January 29, 2014

Wednesday Wrap: Jan. 29, 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.

Key excerpt:

“While it can't yet be described as positively giddy, builders were palpably upbeat this week, predicting rising construction demand in virtually every segment of the non-residential market this year, according to an annual survey released by the Associated General Contractors of America (AGC).

While the survey of contractor sentiments reflects a mostly upbeat assessment by an industry staggered by five years of slow recovery from the Great Recession, a new set of worries emerged among respondents: growing worker shortages, rising materials and business costs, and the impact of new regulations and federal budget cuts.”


• Real Estate’s Least Sexy Sector is Red Hot by Diana Olick of CNBC.

Key excerpt:

“Warehouses are the strongest prospect for both investment and development in 2014, according to the latest PWC Investor Survey. Two thirds of respondents deemed warehouses a ‘buy.’

‘That's the highest of all the real estate food groups,’ said PWC partner Mitch Roschelle. ‘The online retailers have struggled to figure out how to get the goods closer and closer and closer to where the people live.’”


• Expanding the Supply of Affordable Housing by Trisha Riggs of Urban Land Magazine.

Key excerpt:

“Nationally, there were only 6.9 million rentals affordable to 11.8 million extremely low-income renters in 2011, a supply gap that grew by 3 million renters between 2001 and 2011—and continues to grow. ‘In an era of growing demand and declining government financial support for affordable rental housing, it is more important than ever to deliver affordable housing as effectively as possible,’ the report says. ‘Bending the cost curve will enable developers to deliver additional affordable rental homes and help jurisdictions provide more housing choices, meet the growing need for affordable rentals, and ensure that individuals and families across a range of incomes have a place to call home within the community.’”


• CPE 100 Sentiment Survey: Industrial Assets to Make Biggest Gains with Investors in ’14 by Paul Rosta of Commercial Property Executive.

Key excerpt:

“Turning to the makeup of the equity investment pool, the CPE 100 cited two groups that they expect to make a move in 2014. Thirty-six percent say that pension funds will make the largest increases in their allocations this year. Foreign investors are a close second, named by 29 percent of respondents. And the industry appears to be watching the Federal Reserve closely for signs of policy shifts as Janet Yellen assumes the chair. Fifty-seven percent of respondents say that a hike in the Fed’s baseline interest rate would pose the biggest challenge to commercial real estate investment this year. The broader economic picture ranks as a smaller but still significant worry. Another 43 percent say that a slowdown in the improvement of the nation’s job market is the main threat to investment.”


• Perspective: The Military Housing Privatization Initiative is at Risk by Paula Cino for Multi-Housing News.

Key excerpt:

“A BAH drawdown would limit housing options and increase the out-of-pocket housing expenses for nearly one million troops across the country. In turn, this would widely affect the apartment sector—including privatized military housing providers, investments made in proximity to military installations and any apartment properties with military residents.”

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