10 Must Reads for the CRE Industry Today (October 30, 2015)

10 Must Reads for the CRE Industry Today (October 30, 2015)

 

  1. Deutsche Bank Cuts Back to Its Roots “Execution, not strategy, is the problem. So said Deutsche Bank chief John Cryan as he unveiled an overhaul that includes thousands of job cuts and no dividend for two years. Areas to be pruned back, though not cut entirely, include emerging- market bonds along with over-the-counter interest rate and credit trading. The bank will invest a little in servicing hedge funds, commercial property lending and traditional advisory work on mergers and acquisitions and equity raising.” (Wall Street Journal)
  2. Thirty Five Years and $7 Billion Later, World Trade Center Rebuilding Expected to Finally Pay Off “The World Trade Center site will pay for itself in two decades, according to a new report by New York University. NYU's Rudin Center, which focuses on transportation and infrastructure, released a study Thursday showing that the Port Authority of New York and New Jersey will be able to recoup the nearly $7 billion it is anticipated to invest in the rebuilding of the 16-acre site.” (Crain’s New York Business)
  3. Detroit Natives Wary as Recovery Threatens to Push Them Out “Residents and business owners who stuck with Detroit through the economic bad times fear they could be priced out during the city's recovery as property values and rents creep up. Detroit is among several large urban communities experiencing a mini-boom as developers see potential where there once was neglect and abandonment.” (Crain’s Detroit Business)
  4. CalPERS Expected to Close Sale of $1 Bln Private Equity Portfolio “The California Public Employees’ Retirement System was expected to complete the sale of a portfolio of private equity interests valued at about $1 billion, according to a person with knowledge of the transaction. It’s not clear if the transaction closed yet. The sale included multiple buyers, rather than one large buyer, as has been the case with large portfolio deals recently, the person said.” (PE HUB)
  5. Fairway Slumps as Epicure Options Grow “The New York supermarket wars are just one of Fairway’s problems. A leveraged buyout of the chain by a private equity firm has contributed to a heavy debt load of $250 million. An overambitious store-opening strategy — it vowed to open 300 stores across the country — drained its cash flow and has caused ratings agencies to downgrade its debt. Its stock has plummeted, declining 86 percent since it went public in 2013.” (New York Times)
  6. Clues to What Makes Bill Ackman Tick Unveiled in His Family Tree “Bill Ackman didn’t let an investor’s call he had to prepare for get in the way of a family celebration. The event raised more than $2 million for the Center for Jewish History, where the Ackman family and the family of Larry Ackman’s business partner, Simon Ziff, have the genealogy institute named after them. Larry said the institute helped the Ackmans assemble an extensive family tree. Prior to working with their researchers, he’d only known details back to his grandfather.” (Bloomberg)
  7. 3.5M SF Up for Sale in Midtown East If Steering Committee Recommendations Get the OK “The owners of landmarks throughout the east side of Midtown are about to see the market open up for their 3.5 million square feet of air rights. A steering committee made up of elected officials and community groups has released its much-anticipated recommendations to rezone the Midtown East area. There will be two options for increased zoning, if the plan is approved.” (Commercial Observer)
  8. Even Burkle Can’t Save Grocer as Fresh & Easy Falls Again “Billionaire Ron Burkle couldn’t save Fresh & Easy Neighborhood Market Inc. from joining A&P, Pathmark and Food Emporium as the newest victim of a super-heated U.S. supermarket business dominated by Whole Foods Market Inc. and Trader Joe’s Co. Burkle’s Yucaipa Cos. bought the grocery chain out of bankruptcy two years ago from Tesco Plc, the U.K.’s biggest retailer, which retained a stake.” (Bloomberg)
  9. How Stuy Town Was Won “The agreement, touted by Mayor Bill de Blasio as a ‘great victory’ for middle class New Yorkers, is the biggest single deal to preserve affordable housing in the city’s history. It has made Blackstone, a private equity giant, a darling of tenant advocates and left-wing politicians and is, according to U.S. Sen. Chuck Schumer, ‘proof that a company can do well by doing good.’ How on earth did we get here?” (The Real Deal)
  10. Strength of Class-B Among Main Takeaways of EQR-Starwood “The portfolio includes a mix of mid-rise and garden-style apartment buildings in five states, with major concentrations in South Florida; Denver; Washington, D.C.; Seattle; and the Inland Empire, Calif. ‘These assets would generally be described as older, mostly suburban in nature, with limited access to public transportation services,’ said EQR CEO David Neithercut on the company’s earnings call.” (Multifamily Executive)
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