10 Must Reads for the CRE Industry Today (August 4, 2016)

10 Must Reads for the CRE Industry Today (August 4, 2016)

 

  1. Wal-Mart May Buy Amazon Challenger Jet.com for $3 Billion “Launched a year ago, Jet.com has received a huge amount of hype after getting hundreds of millions in funding and a nearly $600 million valuation before selling a single purse, microwave, or bottle of laundry detergent on its e-commerce site. Founded by Diapers.com founder Marc Lore, Jet originally launched its membership-based e-commerce site in July 2015 to take on brick and mortar warehouse clubs like Sam’s Club and Costco while also competing against Amazon’s bulk products business.” (Fortune)
  2. CRE Investors Experiencing Déjà vu in Search for Yield “When I began writing this story on the search for yield in a low-yield environment this week, it had a familiar ring. Turns out this was the same gist of a story I wrote in 2007 -- at the last peak of CRE valuations. Back then, I wrote: Companies are less likely to bite on deals, but there is no lack of sellers pushing product and capital doesn't appear to be too constricted, just that lenders are a little more demanding. The majority of real estate CEOs and senior executives expect 2007 to be a year of revenue growth and higher profits, marked by a race to find appropriate investments and take advantage of growth opportunities in a market that continues to be flooded with capital.” (CoStar News)  
  3. Slow Growth Outlook: Now Worries for Real Estate? “Recent reports on a number of economic fronts–GDP growth, interest rates and Brexit, to name a few–have not been encouraging. Are these conditions a harbinger of the next downturn, or could they portend an extension of the “Goldilocks” economy that has been so good for commercial real estate? Maybe the most disappointing news was second-quarter GDP growth, which came in at a weaker-than-expected annualized rate of 1.2 percent, while consensus forecasts called for 2.6 percent.” (Commercial Property Executive)
  4. Supervalu Will Consider Save-A-Lot Sale “In an apparent acknowledgement of reports that several private equity firms would bid to acquire Save-A-Lot, Supervalu said Tuesday that it still intends to move forward on a plan to spin off the discounter to shareholders, but is also considering an outright sale. In a statement, the Minneapolis-based wholesaler ‘reaffirmed that it is preparing for a separation of its Save-A-Lot business. As part of that process, Supervalu has pursued and continues to pursue a spin-off of Save-A-Lot,’ as described in registration forms with federal securities regulators.” (Supermarket News)
  5. The Big Chill: From Brexit to the U.S. Election, Uncertainty is Freezing Market Activity “While new presidential administrations always mean new changes, given what Trump has said about rescinding trade pacts (as well as some of America’s traditional alliances), the GOP candidate has added an extra layer of ice to investors plotting their next move. (Disclosure: Jared Kushner, the publisher of Commercial Observer, is Trump’s son-in-law.) Both of these events—one a fait accompli, the other still undecided—have made 2016 the year when a lot of big decisions go straight to voicemail.” (Commercial Observer)
  6. Hong Kong Pays $1.2B for Stake in Salesforce Tower “An investment fund controlled by Hong Kong’s de-facto central bank bought a 49-percent stake in the Salesforce Tower New York from Ivanhoe Cambridge and Callahan Capital Partners for $1.15 billion, property records show. The buyer, Real Summit Investment, is a real estate investment subsidiary of the Hong Kong Monetary Authority’s Exchange Fund. Ivanhoe Cambridge, the real estate investment arm of Quebec’s public pension plan, and Chicago-based fund manager Callahan, bought the 1.2 million-square-foot tower, also known as 3 Bryant Park, for $2.2 billion from the Blackstone Group in January 2015.” (The Real Deal)
  7. 10 REITs Yielding 10% or More “With the stock market near all-time highs and global interest rates near all-time lows, it’s getting harder and harder for long-term investors to find reliable sources of income. A number of investors are now turning to dividend stocks to pick up the slack of low bond yields. Real estate investment trusts (REITs) offer some of the highest yields in the market. Maybe the best part about these investments is that they are legally required to distribute at least 90 percent of their earnings to shareholders via dividends. This payout mandate means that a number of REITs have extremely high yields.” (Benzinga)
  8. Construction on the Wynn Casino Will Likely Start This Week in Everett “Somerville officials will not ask the Massachusetts Department of Environmental Protection to reconsider its decision to give Wynn Resorts a waterfront construction permit, clearing the way for resort casino construction to begin within the next couple of days in Everett. The city had until early this week to ask for a reconsideration after DEP Commissioner Martin Suuberg issued the decision in late July, subject to certain conditions. City spokeswoman Denise Taylor confirmed Tuesday that the city will not make that request.” (Boston.com)
  9. Landlord of Park Avenue Office Tower Lands New York-Presbyterian “New York-Presbyterian has struck a deal to take about 500,000 square feet of office space at 237 Park Ave., according to several sources with knowledge of the hospital’s decision. The hospital system has been searching Manhattan for office space so it could consolidate administrative and office operations from several locations around the city. The terms of the deal, including the length of the lease and the rent that New York-Presbyterian agreed to pay, were not immediately clear.” (Crain’s New York Business)
  10. Miami Retail Center Changes Hands for $285M “Weingarten Realty Investors has acquired The Palms at Town & Country, a 667,757-square-foot open-air retail center in Miami, from TIAA Global Asset Management. The property fetched a whopping $285 million, according to the South Florida Business Journal. HFF represented the seller in the transaction, led by Senior Managing Director & Co-head of HFF’s retail practice Daniel Finkle, Managing Director Luis Castillo and Associate Director Nat Scarmazzi.’ (Commercial Property Executive)
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