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10 Must Reads for the CRE Industry Today (December 27, 2017)

The holiday shopping season has been strong this year, according to Business Insider. Forbes takes a close look at Physicians Realty. These are among today’s must reads from around the commercial real estate industry.

  1. The Holidays Were ‘a Big Win’ for Struggling Retailers as Sales Soared “Retailers had a very happy holiday. Retail sales from November 1 through Christmas Eve were up 4.9% over last year, according to data from Mastercard SpendingPulse. That's the highest rate of growth since 2011. That number was given a strong boost by online sales, which were up 18.1% over the season. Much of this growth was due to the new ease of shopping online later in the season, as more last-minute shipping options have become available. Last year, online sales grew 18.9%.” (Business Insider)
  2. Can Central Banks Keep Control of Interest Rates? “Investors are elated by a booming global economy and the promise of central banks to tighten monetary policy only gradually. The risk in the coming year: that long-term interest rates develop a mind of their own. So far, those longer-term rates have remained subdued, even as the U.S. Federal Reserve increased short-term rates three times in 2017 and other central banks signal that the era of super-easy monetary policy may soon draw to a close.” (Wall Street Journal, subscription required)
  3. Physicians Realty Is Poised to Profit “Physicians Realty (DOC) listed shares around four years ago (December 2013) and the healthcare REIT has become a top player in the medical office building (or MOB) sector. Demographics make the medical office sector a compelling investment thesis: the U.S. healthcare industry is boosted by an increasing number of insured and aging people. Between 2015 and 2060, the U.S. population over 65 years is projected to more than double from 47.8 million to nearly 98.2 million.” (Forbes)
  4. The Story of WeWork’s Mysterious First Investor “In 2010, WeWork’s Miguel McKelvey and Adam Neumann were two unknown entrepreneurs scouting buildings for their first co-working space. They set their eyes on a Canal Street property, but when they contacted the landlord, he balked. Instead, the building’s owner offered a meeting with an acquaintance who, he said, might be interested: Joel Schreiber, an obscure Hasidic real estate investor living in Brooklyn.” (The Real Deal)
  5. Forest City Initiates Major Retail Selloff “As the year draws to a close, Forest City Realty Trust Inc. continues making progress on its plan to sell off retail holdings and focus on urban office, residential and mixed-use assets, recently announcing closings with two of its joint venture retail partners. The larger of the two transactions was with Madison International Realty LLC, which bought out 10 specialty retail centers in the New York City region. The REIT also said it had closed on the sale of its interest in South Bay Galleria, a 960,000-square-foot regional mall in Redondo Beach, Calif., to QIC.” (Commercial Property Executive)
  6. U.S. Department Store Stocks Jump on Holiday Spending Record “Shares of U.S. department stores jumped on Tuesday as Mastercard Inc said shoppers spent over $800 billion during the season, more than ever before, boosted by growing consumer confidence, rising employment and early discounts. Sarah Quinlan, head of market insights for Mastercard Advisors, disclosed the figure after the payments processor’s analytics arm published its SpendingPulse retail report. The report said holiday sales in stores and online between Nov 1 and Dec 24 rose 4.9 percent.” (Reuters)
  7. Millennials on the Move Are Creating Major Market Opportunities for Baby Boomers “Millennials are now the largest group of home buyers. They have a different wish list than their parents and face different challenges to obtaining the American dream. Millennials are on the move and fast becoming the largest segment of home buyers, creating major market opportunities for baby boomers downsizing. According to realtor.com’s latest numbers, in November 2017, Millennials (born between 1982 and 2000) made up a 39.6% Share of Mortgage Originations.” (Forbes)
  8. NYC Mixed-Use Development Secures $190M Loan “Trinity Place Holdings Inc. (TPHS) has secured $189.5 million in construction financing to develop 77 Greenwich St., a 300,000-square-foot mixed-use property in Manhattan. When completed, the development will consist of 90 luxury condominiums and a public elementary school. The project’s hard costs are 93 percent “bought out” and are managed under a gross maximum price construction contract. The loan has a four-year term with one extension option.” (Commercial Property Executive)
  9. Lockdown After Aventura Mall Shooting Scare Is the Latest Impact from Rumors Going Viral “The Twitter account for Aventura Mall couldn’t keep pace with the social media of its own shoppers. The scramble to flee was already well under way when Aventura management tweeted at 7:58 p.m. on the Saturday before Christmas that police had found no evidence of gunfire but that the mall was nonetheless being evacuated as a precaution. Thousands had already spent almost an hour trying to escape from one of the busiest shopping centers in Florida.” (Miami Herald)
  10. New Mexico Developer Raises Funds for Self-Storage Development “Equipped with an infusion of more than $80 million in private equity, an Albuquerque, NM-based real estate developer is plotting its entry into the self-storage sector. Titan Development Ltd. is gearing up to build six self-storage facilities in two New Mexico markets — Albuquerque and Santa Fe — and in the Phoenix, AZ, metro area. Some of the six facilities are expected to open as soon as the fourth quarter of 2018. Self-storage is one of the investment targets of the company’s Titan Development Real Estate Fund I.” (SquareFoot)
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