the Editors of Commercial Property Executive
Economic Update – Foreclosures Spike Among Prime-Mortgage Holders
The tsunami of residential foreclosures may have started, back in the days of easy mortgage money, with borrowers whose only qualification was being able to fog a mirror. About half of those kinds of subprime mortgages have resulted in a foreclosure outcome, and Alt-A-inspired foreclosures are spiking too. But now, according to the Mortgage Bankers Association, foreclosures on prime fixed-rate loans represent the largest share of brand-new foreclosures. Currently about 6 percent of all prime mortgages are at some point in the foreclosure process, twice as many as a year ago. Four states account for nearly half of the prime…
Manhattan Sales Reach 25-Year Low: Report
After a rough 2008, Manhattan’s property investment market has continued to take it on the chin thus far in 2009. Real estate sales in Manhattan reached a 25-year low in 2009’s first quarter, according to a new report by Massey Knakal Realty Services.“The No. 1 finding–that turnover in the first half is the lowest it has been in 25 years–is a major indicator of the market,” Massey Knakal managing director Kyle Mast told CPN. “Over the last 25 years, annual volume of sales was about 2.5 percent of total properties. That figure was at a high in 1998 with 3….
New Buchanan Street Exec Peterson Sees Troubles, Opportunities Ahead
The current economic turmoil might well have the commercial property industry feeling pain for some time to come. But according to a newly-hired executive with Buchanan Street Partners, the tumult will also create an environment rife with opportunities. Buchanan Street Partners has hired Bob Peterson as managing director in its Newport Beach, Calif., office. Peterson, with 28 years of experience in the commercial real estate industry, will be responsible for investing in structured debt and value-added equity opportunities on behalf of the firm’s discretionary funds, and will serve Buchanan Street clients throughout the West. He will also be involved in…
In Slow Central Valley Market, 685,000-SF Sale Makes Splash
Industrial property sales in San Joaquin County in California’s Central Valley have been practically nonexistent this year, but USAA Real Estate Co. just broke the monotony with the acquisition of a 658,000-square-foot distribution facility in the city of Tracy, about an hour east of San Francisco. Acting through its affiliate US Industrial REIT III, USAA took the brand new building, which is fully occupied by Home Depot Inc., off the hands of AMB Property Corp. Originally known as AMB Pescadero Distribution Center, the Class A property (pictured) carries the address of 1400 E. Pescadero Ave., and sits within close proximity…
Survey: Most Don’t Expect Industry to Bounce Back Until ’10
When will it end? That is the question on everyone’s lips, but answers have been slow to emerge. However, it seems investors, brokers and owners anticipate another year of slumping sales before recovery is at hand, according to a new survey from online real estate market LoopNet. LoopNet oversaw the survey of more than 1,500 LoopNet members–including commercial real estate investors, brokers and owners–conducted from May 7 through May 21. Key findings include the fact that only one-third of respondents expect commercial real estate sales transaction activity to recover this year. About 42 percent of respondents, meanwhile, see a recovery…
Economic Update – More Troubling Indicators
After the stock market’s strong performance on Tuesday, some worrisome economic figures put a damper on the party on Wednesday. The National Association of Realtors has pegged the nation’s unsold housing inventory–including single-family, townhouses and condos–at 3.97 million units in April, or roughly a 10-month supply at the current slow-mo sales pace. Unsold residential inventory hasn’t been that high since last November, noted the organization. Not that sales are down. In April, housing sales were up 2.9 percent from March, according to the NAR, spurred by prices considerably off peak, perhaps even down to 2003 or 2002 levels in some…
Confident in Market’s Future, Sequoia Adds to Orange County Holdings
With the growing evaporation of jobs, Orange County, Calif.’s multi-family housing sector is starting to feel the burn. Yet, deteriorating fundamentals aren’t scaring off investors like Sequoia Equities Inc., which recently acquired the 484-unit Alize Apartments in the upscale Aliso Viejo master planned community from Northwestern Mutual Life Insurance Co. for $75 million. Walnut Creek, Calif.-based Sequoia relied on financing from Fannie Mae and a $17.3 million equity partnership for the purchase of Alize. Presently 90 percent occupied, the approximately 442,700-square-foot, decade-old apartment complex features 11 three-story residential structures, as well as three single-story buildings encompassing a management office, fitness…
U.S. Properties Return Negative 9.2% in First Quarter, New Index Finds
U.S. properties saw an overall return of minus 7.4 percent last year and minus 9.2 percent in the first quarter of 2009. Those were the findings of Investment Property Databank, the United Kingdom-based real estate performance analysis company, which launched a U.S. version of its property index yesterday and plans to launch a global index next Thursday at its European Property Investment Conference in Barcelona. The office sector was the worst performer last year, with capital growth of minus 12.8 percent, compared to minus 12.2 percent overall, minus 12.2 percent for residential, minus 11.7 percent for industrial and minus 11.4…
As Condo Market Remains Tight, Miami Tower Scores Key Fannie Approval
In the midst of the sluggish economy and tight credit market, condominium developers are having a tough time selling units. As a result, many projects across the nation have been reverted to rental or stalled outright. But in one of the country’s most hard-hit condo markets–South Florida–at least one developer is breathing a bit easier. DYL Group has received Fannie Mae approval for its recently-completed, 52-story Infinity at Brickell condo project (pictured). The rubber stamp from Fannie will greatly expand financing options for interested unit buyers, and is thus being hailed as a key asset in the overall success of…
Economic Update – Consumer Confidence Wows Wall Street
Happy days are here again? Or maybe the American consumer isn’t quite that optimistic, but instead is simply glad things don’t seem to be getting a lot worse. In any case, the Conference Board reported on Tuesday that its index of consumer confidence shot up in May to 54.9 from a revised 40.8 in April, marking the largest one-month jump in the index since April 2003. Wall Street, which had something of a lackluster week before Memorial Day, evidently decided that Main Street’s optimism was a cue to buy. On Tuesday, the Dow Jones Industrial Average was up 196.17 points,…