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10 Must Reads for the CRE Industry Today (July 31, 2017)

Staples may sell its bricks-and-mortar division to Office Depot, reports the New York Post. Forbes looks at the decision-making process of apartment renters facing a lease renewal. These are among today’s must reads from around the commercial real estate industry.

  1. Staples May Spin Off its Retail Chain to Office Depot “A merger between Staples and Office Depot may finally be in the cards — but it won’t be the kind that company brass had longed for, or that regulators had feared. Staples, which agreed a month ago to be acquired by private-equity firm Sycamore Partners for $6.9 billion, has also lately held talks to spin off its 1,500 retail stores to longtime rival Office Depot, sources told The Post.” (New York Post)
  2. Should I Stay or Should I Go? How Renters Decide to Renew Leases “More apartment renters nationwide are choosing to renew their leases when they expire, rather than move out. That trend has been growing for more than five years. The question is where are renters more likely to stay in place? About 51% of apartment renters chose to stay at their current home during the past 12 months, according to research by RealPage, the parent company of Axiometrics, meaning that roughly 49 out of 100 renters chose to move out rather than renew.” (Forbes)
  3. New York City’s Hotel Industry Links Airbnb to Terror in Harsh Ad “New York City’s hotel industry is set to deliver its harshest attack yet on Airbnb. An ad set to begin airing Monday raises security concerns about the popular home-sharing site, and even references the recent Manchester, England, bombing. It cites media coverage that bomber Salman Abedi used a short-term rental apartment he found through a local online real estate agent and had “massive packages” sent to him at that location — which was not an Airbnb unit.” (New York Daily News)
  4. Newbie Activist Snow Park Urges Dillard’s to Lease Real Estate “The New York-based activist fund owns a 2% stake in Dillard's, according to a person familiar with the situation. The fund argues that Dillard's owned real estate worth about $200 a share, significantly more than the company's $83.35 a share price. The activist campaign launch gave the company's share price a bump of about 6% in pre-market trading Monday. According to a person familiar with the situation, Snow Park believes that other retailers, such as Dicks Sporting Goods, Nordstrom Rack, Burlington Stores or Ross Stores, would be happy pay for the use of the real estate.” (The Street)
  5. Supermarkets Face a Growing Problem: Too Much Space “Never before in America has so much retail square footage been devoted to selling food—and it is too much. A massive build-out by retailers has left the country piled up with grocery shelves as consumers are shifting from big weekly shopping trips to more snacking and to-go meals. The mismatch has flattened retail sales and leaves the industry vulnerable to a wave of closures that some executives, bankers and industry experts think.” (Wall Street Journal, subscription required)
  6. Lender Liability “When a landlord is implicated in a tenant–harassment case, it’s usually their name — and their name alone — that makes headlines. Such was the case with Raphael Toledano at 444 East 13th Street, where rent-stabilized tenants charged that the controversial broker-turned-landlord’s management company was bullying tenants into moving out to pave the way for rent increases.” (The Real Deal)
  7. Millennials Want a Hotel Room That Looks Good on Instagram, Rather Than a Cheap One, Says HotelTonight CEO “A study by Internet Marketing Inc. found 97 percent of millennials will post on social media while traveling, with three-quarters posting once a day. Sixty percent were also willing to upgrade their travel, whether that meant early deplaning or purchasing Wi-Fi. Another study by Mintel showed travel was more important than paying student loans, buying a "big ticket" item or starting a family. The changes have become more important, especially because millennials really like to travel.” (CNBC)
  8. Department Store Retailer Plans $40 Million Investment in Remodels, New Stores “Not all department store retailers are closing stores. Charlotte, North Carolina-based Belk said it plans to open three new stores, part of a nearly $40 million investment in store remodels, capital improvements and new store openings in 2017. The first two of the new stores will open on October 11, 2017, at Mullins Colony shopping center, Evans, Georgia, and at Greenwood Mall, Bowling Green, Kentucky. The third store will open in 2018, at Valley Mall Hagerstown, Maryland.” (Chain Store Age)
  9. Real Estate Services Company Taps Advisory Firm for New Technologies “Real-estate services firm Cushman & Wakefield is tapping an advisory and investment firm focused on real-estate technology to spark innovations. MetaProp NYC will help Cushman find and evaluate new real-estate technologies, aiming to hasten the process of identifying ideas and companies beneficial to Cushman’s business, executives at both firms said. MetaProp runs accelerator and pre-accelerator programs for startups annually.” (Wall Street Journal, subscription required)
  10. Who Would Be a Retail Broker Now? “No deal is too small for Max Swerdloff, a retail broker at Eastern Consolidated. He trawls social media and the web for the latest food trends, and reaches out to fashion e-tailers and restaurateurs, always in the hope his efforts will result in a lease deal. ‘I just love the process of deal making, I try to get my hands on any sized deal,’ said Swerdloff, who started as a broker in 2015.” (The Real Deal)
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