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10 Must Reads for the CRE Industry Today (March 13, 2018)

The Fed could raise interest rates four times this year, reports the New York Post. HNA is looking to sell Hilton Grand Vacations, according to the Wall Street Journal. These are the must reads from around the commercial real estate industry today.

  1. The Fed Could Have a Surprise in Store for Wall Street “Wall Street is wondering whether there will be three or four interest rate hikes this year. After Friday’s strong employment report for February, four seems to now be the odds-on favorite. I’m going to be a troublemaker and suggest something else: If the Federal Reserve is truly worried about an overheating economy and future inflation, then there are some shocking steps it could take that won’t make the stock market or the Trump administration happy.” (New York Post)
  2. Ivanka Reportedly Makes $1 Million a Year from Family Business “First daughter Ivanka Trump will pocket more than $1 million a year from her family’s business while also serving as a senior adviser to her father, President Trump, a new report said Monday. The payday will come from businesses affiliated with the Trump Organization that develop luxury resorts around the world, McClatchy reported, including projects in Dubai, Bali and Indonesia.” (New York Post)
  3. HNA in Talks to Sell Hilton Grand Vacations a Year After Investing “HNA Group Co., one of China’s biggest private companies, is looking to further cash out its stakes in companies related to the Hilton hotel chain roughly a year after becoming a major shareholder. The Chinese conglomerate is in discussions to sell a portion of its Hilton-related investments, according to people familiar with the matter. HNA is exploring unloading some or all of its 25% stake in Hilton Grand Vacations Inc., the timeshare business spun off last year from Hilton Worldwide Holdings Inc., the people said.” (Wall Street Journal, subscription required)
  4. Going Private Could Be the Best Thing to Ever Happen to Nordstrom—With One Big Caveat “Last week a roughly $8.4 billion offer from the Nordstrom family to take the eponymous retailer private was rejected as inadequate. The deal now seems at risk as the special committee in charge of evaluating a potential transaction indicated that the price needed to be ‘substantially’ and ‘promptly’ improved upon or they would terminate further discussions. While there is one major concern that looms large in any such deal, my hope is the Nordstroms can get this done.” (Forbes)
  5. Wynn Resorts Drops Litigation Against Former Largest Shareholder Kazuo Okada “Wynn Resorts Ltd. on Monday dropped litigation against its former largest shareholder, Japanese pachinko mogul Kazuo Okada, according to a court order signed by the judge in the case and viewed by The Wall Street Journal. The move brings the company another step closer to resolving a six-year legal battle that also involves Wynn co-founder Elaine Wynn, the ex-wife of former Chairman and Chief Executive Steve Wynn.” (Wall Street Journal, subscription required)
  6. CMBS Delinquency Rates Improve, Except for Retail Loans “With the exception of the troubled retail sector, delinquency rates across property types supporting commercial mortgage-backed securities were mostly flat to declining in February compared with January, Fitch Ratings said. February's total delinquency rate was 3.01%, down from 3.12% in January and 3.37% in February 2017. It was the eighth consecutive month of improved performance, the ratings agency said in a press release.” (National Mortgage News, subscription required)
  7. Changes to Freddie Mac, Fannie Mae Could Drive Mortgage Payments Up $400 a Month “According to Zillow, proposed reforms to the government-sponsored enterprises (GSEs) that guarantee the majority of U.S. home loans could drive up monthly housing costs and diminish housing affordability for many Americans. Congress is considering changes to Fannie Mae and Freddie Mac to reduce the risk to taxpayers if the housing market crashes again. The GSEs, which guarantee a majority of all home loans against defaults, have been under government conservatorship since 2008, when they required more than $150 billion in taxpayer funds as a result of foreclosures during the housing crisis.” (World Property Journal)
  8. Omni Opens $300M Hotel in Kentucky “More than two years after it broke ground in January 2016, the Omni Louisville Hotel, the city’s tallest hotel, has officially opened. The $300 million, 612-key property was a joint venture of Omni Hotels & Resorts and Metro Louisville. Omni Louisville features about 70,000 square feet of flexible meeting and event space, and atop the hotel, 225 one- and two-bedroom luxury apartments are available for preleasing.” (Commercial Property Executive)
  9. Universal Protests 40,000 Documents in Theme Park Property Case “Universal’s attorneys are trying to fend off Thomas’ claim that Universal’s subsidiary — SLRC LLC — is barred from building a new theme park on hundreds of acres it owns, because of private deed restrictions on the parcels. Universal asked Thomas’s company, UCPM, to hand over documents about the deed restrictions and the property, using a database search that included such terms as ‘Universal’ and ‘theme park.’” (Orlando Sentinel)
  10. Shamin Hotels Buys its First Property in the Big Apple “Shamin Hotels, the Richmond region’s largest hotel operator, has entered the Big Apple for the first time. The Chester-based hotel operator bought 81-room Hampton Inn in Lower Manhattan for $32.4 million. The deal closed March 6, according to Neil Amin, the company’s president and CEO. ‘I have been looking for an asset in New York for some time,’ Amin said. ‘This was a great opportunity to buy a premier brand in a prominent neighborhood of Manhattan below replacement cost.’” (Richmond.com)
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