Rounds Roundup: November 2015

Last week, big box retailers such as Macy’s M, -1.40% and Nordstrom JWN, +0.72% reported weak results and both stocks came crashing down, inflicting damage on the retail sector and equity markets in general. I contend that what is happening to these companies is not a result of a weakening economy. Rather, it is due to a secular change — a paradigm shift — in consumer behavior and retail commerce. Investors fail to recognize this at their own peril.

What is most remarkable, in this shift, is the decline of traditional shopping, over the past few years, at malls across the country. I refer to this phenomenon, with no sense of hyperbole, as “The Death of the American Mall.” Recently I discussed this theory and its consequences for investors on WSJ Podcasts and Bloomberg Radio, but wanted to put my thoughts in writing for our MarketWatch readers.

Do you remember the classic movie “Fast Times at Ridgemont High”? It was a story which revolved around teenagers working and hanging out in a mall. I grew up in the 1960s, went to high school in the 1970s and graduated from college in 1982. During those years, malls in the United States were a destination for teens, tweens and young adults. You would go there to get the latest record release (those were vinyl disks which played music on a turntable), shop, grab a meal, see a flick or just hang out with friends. It was also a great place to get a job.

Read entire article here on Marketwatch.com

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Monday, November 23, 2015

The Psychology Behind Interior Design

Color and texture impact our moods, and also determine our choices when it comes to designing our living spaces.

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What to Take Before a Colonoscopy

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Friday, November 20, 2015

Scarce Labor Drives Construction Costs for Multifamily Developers

The good news for the multifamily industry is that the cost of construction materials is very low. The bad news is that skilled construction workers are increasingly expensive and hard to find.

“I’m pretty optimistic that materials costs are going to stay low and maybe get lower,” says Ken Simonson, an economist with Associated General Contractors of America, an industry trade group. “My number one concern is the availability of labor.”

The U.S. economy is relatively strong—at least compared to the rest of the world. From Asia to Europe, economies around the world have struggled this year, driving down demand for products bought and sold on the global market, from oil and steel to concrete. But here in the U.S., unemployment is low. The price of labor needed to build large projects is high and rising, often wiping out the cost benefit of cheaper materials.

Overall costs rise

The prices contractors charge for construction projects, including the cost of labor, rose slowly but significantly this year, according to the U.S. Bureau of Labor Statistics. The overall producer price index for the construction of new non-residential buildings climbed 1.8 percent over the year that ended September 2015. (Costs for “non-residential” construction do not include single-family homes, and include many of the same materials and labor as large apartment developments, especially high-rise apartment buildings.)

The 12-month increases ranged from 0.2 percent for healthcare construction to 1.8 percent for schools to 1.9 percent for warehouses and industrial buildings and 2.4 percent for office buildings.

Worldwide demand for many commodities has fallen over the last year and that makes those goods less expensive in the United States.

Read entire article in National Real Estate Investor here.

Find out more about Liberty at our Youtube page.

To discuss commercial mortgage financing needs contact Liberty.

The post Scarce Labor Drives Construction Costs for Multifamily Developers appeared first on Liberty Realty Capital Group.

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What Do Investors Need to Know About Crowdfunding?

Crowdfunding platforms have exploded recently, with experts expecting $2.57B raised this year. And while we have discussed what investors should look for in a platform, we’ve yet to tackle why you should be looking at crowdfunding in the first place. To get a grip on crowdfunding’s advantages, potential concerns and future, Bisnow sat down with partner RealtyMogul.com’s CTO and co-founder, Justin Hughes (pictured). The Appeal Justin says the advantages of crowdfunding extend beyond accessibility and reach (although he admits they are significant benefits for investors). A solid crowdfunding platform provides investors additional investment opportunities they wouldn’t normally get because investors can “leverage the connections of the platform, as well as benefit from the enhanced purchasing power when investors pool their capital.”

Anti-inflammatory Diet for Depression

from NutritionFacts.org http://www.youtube.com/watch?v=4xbNNxQZEgA

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Thursday, November 19, 2015

Old School Outfitter – Campfire

from Old School Outfitters http://www.youtube.com/watch?v=bL3nNZRXwOo

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Wednesday, November 18, 2015

Elon Musk wants the next Gigafactory to be in Germany, has conducted secret talks

When you are making multiple copies of something new, the hardest one to make by far is the first one. After that, it’s just “cut & paste”…

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Mall Owners Find Silver Lining in Retailer Busts

A spate of retailer bankruptcies this year has left owners of malls and shopping centers scrambling to fill empty stores. But some landlords smell opportunity.

The vast majority of these type of properties are occupied and spare space is in short supply in many parts of the country, according to experts and landlord data. That is boosting the confidence of landlords who believe they can find new tenants and charge them higher rents.

RadioShack was the largest retailer by assets with publicly traded stocks or bonds to file for bankruptcy since 2010. A former Radio Shack store in the Bronx, New York

Photo: Michael Nagle/Bloomberg News

After grocery chain A&P, filed for bankruptcy in July, for example, Brixmor Property Group Inc. said it bought back three leases in a bankruptcy auction under which the grocer, formally known as Great Atlantic & Pacific Tea Co., was paying an average of $6.59 a square foot. The firm, which owns shopping centers in 38 states, will be able to charge new tenants $20 to $30 a square foot, says Michael Carroll, chief executive.

See entire article in the Wall Street Journal.

Find out more about Liberty at our Youtube page.

To discuss commercial mortgage financing needs contact Liberty.

The post Mall Owners Find Silver Lining in Retailer Busts appeared first on Liberty Realty Capital Group.

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Are Calcium Supplements Effective?

from NutritionFacts.org http://www.youtube.com/watch?v=OuiGrT6aSvQ

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Tuesday, November 17, 2015

Choosing Solar Power Beyond the Home Market

Take advantage of the benefits of solar power with portable, small-scale solutions.

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Monday, November 16, 2015

Are Calcium Supplements Safe?

from NutritionFacts.org http://www.youtube.com/watch?v=KEiUVzCIXJU

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Friday, November 13, 2015

After Leading CMBS Out of Recession, Retail Loans Slower To Refinance

For all of their success in leading a resurgence of CMBS financing following the Great Recession, retail properties face a tougher rode ahead in the short term.

Approximately $50 billion of retail-backed CMBS loans are scheduled to mature through 2016. Collateral backed by retail properties accounts for the largest portion of that, its also accounts for the largest proportion of loans defaulting at their 2015 maturities, according to Fitch Ratings.

For loans with original maturities in 2015, retail comprises the majority of the currently delinquent loans ($555.2 million) followed by office ($469 million). Other property types have far lower levels of deliquent loans, including hotel ($162.9 million), mixed use ($161.9 million), multifamily ($44.6 million), industrial ($12.4 million), and self-storage ($6.5 million).

Read the entire article at www.Costar.com.

Find out more about Liberty at our Youtube page.

To discuss commercial mortgage financing needs contact Liberty Realty Capital Group.

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Crowdfunding a crowdinvesting platform for climate solutions

Can the power of crowdinvesting help kickstart a revolution in climate solutions?

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How to Prevent Fainting

from NutritionFacts.org http://www.youtube.com/watch?v=hfPowTb_8l8

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Wednesday, November 11, 2015

3 Eco-Friendly Ways to Lower Energy Costs This Winter

Give your pocketbook a break with these simple ways to lower your energy costs and stay comfortable this winter.

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How Much Cancer Does Lunch Meat Cause?

from NutritionFacts.org http://www.youtube.com/watch?v=A-GIt4CXkyA

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Tuesday, November 10, 2015

Multifamily Lending Starting to Level Off

Lenders will keep pouring money into apartment properties over the next two years, originating about the same volume of loans in 2016 and 2017—with slight increases—that they are likely to close in 2015, according to the latest Commercial/Multifamily Real Estate Finance Forecast from the Mortgage Bankers Association (MBA), an industry trade group.

“The forecast anticipates continued strength and growth,” says Jamie Woodwell, vice president for the research and economics group at MBA.

That’s still going to be a big change from the last few years, when business of lending on multifamily real estate didn’t just grow a little, but instead grew incredibly quickly. So far in 2015, lenders have increased the volume of apartment loans they made by well over 10 percent compared to the year before. In 2016, experts expect more moderate growth, with less frenetic competition to make deals.

Outsized growth

Lenders will likely originate a total of $224 billion in permanent loans to multifamily properties in 2015, according to MBA. That’s a 15 percent increase from the $195 billion they lent in 2014, which in turn marked a 13 percent increase from $173 billion in multifamily originations in 2013. That year marked an 18 percent increase in originations from 2012.

Lending volume can’t grow like that forever. The growth this year already caught most experts by surprise.

Read entire post in National Real Estate Investor here.

Find out more about Liberty at our Youtube page.

To discuss multifamily mortgage financing needs contact Liberty Realty Capital Group.

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Cleaning Tricks for a Chemical-Free Bathroom

Baking soda and vinegar, simple household ingredients, can be used to effectively clean your bathroom. Try them in these four applications to create a chemical-free space.

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Monday, November 9, 2015

Speeding Recovery from Surgery with Turmeric

from NutritionFacts.org http://www.youtube.com/watch?v=1r8tIPXIKd8

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Friday, November 6, 2015

Private Equity Funds Are Sitting on $244B for Commercial Real Estate

Private equity firms are loving them some commercial real estate as funds ended Q3 with $244B of dry powder ready for investments in the industry, Preqin data says. Additionally, private institutional investors are still raising money to bankroll investments in core product in core market—i.e. pricier assets—with 52% of funds focused on North America. “The easy money has clearly been made and pricing is very aggressive,” Vornado CEO Steven Roth says. Vornado holds $555M in property investments and is now focusing on building up its cash reserves from $1B to $2B by the end of the year. Among other funds to keep an eye on, Blackstone Real Estate Partners VIII closed last quarter after raising $15.8B, making it the largest commercial real estate PE fund ever. [CoStar]

Big Food Using the Tobacco Industry Playbook

from NutritionFacts.org http://www.youtube.com/watch?v=YcWCMNV2YIA

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Wednesday, November 4, 2015

Sustainability: The New Norm in Real Estate Development and Investing

Time was when the idea of sustainability in real estate development and investing was a pretty soft notion. Sure, everyone liked the “idea” of reducing carbon emissions, protecting the environment and exploring alternative energy sources, but few were willing to spend money on it. Today, things are vastly different, and it’s the bottom line that’s talking.

A number of factors have driven real estate sustainability into the mainstream, but the greatest influence, whether in the initial design phase or via retrofit, are tenant expectations.

According to McGraw-Hill Construction’s report, “World Green Building Trends—Business Benefits Driving New and Retrofit Market Opportunities in Over 60 Countries,” client demand (35 percent) and market demand (33 percent) were the top two reasons the global green building market grew to $260 billion in 2013, including an estimated 20 percent of all new U.S. commercial real estate projects.

For a commercial building to be able to proclaim sustainability and eco-friendliness is one of its best marketing tools. LEED certification has become a de facto standard for many U.S. cities and class-A buildings. The U.S. Green Building Council-issued LEED certification is awarded to new and renovated office buildings, interiors and operations based on how they’ve adopted best practices in energy, lighting, air quality, water usage and more.

Similarly, the sustainability metrics detailed by GRESB—Global Real Estate Sustainability Benchmark—are increasingly proclaimed by properties.

Government offices for the most part must have LEED certification or other demonstrations of green compliance, according to the U.S. General Services Administration. In other commercial spaces, many tenants simply won’t lease class-A space that’s not LEED-certified.

View entire article here in National Real Estate Investor.

Find out more about Liberty at our Youtube page.

To discuss commercial mortgage financing needs contact Liberty here.

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Prebiotics: Tending Our Inner Garden

from NutritionFacts.org http://www.youtube.com/watch?v=bbHZdQGZqS0

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Tuesday, November 3, 2015

Multifamily REITs Cash In

Leading multifamily REITs are selling off properties—starting with the largest apartment REIT Equity Residential, which announced plans to sell off nearly a quarter of its apartment portfolio on Oct. 26.

“This is an extremely opportune time for Equity Residential to monetize our investments in this portfolio of assets,” said David J. Neithercut, president and CEO of Equity Residential.

REITs usually need to keep growing to help keep their stock prices rising. But leading apartment REITs have become net sellers this year, starting with Equity. The huge deal will dispose of nearly a quarter of Equity’s portfolio of more than 109,000 apartments. In addition, Equity is not planning to spend the cash from the sale on buying other apartments or developing new properties. Instead, the REIT plans to pay down its debt and return a large dividend to its shareholders.

Equity plans to sell more than 23,000 apartments at 72 properties to Starwood Capital Group, through a controlled affiliate, for $5.365 billion. About half of these properties are located in Florida, with other communities in Denver and California’s Inland Empire, in addition to core markets including Washington D.C. and Seattle. Going forward, Equity also plans to sell an additional 26 properties totaling 4,728 apartment units, one at a time or in small portfolios, including all of the company’s assets in Connecticut and in non-core sub-markets of Massachusetts. The sale to Starwood, combined with these other sales, will result in the company’s exit from the South Florida and Denver markets, as well as the New England sub-markets.

“We have also narrowed our focus, which will now be entirely directed towards our core, high-density urban markets,” says Neithercut.

Read entire article in National Real Estate Investor

Find out more about Liberty at our Youtube page

To discuss commercial mortgage financing needs contact Liberty here.

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Monday, November 2, 2015

Microbiome: The Inside Story

from NutritionFacts.org http://www.youtube.com/watch?v=2ObAE52uMDU

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