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10 Must Reads for the CRE Industry Today (November 14, 2017)

Forbes looks at the strength of the self-storage sector. Taubman Centers is facing pressure to consider options such as privatization, reports CNBC. These are among today’s must reads from around the commercial real estate industry.

  1. Republican Tax Plan Would Make It Less Beneficial to Own a Home, Analysis Finds “The economics team at Trulia took at crack at analyzing what the two proposals already out would mean for the housing market. One of the most striking findings is that both proposals would make buying vastly more economical for the lowest-priced tiers of homes. Anyone buying a home that costs less than $300,000 would do better than under the current system, because, as Trulia Chief Economist Ralph McLaughlin puts it, ‘these are buyers who would never have had a chance to itemize in the first place but who would, under the proposed tax plan, get the benefit of a larger standard deduction.’” (MarketWatch)
  2. Not Sexy, But Investors Should Consider the Simplicity of Self-Storage “Recently, the boring world of self-storage somehow became one of the most sought-after ways to invest in real estate. It doesn’t sound sexy, but, like anything with a good return, it actually is. In days past, it used to be that those looking to invest in real estate were mostly interested in apartment property, real estate investment’s ‘gold standard.’ There are many reasons to branch out, one of which is, you guessed it, millennials.” (Forbes)
  3. Mall Owner Taubman Now Faces Double the Activist Pressure “Taubman Centers, a top U.S. mall operator, now has a second activist investor on its case. Paul Singer's hedge fund, Elliott Management, has built a position in Taubman, a source familiar with the situation told CNBC. The activist firm has spoken with management of the real estate investment trust about pursuing potential options that include a take private, said the source. It is unclear what the next steps for the activist fund will be.” (CNBC)
  4. Walmart Testing Virtual Reality in Makeup Department Explains Everything “Everything you need to know about Walmart right now could be explained in some makeup sections. Walmart has begun testing a virtual reality system called ModiFace to help try on makeup in five stores across the country, according to a new media report. This experimentation shouldn't be a shocker to Walmart watchers. Walmart's stock has gone up nearly 35% this year. Even with such a grand surge, the 55-year-old retailer, of which grocery is a big factor, appears poised for further growth because it is remaking itself into, for all intents and purposes, a startup.” (The Street)
  5. How Foreign Investors Launder Their Money in New York Real Estate “One of the signature features of the modern age is the bottomless greed of the global economic elite. The richest people in the world — business tycoons, political elites, and wealthy heirs — spend half their time attempting to rake in more cash, and the other half protecting what they already have from as much taxation as possible. The key tool in this latter process is the tax haven: using legal chicanery (and, rather frequently, straight-up fraud) to move income and wealth into jurisdictions where it will be subject to little or no tax.” (The Week)
  6. Is Your Landlord a Building-Code Violator? New Service Aims to Tell You “For most New York residents, it is easier to find out whether the local hamburger joint has a mouse problem than if an apartment they are about to rent has no heat in the winter or a cockroach infestation. Rentlogic, a New York-based startup, aims to create more transparency by assigning letter grades to apartment buildings based on housing-code violations data, which track issues such as climate control, mold, bed bugs and vermin infestations.” (Wall Street Journal, subscription required)
  7. Coldwell Banker: Brick-and-Mortar Stores Still Desirable “Reports of brick-and-mortar retail’s death are greatly exaggerated, according to a new survey by Coldwell Banker Commercial Affiliates. Harris Poll conducted the online survey on behalf of CBC Affiliates and queried 2,100 U.S. adults from ages 18 to 69 to ascertain shopper preferences and determine new trends. Despite the oft-reported overthrow of in-store retail by e-commerce, actual stores have continued to hold their own over the last few years, with 47 percent of this year’s respondents indicating that they prefer visiting stores to make purchases rather than buying online.” (Commercial Property Executive)
  8. Coming to Your Local Mall: Online Retailers Beloved by Millennials “Landlords of top U.S. malls used to rent most of their space to the biggest national retailers, which boasted the best credit and the most desirable selection of goods. Now they are looking beyond big chains and toward lesser-known retailers and startups that started online but have amassed customers and brand recognition.” (Wall Street Journal, subscription required)
  9. Lord & Taylor to Launch Flagship Store on Walmart.com “Walmart Stores Inc. is raising the bar for its in-house fashion. Starting in spring 2018, upscale retailer Hudson's Bay Co.-owned (HBAYF) Lord & Taylor will launch a flagship store on Walmart.com, the two companies said in a statement Tuesday, Nov. 14. Lord & Taylor will introduce a "specialized online experience offering premium fashion brands" from the store on Walmart's ecommerce site. Lord & Taylor will have a dedicated store on the website and on the Walmart app, which will allow it to reach more customers than it currently does on its own ecommerce platform.” (The Street)
  10. Commercial Real Estate Remains a Safe Haven Despite Divisive Global Political Climate “2017 is shaping up to be a year like no other as an increasingly divisive political climate unsettles global markets. But, according to the latest figures from global real estate consultant JLL, commercial real estate continues to successfully navigate this uncharted territory. Third quarter global transactional volumes remain unchanged compared to the same period a year ago, coming in at $166 billion and bringing year-to-date (YTD) volumes to $464 billion, 2 percent higher than the first three quarters of 2016.” (World Property Journal)
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