10 Must Reads for the CRE Industry Today (December 13, 2016)

10 Must Reads for the CRE Industry Today (December 13, 2016)

 

  1. Fifth Avenue is Barely Clinging to its Priciest-in-the-World Title “Once again, in 2016 the most expensive shopping strip in the world was Manhattan’s Upper Fifth Avenue, where annual rent averaged $3,000 per square foot. But the luxury nexus, which goes from 49th Street to 60th Street—and houses world-famous stores such as Tiffany & Co., Saks Fifth Avenue and Bergdorf Goodman’s flagships—could be losing its grip on that mantle: in 2015, the average rent was $3,500, according to Cushman & Wakefield research.” (Fortune)
  2. Kroger Poised to Buy Walgreens/Rite Aid Stores “Kroger Co. could be close to wrapping up a deal to buy some of the Walgreens and Rite Aid stores that Walgreens needs to divest when it completes its acquisition of the drug store chain. The deal involving multiple buyers for nearly 1,000 stores should be finalized by year-end, an attorney told mergers and acquisitions reporting website CTFN. A real estate executive told CTFN that Kroger is in line to buy some of the stores while discount pharmacy chain Fred’s is set to buy what that person called a ‘substantial’ number of stores.” (Cincinnati Business Courier)
  3. Mall of America Gets an IBM Watson-Powered Bot for Holiday Shopping “IBM today announced the launch of a pilot program to deploy its artificial intelligence inside Mall of America. Mall of America in Bloomington, Minn. covers 5.6 million square feet, making it the largest retail space in the U.S. The Experiential List Formulator (E.L.F.) can now help guests manage their options by suggesting ways to spend time at the mall’s more than 500 stores and theme parks.” (Fortune)
  4. U.S. Commercial, Multifamily Mortgage Delinquencies Remain Low in Q3 “According to the Mortgage Bankers Association's Commercial/Multifamily Delinquency Report, delinquency rates for commercial and multifamily mortgage loans remained low in the third quarter of 2016. The MBA analysis looks at commercial/multifamily delinquency rates for five of the largest investor-groups: commercial banks and thrifts, commercial mortgage-backed securities (CMBS), life insurance companies, Fannie Mae, and Freddie Mac.  Together these groups hold more than 80 percent of commercial/multifamily mortgage debt outstanding.” (World Property Journal)
  5. Morningstar Adds Houston Properties to Real Estate ‘Watchlist’ “Several large real estate loans backed by Houston office buildings with vacant space and exposure to the volatile energy industry have the potential to default, according to a recent report from a ratings agency Morningstar Credit Ratings. Morningstar's November "Watchlist" report includes loans held in commercial-backed mortgage securities with an elevated risk of default based on a number of factors, including building occupancy, upcoming lease expirations and the amount of debt the owner has on the property.” (Houston Chronicle)
  6. CBRE Boosts Retail Presence with Skye Group Acquisition “CBRE Group Inc. recently announced the acquisition of Skye Group, a provider of retail project management, shopping center development and tenant coordination services in the U.S. and Canada. This acquisition enhances CBRE’s position in the retail market by boosting its retail project management service offerings. Terms of the deal were not disclosed. Based in the Oswald Centre on 1100 Superior Ave., in Cleveland, Skye is a local consulting firm founded in 2000.” (Commercial Property Executive)
  7. Rutgers Now Offering Certification in Real Estate Development & Redevelopment “Last week, Rutgers announced that it will now offer a graduate-level certification program dedicated to development and redevelopment through the Rutgers Business School Center for Real Estate in partnership with the Edward J. Bloustein School of Planning and Public Policy. The program will cover various courses including land use planning, property tax regimes, urban redevelopment, environmental law and policy, community economic development, among others.” (Jersey Digs)
  8. Rising Housing Costs Precipitate Increases in Eviction Rates “According to Redfin, an estimated 2.7 million Americans faced a home eviction in 2015. Redfin analyzed more than six million eviction records across 19 states where data was available provided by American Information Research Services, Inc. to predict the number of evictions for each U.S. county as well as the country at large. Redfin also examined the effects of rising home prices at neighborhood and metro levels on local eviction rates.” (World Property Journal)
  9. Communal Living: Should Real Estate Developers Be Interested? “In recent years, the concept of utilizing shared resources has gained traction in the housing market. Targeting cities where demand for rental properties has prompted a spike in prices, communal living has emerged as a cost-effective alternative. The rise of communal living is an attempt to fill a gap in the residential marketplace and a buzz continues to build around the startups that are spearheading the charge. At issue for real estate developers, however, is whether it’s a trend that’s both sustainable and powerful enough to transcend beyond a small market niche.” (Forbes)
  10. Opus Plans 540 KSF Industrial Project Near Phoenix “The Opus Group is keeping busy in the Phoenix metro area with a master-planned, 96-acre speculative industrial project in Goodyear, Ariz. The company intends to begin work on the 540,000-square-foot first phase of the development at Goodyear Crossing Industrial Park in early 2017. Phase I of the project will consist of a 540,000-square-foot industrial building with expansion capability to more than 1.1 million square feet, and will be one of only two buildings in the area to have at least 500,000 square feet of available space with 36-foot clear heights.” (Commercial Property Executive)
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