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10 Must Reads for the CRE Industry Today (September 6, 2017)

MarketWatch looks into the single-family rental business. Jonathan Litt may try a proxy fight with Hudson’s Bay, according to The Street. These are among today’s must reads from around the commercial real estate industry.

  1. Real Estate Firm Says Malls Need a New Business Model “After a 70-year run, the business model driving the U.S. mall industry needs an overhaul, according to a new report. Malls need to shift emphasis away from department stores and toward retailers that are less susceptible to competition from e-commerce, according to a report from real estate services firm CBRE Research. On average, department stores still occupy about 50% of the gross leasable area of shopping malls.” (Wall Street Journal, subscription required)
  2. Meet the New Real Estate Sector That Plays Offense and Defense “As the real estate cycle churns on, it’s getting harder to find good ways to invest. Prices in many segments of the market are high, many metro areas are oversaturated with supply of homes, and too many long-term concerns dog other types of real estate, like malls. But real estate investment trusts focused on renting out single-family homes are appealing to experts interviewed by MarketWatch, all of whom describe it as a great investment for the short and long term.” (MarketWatch)
  3. Hudson’s Bay May Face Proxy Fight as Share Slump and Real Estate Falters “Plummeting shares, a missed real estate IPO opportunity and two failed acquisitions leaves Hudson's Bay Company (HBC)  with little choice but to make drastic changes — such as going private or selling Saks Fifth Avenue — or confront a proxy fight. The Canadian retailer may be nearing a hostile takeover led by activist investor Jonathan Litt, who is urging the company to sell its real estate assets or consider privatization. The company is reviewing its options with Bank of America as an adviser, TheStreet reported last week. Shares have lost almost 40% in the past year.” (The Street)
  4. The Top 10 Cities Where It’s Easiest to Rent an Apartment “Apartment rental approval rates are up in the United States. According to Rent Café, ‘the percentage of applications that are approved nationally is increasing, from an 81.7 percent approval rate in 2014 to 83.2 percent in 2017.’ And, of the 2017 applicants, more than 60 percent are millennials, Nadia Balint, real estate writer and author of the study, tells CBNC Make It. They represent the country's largest renting population.” (CNBC)
  5. Lodging REITs Could Be Slammed by Hurricane Irma “A number of hotel owners with exposure to Florida and the Caribbean islands could be affected by Hurricane Irma, a category five storm expected to hit the islands by Wednesday and possibly make landfall in Florida this weekend. Officials in the Florida Keys are ordering mandatory evacuations starting Wednesday, and hotels could face immediate losses from canceled trips.” (Wall Street Journal, subscription required)
  6. Timely Tips for the New Real Estate Investor “Whether you want to diversify your investments, develop cash flow for your retirement years or achieve other financial goals, investing in real estate can be a smart idea. Real estate tends to be less volatile than the stock market, and the owners of investment properties can benefit from price appreciation as well as the current rent roll. That does not mean that owning investment real estate is an easy road to riches. If it were, everyone who owned an apartment building or a rental home would be rich, and clearly, that is not the case. If you are new to the world of real estate investing, you need to plan carefully, develop a strategy for success and treat your new endeavor like the business it is.” (Forbes)
  7. The Closing: Sam Zell “The tycoon, who turns 76 this month, isn’t mellowing with age. In May, he published a memoir entitled ‘Am I Being Too Subtle?’ and he’s been actively making the rounds on cable news shows, talking about the Trump administration’s proposed tax plan, which he believes will boost the economy. He’s also an avid motorcycle rider.” (The Real Deal)
  8. Why E-Commerce Brands Are Flipping the Script and Opening Brick-and-Mortar Stores “Walking into Boll & Branch’s new New Jersey-based retail store, you would never guess that the brand’s bedding products were only available online before last week. It looks like a modern store with items on display and friendly customer associates ready to answer questions. And yet you won’t see any customers walking out with packages here. All purchases are mailed directly to the consumer, just like how the store operates online. Boll & Branch now belongs to a group of e-commerce, direct-t0-consumer brands that have opened their own brick-and-mortar stores in the past year.” (Digiday)
  9. Harry Macklowe’s French Girlfriend Breaks Her Silence “The French squeeze of mega-city developer Harry Macklowe insists that her love for the lusty long-in-the-tooth Lothario is the real deal. ‘I am not a French kept girlfriend,’ Patricia Landeau, 62, told The Post on Tuesday in her first public interview about her four-year relationship with Macklowe, 80. Landeau spoke on the eve of the opening of her billionaire beau’s divorce trial from his wife of nearly 60 years, Guggenheim Foundation trustee Linda Macklowe.” (New York Post)
  10. Meyer Equities and Children’s Aid Society Feuding over Midtown HQ Deal “Meyer Equities may have Harry Macklowe out of the way for now, but buying the Children’s Aid Society’s headquarters in Midtown is proving to be a difficult deal to close. The Garment District-based firm notched a big win earlier this year when a judge ruled that Macklowe didn’t have a right of first refusal to buy the nonprofit’s property at 150 East 45th Street, which Meyer Equities had offered to buy for $28 million.” (The Real Deal)
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