10 Must Reads for the CRE Industry Today (December 10, 2015)

10 Must Reads for the CRE Industry Today (December 10, 2015)

  1. Wall Street Lending Standards Remind Regulators of Crisis Run-Up “The biggest U.S. banks continue to weaken standards for some of the highest-risk lending in a trend similar to what their examiners saw before the 2008 financial crisis, according to a regulator’s report. Competitive pressures have driven bankers to ease the standards for three years running, especially in leveraged lending, commercial real estate construction and credit cards, according to an annual survey of bank examiners who work for the Office of the Comptroller of the Currency.” (Bloomberg)
  2. America’s Middle Class Has Lost Nearly 30% of Wealth “More American households make up the middle class than 40 years ago, yet they comprise a smaller share of overall wealth. In early 2015, there were 120.8 million adults in middle-income households versus 70.3 million in lower-income and 51 million in upper-income households, according to a new analysis of government data by the Pew Research Center, a nonprofit think tank in Washington, D.C. However, the share of income held by middle-income families has plunged to 43% of households in 2015 versus 62% in 1971.” (MarketWatch)
  3. Without Real Estate, What Does Sears Holdings Corp. Have Left to Offer? “The real estate investment trust that was supposed to transform Sears Holdings is finally doing its thing. However, it's not happening the way investors imagined when the idea was first revealed and the retailer's stock was sent soaring by the value that was about to be unlocked. Instead, it's more apparent than ever that Sears is an empty shell of its former self. Without the real estate around to prop up its value, what's left is an aging retailer with clothes and household goods no one wants to buy.” (The Motley Fool)
  4. The Activist Group Suing the Suburbs for Bigger Buildings “In a speech last month, Council of Economic Advisers Chairman Jason Furman blamed zoning restrictions—local land-use rules governing things like how tall buildings can grow—for the lack of affordable housing, lost economic productivity, and rising inequality across the U.S. On Tuesday, a San Francisco activist named Sonja Trauss took Furman's argument to the streets, filing a lawsuit in Contra Costa County (Calif.) to fight what she sees as a lost opportunity to build more housing.” (Bloomberg)
  5. The Smart Money is Getting Out of Real Estate “Real estate investing is all about timing, and Sam Zell knows this better than anyone. He sold his real estate firm, Equity Office, to Blackstone Group for $39 billion near the peak of the market. This was back in February 2007—only months before real estate credit markets started to spiral out of control. He’s doing it again.” (Business Insider)
  6. Renting Isn’t Getting Any Cheaper, Analysts Say “Think the rent is too damn high? You haven’t seen anything yet, according to housing experts. Demand for rental housing, already elevated in the aftermath of the financial crisis, is only going to grow. That’s going to pressure prices even higher. More than 1.25 million new households will be formed in 2016, as the economy and job market heat up, according to CoreLogic Chief Economist Frank Nothaft. That’ll take place even as rental vacancy rates hover near 20-year lows, Nothaft wrote in CoreLogic’s 2016 Outlook for Housing.” (MarketWatch)
  7. City to Hike Affordable Units, Fees for Housing Developers “Mayor Martin J. Walsh and the Boston Redevelopment Authority are looking to take a bigger cut of the Hub housing construction boom to pay for moderate-income housing, rolling out a plan that substantially hikes fees and requirements on developers. The plan, to be authorized by an executive order Walsh will sign today, takes the city’s current one-size-fits-all ‘Inclusionary Development Policy,’ which requires developers to build or fund moderate-income units, and slices it into three zones, with a downtown zone seeing the biggest fee hikes.” (Boston Herald)
  8. New York REIT: A Tumultuous 20 Months “At the Schack Institute’s REIT symposium last year, Nicholas Schorsch was the man of the moment. Not only did his panel draw big crowds, but many of his fellow speakers touted his remarkable New York acquisition spree — over $1.7 billion worth of properties in 2013 alone through his firm, New York REIT. Just a few months later, however, Schorsch’s empire began to crumble. An accounting scandal at the Schorsch-led American Realty Capital Properties unsettled investors and caused share prices at New York REIT to take a hit.” (The Real Deal)
  9. Tishman Speyer Acquires Boston Office Property for $316 Million “Tishman Speyer has just announced this week the acquisition of One Channel Center, a newly-constructed 501,650-square-foot office building located in Boston's Seaport District, along with an adjacent 965-space parking garage.  The property is fully leased to State Street Corporation through 2029. One Channel Center was developed on a build-to-suit basis for State Street, one of Boston's largest financial institutions, and completed in 2014.” (World Property Journal)
  10. Investcorp’s $400M Buying Binge Continues “Never shy about plunking down the big bucks, the U.S real estate division of Bahrain-based investment manager Investcorp has added a national portfolio of 5.5 million square feet of office and industrial properties to its holdings through four transactions totaling approximately $400 million. Investcorp partnered with several operating partners on the purchases, which consist of Class A and B properties located in metropolitan Atlanta, San Francisco and Boston.” (Commercial Property Executive)
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