January 15, 2014

Wednesday Wrap: Jan. 15, 2014

Each Wednesday, The Wrap presents a compilation of recent noteworthy commercial real estate stories from a variety of publications. Below are links to five stories that caught our eyes in recent days.

Commercial Real Estate Set To Show Strong 2013 Sales by Joe Gose of Investors.com.

Key excerpt:

“Buoyed by steadying job growth, improving real estate fundamentals and eager capital, buyers throughout the first 11 months of 2013 ponied up more than $305 billion to acquire office buildings, industrial properties, retail centers, hotels, apartments and development sites around the U.S., according to Real Capital Analytics, which tracks commercial real estate sales of more than $5 million.

The dollar volume already had outpaced sales in all of 2012 by about $5 billion, Real Capital notes. The firm is scheduled to release final 2013 sales numbers later this month, but it anticipated close to $360 billion in total dollar volume for the year.”

Newmark: Office Market Deliveries Surge at End of 2013 by REBusinessOnline.com.

Key excerpt:

“New office product across the United States totaled 13.2 million square feet during the fourth quarter of 2013, outpacing absorption of 9.8 million square feet during the same period, according to Newmark Grubb Knight Frank (NGKF). This broke a string of 10 quarters in which demand exceeded new supply. New York, Washington, D.C., and Houston accounted for half of the new space added in the fourth quarter of 2013.”

Economy Watch: Federal Government Records Surplus in December by Dees Stribling of Multi-Housing News.

Key excerpt:

“The U.S. Department of the Treasury reported on Monday in its most recent monthly statement that the United States took in a surplus of $53.22 billion during the last month of 2013, which was more than expected, boosted by almost $40 billion in payments to the government from Fannie Mae and Freddie Mac. In December 2012, the deficit was $1.2 billion.”

Analysis: 2014 Looking Up for REITs by Matt Slepin of REIT.com.

Key excerpt:

“In December, NAREIT reported to its members that Fitch Ratings posted a ‘stable’ outlook for REITS in 2014, with the greatest downside risk being posed by a 1970s-like possibility of rising interest rates coupled with little or no economic growth. As Fitch put it, interest rate increases that result from stronger economic growth would be positive for REITs, whereas a stagflation scenario would ‘almost certainly be detrimental.’ It also said that a more gradual increase in interest rates would benefit property sectors with longer-lease tenants, such as net lease, health care, retail, office and, to a lesser extent, industrial. REITs with more fixed-rate debt on their balance sheets would likely better withstand rate increases than those with more floating-rate debt, Fitch added.”

Four U.S. Markets Ranked Among Top Five Global Picks for CRE Investment by Mark Heschmeyer of CoStar.

Key excerpt:

“Foreign commercial real estate investors ranked four U.S. markets among their top five global picks for acquiring commercial property, according to the results of the 22nd Annual Survey taken among the members of the Association of Foreign Investors in Real Estate (AFIRE).

The group's members rated New York, San Francisco, Houston and Los Angeles as the top two through five most attractive markets for real estate investment. The number one pick was London, which displaced New York for the top spot for first time in three years.”

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