10 Must Reads for the CRE Industry Today (November 5, 2018)

Amazon is in late-stage HQ2 talks with a handful of cities, including Crystal City, Va., Dallas and New York, reports the Wall Street Journal. REITs have outperformed stocks on a long-term basis, according to Seeking Alpha. These are among today’s must reads from around the commercial real estate industry.

  1. Amazon in Late-Stage Talks with Cities Including Crystal City, Va., Dallas, New York City for HQ2 “ Inc. has progressed to late-stage talks on its planned second headquarters with a small handful of communities including northern Virginia’s Crystal City, Dallas and New York City, people familiar with the matter said, as it nears a final decision that could reshape both the tech giant and the location it chooses. The ongoing talks with some local officials come as discussions appear to have cooled in some of the other 20 cities on Amazon’s shortlist, including Denver, Toronto, Atlanta, Nashville, Tenn., and Raleigh, N.C., according to people familiar with those situations.” (Wall Street Journal, subscription required)
  2. MGM Casino Exploring Caesars Merger: Sources “MGM and Caesars Entertainment think they may be a pair. MGM has hired investment bank Morgan Stanley and law firm Weil, Gotshal & Manges to start studying the idea of the giant tie-up, a gaming source close to the situation said. No offer is on the table, though, according to sources. Activist hedge funds, which together own about a 25 percent chunk of underperforming Caesars, have been pushing for a MGM deal, sources said. Caesars shares are off 25 percent year to date, while MGM is down 15 percent.” (New York Post)
  3. Dollar Tree’s $9 Billion Problem: Family Dollar Isn’t Paying Off “Dollar Tree Inc. won a hard-fought battle to buy Family Dollar more than three years ago, beating out Dollar General Corp. for the roughly 8,200-store chain that caters to low-income shoppers by selling everything from $40 wireless speakers to 55-cent cans of Vienna sausage. Dollar Tree at the time was the smallest of the three discount retailers, and sought more heft to compete with Dollar General and the likes of Walmart Inc. and Target Corp. But now Dollar Tree executives are trying to prove the nearly $9 billion cash-and-stock purchase wasn’t a mistake.” (Wall Street Journal, subscription required)
  4. Deals Clear for Big Midtown Building Projects “Powerful developers just took control of properties they needed to build long-in-coming mega-projects on two different blocks between Fifth and Sixth avenues. Gary Barnett’s Extell Development Company bought 4-story 32 W. 48th St., former home to the Plaza Arcade diamond mini-mall, for $40 million, and at the same time closed on title to several adjacent buildings an air rights to another. The deals popped up in city records Friday night.” (New York Post)
  5. CRE Sector at Crossroads as Investors Navigate Headwinds, Report Finds “An abundance of capital, solid economic fundamentals, and favorable demographics will continue to buoy commercial real estate, though each sector is facing some headwinds. Companies can gain competitive advantage by focusing on mixed-use properties where the synergies among multifamily, office, and retail converge, either along suburban transit nodes or in urban areas. This is among the key takeaways from Commercial Real Estate at the Crossroads, a new report that Capital One commissioned from MIT’s Center for Real Estate.” (ABL Advisor)
  6. Spoiler Alert: REITs Have Outperformed Stocks for the Past 50 Years “As stock markets tumble around the world, here’s something your money guy may not have told you: No, stocks may not produce the best long-term returns. That distinction may go instead to real-estate investment trusts, or REITS. No kidding. Real-estate investments overall have beaten stocks by more than a full percentage point per year, on average, since 1960, according to recent analysis conducted by researchers in the Netherlands.” (MarketWatch)
  7. This Fledging Lingerie Company Is Growing by 300%, Crushing the Mighty Victoria’s Secret “Lively was founded by Grant in April 2016, and has been growing ever since — with its latest move its partnership with Nordstrom this year. The brand hones in on female positivity, using comfortable bras and activewear to get there— combining lingerie and leisure to pen the term ‘leisurée.’ Every bra from the brand is $35 and includes items such as t-shirt bras, bralettes, push-ups and strapless styles. Seventy percent of their pieces are wire-free, and sizes range from 32A to 40DD. But Cordeiro knows not all women fall within this range and says more sizes will come as the company perfects more products.” (CNBC)
  8. How Brookfield Imagines the Future of Retail Real Estate “Brookfield Property Partners (BPY) has become much more widely known over the last year, thanks to its series of attempts to acquire GGP, a sizeable retail REIT. The acquisition has finally closed in August, but the story is just beginning: out of 125 acquired malls, BPY plans to keep about 100 of the highest quality and redevelop them into mixed use. This redevelopment would not be achievable without bringing in Brookfield's non-retail and place-making expertise, and this lack of GGP's capability was the main rationale for the transaction.” (Seeking Alpha)
  9. Housing, By Any Means Necessary “Just hours after Mayor London Breed was sworn into office earlier this year, about 50 members of YIMBY Action crammed into a cafe at Ninth and Mission streets for their monthly membership happy hour. They drank complimentary beer and wine, provided by the building’s owner, developer Patrick Kennedy. The group’s executive director, Laura Foote Clark, asked the crowd how many had attended Breed’s inauguration. About a dozen hands shot up.” (San Francisco Chronicle)
  10. Is Downtown Dallas’ Sleepy Southwest Corner About to Take Off? “The more than $30 million pending sale of The Dallas Morning News' historic building puts a spotlight on an area of downtown that's been overlooked in recent years. In the early 20th century, the southwest corner of downtown Dallas was one of the busiest sectors of the city. Thousands of people a year poured through the area in what was then the equivalent of DFW International Airport - the Union Station railway depot. That's one of the reasons The News picked the site on Young Street for its new building in the 1940s.” (Dallas Morning News)
Hide comments


  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.