. The survey will help determine how the river can serve as an amenity to the community. Community workshops are scheduled for October.
Sonoran Institute:
Pima County Regional Flood Control District:

City of Tucson approves West Side Landfill cleanup and infrastructure improvements – The Mayor and Tucson City Council voted last week to spend $9 million on landfill remediation and infrastructure improvements to the west end of downtown. The package includes neighborhood upgrades and a partnership with Rio Nuevo to facilitate Caterpillar site improvements and invest in surrounding roadways. The funding will clean and remediate 300,000 cubic yards of old landfill across 8 acres of city owned land on the west bank of the Santa Cruz River. The newly authorized work also includes a partnership with Rio Nuevo to support Caterpillar site improvements and investment in the build out of historic Mission Lane. The vote brings more than $1 million worth of street repair, lighting, and pedestrian connections in Barrio Sin Nombre. Construction sales tax revenue and building permit fees from the Caterpillar development will be used to build access to the site along Avenida del Convento. “These improvements will serve as a catalyst for ongoing investment in the west end of downtown,” said Ward 1 Council Member Regina Romero.

Investors Take On Mortgage Risk from Fannie Mae, Freddie Mac “Investors are snapping up a new type of security sold by Fannie Mae and Freddie Mac, increasingly assuming the risks of mortgage defaults from taxpayers and powering a quiet transformation of the housing giants after almost a decade of government control. Fannie and Freddie have sold roughly $48 billion of the securities since 2013 to a broadening group of buyers including asset managers and insurance companies.” (Wall Street Journal, subscription required)

Amazon to Issue Up to $16 Billion in Debt to Fund Whole Foods Acquisition “ Inc. is planning to issue up to $16 billion in debt to fund its planned acquisition of Whole Foods Market Inc., Moody’s Investors Service said Monday. The ratings agency assigned the deal a Baa1 rating and revised Amazon’s credit outlook to positive from stable. The move ‘reflects our view that despite the increase in debt, the Whole Foods acquisition is an immediate credit positive for the company on a variety of fronts,’ Moody’s Vice President Charlie O’Shea wrote in a note.” (MarketWatch)

Homebuyers Put Less and Less Skin in the Game, Adding to the Market’s Overall Risk “It feels like déjà vu in mortgage land all over again. Homebuyers are increasingly opting to put less money down when purchasing their homes, increasing their risk should the housing market, and specifically home prices, falter yet again. When home prices crashed in the last decade, millions of borrowers fell underwater on their home loans, prompting a foreclosure crisis of epic proportions. It all begs the question, could it happen again?” (CNBC)

Chicago Property Market Heats Up as Food Companies Pile In “In Chicago’s trendy Fulton Market district, a once gritty area known only for Oprah Winfrey’s Harpo Studios, construction crews have started facade work on a new headquarters for McDonald’s Corp., which is returning to the city after more than four decades in the suburbs. McDonald’s, now building at the former Harpo site, isn’t alone in making that move. Conagra Foods Inc., Hickory Farms Inc. and other traditional American heartland companies have shifted major operations to Chicago in recent years as well.” (Wall Street Journal, subscription required)

Investors Are Walking Away from Property “New research from the Residential Landlord Association suggests that a significant number of property investors are set to turn their backs on life as a landlord. Its survey of 3,000 landlords found that almost a quarter (22%) plan to sell at least one of their properties in the next 12 months, with just a paltry 18% considering expanding the size of their portfolio. It follows research from the National Landlords Association, which found landlords are losing confidence in their ability to rely on steady rental yields in order to make their investments work.” (Forbes)

Here Are the Best (And Worst) Places to Retire “As they approach retirement age, older Americans are becoming steadily more pessimistic about their future economic prospects. Where they choose to spend their golden years could make all the difference. A little more than half of working-age households are at risk of being unable to maintain their current standard of living in retirement, according to the National Retirement Risk Index measurement from the Center for Retirement Research at Boston College.” (CNBC)

Public Advocate Letitia James to Reveal Banks Backing Property Owners on ‘Worst Landlords’ List “You’ve met New York City’s worst landlords — now meet their banks. Public Advocate Letitia James will roll out a list of the financial organizations backing the property owners on her office’s “Worst Landlords Watchlist” Tuesday — with 10 banks lending more than $300 million in mortgages for landlords who landed on the list. James’ office reached out to the banks asking them to change the way they loan to landlords flagged by her office — taking it into account when considering a loan along with current violations, hazardous conditions or harassment findings.” (New York Daily News)

CIM Buys Brooklyn Office Building in $171M Deal “CIM Group has agreed to purchase, for a gross sale price of $171.0 million, the 317,600-square-foot vintage Class A office building at 16 Court St. in Brooklyn. SL Green Realty Corp. was the seller. SL Green had acquired the 36-story building in 2007 for $107.5 million through a joint venture with Joseph P. Day Realty—according to information provided by Yardi Matrix—and in 2013 took full ownership.” (Commercial Property Executive)

This Office Wants You to Pay $48 to Work There While You Drink Wine “It’s work, with wine. When you rent a desk at Pourt, a shared workspace with a cafe up front in the East Village neighborhood of New York City (35 Cooper Square), food and drink is included. Workspace rates go for $10 an hour, or a day pass for $48, and the biggest work perk is every dollar you spend can go towards food. Walk-ins are also welcome to buy refreshments separately in the cafe area, but if they want to use the wi-fi longer than 30 minutes, they’ll have to pay the hourly rate.” (Money-ish)

Major Seattle Real Estate firm Cushman & Wakefield Commerce Is Being Sold “Cushman & Wakefield Commerce, one of the larger commercial real estate firms in Seattle and Bellevue, is being acquired by the global Cushman & Wakefield group, with an eye toward expansion. The deal brings together two aligned but separate chains. The local Cushman & Wakefield Commerce brokerages employ about 750 people in markets like Seattle, Las Vegas and Salt Lake City.” (Seattle Times)