10 Must Reads for the CRE Industry Today (March 1, 2016)

10 Must Reads for the CRE Industry Today (March 1, 2016)


  1. U.S. Construction Spending Jumps to Eight-Year High “U.S. construction spending surged in January to the highest level since 2007, in the latest indication that the economy was regaining momentum after slowing in the fourth quarter. Construction spending increased 1.5 percent to $1.14 trillion, the highest level since October 2007, as both private and public outlays rose, the Commerce Department said on Tuesday. That followed an upwardly revised 0.6 percent increase in December, previously reported as a 0.1 percent gain.” (Reuters)
  2. Trump Mortgage Couldn’t Make Crashing Housing Market Great Again “’I think it’s a great time to start a mortgage company,’ Donald Trump told CNBC. It was April 2006. Sales of existing homes had hit a cycle high the previous September and had declined nearly every month after that. Confidence among home builders had peaked 10 months earlier, at the same time as new home sales, and had been on a steady descent ever since.” (MarketWatch)
  3. A Fairfield Developer Looks to Step In When G.E. Departs “Kleban owns several major retail/office plazas in Fairfield’s downtown, including the Fairfield Center building, which houses a Fairfield University bookstore, as well as a Starbucks, a Victoria’s Secret and other national chain stores, and at least 10 shopping centers along the Black Rock Turnpike commercial corridor. The company also owns properties elsewhere in Connecticut and in other states.” (The New York Times)
  4. Outlet Center Growth Signals Malls Aren’t Dead “For traditional retailers and the malls in which they reside, the game of chicken that consumers are playing on price has had major repercussions for their sales and profitability. But for one property owner, this same shopper reticence is instead fueling its growth. As retailers across the U.S. shutter hundreds of locations — sometimes leaving empty malls in their wake — Tanger Factory Outlet Centers continues to break ground on new properties.” (CNBC)
  5. Real Estate’s New “It” Position: Chief of Staff “Hear the words ‘chief of staff,’ and one may conjure up an image of Rahm Emmanuel preparing for a battle with lawmakers, or, for ‘The West Wing’ fans, Leo McGarry giving President Bartlet a pre-SOTU pep talk. But in recent years, the position has also become a popular one at development firms. ‘Typically what I’ve seen from the chief of staff role within the real estate world is, it’s a right-hand person to the CEO or other chief executive,’ said Bob O’Brien, the head of global and U.S. real estate services at PricewaterhouseCoopers.” (The Real Deal)
  6. Developer of Troubled Supertower Files for Bankruptcy to Hold Onto His Building “The developer planning a 950-foot tall condo tower on a site in Sutton Place has pushed the project into bankruptcy protection in order to stop a foreclosure auction that would have likely stripped him of the property and put it in the hands of his lender. On Friday, Joseph Beninati, who operates the real estate firm Bauhouse Group, plunged a limited liability company that they control and that owns the development site on East 58th Street into Chapter 11 bankruptcy. The move halted the Feb. 29 auction of the site.” (Crain’s New York Business)
  7. Ex-CEO of Investment Firm Sentenced to 14 Years in Prison for Ponzi Scheme “A federal judge sentenced the head of a defunct Southern California real estate investment firm to 14 years in prison for running a Ponzi scheme that lost as much as $169 million for hundreds of investors, the U.S. attorney's office said. U.S. District Judge Cormac J. Carney on Monday also ordered Michael J. Stewart, a 68-year-old San Clemente resident, to pay 120 victims $9.2 million in restitution. Stewart and his partner John Packard founded Pacific Property Assets in 1999 and bought, renovated and sold apartments in Southern California and Arizona.” (Los Angeles Times)
  8. More Home Buyers Cite High Rent as Reason for Buying “Rents across the nation are too high, which is causing one in four home buyers to want to purchase a home according to Redfin staffer Alex Starace and a Redfin survey of 750 buyers this month. This number is up from November's results of one in five and one in eight in August. Affordability was the top reason cited for buyers looking to purchase a home, second only to major life events such as marriage or having a child.” (Multifamily Executive)
  9. Cushman & Wakefield Facilitates $299M Sale of N.J. Office Assets “Gramercy Property Trust has closed on the disposition of 70 Hudson St. and 90 Hudson St., two Jersey City, N.J., office properties totaling nearly 858,000 square feet, for a total of $299 million—the largest New Jersey office deal of the year so far. The 409,272-square-foot building at 70 Hudson St. was vacant at the time of sale, following the departure of full-building tenant Barclay’s.” (Commercial Property Executive)
  10. Despite Strong Online Competition, Global Retailers Expanding in 2016 “According to a new survey of more than 150 major international brands released last week by CBRE Group, retailers are expanding their networks of stores internationally this year despite the presumed headwind of online shopping, with a greater percentage eyeing growth in the Americas than last year.  CBRE's survey found that 25 percent of respondents plan to expand in the U.S. this year, up from 21 percent in last year's survey.” (World Property Journal)
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