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10 Must Reads for the CRE Industry Today (March 24, 2016)

10 Must Reads for the CRE Industry Today (March 24, 2016)


  1. How Satisfying Millennials Could Save PwC $850 Million “About 80 percent of PwC’s U.S. employees are millennials, and the New York-based global consulting firm wanted to keep everyone happy. To offer more flexibility, the company hatched a plan to convert all of its U.S. offices to co-working spaces, where employees can reserve a seat or an office to work in using proprietary software or a mobile app. The shift could save millions of dollars in recruiting and training, and put a meaningful dent in overhead.” (Bloomberg)
  2. Commercial Real Estate Sales Drop: Time to Move Out? “Recent reports indicate that commercial real estate sales have dropped for the month of February, indicating a reversal of a trend that has been expanding. Lenders who in the past made low LTV loans are now requiring ever increasing equity, and interest spreads are widening. So, what is happening in the commercial real estate market? Is the demand down? Are buildings not worth as much, reflecting a weaker economy? Are investors and lenders scared of a market that has been growing since the reversal of 2008?” (Seeking Alpha)
  3. A Spate of Purchases Around This Brooklyn Avenue Heralds More Skyscrapers “Around the new year, a joint venture of JDS Development and the Chetrit Group filed plans with the city to build a 1,066-foot tower at 9 DeKalb Ave. in downtown Brooklyn. The 73-story tower would be by far the tallest building in the borough, nearly twice as tall as the reigning spire, the 596-foot AVA DoBro apartment tower at 100 Willoughby St. The city has yet to green-light the tower, which requires landmark approval because it would involve significant changes to the historic Brooklyn Dime Savings Bank building at 9 DeKalb.” (Crain’s New York Business)
  4. Leon Charney, New York City Real Estate Owner, Dies at 77 “Leon Charney, a billionaire owner of Manhattan real estate and supporter of Israel who became a familiar face to viewers of New York City public television, has died. He was 77. He died March 21, according to an online death notice. No cause was given. The son of a sewing-supplies salesman, Charney assembled a real-estate portfolio that included three skyscrapers in Times Square, including 1441 Broadway, and a total of 1.5 million square feet of commercial space, according to Forbes magazine.” (Bloomberg)
  5. Inside the Title Insurance Cartel “On December 10, 2013, regulators summoned the nation’s biggest title insurance firms to 1 State Street. Much of the hearing focused on the technicalities of title insurance fees and covenants. Representatives of firms in attendance, including Fidelity National, First American, Old Republic, and Stewart, spoke of enabling ‘the American dream of homeownership.’ But then came a question about strip clubs. Joseph DeSalvo, First American’s senior legal counsel, was asked why his company expensed trips with clients to Blush, a gentleman’s club just off of Route 454 on Long Island.” (The Real Deal)
  6. Five Below Ramping Up Store Growth “Five Below is accelerating new store growth again this year. The tween and teen retailer shared a long-range profit forecast which indicates it expects accelerating growth to be a recurring theme. It plans to open 85 new stores this year, adding to its base of 437 units. A net increase of 71 new stores last year – on top of 62 units the prior year – enabled Five Below to increase sales 23.7% to $326.4 million in the fourth quarter and 22.3% to $832 million during the fiscal year ended Jan. 30.” (Chain Store Age)
  7. Think Housing is Unaffordable? It’s Only Getting Worse, RealtyTrac Says “When it comes to priciest housing markets, a new report points to the usual coastal suspects. But the first quarter Home Affordability Index from data provider RealtyTrac has some other sobering realities about housing affordability – or lack of it. Home price growth outpaced wage growth in most counties, RealtyTrac said. And the problem is getting worse: the number of metros that are growing less affordable according to their own historical standards grew.” (MarketWatch)
  8. Inside the Most Audacious Real Estate Project in the World “Howard Air Force Base was once an imposing military installation alongside the Panama Canal, from which the United States fought guerillas and hunted down dictators. Sixteen years after the Americans left, there is a new man in charge: Colombian businessman Jaime Gilinski, who is turning the base into a brand-new city. He has already made $1.4 billion — and there are billions more to come.” (Forbes)
  9. Apartment Renewal Rates Hit 10-Year High “The apartment industry reached a 10-year high in lease-renewal rates in February, a new report from MPF Research shows. Last month, 55.1% of expiring leases were renewed. MPF's analysis of lease transactions from its parent company, RealPage, reveals that February 2016 renewals were up 0.1% from those of February 2015, which makes it the 33rd year-over-year increase in the past 34 months. Additionally, there was a 5.0% increase in monthly rents for leases renewed last month.” (Multifamily Executive)
  10. Over One Trillion Dollars to Enter Global Real Estate Market in 2016 “According to CBRE's Global Investor Intentions Survey 2016, real estate investors worldwide remain strongly expansionary in 2016, with more than $1 trillion of planned expenditures anticipated to enter global real estate markets--6 percent higher than in 2015. The 2016 survey was conducted between January and early February, and captured negative sentiment arising from volatility in China's stock market at the time.” (World Property Journal)
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