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14 Must Reads for the CRE Industry Today (Nov. 11, 2020)

More than 80 percent of apartment households made a full or partial rent payment for the month of November, reports NMHC. Single-family rental owners are raising rents, according to the Wall Street Journal. These are among today’s must reads from around the commercial real estate industry.

  1. NMHC Rent Payment Tracker Finds 80.4 Percent of Apartment Households Paid Rent as of November 6 “The National Multifamily Housing Council (NMHC)’s Rent Payment Tracker found 80.4 percent of apartment households made a full or partial rent payment by November 6 in its survey of 11.5 million units of professionally managed apartment units across the country. This is a 1.1 percentage point, or 131,712 household decrease from the share who paid rent through November 6, 2019 and compares to 79.4 percent that had paid by October 6, 2020. These data encompass a wide variety of market-rate rental properties across the United States, which can vary by size, type and average rental price.” (NMHC)
  2. Race for Space Pushing Up Suburban Rents “Big companies that own single-family homes are raising rents at the fastest rate since they emerged from last decade’s foreclosure crisis, capitalizing on a rush for suburban housing. Though millions of Americans are still struggling to pay rent and at risk of eviction, the bet on six-figure-earning suburbanites by companies such as Invitation Homes Inc. and American Homes 4 Rent has so far been pandemic proof. Occupancy of the hundreds of thousands of houses collectively owned by these companies is at record highs.” (Wall Street Journal)
  3. REIT Investors Must Follow CBL & Associates Bankruptcy Case “CBL & Associates Properties, Inc was effectively forced to file Ch.11 bankruptcy on November 1 because actions taken by the administrative agent, Wells Fargo, for bank lenders. This bankruptcy case should be followed very closely by investors holding other REIT securities because there are a number of critical issues that will impact the industry. While a Restructuring Support Agreement was agreed to by many stakeholders, I do not think the actual confirmed Ch.11 reorganization plan will reflect the recoveries in the RSA.” (Seeking Alpha)
  4. Holdout on PREIT Bankruptcy Seeks to Depose Coradino, Other Executives “Strategic Value Partners owns 5% of PREIT's debt and isn't happy with the pre-packaged Chapter 11 that other creditors have signed off on.” (Philadelphia Business Journal)
  5. Mall Vacancies Hit Highest Level in 20 Years “The retail sector’s struggles intensified in the third quarter.” (
  6. AMC Offers Private Theater Rentals to Attract Moviegoers “AMC Entertainment announced on Tuesday that it would offer Private Theater Rentals at AMC, which would allow people to reserve theaters for private film showings, an effort to attract customers during a pandemic that has decimated movie theaters across the country. The offering comes after a four-week trial for the service, which drew 110,000 inquiries around the country — more than four times the number of bookings in all of 2019, without any significant marketing, the company said.” (The New York Times)
  7. Ulta Beauty to Get Shops Inside Target Stores “The cosmetics retailer Ulta Beauty Inc. ULTA will open dedicated shops inside more than 100 existing Target Corp. stores starting next year, the companies said Tuesday. The partnership will expand Ulta’s physical and digital presence, Ulta Chief Executive Mary Dillon said, as the Covid-19 pandemic caused its locations to close temporarily, altered demand for cosmetics and changed the ways people buy them. At Target locations included in the partnership, a roughly 1,000-square-foot retail section will be set aside for Ulta products, and Target workers will be trained in helping shoppers browse.” (Wall Street Journal)
  8. Extra Space Storage Adds 37 Properties to Management Portfolio “Extra Space Storage has added 37 properties across the U.S. to its self storage management portfolio after investing $300 million into the recently acquired Jernigan Capital. Extra Space’s $300 million investment in Jernigan’s preferred stock is made up of a $200 million tranche that will yield 10 percent per year and a $100 million tranche that will yield 12 percent annually for a blended yield of 10.7 percent per year.” (Commercial Property Executive)
  9. Simon Property Group’s Earnings Plummet Below Last Quarter “The retail REIT saw net income plummet to just $145.9 million during the third quarter, below the $544.3 million made during the same time last year.” (The Real Deal)
  10. Dropbox, Glassdoor List More S.F. Office Space for Sublease “Dropbox has listed more than half of its space at The Exchange, a newly constructed headquarters complex at 1800 Owens St., for sublease.” (San Francisco Business Journal)
  11. Casey’s in $580 Million, 94-Store Acquisition “Casey’s General Stores is expanding its presence in the Midwest. The convenience store chain has agreed to acquire Buchanan Energy, owner of Bucky’s Convenience Stores, in an all-cash transaction for $580 million. The purchase price includes tax benefits valued at $80 million for a net after-tax purchase price of $500 million.” (Chain Store Age)
  12. COVID-Fueled Retail Apocalypse Hits Homeowners “New York City condo and co-op owners are suffering as their retail tenants struggle to pay rent on commercial space in residential buildings.” (The Real Deal)
  13. NYC Automat Announces Massive Deal to Franchise 500 Locations in North America “Automats may be poised to make a big comeback during the pandemic. Stratis Morfogen, owner of yet-to-open, touch-free automat Brooklyn Dumpling Shop in the East Village, already has far-reaching expansion plans in the works. The Wall Street Journal reports that Morfogen inked a deal with franchise-development company Fransmart to sell 500 automat franchises in North America over the next 10 years. The financial terms of the investment deal were not disclosed.” (Eater New York)
  14. Rite Aid Revamps its Layout. Here’s How That Could Impact Real Estate Investors “Though numerous retailers have permanently closed up shop in the course of the coronavirus pandemic, you'd think drug stores would be in no danger of going that route. After all, consumers need access to pharmacies and essentials that can be purchased on a whim without having to navigate a massive supermarket (a whopping bout of hay fever, for example, might inspire a drug store run for some allergy medication).” (Millionacres)
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