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10 Must Reads for the CRE Industry Today (May 30, 2018)

Sears’ parent company has received multiple inquiries about asset sales, according to CNBC. Real estate developers pursue driverless vehicle initiatives, reports the Wall Street Journal. These are among today’s must reads from around the commercial real estate industry.

  1. Eddie Lampert’s Hedge Fund, ESL, Receives ‘Numerous Inquiries from Potential Partners’ for Sears Asset Sales “Sears Holdings CEO Eddie Lampert's hedge fund, ESL, said Tuesday it's received ‘numerous inbound inquiries from potential partners’ since it made an offer last month to buy Kenmore and other Sears assets. In a letter penned to a special committee of the board and filed with the Securities and Exchange Commission, Lampert asked for permission to ‘engage’ with those interested parties ‘to allow us to put forward a definitive proposal that will result in the most benefit to Sears.’” (CNBC)
  2. City Planners, Property Developers Fuel Push for Driverless Vehicles “Six years after Nevada became the first state to allow driverless cars on public roads, real-estate developers and city planners around the country are stepping up their efforts to court pilot projects. In downtown Las Vegas, for example, a driverless eight-passenger electric shuttle has ferried roughly 24,000 people since November, when it was first opened to the public.” (Wall Street Journal, subscription required)
  3. Run-Up in Home Prices is “Not Sustainable:” Realtors’ Chief Economist “Home values have been rising for six straight years, and the gains have been accelerating for the past two years. Unlike the last housing boom, the gains are not driven by fast and easy mortgage money, but instead by solid buyer demand and very low supply. Still, like the last housing boom, some are starting to warn these price gains cannot continue.” (CNBC)
  4. MGM Resorts to Buy New York Casino for About $605 Million “MGM Resorts International is buying a harness-racing track and casino outside New York City for about $605 million, helping the gambling-venue owner expand its East Coast presence. MGM will acquire the Empire City Casino in Yonkers, N.Y., from the Rooney family, which has owned the operation at Yonkers Raceway for more than four decades. The Wall Street Journal reported in November that the casino was exploring strategic alternatives, including a possible sale or partnership.” (Wall Street Journal, subscription required)
  5. Walgreens May Be Building the Store of the Future in Florida—but Wall Street Is Skeptical “CVS Health Corp. is buying Aetna Inc., while Cigna Corp. is snapping up Express Scripts Holding Co. As health-care companies vertically integrate with high-priced deals across varied parts of the industry’s supply chain, Walgreens Boots Alliance Inc., its acquisition of rival Rite Aid’s nearly 2,000 stores now complete, remains alone at the party.” (MarketWatch)
  6. How the Federal Reserve Could Ruin the U.S. Economy Within 12 Months “The Fed is widely expected to increase rates at its next policy meeting on June 12-13. But markets are betting on a more hawkish Fed for the balance of the year, too. Fed fund futures see an 80% chance of a rate hike at the July 31-August 1 policy meeting, and near 50% chances of increases at the last three meetings of 2018.” (The Street)
  7. 5 Things to Know About Investing in Single-Family Rental Homes “Single-family rental homes comprise more than one-third of all U.S. rental properties — about 16 million currently, with another 13 million new rental households expected to be formed by 2030. Since U.S. housing stock is not keeping up with this future demand, the sector should enjoy a significant tailwind given these favorable supply/demand trends.” (MarketWatch)
  8. Can Tech Outsmart the Housing Shortage? “Like most industries, real estate has welcomed a flood of tech investors seeking change, profit, and “disruption.” And though Silicon Valley venture capitalists and tech investors came to real estate relatively late compared to other fields, real estate tech’s big 2017 shows it’s trying to make up for lost time. Coworking colossus WeWork is now valued at $20 billion. Fifth Wall Ventures, a fund dedicated to real estate technology, raised $212 million.” (Curbed)
  9. Healthcare Real Estate Moves to Non-Traditional Settings “A hospital-centric system has dominated US healthcare for generations, but demographic change, technology advances and shifting consumer preferences have started pulling that system apart. Furthermore, an aging population has placed new demands on healthcare providers, who face pressures to expand care, control costs and ease access to services. That’s a tall series of orders to fulfill. But healthcare providers of all sizes have responded to the challenge and now use real estate to serve patients more efficiently and effectively, according to a new study on the sector by Chicago-based JLL.” (GlobeSt.com)
  10. Fifth Wall Ventures Launches New Real Estate Tech Investment Funds “Fifth Wall Ventures, a venture capital firm that frequently puts money toward real estate tech, is raising even more funds toward new startups. Fifth Wall Ventures Retail Fund, a new investment fund, has already raised $60 million from two unidentified investors in an offering valued at $200 million, according to an SEC filing issued May 8, first reported by The Real Deal. Fifth Wall co-founder Brendan Wallace spoke about the investment strategy during the International Council of Shopping Centers ReCon Convention in Las Vegas last week, according to the publication.” (Inman)
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