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Economy Watch: The Business Cycle Abides
The case for pessimism might now be spreading to Wall Street after its recent flirtation with the 10,000 highlands, since the Dow Jones Industrial Average was down 104.22 points, or 1.05 percent, on Monday, ending well below 9,900. The S&P 500 and the Nasdaq were also off, 1.17 percent and 0.59 percent respectively.
Organization Launches $4B Green Initiative for Affordable Housing
The green movement in commercial real estate has caught on like wildfire and even with the recession having left most clutching their pocketbooks, it continues to spread. Now Columbia, Md.-based Enterprise Community Investment Inc. plans to take the trend to new heights with the kicking off its $4 billion Green Communities initiative, which is designed to propel the greening of affordable housing development across the country.
Economy Watch: Capmark Files for Bankruptcy
Major commercial real estate lender Capmark Financial Group Inc. and various subsidiaries have filed for Chapter 11 bankruptcy, which last month the company had warned was coming. The move will allow the Capmark to reorganize and, very likely, delay selling off some of its $20 billion-plus in assets at less-than-desirable prices.
$135M Financing Secured for 1MSF Yonkers Shopping Center
It's almost like the good old days of 2007 when loans over $100 million for commercial real estate practically rained from the sky. Undeniably, those times have not returned, but news that Brooks Shopping Center L.L.C., owner of the 1 million square-foot Cross County Shopping Center in Yonkers, N.Y., has gotten its hands on a $135 million first mortgage to finance the property's redevelopment certainly brings back good memories.
Economy Watch - Homebuyer Tax Credit Sees Some Cheating
In testimony reminiscent of dogs getting credit-card applications approved back during the mid-2000s credit bubble, a Treasury Department inspector told Congress that kids as young as four years old have been able to receive $8,000 first-time homebuyer tax credits. “Some key controls were missing to prevent an individual from erroneously or fraudulently claiming the credit,” J. Russell George told the House Ways and Means Committee’s oversight panel on Thursday.
7 Come 2011
There have been hints for awhile that some of the most well-known titans in the industry were about to be dealt some major losses. Last week’s news was that the deal for Peter Cooper Village and Stuyvesant Town, Manhattan’s most high-profile apartment complex, appears to be moving toward default. According to the report in the Wall Street Journal, the equity investors and many of the lenders associated with this apartment complex, including several state pension funds, may well see most (if not all) of their investment gone.
Compelling Opportunities in International Real Estate
Investors in U.S. REITs and other U.S. property companies should consider investing in publicly traded REITs and property companies abroad. Within developed markets globally, the aggregate equity market capitalization of this sector totals $600-plus billion, two thirds of which are outside of the United States. My team and I continue to identify very compelling investment opportunities in international markets and encourage investors to consider “going global” as part of their real estate allocations.
Fitch: CRE Losses to Increase into Next Year
Good news in the commercial real estate world seems to be in short supply these days. In a study released earlier this week by Fitch Ratings, they’re indicating that losses will increase this year and next for the U.S. CMBS.
Economy Watch: Beige Book Describes Modest Recovery
The Federal Reserve’s most recent Summary of Commentary on Current Economic Conditions,better known as the Beige Book, wasn’t exactly cheerful about the stateof the U.S. economy toward the end of annus horribilis 2009. But itwasn’t precisely pessimistic either.
Specialization Helps Close Deals
In most sports, coaches use specialists to deal with pressure situations. In football, for example, they will bring in a slash-type runner on offense to cross the goal line or a pass rusher on defense to sack the quarterback. These specialists have specific skills and in many cases prove to be the difference between victory and defeat. For those in real estate, and particularly with Stan Johnson Co., specialization is the maxim for those that want to succeed in these trying times and get deals closed, no matter what the size or complexity.
Germany's Promising Discount Retail Market Lures Behringer Harvard
With the recession having taken a chunk out of consumers' pocketbooks around the world, the retail real estate market has been struggling for quite some time, and the situation is no different in Germany. However, the discount retail sub-sector is thriving in the country, and Dallas-based commercial real estate firm Behringer Harvard has positioned itself to capitalize on related development opportunities with the recent formation of Behringer Harvard German Retail, a joint venture with Hanover, Germany-based real estate investment and management company Rahlfs Immobilien GmbH.
Consumers Warm to Green Energy, But Questions Remain
Concerns about energy costs and the environment are driving consumer behavior as they choose between a growing selection of green energy initiatives, according to new research from Nielsen Claritas. “Energy Trends: Highlights on Consumer Energy Usage,” which draws on the responses of more than 32,000 respondents about their energy use, found that while some consumers are adopting green habits, many have not been as quick to jump onboard.
Economy Watch: No Rush to Build More Houses
U.S. housing starts posted a gain in September, but only a modest one,pointing to a still-modest rate of recovery for the overall economy.According to the U.S. Department of Commerce, the rate of new homestarted inched upward by 0.5 percent during the month to a seasonally adjustedrate of about 590,000 units. Ever-optimistic economists, it seems, wereexpecting more.
Economy Watch: More Medicine for Ill Housing Market
The U.S. housing market might not be quite as deathly ill as it was a year ago, but no one is suggesting--to stretch the health metaphor--that it will get up and run a marathon any time soon. In fact, the industry is wheezing and gasping a little at the thought of the looming expiration of the $8,000 first-timer tax credit, so plans have been hatched in Congress to keep the credit in place.
Manhattan Retail Hit Hard in '09, But Turnaround on Tap
It's been a rough year for retail, even in tony Manhattan. The crumbling of Wall Street in the fourth-quarter of 2008 spurred the downward spiral of the market and the recession just added salt to the wound, according to a third quarter report by Marcus & Millichap Real Estate Investment Services.
RCA: Recovery Rate on Defaulted Loans Only 60%
It comes as no surprise that lenders continue to be plagued by commercial mortgage defaults and, according to a recently released U.S. Capital Trends report by global research and consulting firm Real Capital Analytics, the recovery rate on these troubled loans is just 60 percent.
Economy Watch: More Bank Failures Dead Ahead
Which bank will be lucky 100th bank to fail in 2009? Or more fittingly, the unlucky 100th? The world will have to wait until next weekend.
The Graying of America: Age and Opportunity
The graying of America may arguably be one of the single most dramatic demographic megatrends shaping our landscape. Although the U.S. population growth for individuals age 55 and over during the past nine years hasn’t been impressive—from 21.06 percent to 24.17 percent—growth for individuals age 55-64 increased by 30 percent over the same period. Given that the oldest Boomers turned 63 this year, maybe it’s time investors consider the opportunities this megatrend offers.
As San Antonio Office Market Rebounds, Transwestern Takes Over at 2MSF Mixed-Use
With San Antonio's office market rebounding in the third quarter, Transwestern’s local office hopes to take advantage of that good karma with the contract to handle the real estate services assignment for the Brooks City-Base development there.
Economy Watch - Foreclosures Trend Upward in Usual Places
More than 925,000 U.S. homeowners received a foreclosure notice of some kind -- a default notice, scheduled auction or bank repossession -- during the third quarter of 2009, according to RealtyTrac, a figure that represents a 5 percent increase over the second quarter and a 23 percent increase over 3Q08. One in every 136 U.S. housing units received a foreclosure filing during the quarter, which was the highest quarterly foreclosure rate since the company began issuing its report in the first quarter of 2005 -- though admittedly, that was during the run up to the bubble peak.
