10 Must Reads for the CRE Industry Today (April 28, 2016)

10 Must Reads for the CRE Industry Today (April 28, 2016)


  1. Sam Zell’s Real Estate Assets Selling at 20% Off “Investors who want to invest along with Zell need look no further than Equity Commonwealth (ticker: EQC ), an office property REIT, which traded for a recent $27.64. Under his leadership, the shares could gain nicely over the next few years. With a strong real estate market at its back, Commonwealth sold 91 properties for $2 billion in 2015. On the February earnings call, Zell characterized the company in the ‘midstream of our disposition program.’” (Barron’s)
  2. Real Estate Activist Litt Bets Against IRET “An activist hedge fund focused on the real estate sector is launching its first public bet against the shares of a company, targeting Investors Real Estate Trust (IRET.N), according to documents obtained by Reuters. Land and Buildings, the real estate activist firm founded by a former Citigroup analyst, says IRET's debt levels and its exposure to North Dakota's struggling economy are among the reasons why the real estate investment trust's stock is set to fall nearly 40 percent to a fair value of $4.40, the documents show.” (Reuters)
  3. Sovereign Wealth Funds Move into Real Estate amid Volatile Stock Market “Real estate is now a prime play for sovereign wealth funds (SWFs) as equity markets remain unpredictable, said an analyst Wednesday. The Sovereign Wealth Fund Institute president Michael Maduell said, ‘They are looking for long-term investments where they can lock up their capital and not have to continually reinvest that capital.’ The institute analyzes investments by public asset owners such as SWFs and other long-term governmental investors.” (CNBC)
  4. Hilton Names Thomas Baltimore CEO of its New Real Estate Company “Thomas J. Baltimore, Jr., the longtime chief executive of RLJ Lodging Trust, is returning to Hilton Worldwide to lead its new real estate spin-off, the McLean-based hotel giant announced Wednesday. Baltimore, who is resigning from Bethesda-based RLJ effective May 11, will become chief executive of Hilton’s yet-to-be-named real estate investment trust. Hilton announced in February that it plans to spin off its real estate and timeshare businesses.” (The Washington Post)
  5. The Port Authority is Sitting on All This Prime Real Estate—but What Can it Really Do with It? “The Port Authority has options for the World Trade Center, among them is selling the fee position on the 16-acre site outright, selling the leases it has with Silverstein Properties on towers 2, 3 and 4 and selling its 90-percent interest in One World Trade Center. But each scenario presents its own set of difficulties. Take, for instance, the option of selling the land. Because the trade center sits on property owned by the state, the Port Authority does not pay property taxes.” (The Real Deal)
  6. Feds Move to Sell State Street Buildings “Developers could finally get a crack at four vacant government-owned buildings on the State Street shopping strip, but they have to wait at the back of the line. The federal government has decided to dispose of 202, 212, 214 and 220 S. State in the Loop after spending more than a decade trying to figure out what to do with them. The buildings, in a national historic district, have sat empty amid a Loop renaissance.” (Chicago Real Estate Daily)
  7. Sports Authority Scraps Reorganization Bid, Will Liquidate “Sports Authority Inc. has abandoned hope of reorganizing and exiting bankruptcy and instead will count on buyers to save parts of its sprawling retail chain, company lawyer Robert Klyman told a judge Tuesday. ‘It has become apparent that the debtors will not reorganize under a plan but instead will pursue a sale,’ Mr. Klyman told Judge Mary Walrath at a hearing in the U.S. Bankruptcy Court in Wilmington, Del.” (Wall Street Journal)
  8. Study: North American Warehouses Get Smart “The warehouse is shifting from a building where you keep stuff to an intelligent hub that supports order management, customer service and general productivity. According to U.S. and Canadian results from a new global study of 1,378 warehouse and IT professionals conducted in October 2015 by Zebra Technologies, ‘Warehouse Vision Study,’ companies are investing in warehouse technology. Fifty percent of respondents currently have or are moving to a full-feature, best-of-breed warehouse management system (WMS).” (Chain Store Age)
  9. IKEA to Build 1st of 2 Illinois Distribution Centers as Part of Chicagoland Project Boom “A 1.3 million-square-foot distribution center for home furnishings retailer IKEA is being built in Joliet, Ill., one of nearly $3.8 billion in industrial capital and maintenance projects in the Chicagoland area planned for this year. Industrial Info Resources, which is planning a free Market Outlook & Networking Event May 11 in Chicago, included the $80 million IKEA distribution center as one of the many projects expected to be built in the 14-county Chicago-Naperville-Elgin MSA between May and April 2017.” (Commercial Property Executive)
  10. Panera to Close Standalone Paradise Units “Panera Bread Co. will close or convert some Paradise Bakery & Café locations and continue to invest in food safety, executives said Wednesday. St. Louis-based Panera purchased a majority stake in Paradise, then based in Phoenix, in 2007, when it had more than 70 locations in 10 states. Panera purchased the balance of Paradise in June 2009. Paradise now has just over 50 units in six states, Arizona, Colorado, Illinois, Nebraska, Texas and Utah.” (Nation’s Restaurant News)
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