10 Must Reads for the CRE Industry Today (June 1, 2015)

10 Must Reads for the CRE Industry Today (June 1, 2015)

 

  1. The Fed Has Created a Liquidity Time Bomb “This combination of macro liquidity and market illiquidity is a time bomb. So far, it has led only to volatile flash crashes and sudden changes in bond yields and stock prices. But, over time, the longer central banks create liquidity to suppress short-run volatility, the more they will feed price bubbles in equity, bond, and other asset markets.” (MarketWatch)
  2. John Hancock Grabs Trophy Asset in Chicago’s CBD “John Hancock, the U.S. division of Toronto-based Manulife Financial Corp., is expanding its Chicago portfolio with the addition of One South Wacker, a 40-story, 1.2 million-square-foot, Class A office building in the city’s CBD, for $344 million.” (Commercial Property Executive)
  3. Fed’s Fischer Says Real Estate a Crisis Risk in Some Countries “Fed Vice Chair Stanley Fischer says he doesn’t ‘at present see a major financial crisis on the horizon. But whenever you say that, you know you’re looking for trouble.’ ‘I believe that the main place you look for financial crises to be developing is the real-estate sector.’” (Bloomberg)
  4. Construction Spending Rises More Than Expected “Construction spending rose 2.2% in April, more than expected by Wall Street economists. Expectations were for the report to show spending rose 0.7% in April.” (Business Insider)
  5. Five Below is Riding High “Seizing on what teens and preteens are into and stocking stores with the latest merchandise and selling it more cheaply than competitors in a colorful setting have made Five Below the fastest-growing retailer in its category in the country, according to eMarketer, a retail industry tracker.” (Philly.com)
  6. Managing REIT Risk by Evaluating Credit Ratings “To sleep well at night, I look to invest in those REITs that are investment grade and have the financial strength that I need and still have the ability to grow my capital. Those REITs that are sub-investment grade will typically offer much higher dividend yields, but the rating agencies are also telling us they carry much greater risk. Buyer Beware.” (Seeking Alpha)
  7. Foreigners Swoop Into Miami Real Estate with Piles of Cash “Every time the Argentine or Brazilian economy takes a plunge, Miami real estate agents see a wave of people flying north looking for a safer place to invest their money. Whenever global oil prices fall, Russians and Venezuelans start showing up. Vacationers from Europe buy properties to serve as winter retreats.” (USA Today)
  8. Dollar Tree to Sell 330 Stores to Sycamore Partners “Dollar Tree on Friday announced it had reached an agreement to sell private equity firm Sycamore Partners a divestiture package of 330 Family Dollar Stores locations, with the deal contingent on the completion of Dollar Tree’s pending acquisition of Family Dollar.” (Chain Store Age)
  9. Luxury Shopping Arrives Downtown, and Friendship Heights Braces for Departures “A year after CityCenter DC brought a slate of high-end shops downtown, and months ahead of when Ivanka Trump is expected to open luxury shops as part of a downtown hotel, the owners of the Collection at Chevy Chase recently advised that the center is in danger of losing some of the stores in the next couple of years when their leases expire.” (The Washington Post)
  10. Observers Skeptical as Fairway Plans Downsize “Burt P. Flickinger III, managing director of Strategic Resource Group, said he believed Fairway could operate a 40,000 square-foot store successfully but noted Fairway's growth plans — which fueled its IPO and investor sentiment — can’t really be executed until financials stabilize.” (Supermarket News)
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