Business Specialties

Joining the brigade of real estate companies that are relying on the sale of shares to pay off debt during the lending market’s deep freeze, shopping center REIT Regency Centers has closed its offering of 10 million shares of common stock for net proceeds totaling approximately $310.5 million.Regency priced the shares in the public offering at $32.50. The company originally planned to sell 7.7 million shares of common stock with an option for underwriters to acquire an additional 1.55 million, but ultimately offered 8.7 million, plus 1.3 million for optional purchase by underwriters. Regency plans to use the funds from…

The specter of a swine flu pandemic excited the news media over the weekend, based on outbreaks in Mexico and a handful of cases in the United States. Few industries are likely more worried about such a prospect than the travel business, including hotel owners and operators. As a hint of what might happen if the disease spreads, tour operators in Japan have reportedly canceled a number of organized tours to Mexico that were to have taken place during Japan’s string of spring holidays known as Golden Week–a prime season for travel by Japanese, which begins on April 29. The…

Bear Sterns Cos. was in the news again Thursday, in case anyone remembers back far enough to recall the last time it was big news–a time when the disappearance of that company into JPMorgan Chase seemed unfortunate, but not necessarily a harbinger of vast financial problems ahead. Which, in fact, it turned out to be. Now the Federal Reserve has released something of an autopsy for the company, detailing the kinds of assets it accepted from Bear Stearns (the ones JPMorgan didn’t want) and which of them caused losses for the Fed since then. The biggest losses in the former…

Only a year ago, the International Monetary Fund predicted growth of 1.9 percent for the world economy in 2009, a prediction that seems positively quaint now. On Wednesday, the IMF called the current crisis “by far the deepest global recession since the Great Depression,” and urged governments to stimulate their economies more. The organization is now predicting a worldwide economic contraction of 1.3 percent in 2009, with the U.S. economy shrinking 2.8 percent, a largest decline since 1946. Still, there may be glimmers of recovery in parts of the U.S. economy damaged most by the recession. Indicators such as existing…

If some esteemed economists testifying before the Joint Economic Committee of  Congress Tuesday had their way, “too big to fail” would be a phrase of historical interest only–applying especially to that period of history just before 2008. “We have little to lose, and much to gain, by breaking up these behemoths, which are not just too big to fail, but also too big to save and too big to manage,” said one of them, Columbia University professor Joseph Stiglitz, who is a well-known critic of the current bailout of the financial sector, and who also happens to be a Nobel…

Citi Infrastructure Investors–a joint venture of Citigroup Inc., John Hancock Life Insurance Co. and Vancouver Airport Services– will be unable to go through with a deal that would have seen the group buy Midway International Airport in Chicago for $2.5 billion. After previous extensions, the City of Chicago decided not to give the group any more time to close on the deal.The problem with the Midway sale? As the president & CEO of Vancouver Airport Service was quoted as saying in a statement, “the company was unable to finalize the transaction due to current global market conditions that have materially…

The idea that commercial real estate might be the next big thing to implode–which is all too familiar within the commercial real estate industry–is finally getting some mainstream attention. On Saturday, speaking at a conference at Vanderbilt University, Atlanta Federal Reserve Bank president Dennis Lockhart said that “on our watch list this year, as a risk to the (U.S. economic) outlook, is continuing worsening in the commercial real estate sector.”Earlier last week, Lockhart waxed a bit more optimistic by asserting that the economy might experience “slow and tentative growth” as early as the third quarter of this year. On the…

One rippling effect of mall behemoth General Growth Properties’ bankruptcy may be that it will help re-establish something that’s been missing from much of the commercial property investment market for a while now: pricing.Sellers have been sitting on the sidelines, and so have buyers, waiting. GGP can no longer warm the bench regarding the disposition of at least some of its properties now. The market will thus ascertain those prices, probably to the benefit of healthier REITs and other major potential buyers, such as Simon Property Group or Vornado. High-profile bankruptcy sales may not be the only way for commercial…

“Forbearance into foreclosures” was how the Wall Street Journal characterized prospects for the commercial mortgage-backed securities market over the coming years, when many billions of loans underlying CMBS will come due–$22 billion of which will be this year and next. For now, banks have been extending maturities in hopes of some kind of recovery in underlying asset values. But how long they will keep doing that is an uncertainty. It isn’t just a U.S. problem, either. Rating agency Moody’s Investors Service said this week that it might cut ratings for ¥1.4 trillion ($14 billion) worth of Japanese CMBS. Roughly ¥1.72…

On Tuesday President Obama spoke of “glimmers” of hope for the economy, while Fed chairman Ben Bernanke, speaking separately, also waxed a tad optimistic by noting that there are “tentative signs” that the decline of the U.S. economy is slowing. Bernanke also said that the U.S. is faring better than other train-wreck economies around the world, though he was too diplomatic to put it quite that way, or name any names. The glimmers of hope might not apply to the retail industry just yet. Also on Tuesday, the U.S. Department of Commerce reported that retail sales were down 1.1 percent…