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Howard Schultz Stephen Brashear/Getty Images

10 Must Reads for the CRE Industry Today (June 5, 2018)

Forbes looks at how real estate asset managers can minimize risk from rising interest rates. Sears gets more time to pay down its debt, according to CNBC. These are among today’s must reads from around the commercial real estate industry.

  1. More Than Half of U.S. Housing Markets Were Overvalued in April “As the sharp gains in home prices continue, more markets are seeing values higher than their local economies can support. Prices nationwide jumped 6.9 percent in April from a year ago, according to the latest monthly value report from CoreLogic. While that is slightly less than the 7 percent annual jump in March, it is still making more and more markets unaffordable.” (CNBC)
  2. Starbucks’ Howard Schultz to Retire. Will His Next Role Be Presidential Candidate? “Howard Schultz, the executive chairman of Starbucks, will step down at the end of the month, fueling speculation that he might run for political office. Schultz, who transformed U.S. coffee culture and made his colossal chain synonymous with the beverage, told the New York Times that he had told the company’s board about his plan to retire a year ago. Schultz stepped down as CEO of Starbucks last April, relinquishing the title to longtime board member Kevin Johnson.” (Fortune)
  3. Property Losses Mount on Hawaii’s Big Island as Lava Flow Spreads “Mounting property losses were reported a day after five or six people who initially chose to stay in the newly evacuated Kapoho area after road access was cut off were rescued by helicopter, according to the Hawaii County Civil Defense agency. All but a few of the estimated 500 inhabitants of Kapoho and adjacent Vacationland development are now believed to have fled their homes, an agency spokesman said. The area lies near the site of a seaside village buried in lava from a 1960 eruption.” (Reuters)
  4. Three Ways Real Estate Asset Managers Can Minimize Interest Rate Risk “When wages showed strong growth earlier this year, it sparked investor concerns that the Federal Reserve will pick up the pace of interest rate increases. It led to a stock market selloff as investors panicked about whether higher borrowing costs would cause lower corporate profits. It also calls to mind the fact that private real estate is equally susceptible to rising rates.” (Forbes)
  5. McDonald’s New Chicago Headquarters Is Officially Open. Why It Moved Back to the City After 47 Years “McDonalds CEO Steve Easterbrook said the move back to Chicago would help the company attract top talent and adapt to contemporary tastes. ‘We firmly believe that part of the importance of the move downtown is that it gets us closer to our customers, it gets us closer to competition, it gets us closer to the trends that are shaping the future of society,’ he said at the opening.” (Fortune)
  6. Amazon and Apple Eyeing Raleigh for New Headquarters “West Coast juggernauts Apple and Amazon are still searching for a new East Coast home. This has prompted companies to try and figure out exactly what city they’re going to build their next offices in. It seems like it could be the same city for both companies thanks to a new report from ATTOM Data which puts Raleigh, North Carolina as the front runner for the coveted position of Amazon’s HQ2. Could this move help with Amazon’s employee diversity issues?” (Forbes)
  7. Sears Gets More Time to Pay Back Loans “Sears Holdings says in a Securities and Exchange Commission filing it has been given two extra years to repay lenders, including its CEO and hedge fund owner Eddie Lampert. In its filing Monday night, the troubled department store chain said it has consolidated three loans, including two real estate loans totaling roughly $320 million and due in July. The new consolidated loan is due in July 2020.” (CNBC)
  8. DCT Real Estate Closing Denver HQ and Laying Off Nearly 60 People as it Joints Prologis “As part of the permanent shutdown, DCT said it notified between 55 to 59 employees that they will lose their jobs beginning July 31. The cuts affect positions at its headquarters, 555 17th St, Suite 3700, and will occur through Oct. 31, according to a Worker Adjustment and Retraining Notification letter filed May 31 with the Colorado Department of Labor and Employment.” (The Denver Post)
  9. Savills Studley Turns to Artificial Intelligence for Competitive Edge “Brokers, meet your machine sidekick. Savills Studley launched an artificial intelligence-based platform in partnership with the startup Leverton. The platform will allow office users to use Leverton’s AI technology to automatically extract information from leases, contracts and other documents, according to Savills Studley. The company claims its software can compile data and turn it into visualizations 30 percent faster than humans.” (The Real Deal)
  10. Meridian Arranges $250M Loan for NYC Office Tower “Meridian Capital Group has landed $240 million in financing on behalf of The Hakimian Organization, owner of the office building at 636 11th Ave. in Manhattan. Hakimian will use the proceeds from the loan to refinance the 560,000-square-foot property. Meridian secured Hakimian’s 10-year CMBS loan through JP Morgan Chase Bank N.A., according to New York City records.” (Commercial Property Executive)
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