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10 Must Reads for the CRE Industry Today (April 12, 2016) Rendering courtesy of David Chipperfield Architects

10 Must Reads for the CRE Industry Today (April 12, 2016)

 

  1. Goldman Sachs to Pay $5 Billion in U.S. Justice Dept Mortgage Bond Pact “Goldman Sachs Group Inc (GS.N) has agreed to pay $5.06 billion to settle claims that it misled mortgage bond investors during the financial crisis, the U.S. Department of Justice said on Monday. The settlement, which Goldman disclosed in January, stems from the firm's conduct in its packaging, securitization, marketing and sale of residential mortgage-backed securities between 2007 and 2009, the Justice Department said. Investors suffered billions of dollars in losses from the securities bought during the period, the department said.” (Reuters)
  2. Forget Flipping Houses—These Retail Investors Flip Mortgages “While titles and deeds establish property ownership, notes — the financial agreements between lenders and home buyers — set the terms by which a borrower will pay for the home. Financial institutions have long passed them back and forth as they rebalance their portfolios. But the trade in delinquent notes has exploded in the post-financial-crisis world. As government entities like Fannie Mae and Freddie Mac have struggled with the legacies of the housing bust, they’ve sold billions of dollars’ of delinquent notes to big institutional investors, who resell them in turn.” (MarketWatch)
  3. Union Investment Expands Property Portfolio in Boston “Since its acquisition of The Godfrey Hotel in Boston, the company’s first ever purchase in the States, Union Investment has felt particularly at home in New England. The company has now acquired its second property in Boston for approximately $452 million. Developed by Skasnka and only completed at the end of last year, the office newly built at 101 Seaport Boulevard will join the portfolio of open-ended real estate fund Unilmmo: Europa.” (Property Magazine)
  4. Walgreens—Rite-Aid Deal Depends on Selling Stores “Announced mergers do not always become completed mergers. Deals are often subject to regulatory approval, shareholder votes and changes in circumstances in the time between when a deal is announced and when it is expected to close. In this climate, who is to say that Action Alerts PLUS holding Walgreens Boots Alliance's $17.2 billion (including debt) bid to take over Rite Aid is immune from similar challenges? This year has already seen mergers challenged due to a mix of regulatory concerns.” (The Street)
  5. Annaly Capital to Buy Hatteras Financial for $1.5 Billion “Annaly Capital Management Inc., the largest real estate investment trust that buys mortgage debt, agreed to purchase Hatteras Financial Corp. for $1.5 billion to expand and help diversify its holdings. The offer values Hatteras at $15.85 a share. Annaly will acquire the Winston-Salem, North Carolina-based mortgage REIT using a combination of cash and its own shares, the companies said in a statement on Monday.” (Bloomberg)
  6. Port Authority Pays for Old Conde Nast Office to Sit Empty “More than a year after Condé Nast moved from Times Square to One World Trade Center, its new landlord, the Port Authority of New York and New Jersey, continues to shell out more than $3 million a month to cover the cost of the media giant's previous lease. By the end of 2015, the Port Authority had paid $47.6 million to cover Condé Nast's 840,000-square-foot lease at 4 Times Square, a 48-story office tower owned by the Durst Organization, according to information provided by the authority.” (Crain’s New York Business)
  7. We Went Inside New York City’s Latest Luxury Skyscraper, Which Is One Giant Marble Block “Architect David Chipperfield's latest skyscraper won't feature a glass facade like normal skyscrapers. Instead, both the interior and exterior walls will be made of a marble mosaic. Chipperfield has received more than 100 awards, including the RIBA Stirling Prize. His new apartment building, called the Bryant, will open in spring 2017 and live on the last bit of real estate lining Bryant Park in New York City's midtown. Tech Insider recently toured one of the model units, which will sell from $2 to $16 million. Take a look inside.” (Business Insider)
  8. Use FHA Duplex Financing to Become a Real Estate Investor “Real estate investors in most cases need at least 25% of the purchase price as a down payment and possibly 35%. But investors willing to occupy one unit of a duplex or similar small multifamily property can get Federal Housing Administration insured loans for as little as 3.5% down. FHA loans are also suitable for borrowers with lower credit scores, and people just getting started in real estate investing.” (The Street)
  9. Allen Morris Plans Midtown Atlanta Apartments, Offices “The Allen Morris Co. has unveiled development plans for Star Metals, a $210 million mixed-use development in the West Midtown neighborhood of Atlanta. The project will consist of a multifamily building, along with an office building directly across the street, with ground-floor retail. The multifamily component will feature 409 rental units, and offer residents a rooftop club room and amenity deck, theater, Bocce ball court, yoga studio, poolside movies at night, community garden and greenhouse.” (Multi-Housing News)
  10. U.S. Office National Vacancy Rate Upticks in Early 2016 “According to CBRE, vacancy for the U.S. office market inched up by 10 basis points (bps) during the first quarter of 2016 (Q1 2016), rising to 13.2%. Even with the increase, the national office vacancy rate remains at the lowest level since 2008. Despite the slight increase, vacancy continued to improve in the majority of U.S. markets, with rates falling in 33 markets, rising in 25, and remaining unchanged in five. Suburban vacancy remained at 14.7% while downtown vacancy increased by 10 bps, to 10.4%.” (World Property Journal)
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