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10 Must Reads for the CRE Industry Today (October 27, 2016)

10 Must Reads for the CRE Industry Today (October 27, 2016)


  1. Real Estate Faces Cyber Threats on Several Fronts “The real estate sector should prepare for a rapidly escalating onslaught of online attacks by hackers employed by organized crime, according to a top cyber-security expert who spoke at ULI’s 2016 Fall Meeting in Dallas. Hemanshu Nigam, chief executive of SSP Blue, a security consulting firm, and a former federal prosecutor specializing in computer crime, said that while the industry has not yet been hit by catastrophic data breaches of the sort that have plagued companies such as Yahoo and Target, nobody with an online presence can rest easy. ‘Even the Pentagon has 1 million attacks per day,’ said Nigam, who has also worked as a security executive for companies such as Microsoft and News Corp. He was part of a panel discussion on reducing vulnerability, which also covered burgeoning risks to society from threats such as epidemics and food insecurity. Online intruders, who are out to steal from companies any information that can be resold on the so-called dark web, are victimizing 30,000 websites daily, he said. In addition to trying to ransack corporate databases, criminals sometimes implant malware that allows them to break into the computers and other devices used by people who visit compromised sites.” (Urban Land Magazine)
  2. Top 10 emerging trends shaping real estate in 2017 “For months, the real estate market—and markets in general—have suffered a lack of security. From the Brexit aftermath to the U.S. election, political wildcards as well as structural market shifts have made prognostication and predictions difficult.  But there are still fundamental changes at play and, amid the ups-and-downs, the United States has emerged as a safe haven and investment opportunity. According to the Urban Land Institute’s annual Emerging Trends in Real Estate Report, which was just released this morning at their annual meeting in Dallas, real estate in the United States shows a more favorable outlook than much of the rest of the world. Of course, this attention carries plenty of risks and challenges. Here's a breakdown of the big topics that analysts at the Urban Land Institute and PriceWaterhouseCoopers, as well as hundreds of industry experts, believe will shape the real estate landscape for the years to come.”  (Curbed)
  3. 5 best — and worst — U.S. real estate markets “Investors and homeowners looking for the next hot property market should keep an eye on two trends: jobs and affordability. That's according to new research from PwC and the Urban Land Institute, which on Wednesday published their annual Emerging Trends in Real Estate report. It's based on economic data and survey responses and interviews with property investors, developers, brokers and other professionals involved in the real estate business. Some of the cities that landed near the top of the list in past years have been bumped down in this year's ranking because of affordability issues. San Francisco, for instance, ranked No. 2 just a few years ago but has fallen to 10th place because of high costs, said Mitch Roschelle, a partner and real estate research leader at PwC.” (CBS News)
  4. Zell not bullish on economy, real estate market “If you want an optimistic take on the U.S. and world economies, don't look to Sam Zell. Speaking at an investment conference today, the billionaire Chicago investor suggested a recession may be on the horizon, decried the demographics of aging Europe and made it clear he thinks there's not much upside left in commercial real estate. Yet Zell is high on Latin America, where he's had more hits than misses investing in real estate. Zell, the 75-year-old chairman of Equity Group Investments, covered those topics and many more in a conversation with Debra Cafaro, chairman and CEO of Ventas, that kicked off the annual Invest for Kids event. The conference, which raises money for kid's charities, drew about 1,100 people to the Harris Theater in downtown Chicago to hear investment ideas from top money managers. Cafaro pointed out that two of Zell's real estate companies, Equity Residential and Equity Commonwealth, have been selling properties while funds led by two other high-profile investors, Jonathan Gray, Blackstone Group's head of real estate, and Barry Sterlicht, of Starwood Capital Group, have been buying.” (Crain’s Chicago Business)
  5. Unique factors may be driving real estate investment decisions in Portland's suburbsRecently, the Urban Land Institute hosted a great webinar regarding national forecasts for the economy and real estate. During the Q&A session, three leading real estate investment researchers, Jim Clayton, head of investment strategy and analytics for Barings Real Estate Advisers, Eileen Marrinan, America’s director of research with Grosvenor, and Josh Scoville, senior managing director with Hines, were asked where they are currently investing in real estate. All of them indicated they are focused on long-term investments in areas with strong walk scores.” (Portland Business Journal)
  6. Under Clinton, What Would Be the Tax Implications for Luxury Real Estate Buys?“Real estate tax experts told Mansion Global that they think a Hillary Clinton presidency would be good for the high-end residential real estate market, even though capital-gains taxes would likely increase. “While there is an expectation of higher taxes,” said Edward Mermelstein, managing partner of the Manhattan law firm of Rheem, Bell & Mermelstein, ‘the impact will be softened by market certainty as well as continued economic expansion.’ Mr. Mermelstein said he believes that many in the real estate market favor Ms. Clinton because she is “a known product” and the expectation is that there would be no major policy changes that would greatly impact luxury real estate purchases. ‘The financial markets, as well as the real estate market, do well during stable times. A Clinton presidency has significant certainty as to market conditions,’ he said.” (Mansion)
  7. Aerospace company to create more than 100 jobs in Miami “KLX Aerospace Solutions Group announced Wednesday that it would move to new headquarters in Miami and create more than 100 jobs. The major aerospace supplier will lease a 515,000-square-foot facility at the intersection of Northwest 107th Street and 97th Avenue between Florida’s Turnpike and Interstate 75, near the proposed American Dream Mall. The building is part of the first phase of a massive, 504-acre office park called Countyline Corporate Park being developed by Flagler Global Logistics. KLX’s deal is one of the largest industrial transactions in South Florida this year, according to brokerage JLL.” (Miami Herald)
  8. Religious groups’ tax-exempt NY properties skyrocket in value to $26B: report “The value of religious groups’ real estate holdings across New York state has exploded over the past two decades — to a total of $26 billion. The state’s most notable expansion of tax-free land is in Ramapo, where there is a fast-growing Orthodox Jewish population, according to analysis from the USA Today Network. The number of religious tax-exempt properties in the town more than tripled between 1999 and 2015. The value of the properties rose by 165 percent in the same period. Michael West, an attorney at the New York Council of Nonprofits, told the news network the expansion has been so vast it is possible there are no longer any properties left on the tax rolls. ‘If you do the math and extrapolate it out, there’s only so much land,’ he said.” (The Real Deal)
  9. Why Macy's will open its doors on Thanksgiving Day, but Mall of America won't “Macy’s made headlines earlier this month after announcing it would push up its opening hours on Thanksgiving Day to 5 p.m — an hour earlier than the year before. But the retailer's decision to open its doors on the holiday is far from radical. Macy's has consistently opened on Thanksgiving Day since 2013, as have many other big-box retailers. Over the last several years, competition between retailers like Wal-Mart, Kohl’s, Best Buy, Target and J.C. Penney has driven doorbuster promotions earlier and earlier — a phenomenon aptly known as “Black Friday creep.”… For years, retailers have held special early morning Black Friday hours. In 2011, retailers such as Kohl's, Macy's and Target pushed up those hours to midnight, and a year later, Wal-Mart announced it would open at 8 p.m. on Thanksgiving Day. Since then, the retailer has pushed its opening hours as early as 6 p.m., while others have followed suit. Wal-Mart was the catalyst for Thanksgiving Day openings throughout the retail industry, Moody's O'Shea said. Wal-Mart has historically opened on Thanksgiving Day to pick up food sales from procrastinating grocery shoppers who need a last minute dish. Competitors like Target quickly caught on to the early promotions, and the retailer continues to open on Thanksgiving to keep up competition against Wal-Mart.” (Retail Dive)
  10. Retail phase of 65-acre Florida project is approved “Metropica, a 65-acre community planned for Sunrise, Florida, will begin building 370,000 sq. ft. of retail, dining, and entertainment space after getting the go-ahead from the town’s Planning and Zoning Committee. Tenants waiting to fill the space include iPic Theaters, Anthropologie, Fogo de Chao, Kings Bowl, and Kona Grill. Also approved as part of this first phase of construction phase were a 345-unit apartment building, a 240-room hotel, and 140,000 sq. ft. of office space. Sunrise Mayor Michael Ryan hailed the project as the ground-up creation of a brand new neighborhood for his city. “It will tie all of Sunrise together, giving us a convenient and beautiful place to live, work and play, as well as connecting us to the greater South Florida metroplex,” he said following the committee vote.” (Chain Store Age)
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