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10 Must Reads for the CRE Industry Today (March 2, 2017)

10 Must Reads for the CRE Industry Today (March 2, 2017)


  1. GDP Estimate Cuts Show Divergence Between Economic Activity and Optimism “There’s a growing divergence between the optimism seen by stock market traders, business executives and consumers, and actual economic activity. The Atlanta Fed’s GDPNow model for GDP growth, which mashes 13 subcomponents together, was cut on Thursday to 1.8% from 2.5%, marking its lowest forecast for the quarter. The biggest culprit was the weak consumer spending revealed in Thursday’s personal consumption expenditure report.” (MarketWatch)
  2. New York Developer Jonathan Rose Plows Into Affordable Housing “New York developer Jonathan Rose Cos. is set to purchase a $500 million portfolio of affordable-housing properties from Forest City Realty Trust, in a transaction that will double the size of Jonathan Rose’s portfolio and help turn it into a more significant player in the industry. The 48 affordable-housing communities the company is purchasing in a deal expected to close Wednesday are sprinkled throughout seven states.” (Wall Street Journal, subscription required)
  3. 6 Large Retailers Besides J.C. Penney Are Closing Waves of Stores “The Great Restructuring in retail continues. In the wake of a disappointing holiday season, J.C. Penney (JCP) said recently that it will close 130 to 140 stores by the second quarter. The store closures represent 13% to 14% of the company's current store base and less than 5% of annual sales. Here are several other retailers continuing to rightsize their store fleet amid the shift to digital shopping or other external pressures.” (The Street)
  4. CRE Opinion: DFW Institutional Real Estate—Right Where We Should Be “As of year-end 2016, the NPI was tracking 7,362 assets with an aggregate appraised value of $525,273,700,000—call it $525 billion. That’s a cool $71.3 million per asset; by that measure, this is big time real estate investing. And in case you were wondering what property type is most favored by these large investors: it is office, followed by apartments, then retail. The industrial sector has the most individual properties, but because of the relatively lower cost (per asset), it falls a distant fourth in dollars invested.” (D Magazine)
  5. DineEquity Expects Closures at 2016 Levels “ DineEquity Inc. expects Applebee’s Neighborhood Grill & Bar franchisees to close slightly more restaurants this year than in 2017, the company said Wednesday. ‘Our 2017 plan includes expectations for the closure of some Applebee’s restaurants,’ said Greggory Kalvin, who on Wednesday was named DineEquity’s interim chief financial officer.” (Nation’s Restaurant News, subscription required)
  6. With Sales Slowing, But Prices Still High, Where Does the Multifamily Investor Go? “The 2016 multifamily investment sales market suffered last year in New York City. Compared with the year prior, transaction volume was down, dollar volume was down and number of units sold was down, according to data from Ariel Property Advisors. Dollar volume dropped the most, at 26 percent, to $14.1 billion year-over-year citywide, the brokerage’s numbers show.” (Commercial Observer)
  7. How Real Estate Developers Can Profit from Solar “Many organizations have committed to the idea of sourcing all their power from renewables. Some, including Intel, Kohl’s, Apple, the National Hockey League and Starbucks, purchase enough clean energy to offset or run all of their operations. Real estate developers who sell or lease their spaces, however, have been slower to incorporate rooftop solar in the projects. Because their tenants usually pay the electric bills, there hasn’t been much of an incentive. But that scenario is changing.” (GreenBiz)
  8. Medical Institution Buys Detroit Office Park “Friedman Integrated Real Estate Solutions arranged the sale of North Troy Corporate Park, a 141,464-square-foot office property located at 5505 Corporate Drive in Troy, Mich. Friedman CEO & executive managing director and Associate Broker Robert Gagniuk represented the seller, 5505 NTCC LLC, in this transaction. The building was acquired by the Oakland County Community Mental Health Authority (OCCMHA), which plans to move its headquarters from Auburn Hills to Troy in late summer.” (Commercial Property Executive)
  9. Belay Investment Group Forms Strategic Partnership with Eagle Property Capital Portfolio “Los Angeles-based Belay Investment Group has acquired a 49% interest in a five-property portfolio of workforce housing assets assembled by Miami-based Eagle Property Capital Investments, which sponsors the portfolio’s 51% interest holder, EPC Fund III. Belay and EPC have also entered into a programmatic joint venture, Belay-EPC PJV, through which they will acquire and reposition up to $269 million in Class B and Class C multifamily properties, primarily in Florida and Texas.” (Multifamily Executive)
  10. Outcome Health Plans Huge New HQ in River North “Outcome Health is increasing its headquarters space by six times with a nearly 400,000-square-foot office lease in River North, signaling that one of Chicago's fastest-growing companies is keeping its foot on the gas. The health technology company, formerly known as ContextMedia, has leased almost 400,000 square feet in the former American Medical Association headquarters building at 515 N. State St., according to people familiar with the deal.” (Crain’s Chicago Business)
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