- Small Towns Are Booming, Thanks to Rising Oil Prices “Oil is booming again in the Permian Basin, and so are the fortunes of this sun-bleached town. Job postings for truckers and electricians cover billboards and chain-link fences lining the highways. Hotels are full of oil-field workers. The civic coffers are recovering from the recent oil bust. Hobbs, population 38,000, was able to put up $25 million in cash for its share of a glitzy new $63.5 million community recreation center.” (Wall Street Journal, subscription required)
- Who Is Making Money from Struggling U.S. Malls? “With its lonely hallways, half-shut food court and out-of-order restrooms, the River Oaks Center mall in suburban Chicago seems like an unlikely place to make money. But that is exactly what two little-known, family-owned investment firms - Namdar Realty Group and Mason Asset Management - are doing here and across the country. With about 100 malls from New York to Utah now under their ownership, the two funds have climbed quietly from anonymity to being among the country’s top-twenty mall landlords - thanks in large part to an aggressive low-investment business strategy at many of the distressed malls they have acquired over the past five years.” (Reuters)
- Here’s How the ‘Future of Work’ Can Drive Revenues for WeWork “WeWork, the fastest growing co-working space provider was valued at $20 billion in its latest funding round by Softbank. This valuation commands a Price/Sales multiple of 8.5 with WeWork’s projected revenues of $2.3 billion in 2018. While this revenue multiple is high (WeWork’s closest listed competitor Regus commands a multiple of around 1.0X), the company expects to increase its revenues exponentially as it rides the trend of the ‘Future of Work.’ Companies such as Facebook, Google, and Microsoft are likely to make technology contributions towards the future of work, and we believe WeWork can benefit significantly from this trend.” (Forbes)
- U.S. Consumer Confidence Slips, House Price Gains Slow “U.S consumer confidence ebbed in June, with households a bit pessimistic about their short-term income prospects, suggesting that an apparent acceleration in economic growth in the second quarter was unlikely to be sustained. Economists blamed the dip in confidence on escalating tensions between the United States and its trade partners. The survey published by the Conference Board on Tuesday potentially signals some cooling in consumer spending.” (Reuters)
- Toys ‘R’ Us Built a Kingdom and the World’s Biggest Toy Store. On Friday, its Stores Close for Good. “The toy emporium that Charles P. Lazarus envisioned has been reduced to dusty floors and empty shelves. Much has been said about the demise of the toy empire, which will shutter its U.S. stores for good on Friday. There have been fingers pointed at corporate raiders, Amazon and big-box stores. All contributed to its undoing. Ultimately, though, Toys R Us' collapse is a story of loyalty run dry.” (CNBC)
- Demand Rises for Furnished Rental Apartments “Devon Patterson’s furnished apartment in a luxury Manhattan building came with mid-20th-century furniture, champagne flutes and a cocktail mixer along with dishes, sheets, towels and cable television. ‘I can just enjoy New York and not feel locked in by my furniture, my cable and my internet,’ said Mr. Patterson, a visual-effects production manager, on a long-term temporary stay in New York for work on a Disney movie.” (Wall Street Journal, subscription required)
- Sale of EdR Not Expected to be Final REIT Deal in 2018 “The $4.6 billion buyout of student housing developer and owner EdR by an affiliate of Greystar Real Estate Partners announced Monday continues to ratchet up merger and acquisition activity in the real estate investment trust (REIT) sector. Industry observers expect more to come. The environment is beginning to mirror 2007 when premium-paying buyers binged on companies like Mills Corp., Equity Office Properties Trust and Archstone-Smith Trust as property prices were peaking.” (Forbes)
- U.S. Architecture Billings Index Upticks in May “According to the American Institute of Architects, architecture firm billings grew in May 2018, marking the eighth consecutive month of solid growth. Overall, the AIA's Architecture Billings Index (ABI) score for May was 52.8 (any score over 50 is billings growth), which shows that demand for services from architecture firms continues to be healthy. The ABI also indicated that business conditions remain strong at firms located in the South and West, while growth in billings was modest at firms in the Northeast and Midwest.” (World Property Journal)
- Newcastle Partners Sells Silicon Valley Office Campus “Newcastle Partners, of San Francisco, has sold Great America Place, a 224,522-square-foot office campus at 2903, 2993 and 5200 Great America Parkway in Santa Clara, Calif., according to NKF Capital Markets, which represented the seller. The buyer was not identified, nor was the price disclosed. NKF was unable to provide additional requested information to Commercial Property Executive by press time.” (Commercial Property Executive)
- How Do Amazon Fulfillment Facilities Impact Their Surroundings? “When it comes to ecommerce — and especially superior last-mile efficiency — no one comes close to Amazon. The Seattle-based giant currently operates nearly 350 facilities — including fulfillment centers, Prime hubs, and sortation centers — around the country, and regularly announces plans for continued industrial development.” (GlobeSt.com, subscription required)
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