10 Must Reads for the CRE Industry Today (November 25 2014)

10 Must Reads for the CRE Industry Today (November 25 2014)

 

  1. Griffin Capital To Pick Up 15 Properties Thru Merger of Signature Office REIT “Signature Office REIT has agreed to merge into Griffin Capital Essential Asset REIT creating an office and industrial REIT focused on business essential properties with a capitalization of $3 billion based on gross proceeds. The combined companies will have a portfolio of 69 properties in 21 states with strong occupancy and consisting largely of single-tenant, net lease office properties.” (CoStar)
  2. RCAP Recoups 51 Selling Agreements; LPL, AIG Hold Out “Over 50 broker/dealers have agreed to resume selling products distributed by RCS Capital (RCAP), the firm said Monday. But heavyweight broker/dealers AIG Advisor Group and LPL Financial have not yet to jump back into the fray.” (WealthManagement.com)
  3. Saks Flagship Store Is Appraised for Mortgage at $3.7 Billion “Many financiers have tried to make money from retailers through the ground beneath their stores. But few have pulled off the strategy as well as Richard Baker, the chief executive of the Hudson’s Bay Company, which owns Saks, Lord & Taylor and the Bay in Canada. On Monday, he announced that Hudson’s Bay had taken out a loan against the Saks Fifth Avenue flagship that values the department store — one of New York’s temples of luxury retailing — at nearly $4 billion, making it one of the most valuable retail properties in the country.” (The New York Times)
  4. Caesars entertains idea of converting into REIT “Just as the gaming industry began to give some support to the idea that Caesars Entertainment Corp. (CZR) could transform itself into two divisions, including a real estate investment trust (REIT), company officials downplayed that maneuver. In a filing with the Securities & Exchange Commission (SEC), the company said the REIT concept ‘has been superseded by the numerous proposals that have been, and continue to be, transmitted.’” (Gaming Today)
  5. Refinancing Boom Exposing Risks in U.S. Property Bonds “A $40 million penalty wasn’t enough to keep the owner of San Francisco’s Parkmerced apartment complex from the chance to lock in record-low interest rates and take advantage of the property’s $1.5 billion value. While a landlord willing to pay almost 63 times the average fee to refinance early is a bullish sign for commercial real estate, it’s less so for bond investors facing $295 billion of mortgages that come due during the next three years. That’s because the securities are increasingly tied to the market’s weakest properties, many of them financed during the peak of the real-estate boom in 2007, as the strongest are paid off.” (Bloomberg)
  6. Wal-Mart’s Chief Merchandising Officer to Leave “Wal-Mart Stores Inc.’s chief merchandising officer is expected to announce his departure from the retailer just days before the annual Thanksgiving shopping frenzy known as Black Friday, people familiar with the matter said.” (The Wall Street Journal)
  7. New Global Infrastructure Index Announced “The world's infrastructure sector is getting its own investment tracking index. This week MSCI announced the IPD Global Infrastructure Direct Asset Index, describing the investment performance of infrastructure investments irrespective of the investment vehicle structure. The index database is comprised of 132 investments around the globe with an enterprise value of USD $49 billion and represents a significant milestone for the infrastructure sector as it provides a robust measure of return performance that can be compared with competing asset classes and used to benchmark performance across investments.” (World Property Journal)
  8. Which retailers will sing a Black Friday swan song? “Many are struggling. Most will power through, but some retailers may be facing their last holiday season. A season of giving isn’t enough for some retailers. A few struggling companies are in need of a holiday miracle.” (Fortune)
  9. The Dangers of Euphoria in Real Estate Investments “There is widespread consensus that the real estate crisis is over.  The possibility of a repeat of the collapse of 2008-2009 is inconceivable to investment advisors and their wealthy clients. Wealthy investors have been flocking back to real estate with abandon. TIGER 21 – an organization for ultra-high-net worth investors (UHNW) – publishes the results of its asset-allocation survey of its members every quarter.  The latest survey for the third quarter illustrates this point very well.” (ValueWalk)
  10. The hard discount threat “For food retailers outside North America, intense competition from hard discount formats is just part of the competitive landscape. But inside North America, hard discount has not been much of a factor. We believe that is likely to change soon. Aldi is reaching an inflection point in its store density and customer acceptance; it is poised for explosive growth.” (Supermarket News)
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