Archives by: John Bergin

Fund manager: US CMBS a good investment now

Structured credit products such as US commercial mortgage-backed securities, leveraged loans and residential mortgages are good investments now because they are insulated from global events such as Britain's referendum on EU membership or Chinese currency devaluation, says Troy Gayeski, senior fund manager at SkyBridge. Read full story Read more

Fed slows plan for rate increases

The Federal Reserve's policymaking committee has decided against raising its key interest rate and says increases will be implemented more slowly than previously anticipated. The decision to delay an increase was backed by every member of the committee, including Esther George, who had voted at recent meetings for a rate hike. Read full story Read more

Divorce Rate Drives Demand for Multifamily Properties

What owners need to know to cater to this growing demographic. Read full story Read more

Sovran buying privately held LifeStorage in $1.3B deal

Sovran Self Storage REIT is acquiring privately owned LifeStorage, which operates 92 facilities, for about $1.3 billion. Sovran, whose brand is called Uncle Bob's Self Storage, is paying cash for the acquisition. Read full story Read more

Dispositions remain the focus for top apartment REITs

The three largest multifamily REITs, Equity Residential, Camden Property Trust and AvalonBay, are continuing to sell more assets than they buy. Read full story Read more

Central banks are dumping America’s debt at a record pace

China, Russia and Brazil sold off U.S. Treasury bonds as they tried to soften the blow of the global economic slowdown. They each sold off at least $1 billion in U.S. Treasury bonds in March. Read full story Read more

Multifamily Investors Seek More Value-Add Deals

Higher prices on apartment properties have squeezed the yields for investors. Value-add investments offer an opportunity to push those yields higher. Read full story Read more

Reis: The Apartment Sector’s Run Is Almost Over

Research firm says supply is outpacing demand. Read full story Read more

Higher CMBS Defaults Expected in 2016

Defaults on CMBS loans have been on a steady downward slope for the past five years, falling to an annual rate of 0.39 percent in 2015. Read full story Read more

Apartment rent growth slowed in Q1

Effective apartment rents increased 4.5% in the first quarter compared with a year ago, according to Reis. That was a slight drop from the 5% growth at the end of 2015. The vacancy rate increased to 4.5% in Q1 from 4.4% in the previous quarter. A year ago, the vacancy rate was 4.2%. Read full story Read more

Sun Communities to pay $1.68B for Carefree Communities

Sun Communities said it has reached an agreement to pay an affiliate of Centerbridge Capital Partners $1.68 billion for Carefree Communities. Carefree owns and operates manufactured housing and recreational vehicle communities in Florida and California. Read full story Read more

Fed slows its plan for raising rates

The Federal Reserve has left interest rates unchanged in response to slowing economic growth and says rate increases will come more slowly than planned this year. The Fed also has downgraded its outlook for economic growth this year to 2.2% from 2.4%. Read full story Read more

Foreign investors spent record $91.1B on US property last year

Foreign investors in US properties continue to show robust appetite for these assets this year, according to Real Capital Analytics. Last year they acquired $91.1 billion in US properties, more than double the amount spent in 2014. Investors from Canada, China, Europe, Korea and Singapore are particularly active. Read full story Read more

Fed expected to leave interest rates unchanged this week

The Federal Reserve has signaled that it wants more time to analyze economic data before moving interest rates higher. With a rate hike probably off the agenda, economists will watch this week to see how the central bank views the world's economies and financial markets. Read full story Read more

Property execs confident in US markets

Commercial real estate executives are more confident in the US economy than in the global market, and they see volatility in overseas financial markets as beneficial for US real estate, according to a first-ever survey by Altus Group, NAREIT and the National Council of Real Estate Investment Fiduciaries. Respondents said they don't expect property values to keep appreciating at a double-digit pace, even as foreign investment continues to boost prices and fuel competition for top assets. Read full story Read more

Lenders Exercise More Caution on Multifamily Construction Loans

As the multifamily construction pipeline ramps up and new regulations go into effect banks think twice before issuing construction loans on new apartment properties. Read full story Read more

CMBS delinquencies fall below 3%

Delinquencies on commercial mortgage-backed security loans fell 109 basis points in January to 2.93%, according to Fitch Ratings. The sale of Peter Cooper Village/Stuyvesant Town was largely responsible for the drop. Read full story Read more

Stress-Tested Every Way, Freddie Mac Finds MF Is Still A Winner

WASHINGTON, DC—The multifamily market accelerated in 2015 and will build on that momentum this year, according to Freddie... Read full story Read more

Cap Rates Fall in Secondary and Tertiary Markets

The spreads are now more in line with those in the six major metros. Read full story Read more

China GDP: Slowdown or Deterioration?

Economic growth in China has clearly slowed over the past few years, and data released this morning indicated the slowdown continued in Q4 2015. Full year growth for 2015 ended up roughly half a percentage point below the rate registered in 2014, with most of the deceleration concentrated in the country’s industrial and construction sectors. Read full story Read more

RKF CEO: Why retail rental rates will continue rising

RKF CEO Robert Futterman says retail rents in US cities such as New York, Miami and Chicago should continue to increase because it is still important for retailers' corporate identities to have a brick-and-mortar presence. Residential growth and international tourism are also boosting retail. Read full story Read more

What Does the Central Bank Canoe Theory Mean for Investors?

While the anticipated path of future Fed rate hikes is likely not in and of itself a significant threat to commercial real estate cap rates, wise investors will keep an eye on two interest rate-related factors that could negatively impact cap rates and catch the myopic investor off guard. Read full story Read more

Top News Multifamily market’s strength draws newcomers

Continued high demand for apartments is attracting more investment, including companies that traditionally focus on office, retail and single-family homes. These new entrants are driving up land costs, some say. Much of the new supply is being built for the high end of the market. Read full story Read more

US property could benefit from China’s volatility

Blackstone Group acquired $9.6 billion of real estate in the New York area last year, the most of any company, according to Real Capital Analytics. It sold $4.2 billion worth of local assets. Altogether, Blackstone was involved in 21% of all commercial property transactions in Manhattan. Read full story Read more

Sales slump prompts Macy’s to cut jobs, rethink real estate

Macy's reported a 4.7% decline in existing-store sales for November and December. The retailer said it would cut as many as 4,800 jobs and hire more advisers to consider joint ventures for its real estate holdings. Macy's and other traditional retailers are struggling as shoppers seek off-price chains and do more shopping online. Read full story Read more

Apartment rent increases rising at fastest pace in years

Average effective apartment rents nationwide rose 4.6% last year to nearly $1,180, Reis reports. This was the fastest pace since 2007. According to Axiometrics, multifamily rents rose 4.7% in the fourth quarter year over year, the strongest performance since 2005 for that quarter. Read full story Read more

Foreign JV buys US student-housing portfolio for $1.4B

A joint venture consisting of the Canada Pension Plan Investment Board, Singapore's GIC Pte. and the Scion Group LLC is making a $1.4 billion acquisition in the US student-housing market. It has acquired University House Communities Group from InvenTrust Properties Corp. The JV, in which CPPIB and GIC own 47.5% each and Scion owns 5%, says it wants to make other student-housing acquisitions. Read full story Read more

Fed’s large reverse repo award to help push up interest rates

Moving to drain liquidity from the US financial system, the Federal Reserve made the third-largest reverse repurchase agreement award ever Wednesday. The auction awarded $277.45 billion of one-day fixed-rate reverse repos carrying a 0.25% interest rate to 82 bidders. Read full story Read more

2016 will test US bull market, analysts say

Analysts expect 2016 to be marked by a continued conflict between the Federal Reserve's efforts to raise interest rates in a strengthening job market and attempts to lower rates around the world amid China's economic slump. Investors expect another difficult year of tumultuous markets and narrow profit margins. Read full story Read more

Investor demand for real estate could rise with new category

Some analysts expect demand for real estate securities to increase after August, when MSCI and S&P Dow Jones Indices create a new category for real estate instead of including it in the broader group of financial companies. Investment firms are developing new real estate funds in response to the change, and portfolio managers are expected to pay more attention to real estate. Read full story Read more

FIRPTA changes could bring billions in new investment

Congress' approval of the Protecting Americans from Tax Hikes Act of 2015 last week included new provisions for the Foreign Investment in Real Property Tax Act that could bring an additional $20 billion to $30 billion of foreign investment, according to Kenneth Rosen, a professor at the University of California, Berkeley. Read full story Read more

New Crowdfunding Ruling/Apartment Rent Trends/Seniors Housing Prices Too Frothy?

New ruling gives crowdfunding firms access to non-accredited investors. Apartment rents rising faster than incomes. Are prices for seniors housing too frothy? Read full story Read more

How Per-Bed and Per-Unit Student Housing Properties Differ

Fundamentals in the student housing sector advanced at a healthy pace during the 2014-2015 school year, mirroring the performance of the greater multifamily sector. Student housing is categorized by buildings leased on a per-unit basis and those leased on a per-bed basis. Facilities that lease by the unit exhibited rent growth of 3.4 percent between the third quarter of 2014 and the third quarter of 2015. Read full story Read more

Transaction Trends: Velocity, Capital, and Cap Rate Compression

John Sebree, a national director with Marcus & Millichap, looks at the dynamics at play in today’s transaction market as capital flows and investors increasingly chase yield into secondary and tertiary markets, pushing cap rates down a little more each day. Read full story Read more

Fed holds rates, signals potential increase in Dec.

The Federal Reserve has left interest rates unchanged but says it will consider an increase at December's meeting. The Federal Open Market Committee has dropped a warning that global financial and economic developments might "restrain economic activity somewhat." Read full story Read more

Axio: Strongest Apartment Market in 9 Years

Rent growth hits 2006 levels, while occupancy reaches 2001 milestones. MFE's Les Shaver looks at the highlights. Read full story Read more

MPF: Effective Rent for New Residents Hits 5.9% in 3Q

Occupancy tightens to 96.1% as the strong 2015 growth continues. Les Shaver looks at the MPF report. Read full story Read more

2015 Poised to Be Busiest Year Ever for Multifamily Sales

With apartment transactions continuing to keep a torrid pace, industry analysts predict 2015 will go down as the most-active multifamily investment year ever. Read full story Read more

Student housing strong despite huge new supply

Student-housing properties are fully occupied and delivering solid rent growth for this school year after a surge of development over the last two years that delivered 110,800 new beds, according to Axiometrics statistics. It was unclear whether all of these beds would be filled, but Axiometrics expects occupancy to end up around 96% for September -- an improvement from 94.4% in August 2014, according to Taylor Gunn, student-housing analytics lead. Read full story Read more

Real estate will deliver long-term returns, expert says

The decision not to raise interest rates this month doesn’t come as a surprise and they will inevitably go up, according to a podcast interview with Mark Roberts, head of strategy and research with Deutsche Asset Management. Real estate fundamentals are sound and should continue to deliver "at least average long-term returns," he says. Read full story Read more
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