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.
• Google Buys A Chunk Of Online Real Estate by Pete Barlas of Investor’s Business Daily.
“Google (GOOG) has bought a chunk of online real estate.
The search company's growth equity fund, Google Capital, said Wednesday that it invested $50 million in Auction.com, a leading online real estate marketplace.
Launched in 2008, Auction.com has sold nearly $20 billion in commercial and residential real estate assets since 2010. Customers include large financial institutions, individual property owners and real estate brokers.”
• Office Towers Better Than Bonds Luring Global Investors by Kyungji Cho of Bloomberg.
“Investors flocked to the most stable real estate after the global credit meltdown in 2008 caused the collapse of several high-risk property fund managers that relied on debt financing, including Lehman Brothers Holdings Inc. and Goldman Sachs Group Inc.’s Whitehall unit. While the increased demand may reduce returns, core buildings are now luring more international buyers seeking a haven and investors trying to hedge against inflation.”
• Improving Retail Sales and Leasing Activity by Michael Bull for Shopping Center Business.
“Retail investment sales in 2013 totaled approximately $60 billion, up seven percent year over year, according to Dan Fasulo, managing director of Real Capital Analytics. ‘Retail is not the best performing asset class, but certain segments of the market like strip centers outperformed in 2013,’ he says.
A real sign of a healthy market is the diversity of participants acquiring properties, Fasulo says. ‘The retail market is seeing action from institutional investors, but also public and private REITs. Private buyers are back in a big way, partly fueled by CMBS resurgence.’”
• Labor Shortages, Materials Costs Plague Apartment Builders by Bendix Anderson.
“Overall, the cost of construction for apartment properties continues to rise faster than inflation, at a rate of about 2 percent to 6 percent a year, according to developers. That roughly matches the analysis of the Associated General Contractors (AGC), which put the increase in construction costs at 3.1 percent in 2013, compared to the consumer price index, which rose just 1.5 percent.
However, the cost of many materials has been constrained by the slowness in the overall economy in general, as well as in specific real estate classes including office, retail, and school construction.”
• REITs' Wallets To Remain Wide Open in 2014 by Mark Heschmeyer of CoStar Group.
“The majority of REITs have now posted their year-end earnings and provided 2014 guidance outlines. Based on CoStar’s research from those reports, it’s clear they continue to plan to be very active in the capital and investment markets. While not all REITs provide full 2014 guidance on their acquisition, disposition and development pipeline, about one-third of the publicly traded equity REITs do.”