June 15, 2016

Wednesday Wrap: June 15

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:

Hilton CEO Unveils Names, Details on New REIT Spin Offs, by Randyl Drummer, CoStar

Key Excerpt:

“Hilton’s board of directors on June 3 approved plans to spin off its real estate and timeshare businesses into the standalone companies, with final approval expected by the end of the year. Park Hotels & Resorts would become the second-largest publicly traded lodging REIT with 69 hotels and resorts, to be headed by Tom Baltimore Jr., former chief executive of RLJ Lodging Trust.”

Single-Family Rental Housing Sector Maturing, Executives Say, by Allen Kenney, REIT.com

Key Excerpt:

“The sector is buoyed by the lack of affordable housing in the United States, according to Schade, and renters have embraced the quality of rental homes offered by large-scale operators.”

Medical Facilities Are Becoming More Visible at Retail Centers, by Donna Mitchell, NREI.com

Key Excerpt:

“Specifically, medical providers in retail spaces represent two compelling forces directing lives in the U.S. right now: Americans are spending more on health care, and want to do so in locations that are as convenient as they are safe. Also, landlords and investors are vigilantly looking for creditworthy tenants who can also consistently draw foot traffic to their properties. Not all medical services are suited to every available retail vacancy. Good partnerships do crop up, however, and it is a formula that both landlords and real estate investors are learning to perfect.”

Despite Global Commodity Price Declines, Labor Shortages Driving Up Construction Costs in U.S., by Michael Gerrity, World Property Journal

Key Excerpt:

“Nationwide, the number of workers employed in construction-related occupations declined by nearly 985,000, or 15.8 percent, between 2005 and 2015, according to the most recent occupational employment statistics survey from the Bureau of Labor Statistics. As a consequence, many markets have faced considerable labor shortages as new construction has picked up during the current economic cycle.”

Why Green Building Certification Makes Cents, by Carl Seville, Multifamily Executive

Key Excerpt:

“Considering the benefits—financial incentives, improved performance, tenant comfort, marketing advantages, and limited added cost, to name a few—there isn’t much of a case to be made for not considering certification for your project. Andrew Yule, vice president of development at Village Green, puts it this way: ‘Green building certification has helped our newly created assets sustain the lowest-cost utilities in the industry. It’s a cost-effective program that’s proven to satisfy our prospects and residents, from a leasing perspective, while benefiting the owners of each asset, from a utility-consumption and expense standpoint. It also has ensured that the general contractor and its subcontractors have performed a certain standard and quality of work throughout the project.’”

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