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10 Must Reads for the CRE Industry Today (January 8, 2019)

Liquidation looms for Sears, according to the Wall Street Journal. Forbes examines the best markets for real estate investment in 2019. And Keith Jurow explains why the housing and mortgage crisis is still a problem in a piece for Marketwatch. These are among today’s must reads from around the commercial real estate industry.

  1. Edward Lampert Scrambles to Keep Sears Alive “Liquidation firm Abacus Advisors—which has already handled the closures of Sears stores since the retailer filed for bankruptcy filing in October—has been selected as a qualified bidder, people familiar with the matter said. The two sets of liquidation firms that earlier submitted competing bids to liquidate all of Sears have stepped back from the bidding process, the people added. A court hearing is scheduled for Tuesday to update Judge Robert Drain, who is presiding over the bankruptcy case. Mr. Lampert and other bidders will likely have until a Jan. 14 auction to modify their offers.” (Wall Street Journal, subscription required)
  2. The Best Markets for Real Estate Investment in 2019 “This coming year, most real estate investors will want to stay away from the cities with soaring prices, where they’re more likely to end up holding the bag than to strike it rich. You can never know when a real estate bubble will burst – I happen to think it won’t happen in 2019 – but in places like San Francisco, Seattle, Miami and Denver, caution is now the order of the day. If you own property in these spots and plan to sell, don’t wait until the market has peaked.” (Forbes)
  3. Why the Housing and Mortgage Crisis Is Far from Over “With major data providers reporting that mortgage delinquencies continue to decline, Wall Street and the pundits are more convinced than ever that the mortgage crisis is dead and buried. The enormous delinquency problem in the New York City metro area shows why I’m convinced that the U.S. housing and mortgage crisis is far from over, and reveals an ugly truth about mortgage deadbeats. Moreover, New York City is not the only city in this weakened position.” (MarketWatch)
  4. Real estate data firm ATTOM acquired by private equity shop “ATTOM maintains a large real estate database covering property tax, deed, mortgage, foreclosure, environmental risk and other data for more than 155 million residential and commercial properties in the U.S., which it licenses to companies in real estate and adjacent industries.” (The Real Deal)
  5. WarnerMedia Puts Its Stake in New HQ Building Up for Sale, Before It Moves In “The media and entertainment company, which includes HBO, CNN and the Warner Bros film company, aims to raise about $2 billion from the sale of the 1.4-million-square-foot Manhattan office condominium, according to real-estate firm Cushman & Wakefield , which is marketing the property. That would make it among the highest-priced U.S. single office building sales.” (Wall Street Journal, subscription required)
  6. Downtown Office Vacancy Stable While New Supply Looms “The downtown office market carried its streak of stability through the end of 2018. The question this year is how long it will last as big new buildings pick off tenants from older ones. Vacancy among downtown office properties at the end of the fourth quarter ticked up by just a tenth of a percentage point, to 13.4 percent, compared with the previous quarter, according to data from brokerage CBRE. That's just slightly higher than the 13.2 percent vacancy rate downtown at the end of 2017 and marked two consecutive years in which the rate has hovered around 13 percent.” (Crain’s Chicago Business)
  7. Plano Buildings Sales Add Up, with More on the Way “A string of high-profile building sales made Plano one of North Texas' top real estate investment markets in 2018. While downtown Dallas and Uptown often land some of the biggest commercial real estate sales, Plano racked up an impressive total of transactions in recent months. The $160 million purchase of the Granite Park VII office building near the Dallas North Tollway was one of the priciest purchases on record for a suburban Dallas building.” (Dallas Morning News)
  8. CRE Brokers Made More Money in 2018 “The majority of commercial real estate brokers made more money in 2018 than in 2017, according to the latest Apto National Broker Buzz Poll. The surveyed brokers also expect more of the same financial success in 2019. ‘Rising macroeconomic tides in the US lifted commercial real estate boats in 2018,’ says Tanner McGraw, founder of Apto, a commercial real estate software company.  2019 bodes well for the macroeconomy and the commercial real estate sector, though there are plenty of jitters with the US government partially shutting down and over trade, interest rates, and questions about whether the corporate tax cuts will be as much of a boon in 2019, he adds.” (GlobeSt.com)
  9. Three Specialty REITs That Could Generate Massive Returns in 2019 “As the editor of the Forbes Real Estate Investor, I have the responsibility to research over 125 individual Real Estate Investment Trusts (or REITs) and over a dozen property sectors. Many of our choice picks come from the basic ‘food groups’ or property sectors such as retail, apartments, healthcare, and industrial. Since these are considered ‘mainstream’ property sectors, most investors can easily identify with their attributes and potential for growth.” (Forbes)
  10. A Tale of Two Cities: What’s Driving Capital to LA vs. New York? “Historically New York was the darling of foreign investment, but L.A. is attracting more than its fair share of overseas capital and even New York-devoted owners are looking West. Then there’s the steady flow of debt deals on both coasts, the cut-throat competition for which shows no sign of abating. It makes sense, market experts say, given the similarities between the two markets.” (Commercial Observer)
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