Archive for November, 2010
Tuesday, November 30th, 2010
Hunt Power has begun the creation of two REITs that will invest up to $2.1 billion in energy infrastructure and gas storage and delivery sectors in the U.S. According to GlobeSt.com, the two new REITs, Electric Infrastructure Alliance of America and Gas Infrastructure Alliance of America, will be backed by Hunt Power and are the first REITs of their kind in the electricity and gas transmission and distribution sector.
The REIT’s will develop and acquire electricity and gas transmission and distribution assets primarily in Texas, the Great Plains and the desert Southwest regions. The REIT structure allows operators to lease electricity and gas transmission and distribution assets. Similar to hospitality REITs, these infrastructure REITs develop and own assets and lease them to regional operators and in some cases will acquire distribution and transmission assets from operators, who then lease back the assets.
To read the full article from GlobeSt.com, click here.
Posted in Distribution Centers, Hospitality, Industrial, Mid America, Real Property, Western | No Comments »
Monday, November 29th, 2010
Though rents are likely to continue their decline, commercial real estate vacancy rates have already peaked or will soon top out. According to abcNEWS.com, The National Association of Realtors expects the office vacancy rate to rise a tick to 16.7% this quarter and gradually decline to 16.4% in the fourth quarter of 2011. There should be a modest decline in vacancy rates in the office and industrial sectors while retail should hold fairly steady.
The weak commercial real estate market has been a drag on economic growth in the past 2 and a half years, subtracting from the gross domestic product in 9 of the past 10 quarters. The vacancy rates of apartment buildings, one of the few bright spots in commercial real estate, are expected to fall to 5.8% in the fourth quarter of 2011 after rising slightly to 6.4% in the final quarter of 2010.
To read the full article from abcNEWS.com, click here.
Posted in Apartments, Industrial, Multi Family, Office, Real Property, Retail | No Comments »
Wednesday, November 24th, 2010
The FDIC has said that its list of ‘problem’ banks has grown from 829 to 860, including many smaller banks straining under the weak economy. According to the San Francisco Business Times, total assets held by the growing number of problem banks fell to $379 billion from $403 billion, underscoring that none of the nation’s largest banks are on the list. The banking industry is continuing to make progress in recovering from the financial crisis as credit performance has been improving.
Loan-loss reserves have also declined for the first time since the fourth quarter of 2006, primarily because large banks lowered their reserves. But there comes cautions with reducing reserves on bad loans because it may be too early for institutions to be reducing reserves without strong evidence of sustainable, improving loan performance and reduced loss rates. As a rule of thumb, when dealing with the adequacy of reserves, banking institutions should always err on the side of caution.
To read the full article from the San Francisco Business Times, click here.
Posted in Banks, Financial Services | No Comments »
Tuesday, November 23rd, 2010
Invesco has signed the largest lease renewal in the Houston, Texas region this year for 10 years and nearly 400,000 square feet at 11 Greenway Plaza. According to GlobeSt.com, the building is one of 10 office buildings in Greenway Plaza which also includes a luxury hotel, high-rise condos, an athletic club, retail, a food court and a transportation center. The entire complex is a 52-acre master-planned community along U.S. 59.
Although being headquartered in Atlanta, the Houston office of Invesco is its largest worldwide. The company has been a tenant there for more than 20 years with their 10 year renewal taking effect in January. Nearly 60% of the 225 companies in the Greenway Plaza complex have had leases for over 20 years. With the Invesco lease, the building is about 88% occupied and as part of the deal will receive a redesign and renovation of a portion of the building’s lobby.
Posted in Hospitality, Leased, Mid America, Multi Family, Office, Real Property, Retail | No Comments »
Monday, November 22nd, 2010
Mecklenburg County, North Carolina is putting the final touches on its first reappraisal in 8 years. County officials delayed the reappraisal two years ago due to instability in the Charlotte market caused by the economic downturn. It is unclear at this point how much values will move in 2011, but an increase in the 10-15% range would not be surprising. To ensure fair property valuations and minimize 2011 increases, it is important to begin communicating with the assessor’s office as early in the appeal process as possible. Paradigm Tax Group’s team of North Carolina property tax consultants offer over 50 years combined experience in the North Carolina market and have had great success in securing savings for taxpayers of all property types.
Click here to read a recent article on the 2011 reappraisal published by the Charlotte Observer as well as bios of Paradigm consultants that work in North Carolina.
Posted in Eastern, Paradigm Info, Personal Property, Real Property | No Comments »
Friday, November 19th, 2010
In New York City, of the four major commercial real estate sectors, office will take the longest to recover. However, the local NYC office market will fare much better than the national average. According to GlobeSt.com, offices will struggle to recover due to slow job creation and only when companies begin to grow again will they begin to hire and need more space. Good news is that it is predicted that about 125,000 jobs will be created per month next year, followed by 150,000 in 2012. Those numbers are significant improvements from the 87,000 new ones a month this year.
Rental rates in NYC took a big hit in 2008 when they plummeted to $58 per square foot from $80 in 2007, but they have already crept back up to $62. Leasing activity is also up and there are about 12 buildings with sales per square foot in excess of $100. In terms of lending, companies are starting to ramp up their activity. Commercial Mortgage-Backed Securities should come back in a big way next year as well. Forecasts have CMBS increasing three to four times in 2011 from this year.
Posted in Eastern, Hospitality, Leased, Multi Family, Office, Real Property, Retail | No Comments »
Thursday, November 18th, 2010
Despite the economic hangover that has been the first three quarters of 2010, the commercial real estate (CRE) market is finally finding its rhythm and is ready to get back to its victorious ways. According to an article from PRWeb, institutional investors have switched from defense to offense making it clear that buyers are alive and well and that the outlook for the CRE market is healthy. Recently a lot more deals have been getting done and the overall consensus is that CRE will come out of the recession just fine.
One reason for optimism about health and stability of the market is a pricing efficiency in place. Commercial Mortgage-Based Security (CMBS) lenders are pricing loans within 5 to 10 basis points of each other compared to 25 to 50 points as little as six months ago. The tighter range of prices indicates that there are bond buyers in the market for CMBS securities and that there is a depth to those buyers. The final leg that still needs to come around in the CRE industry is banks. As soon as banks stop shedding real estate loans and begin lending again, things in CRE should be back to normal.
To read the full article from PRWeb via the San Francisco Chronicle, click here.
Posted in Banks, Financial Services, Real Property, Special Services | No Comments »
Wednesday, November 17th, 2010
Despite the real estate market’s rise and fall of the past decade, the parallels between now and 10 years ago are striking. According to GlobeSt.com, both prices and sales volume have returned very close to where they stood a decade past. In both post-recessionary periods, real estate investors rightly took pride that overbuilding was not a cause of the decline, yet vacancy soared nonetheless. Still, commercial property continues to attract new investors despite the adverse economic conditions.
Commercial property emerges today, like it did 10 years ago, as one of the most highly desired investment alternatives despite the fact that, in both instances, vacancy rates approached record heights. The most noteworthy aspect of this trend is that both times, the inflows of capital preceded any improvement in fundamentals causing the ability of prices to rise even if rents and occupancies fall. These poor fundamentals have led to the surprise of record or near record prices both now and then.
Posted in Financial Services, Real Property | No Comments »
Tuesday, November 16th, 2010
The return of the hotel transaction market has taken longer than expected. But, according to Lodging Hospitality, a splash of high-profile acquisitions and a potential wave of distressed assets coming to market have many believing the dam is about to burst.
The much anticipated buying opportunity many expected has yet to arrive, but several recent high-profile assets acquired in major markets for top dollar indicate the paralysis of the 18 months is over. Many distressed assets have still yet to come to market though, and some stabilized properties in secondary locations have drawn little interest from buyers.
To learn more on this topic and read the full article from Lodging Hospitality, click here.
Posted in Hospitality, Hotels, Real Property | No Comments »
Monday, November 15th, 2010
Saint-Gobain Glass has acquired 50% of the equity from SAGE Electrochromics for the large-scale manufacture of electrochromic glass. According to National Real Estate Investor, the two companies have started this month building a large-scale electrochromic glass plant in Faribault, Minnesota. The plant will cost about $135 million and is expected to promote the use of electrochromic technology worldwide.
The new plant will have an annual production capacity or more than 4 million square feet of electrochromic glass in varying sizes. As for the companies themselves, SAGE will remain an independent company despite the loss of 50% of their equity. There glass product are used in hundreds of commercial, institutional and residential buildings. Saint-Gobain will market SageGlass under the Quantum Glass brand in Europe.
To read the full article from National Real Estate Investor, click here.
Posted in Complex, Industrial & Manufacturing, Mid America, Personal Property | No Comments »
