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10 Must Reads for the CRE Industry Today (July 28, 2016)

 

  1. Fed Appears More Willing to Lift Interest Rates in September “The Federal Reserve on Wednesday opened the door a bit to making an interest-rate increase at its next meeting in September. ‘Near-term risks to the economic outlook have diminished,’ the Fed said in its policy statement released after a two-day meeting. That’s a stronger hint of possible move than most Fed watchers were expecting. After a two-day meeting of its policy-making committee, as expected, the Fed kept its benchmark fed funds rate unchanged in a range between 0.25 and 0.5%.” (MarketWatch)
  2. By Buying Yahoo, Verizon Scoops Up a Rare Prize: Silicon Valley Real Estate “With its $4.8-billion acquisition of Yahoo, Verizon has snatched up an Internet pioneer with a massive audience. But it has also secured something equally coveted in Silicon Valley: real estate. When the deal closes, the New York telecom giant will become one of the largest office landlords in the nation's technology hub thanks to the roughly 1 million-square-foot campus Yahoo owns in Sunnyvale, Calif. — a desirable position amid the current tech boom.” (Los Angeles Times)
  3. With Yields as High as 10%, Real Estate Funds Drum Up Assets and Appeal “Real estate securities continue to shore up their popularity with ETF investors, with demand for these income-producing assets accelerating in recent months. Vanguard REIT saw $860.4 million net inflow in the month ended July 25 to take its asset haul this year to $4.12 billion, according to analytics firm XTF.com. Investors have poured fresh money into VNQ every month since the February stock market pullback, including $1.33 billion in June alone.” (Investor’s Business Daily)
  4. Kmart Shoots Down Reports Sears is Closing Down “Media reports that Kmart is slowly going out of business via stealth liquidation sales have clearly struck a nerve with parent company Sears Holdings. The company published a blog post on Wednesday seeking to debunk claims that Kmart is getting ready to shut down after a Business Insider article last week said, citing employees, that the company was purging warehouses and putting all stock out on the sales floor in what could seem tantamount to close-out sales.” (Fortune)
  5. Dollar General Buys 41 Former Wal-Mart Stores “Goodlettsville-based discount retailer Dollar General plans to relocate 40 stores and enter one new market after the company finalized a deal to purchase 41 former Wal-Mart Express locations. The acquisition affects Dollar General stores in 11 states, including one site in Dover, Tenn. The move comes six months after Wal-Mart announced plans to shutter 269 locations worldwide, including all of the company’s 102 Express format stores.” (The Tennessean)
  6. BlackRock Fills Wall Street Void in Headquarters Hunt “BlackRock Inc. is presenting New York real-estate developers with something they haven’t seen in a while—a financial firm that is looking to grow. While big banks and hedge funds are in retreat and emptying out space, the asset management giant is deciding whether to move into a new global headquarters and is narrowing its review of sites being developed in Manhattan down to three. The 850,000-square-foot deal will be among the biggest leases of the year for the city and a contrast to the direction of the banking industry.” (Wall Street Journal)
  7. Dallas Investor Buys $200 Million in Texas Industrial Buildings “A Dallas real estate investor has made a $200 million industrial building buy that includes properties in three major markets. Stonelake Capital Partners has purchased 35 buildings located in Dallas, Houston and San Antonio. The 3.1 million square foot purchase was made in 11 separate transactions over the last 18 months. The industrial buildings will be owned by a fund called Stonelake Opportunity Partners III LP. Stonelake raised $262 million in equity commitments for the investment fund to buy buildings ranging in size from 50,000 to 150,000 square feet.” (Dallas Morning News)
  8. Workspace Property Trust Buys Office, Flex Portfolio for $969M “For the second time in less than a year, Workspace Property Trust has made a major deal with Liberty Property Trust, acquiring 108 office and flex buildings in four states for approximately $969 million, in a strategic relationship with global investment firm Safanad. Once the deal closes in the third quarter, WPT’s total portfolio will total approximately 9.9 million square feet across 149 properties in five markets.” (Commercial Property Executive)
  9. Cracking Shells: U.S. Treasury Widens LLC Disclosure Law throughout NYC, LA “In its effort to root out dirty money flowing into luxury real estate, the Treasury Department said it will expand a pilot program requiring title companies to identify the true buyers behind anonymous, all-cash deals. In new geographic targeting orders (GTOs), officials will require the disclosure of buyers in all five boroughs of New York City as well as parts of Florida, California and Texas. Previously, officials targeted all-cash deals by shell companies spending more than $3 million in Manhattan and Miami. That order took effect in March.” (The Real Deal)
  10. Related and Oxford Land $1.2B  from Children’s Investment Fund for 35 Hudson Yards “Related Companies and Oxford Properties Group completed a $2 billion capitalization of 35 Hudson Yards, the partnership announced in a news release today. The Children’s Investment Fund (TCI) led a $1.2 billion debt financing for the completion of the 1.1-million-square-foot tower. Once completed in 2019, 35 Hudson Yards will hold an Equinox-branded hotel, as well as office, residential and retail spaces. The property sits on the corner of 33rd Street and 11th Avenue.” (Commercial Observer)
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