the Editors of Commercial Property Executive
Seniors Housing Loans, Capitalization Rates Feel Credit Crunch
As the economy continues its downward spiral and credit markets suffer, loan performance and capitalization rates in seniors housing and care feel the heat, too, according to third quarter 2008 data tracked by the National Investment Center for the Seniors Housing & Care Industry (NIC).Each quarter, financial and performance data are collected by NIC from the nation’s leading senior living lenders, owners/operators and appraisal professionals and posted as the NIC Key Financial Indicators™ (KFIs) on the organization’s Web site.Loan volume placed in the industry has been in a downward trend since the first quarter of 2007 when it reached $2.28…
Retail R.E. In Dire Straits; C&W Predicts Worst Yet to Come
The retail market took a beating in 2008 and with the ongoing recession and anticipation of further job loss, the United States retail property sector is in for more trouble, according to a new report by Cushman & Wakefield’s Retail Industry Group. Last year, a bevy of leading retailers either shut the doors of many locations or closed shop altogether, leaving an overabundance of space left on the market. Discount chains, drugstores and wholesale clubs are really the only retail businesses that are expanding, but their growth can account for only so much absorption. “Mervyns leases went to auction, and…
PA Mixed-Use Project Lands Another Tenant
O’Neill Properties Group is chalking up another large office tenant for Worthington Town Center, a $500 million master-planned project in Malvern, Pa. VWR International Inc., a global distributor of laboratory supply equipment, picked the project as the site for its new 150,000 square-foot headquarters. Next year VWR plans to move from its current location in West Chester to Malvern, an upscale community about 25 miles west of Philadelphia in Chester County, VWR’s offices will be located in a 240,000-square-foot building that will also include restaurants and a fitness center. Disclosed last week, VWR’s decision moves O’Neill Properties a giant step…
Unlocking Opportunities: Deleveraging as the Path to Seniors Housing Investment
For most real estate sectors, the party ended last year, with the New Year bringing continued pain–or at least a severe hangover–that will likely linger throughout 2009 and beyond. But amidst the wreckage of the economic system, there are fundamental signs that all is not lost in the up-and-coming seniors housing space. In fact, with supply and demand in check in most markets, there are compelling reasons why this real estate sector may still have some reason to celebrate.While the avalanche of bad economic news has certainly impacted seniors housing, this sector has performed relatively well in the recent real…
Under Construction
Washington, D.C., has turned off its development spigot, but projects already in the pipeline continue to move forward. Trammell Crow Co. managing director Tom Finan estimated that 10 million square feet of office projects are under construction and that very little has thus been stopped, despite the fact that pre-leasing is down from the 60 to 70 percent of a few years ago to 33 percent today.Among the largest projects are Boston Properties Inc.’s 2200 Pennsylvania Ave. in the West End, a 430,000-square-foot office building going up on a 60-year ground lease from George Washington University Hospital, and Trammell Crow’s…
Buyer’s Market?
Mexico has seen increased investment from Germany, the United Kingdom, the Netherlands, Canada and even Brazil and China in recent years, according to Binswanger Mexico managing director Karl Binderberger, though such investment pales in comparison to capital inflows from the United States.Any foreign investment is likely to be cut in the first half of this year, said Savills executive managing director Borja Sierra. But that will likely afford Mexican investors the opportunity to acquire properties at reasonable prices. “They have the advantage of being in the market and understanding the properties that are on the market,” he said.Mexico may face…
Taming a Wild Horse
Our new president has taken office at a difficult time, assuming the reins of a financial horse gone wild and to date unwilling to be tamed. Calming such a beast takes a firm and steady hand, a confident demeanor and consistent direction. Let it take the lead even briefly and you lose control. At the same time, this is a horse like none other in recent history, and training it requires an expertise nobody has. Will efforts under the new president have greater results than those tried so far? That remains to be seen, but without mastery, at least a…
NYLO Hotels Announces First Franchise Agreements
NYLO Hotels L.LC. has announced its first franchise agreements for its urban lofts hotels at the 2009 ALIS Conference on Tuesday. The new-build projects are for full-service NYLO hotels in Chicago and New York, and for a select-service XP in Frisco, Texas, near Dallas. W. Developments L.L.C will build a NYLO in Chicago’s West Loop, while Sentry Hospitality L.L.C. will build a seven-story NYLO in New York’s Financial District. Behringer Harvard will build the first XP, a 127-room property in Frisco, Texas. John Russell, CEO of NYLO Hotels, sees a large market for both brands in secondary markets, as lower…
Amazon Beats Expectations; New Home Sales Dismal
Ten years ago, futurists were predicting that online retail would threaten the prosperity of bricks-and-mortar retail, a prognostication about as accurate as the coming of the paperless office. On the other hand, online retail–at least in the form of Amazon–has managed to do unexpectedly well in the face of the current recession. For the quarter that ended on Dec. 31, the company’s net profit rose 9 percent to $225 million, or 52 cents a share, up from 48 cents in the same quarter last year.Amazon executives chalked it up to “focusing on a better customer experience through price, selection and…
484,000-SF Lease Brings ProLogis’ 6 MSF Inland Empire Complex to Full Capacity
All space has been claimed at ProLogis’ 5.9 million-square-foot Kaiser Commerce Center in Fontana, Calif., now that a third-party logistics provider has committed to a long-term lease for the last 484,000 square feet of space at the sprawling industrial property. Consisting of nine structures built between 2002 and 2004, Kaiser Commerce Center (pictured) sits about an hour northeast of the Ports of Los Angeles and Long Beach. “One of the best attributes of the Inland Empire is its location,” Mike Del Santo, first vice president and market officer at ProLogis, told CPN. “The area is crisscrossed by Interstates 10 and…