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10 Must Reads for the CRE Industry Today (February 9, 2018)

Forbes looks at what a Fannie/Freddie overhaul will mean for the commercial real estate industry. Dunkin’ plans to open approximately 1,000 new locations by 2020, reports Chain Store Age. These are among today’s must reads from around the commercial real estate industry.

  1. What an Overhaul of Fannie Mae and Freddie Mac Would Mean for Commercial Real Estate “CMBS loans for multifamily properties have increasingly been going to Fannie Mae and Freddie Mac in the decade since the global financial crisis, we found in a recent analysis of the commercial mortgage-backed securities market. At the same time, the rumblings of change are making themselves heard in the distance. If the latest efforts to overhaul the U.S. housing finance system don’t fall by the wayside the way previous attempts did, such changes – especially coming as Fannie and Freddie are on the rise – could have broad implications for the securities market as well as lenders, taxpayers, multifamily lending and the housing finance system.” (Forbes)
  2. Retail Sales Expected to Climb as Much as 4.4 Percent in 2018 “U.S. retail sales in 2018 could climb slightly higher than last year's 3.9 percent gain, as lower unemployment and growing wages drive consumer confidence higher. The National Retail Federation on Thursday projected industry sales will grow between 3.8 and 4.4 percent this year, excluding automobiles, gas stations and restaurants. That compares with NRF's forecast last year of growth between 3.2 and 3.8 percent. A jump of 4.4 percent would be the biggest increase since 2011, when retail sales climbed 5 percent.” (CNBC)
  3. Affordable Housing Could Mean Higher Property Taxes “A San Diego City Council committee Thursday advanced a proposed ballot measure that would provide $900 million for affordable housing projects through a property tax increase. The committee voted to direct City Attorney Mara Elliott to draw up the measure to fund 5,000 to 10,000 units of housing, split equally among the following categories: permanent supportive housing for the homeless, units for seniors and veterans at risk of becoming homeless, and homes for low-income families.” (CBS8.com)
  4. When a Suitor Calls: The Calculus behind Brookfield’s Forest City Play “In some ways, now’s a prime time for private equity firms to scoop up publicly traded companies. Brad Case, an economist with the National Association of Real Estate Investment Trusts, said REITs were undervalued in 2017, despite outperforming small-value stocks — a segment of the market to which they are often compared. For Forest City shareholders, a deal could mean getting a premium on their current stocks — or it could mean a disappointing cashout.” (The Real Deal)
  5. Dunkin’ Brands Has Big Expansion Plans “Dunkin Brands Group said it plans to add approximately 1,000 net new Dunkin’ Donuts locations in the U.S. by the end of 2020, with more than 90% of the stores built outside of its core Northeast home territory. For 2018, the company expects Dunkin’ Donuts franchisees will build more than 275 net new U.S. locations. The chain also reaffirmed its goal to eventually have more than 18,000 Dunkin’ Donuts restaurants in the U.S.” (Chain Store Age)
  6. Global Commercial Real Estate Investment to Dip in 2018 “According to global real estate consultant JLL, property investors worldwide continued to demonstrate their confidence in global real estate markets throughout 2017, with investment in the final quarter hitting its highest level in three years. Despite continued political concerns, real estate markets mirrored the global economic recovery with Q4 2017 volumes coming in at $228 billion, bringing full-year activity to $698 billion, six percent higher than 2016.” (World Property Journal)
  7. Veni, Vidi, VICI: An Experiential Asset REIT Has Spun Off from Caesars Entertainment “’We began trading right around 10 a.m.,’ Ed Pitoniak, the chief executive officer of VICI, told Commercial Observer on the day of the REIT’s listing. ‘It was so exciting.’ Exciting no doubt, but it’s also an important next step for VICI, a spinoff from Caesars Entertainment subsidiary Caesars Entertainment Operating Company (CEOC) and named for Julius Caesar’s famous Latin phrase, “I came, I saw, I conquered.” (Look it up.) After CEOC filed for reorganization under Chapter 11 of the U.S. Bankruptcy plan in January 2015 in a bid to reduce debt and strengthen its financial position, VICI was part of its plan of emergence.” (The Real Deal)
  8. Five Nontraditional Ways to Increase Revenue for Your Multifamily Property “What is the biggest source of revenue in a multifamily property? Rent, of course. But there are also a lot of opportunities for additional revenue in most multifamily properties landlords may not consider. Here are some nontraditional techniques that might help you drive additional revenue into your investment.” (Forbes)
  9. Amazon Just Got a Whole Lot More Aggressive with Whole Foods Market “Five months after snapping up Whole Foods, Amazon is moving quickly into the grocery delivery space. On Thursday, Amazon announced plans to offer Prime customers free two-hour delivery on Whole Foods goods in some locations, through Prime Now. In doing so, the company is allowing customers to purchase groceries from Whole Foods through the $12.99 a month Prime subscription—canceling the need for consumers to spend another $14.99 to access Amazon Fresh.” (Fortune)
  10. Panattoni Developing 1 MSF Warehouse in Memphis “Panattoni Development Co. has kicked off development of a new 1 million-square-foot warehouse for Cooper Tire at Gateway Global Logistics Center, its 1,600-acre master-planned industrial park, in Marshall County, Miss. Panattoni is co-developing the suburban Memphis, Tenn., build-to-suit facility with Mohr Capital. GGLC sits roughly 45 miles east of Memphis, straddling Marshall County and Tennessee’s Fayette County. Cooper Tire, whose Pickering Firm Inc.-designed warehouse will be able to accommodate a 400,000-square-foot expansion, will hardly be alone at the sprawling GGLC.” (Commercial Property Executive)
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