Freddie Mac will begin securitizing some mortgage loans that previously were delinquent and that the company had purchased from its related Mortgage Participation Certificate (PC) pools. These mortgage loans have been reinstated to current, performing status and have not been modified.
Reinstated loans must be current at least four consecutive months at the time of securitization. For the initial securitization this month, Freddie Mac elected to securitize reinstated loans that have been current for at least 12 consecutive months.
Read more...Freddie Mac Recirculating Bad Loans into New MBS Pools - CoStar Group
Wednesday, November 30, 2011
Commercial Real Estate Ranks Highest Among Investment Alternatives | CCIM Institute
In 3Q11, commercial real estate ranked highest among investment alternatives, followed by cash, in CCIM Institute and Real Estate Research Corp.’s 4Q11 RERC/CCIM Investment Trends Quarterly. “Despite the investment losses taken with commercial real estate during the past few years, it is still a relatively stable investment compared to the volatility of the stock market, and the potential is there for reasonable returns,” said Ken Riggs, CCIM, CRE, MAI, chief real estate economist of the CCIM Institute and chairman and president of Real Estate Research Corp.
Multifamily continued to lead the industry in 3Q11 with CCIM members increasing their investment conditions rating for apartments from 2Q11. “The apartment sector is still strong. The positive returns on this property type compared to the risk are likely to continue for the near term,” Riggs added. “However, we are seeing increasing pressure on some of the other property types. As demonstrated by CCIM members’ ratings, the returns compared to the risk for office, industrial, retail, and hotels were declining or flat.”
Read more...Commercial Real Estate Ranks Highest Among Investment Alternatives | CCIM Institute
Multifamily continued to lead the industry in 3Q11 with CCIM members increasing their investment conditions rating for apartments from 2Q11. “The apartment sector is still strong. The positive returns on this property type compared to the risk are likely to continue for the near term,” Riggs added. “However, we are seeing increasing pressure on some of the other property types. As demonstrated by CCIM members’ ratings, the returns compared to the risk for office, industrial, retail, and hotels were declining or flat.”
Read more...Commercial Real Estate Ranks Highest Among Investment Alternatives | CCIM Institute
Economy Watch: Consumers More Confident, Home Prices Stuck in Neutral | Commercial Property Executive
he latest S&P/Case-Shiller Home Price Indices, which were released on Tuesday, showed that U.S. home prices didn’t move much during the third quarter of 2011, with the National Home Price Index seeing a 0.1 percent uptick quarter-over-quarter. Compared with the third quarter of 2010, however, the national index was down 3.9 percent — but that could be seen as a bit of good news, since the decline between the second quarter of 2010 and the second quarter of 2011 was 5.8 percent, so the rate of decline might be slowing.
In September, the 10- and 20-city composites posted annual declines of 3.3 percent and 3.6 percent, respectively. Eighteen of the 20 MSAs tracked by Case-Shiller and both monthly composites had negative annual rates in September 2011, the only exceptions being Detroit and Washington D.C., presumably because of a dead-cat bounce in the former case and the good fortune of being the hub of the federal government in the latter case.
Read more...Economy Watch: Consumers More Confident, Home Prices Stuck in Neutral | Commercial Property Executive
In September, the 10- and 20-city composites posted annual declines of 3.3 percent and 3.6 percent, respectively. Eighteen of the 20 MSAs tracked by Case-Shiller and both monthly composites had negative annual rates in September 2011, the only exceptions being Detroit and Washington D.C., presumably because of a dead-cat bounce in the former case and the good fortune of being the hub of the federal government in the latter case.
Read more...Economy Watch: Consumers More Confident, Home Prices Stuck in Neutral | Commercial Property Executive
Commercial Real Estate Direct - CMBS Delinquency Rate Climbs in October, Despite Liquidation of $1.28Bln of Loans
The volume of delinquent CMBS loans increased by $1.06 billion in October, bringing the total volume of loans that are now more than 30-days late to $61.27 billion, according to Morningstar.
Delinquent loans now account for 9.76 percent of the universe of private-label CMBS loans that have seasoned for at least a year. That's up from a 9.51 percent delinquency rate in September.
Given the consistent growth in the delinquency rate in recent months and the fact that the CMBS universe continues to shrink, it could very well top 10 percent in the coming months. The universe tracked by Morningstar, which includes agency transactions, totaled $734.17 billion in October, up from $736 billion a month earlier.
In addition, nearly $55 billion of CMBS loans come due next year and a substantial chunk of them aren't generating the cash flow needed to stay current. Many of those will likely be unable to refinance and could end up in the delinquency rolls.
Read more...Commercial Real Estate Direct - CMBS Delinquency Rate Climbs in October, Despite Liquidation of $1.28Bln of Loans
Delinquent loans now account for 9.76 percent of the universe of private-label CMBS loans that have seasoned for at least a year. That's up from a 9.51 percent delinquency rate in September.
Given the consistent growth in the delinquency rate in recent months and the fact that the CMBS universe continues to shrink, it could very well top 10 percent in the coming months. The universe tracked by Morningstar, which includes agency transactions, totaled $734.17 billion in October, up from $736 billion a month earlier.
In addition, nearly $55 billion of CMBS loans come due next year and a substantial chunk of them aren't generating the cash flow needed to stay current. Many of those will likely be unable to refinance and could end up in the delinquency rolls.
Read more...Commercial Real Estate Direct - CMBS Delinquency Rate Climbs in October, Despite Liquidation of $1.28Bln of Loans
GlobeSt.com - Survey: Apartment Cap Rates Get Lower - Daily News Article
Cap rates for multifamily assets keep getting lower, and the push to purchase these properties in prime cities is increasing. A Jones Lang LaSalle/RealShare Apartments Outlook 2012 Survey at the recent Apartments 2011 conference found that the demand for multifamily is increasing.
“We’re seeing a focus on coastal, gateway cities like Seattle, Portland, San Francisco and Washington, DC.—cities that have a strong focus on technology, biotech, life sciences and government as that’s where the job growth is right now,” said Seth Heikkila, vice president, Jones Lang LaSalle. “But to move out that risk continuum, investors are requiring higher cap rates.”
Cap rates right now in top markets are around 4%. Most people surveyed (34%) think that the market is a bit over exuberant. At the same time, though, 22% claim we have't hit a bubble.
“There’s so much capital chasing too few deals—we call it “homeless capital,” said Bill Montgomery, President, Acquisitions & Investment, Sares-Regis. “REITs have been buying all the core properties and pension funds have had a hard time competing. We’re seeing money flowing into value add and development projects.”
Read more... GlobeSt.com - Survey: Apartment Cap Rates Get Lower - Daily News Article
“We’re seeing a focus on coastal, gateway cities like Seattle, Portland, San Francisco and Washington, DC.—cities that have a strong focus on technology, biotech, life sciences and government as that’s where the job growth is right now,” said Seth Heikkila, vice president, Jones Lang LaSalle. “But to move out that risk continuum, investors are requiring higher cap rates.”
Cap rates right now in top markets are around 4%. Most people surveyed (34%) think that the market is a bit over exuberant. At the same time, though, 22% claim we have't hit a bubble.
“There’s so much capital chasing too few deals—we call it “homeless capital,” said Bill Montgomery, President, Acquisitions & Investment, Sares-Regis. “REITs have been buying all the core properties and pension funds have had a hard time competing. We’re seeing money flowing into value add and development projects.”
Read more... GlobeSt.com - Survey: Apartment Cap Rates Get Lower - Daily News Article
Tuesday, November 29, 2011
ALNdata Releases November Newsletter
ALNData just released their October 2011 stats on occupancy and rents for 23 markets. In Texas, it includes DFW, Austin, Houston, San Antonio, Lubbock, Amarillo, Abilene and Corpus Christi. It is a great read from a great provider of apartment data.
ALNdata October Market Statistics
ALNdata October Market Statistics
Texas Manufacturing Outlook Survey, November 2011 - Economic Data - FRB Dallas
Texas factory activity decreased in November, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, dipped from 4.1 to –5.1, registering its first negative reading in two years.
Other measures of current manufacturing conditions also indicated contraction in November. The new orders index suggested deterioration of demand, falling to –5.1 after a year in positive territory. Eighteen percent of manufacturers noted increased order volumes in November, compared with 23 percent noting a decrease. The shipments index edged down from 2.7 to –1.1, suggesting the volume of shipments fell slightly. The capacity utilization index tumbled to –10.2 after several months of weak readings centered around zero.
Read more...Texas Manufacturing Outlook Survey, November 2011 - Economic Data - FRB Dallas
Other measures of current manufacturing conditions also indicated contraction in November. The new orders index suggested deterioration of demand, falling to –5.1 after a year in positive territory. Eighteen percent of manufacturers noted increased order volumes in November, compared with 23 percent noting a decrease. The shipments index edged down from 2.7 to –1.1, suggesting the volume of shipments fell slightly. The capacity utilization index tumbled to –10.2 after several months of weak readings centered around zero.
Read more...Texas Manufacturing Outlook Survey, November 2011 - Economic Data - FRB Dallas
Chandan Economics - Q3 2011 Bank Default and Lending Report | Chandan Economics
The default rate on multifamily and commercial real estate loans held by the nation’s banks fell to 3.75 percent in the third quarter of 2011, consistent with Chandan Economics' assessment that banks’ commercial real estate default rates plateaued late in 2010 and will continue to improve absent a negative macroeconomic shock. The overall decline in the default rate corresponds with a drop in the rate for commercial mortgages - excluding multifamily - which fell to 3.92 percent. Reflecting the broader improvements in apartment fundamentals and values, the default rate for multifamily loans fell to 2.91 percent.
REO Balances Edge Up to New Cyclical High
While the largest banks may also hold the greatest absolute volume of non-performing multifamily and commercial loans, relatively smaller regional and community banks face some of the most significant challenges in managing distress. The portfolios of these institutions, which accounted for an increasing share of REO in the third quarter, are more heavily weighted to the secondary and tertiary markets where pricing has been slower to recover. Refinancing in these markets remains difficult, even for properties with stable cash flow, because of an absence of lenders seeking to expand their commercial real estate balance sheets.
Read more...Q3 2011 Bank Default and Lending Report | Chandan Economics
REO Balances Edge Up to New Cyclical High
While the largest banks may also hold the greatest absolute volume of non-performing multifamily and commercial loans, relatively smaller regional and community banks face some of the most significant challenges in managing distress. The portfolios of these institutions, which accounted for an increasing share of REO in the third quarter, are more heavily weighted to the secondary and tertiary markets where pricing has been slower to recover. Refinancing in these markets remains difficult, even for properties with stable cash flow, because of an absence of lenders seeking to expand their commercial real estate balance sheets.
Read more...Q3 2011 Bank Default and Lending Report | Chandan Economics
biggerpockets.com - Deferred Maintenance – A Silent Cash Flow Killer
Deferred Maintenance – the practice of postponing maintenance activities such as repairs on both real property and personal property in order to save costs, meet budget funding levels, or realign available budget monies.
That is the definition of deferred maintenance according to Wikipedia. My definition, as it relates to income producing investment properties, would be a little less subtle and much more emphatic. If you defer maintenance to save dollars, you might as well place that money in a box next to your fireplace to use as future kindling. Your cash flow is going up in smoke!
Deferred maintenance can be an absolute killer for an investor looking to build a reliable passive income. What makes deferred maintenance particularly worrisome is when an investor purchases a property without knowing there is deferred maintenance and that puts future cash flow at considerable risk. Two recent incidents brought this topic to the fore front and served as inspiration for this article. One had nothing to do with real estate…but raised the term deferred maintenance in a whole new light for me. The second was very related to real estate and spoke volumes of why there may be an epidemic of misinformation and likely lost cash flows to come.
Read more...Deferred Maintenance – A Silent Cash Flow Killer
That is the definition of deferred maintenance according to Wikipedia. My definition, as it relates to income producing investment properties, would be a little less subtle and much more emphatic. If you defer maintenance to save dollars, you might as well place that money in a box next to your fireplace to use as future kindling. Your cash flow is going up in smoke!
Deferred maintenance can be an absolute killer for an investor looking to build a reliable passive income. What makes deferred maintenance particularly worrisome is when an investor purchases a property without knowing there is deferred maintenance and that puts future cash flow at considerable risk. Two recent incidents brought this topic to the fore front and served as inspiration for this article. One had nothing to do with real estate…but raised the term deferred maintenance in a whole new light for me. The second was very related to real estate and spoke volumes of why there may be an epidemic of misinformation and likely lost cash flows to come.
Read more...Deferred Maintenance – A Silent Cash Flow Killer
DSnews.com - Fed Records First Rise in New Mortgage Delinquencies in a Year
About 2.5 percent of current mortgage balances in the U.S. transitioned into delinquency during the third quarter, according to a new report issued by the Federal Reserve Bank of New York Monday.
That assessment reverses a recent trend of reductions in the measure of newly delinquent mortgage balances. Prior to the rise in the most recent quarter, the Federal Reserve had recorded declines in the percentage of current mortgages falling behind on payments going back to the third quarter of 2010.
The rate of transition from early (30-60 days) into serious (90 days or more) delinquency also rose slightly, with 31.3 percent of early stage delinquencies moving into the seriously delinquent bucket during the third-quarter period.
Read more...Fed Records First Rise in New Mortgage Delinquencies in a Year:
That assessment reverses a recent trend of reductions in the measure of newly delinquent mortgage balances. Prior to the rise in the most recent quarter, the Federal Reserve had recorded declines in the percentage of current mortgages falling behind on payments going back to the third quarter of 2010.
The rate of transition from early (30-60 days) into serious (90 days or more) delinquency also rose slightly, with 31.3 percent of early stage delinquencies moving into the seriously delinquent bucket during the third-quarter period.
Read more...Fed Records First Rise in New Mortgage Delinquencies in a Year:
Monday, November 28, 2011
Fed lent banks nearly $8 trillion during crisis, report shows - MSNBC.com
While the nation's largest banks were publicly reassuring nervous investors of their stability during the height of the financial crisis, they were also quietly approaching the Federal Reserve, hat in hand. The total price tag: $7.77 trillion, many times the amount of the better-known TARP bailout.
The magnitude of the government's assistance to struggling banks allowed them to grow even bigger and continue paying executives billions in compensation, a report in Bloomberg Markets January issue said Monday.
A win in court against a group representing the banks and a FOIA request filed by Bloomberg LP revealed the extent of the central bank's largesse — as well as the $13 billion in profits banks earned from those bailouts. The so called "big six" — JPMorgan, Bank of America, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley — accounted for $4.8 billion of that total — nearly a quarter of their net income during that time.
Read more...Fed lent banks nearly $8 trillion during crisis, report shows
The magnitude of the government's assistance to struggling banks allowed them to grow even bigger and continue paying executives billions in compensation, a report in Bloomberg Markets January issue said Monday.
A win in court against a group representing the banks and a FOIA request filed by Bloomberg LP revealed the extent of the central bank's largesse — as well as the $13 billion in profits banks earned from those bailouts. The so called "big six" — JPMorgan, Bank of America, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley — accounted for $4.8 billion of that total — nearly a quarter of their net income during that time.
Read more...Fed lent banks nearly $8 trillion during crisis, report shows
GlobeSt.com - Survey: Apartment Cap Rates Get Lower - Daily News Article
Cap rates for multifamily assets keep getting lower, and the push to purchase these properties in prime cities is increasing. A Jones Lang LaSalle/RealShare Apartments Outlook 2012 Survey at the recent Apartments 2011 conference found that the demand for multifamily is increasing. Click here for a recap of the entire event.
Read more/watch video...GlobeSt.com - Survey: Apartment Cap Rates Get Lower - Daily News Article
CRE Deal Activity Surpasses Expectations - YouTube
Despite the ongoing economic malaise, commercial real estate deal activity has actually surpassed expectations, according to Vick Seth, managing director with Raymond James & Assoc.
In a video interview with REIT.com at REITWorld 2011: NAREIT's Annual Convention for All Things REIT in Dallas at the Hilton Anatole hotel, Seth discussed the current state of the capital markets. He said the market is seeing an influx of capital seeking out transactions. He noted, however, that most buyers are searching for "trophy real estate," which includes landmarks properties and those located in major markets such as New York and Washington, D.C.
"Irreplaceable real estate is still trading quite healthily," Seth told REIT.com.
In 2012, Seth cautioned against expecting transaction volume to increase significantly. He noted that macro concerns will continue to impact the general market environment next year, including the debt issues currently plaguing the Eurozone. He also speculated that asset prices would continue to rise, causing potential acquirers to grow more selective in pursuing deals."
Watch video...CRE Deal Activity Surpasses Expectations - YouTube
In a video interview with REIT.com at REITWorld 2011: NAREIT's Annual Convention for All Things REIT in Dallas at the Hilton Anatole hotel, Seth discussed the current state of the capital markets. He said the market is seeing an influx of capital seeking out transactions. He noted, however, that most buyers are searching for "trophy real estate," which includes landmarks properties and those located in major markets such as New York and Washington, D.C.
"Irreplaceable real estate is still trading quite healthily," Seth told REIT.com.
In 2012, Seth cautioned against expecting transaction volume to increase significantly. He noted that macro concerns will continue to impact the general market environment next year, including the debt issues currently plaguing the Eurozone. He also speculated that asset prices would continue to rise, causing potential acquirers to grow more selective in pursuing deals."
Watch video...CRE Deal Activity Surpasses Expectations - YouTube
FDIC’s 'Problem Bank List' Contracts for Second Consecutive Quarter - DSnews.com
Bad real estate loans from the boom years of the last decade have forced 412 FDIC-insured lenders to shutter their operations since 2008. No institution’s balance sheet has been fully insulated from the downturn in the real estate markets, but data released by the FDIC suggests those lenders who’ve survived thus far are now finding their way out of the storm.
Read more...FDIC’s 'Problem Bank List' Contracts for Second Consecutive Quarter
Read more...FDIC’s 'Problem Bank List' Contracts for Second Consecutive Quarter
U.S. National Association of Realtors Forecast (Text) - Bloomberg
The following is the text from the NAR’s quarterly commercial real estate forecast release.
Growth in Commercial Real Estate Markets Expected in 2012.
Commercial real estate markets have been relatively flat this year, but improving fundamentals mean a more positive trend is expected in 2012, according to the National Association of Realtors.
Lawrence Yun , NAR chief economist, said there is little change in most of the commercial market sectors. “Vacancy rates are flat, leasing is soft and concessions continue to make it a tenant’s market,” he said. “However, with modest economic growth and job creation, the fundamentals for commercial real estate should gradually improve in the coming year.”
Read more...U.S. National Association of Realtors Forecast (Text) - Bloomberg
Growth in Commercial Real Estate Markets Expected in 2012.
Commercial real estate markets have been relatively flat this year, but improving fundamentals mean a more positive trend is expected in 2012, according to the National Association of Realtors.
Lawrence Yun , NAR chief economist, said there is little change in most of the commercial market sectors. “Vacancy rates are flat, leasing is soft and concessions continue to make it a tenant’s market,” he said. “However, with modest economic growth and job creation, the fundamentals for commercial real estate should gradually improve in the coming year.”
Read more...U.S. National Association of Realtors Forecast (Text) - Bloomberg
Economy Watch: Retailers Clean Up Over Thanksgiving Weekend | Multi-Housing News Online
America might still be suffering a recession-like economy, but that didn’t mean Americans wanted to stay home from the stores on Black Friday, or in a few cases, late-night on Thanksgiving. A number of preliminary reports over the weekend indicated record-breaking retail sales for Black Friday and the entire weekend, for that matter—as well as predictions of an uptick or even upsurge in online sales on “Cyber Monday.”
The National Retail Federation reported on Sunday that a survey conducted by BIGresearch over the weekend found that 226 million shoppers visited stores and websites over Thanksgiving weekend, which includes sales from Thanksgiving Day itself through Black Friday, plus Saturday and an estimate of Sunday’s visits. The total was up from 212 million during the same few days last year, and the average holiday shopper spent $398.62 over the weekend, up from $365.34 a year ago. Total spending reached an estimated $52.4 billion. Some 37.8 percent of the total weekend retail spending, an average of $150.53, was for online purchases, explained the NRF.
Read more...Economy Watch: Retailers Clean Up Over Thanksgiving Weekend | Multi-Housing News Online
The National Retail Federation reported on Sunday that a survey conducted by BIGresearch over the weekend found that 226 million shoppers visited stores and websites over Thanksgiving weekend, which includes sales from Thanksgiving Day itself through Black Friday, plus Saturday and an estimate of Sunday’s visits. The total was up from 212 million during the same few days last year, and the average holiday shopper spent $398.62 over the weekend, up from $365.34 a year ago. Total spending reached an estimated $52.4 billion. Some 37.8 percent of the total weekend retail spending, an average of $150.53, was for online purchases, explained the NRF.
Read more...Economy Watch: Retailers Clean Up Over Thanksgiving Weekend | Multi-Housing News Online
The Future of Rural Rental Housing Finance | Multi-Housing News Online
Federal budget recommendations and legislative proposals are raising questions about the future of federal financial support for rural affordable rental housing projects and about how these much-needed developments will be funded in coming years. Past and recent data on properties and rural market analyses suggest that the Section 538 Rural Rental Loan Guarantee Program provides a beneficial service by financing new rural properties and by providing preservation funds for older Section 515 apartments. Although other funding avenues such as Fannie Mae, Freddie Mac or FHA are available and effective, none provides the same dedication to rural America as do the Rural Development programs.
Read more...The Future of Rural Rental Housing Finance | Multi-Housing News Online
Read more...The Future of Rural Rental Housing Finance | Multi-Housing News Online
Wednesday, November 23, 2011
Multifamily Momentum Expected to Carry Over Into 2012
Occupancy and leasing gains made by multifamily REITs in 2011 are expected to continue into 2012, according to industry analysts.
More consumers prefer the apartment lifestyle over buying a home, according to Haendel St. Juste, analyst with KBW. He said that a key issue for REITs next year will be not only where their assets are located, but the types of tenant they have.
“Those REITs that have the high-quality assets are getting an increasing amount of renters by choice, people who want to remain more mobile,” he said. “This is the higher-end consumer with a better education and a better income.”
Read more...Multifamily Momentum Expected to Carry Over Into 2012
More consumers prefer the apartment lifestyle over buying a home, according to Haendel St. Juste, analyst with KBW. He said that a key issue for REITs next year will be not only where their assets are located, but the types of tenant they have.
“Those REITs that have the high-quality assets are getting an increasing amount of renters by choice, people who want to remain more mobile,” he said. “This is the higher-end consumer with a better education and a better income.”
Read more...Multifamily Momentum Expected to Carry Over Into 2012
McGraw-Hill Construction - Forecasts & Trends
The value of new construction starts advanced 12% in October to a seasonally adjusted annual rate of $469.8 billion, according to McGraw-Hill Construction, a division of The McGraw-Hill Companies. Much of the upward push came from nonresidential building, which was lifted by the start of a massive manufacturing project as well as by broader strengthening across several structure types. Also contributing to the total construction gain in October was a slight increase for the housing sector. Meanwhile, nonbuilding construction in October stayed even with its elevated September amount, helped by the start of several large electric power plants. Through the first ten months of 2011, total construction on an unadjusted basis came in at $355.6 billion, down 3% from the same period a year ago.
Rad more...McGraw-Hill Construction - Forecasts & Trends:
Rad more...McGraw-Hill Construction - Forecasts & Trends:
North Texas annual foreclosure activity hits three-year low « HousingWire
Residential foreclosure postings in North Texas reached the lowest level in three years, research firm Foreclosure Listing Service said Tuesday.
This year, 56,358 Dallas-Fort Worth homes were posted for foreclosure sales, down 12% from last year when 63,835 homes were posted for foreclosure sales. The data is for the upcoming Dec. 6 foreclosure auctions, which will close out 2011 sheriffs' sales of foreclosed properties in Dallas-Fort Worth.
All four counties within the DFW region experienced a decline in foreclosure posting activity compared to last year's totals.
Read more...North Texas annual foreclosure activity hits three-year low « HousingWire
This year, 56,358 Dallas-Fort Worth homes were posted for foreclosure sales, down 12% from last year when 63,835 homes were posted for foreclosure sales. The data is for the upcoming Dec. 6 foreclosure auctions, which will close out 2011 sheriffs' sales of foreclosed properties in Dallas-Fort Worth.
All four counties within the DFW region experienced a decline in foreclosure posting activity compared to last year's totals.
Read more...North Texas annual foreclosure activity hits three-year low « HousingWire
S&P: 45 months to clear shadow inventory « HousingWire
Changing default and liquidation rates in various regions prompted Standard & Poor's Ratings Services to reduce its projection of how many months it will take to clear the nation's shadow inventory.
After reviewing third quarter default and liquidation rates, the agency noted signs of improvement. S&P estimates it will take 45 months to clear the excess stock.
However, with constant changes to the foreclosure process, the number appears ever-shifting. Three months ago, for example, S&P said it would take 47 months to clear the shadow inventory, those properties not yet on market, but facing eventual resale.
Read more...S&P: 45 months to clear shadow inventory « HousingWire:
After reviewing third quarter default and liquidation rates, the agency noted signs of improvement. S&P estimates it will take 45 months to clear the excess stock.
However, with constant changes to the foreclosure process, the number appears ever-shifting. Three months ago, for example, S&P said it would take 47 months to clear the shadow inventory, those properties not yet on market, but facing eventual resale.
Read more...S&P: 45 months to clear shadow inventory « HousingWire:
RECON - Texas Outperforms Nation in October Home Sales
Sales of existing single-family Texas homes in October were up 8 percent from a year ago, according to the most recent Multiple Listing Services (MLS) data compiled by the Real Estate Center at Texas A&M University.
More than 15,600 existing single-family homes were sold, data showed. The median home price was $147,500, up 2 percent from a year ago, and the state's overall inventory was at 6.9 months.
Meanwhile, the National Association of Realtors (NAR) reported yesterday that, nationally, existing home sales rose 1.4 percent to a seasonally adjusted annual rate of 4.97 million in October from a downwardly revised 4.9 million in September, and are 13.5 percent above the 4.38 million unit level in October 2010.
Read more...RECON - Texas Outperforms Nation in October Home Sales
More than 15,600 existing single-family homes were sold, data showed. The median home price was $147,500, up 2 percent from a year ago, and the state's overall inventory was at 6.9 months.
Meanwhile, the National Association of Realtors (NAR) reported yesterday that, nationally, existing home sales rose 1.4 percent to a seasonally adjusted annual rate of 4.97 million in October from a downwardly revised 4.9 million in September, and are 13.5 percent above the 4.38 million unit level in October 2010.
Read more...RECON - Texas Outperforms Nation in October Home Sales
Commercial Prices Post Decline After 4 Months of Increases - DSNews.com
"September marked the 20th consecutive month that distressed sales made up more than 20 percent of commercial property sales, according to Moody’s/REAL Commercial Property Price Index. The index reported distressed transactions for the month accounted for 25.9 percent of all commercial transactions.
While distressed sales were in keeping with recent trends, commercial property prices broke a four-month streak of increases with a 1.4 percent decline in September, according to Moody’s.
However, on a quarterly basis, prices rose in all four commercial property sectors from the previous quarter. Retail and apartments posted the highest gains rising 10.4 percent and 6.3 percent, respectively."
Read more...Commercial Prices Post Decline After 4 Months of Increases - DSNews.com
While distressed sales were in keeping with recent trends, commercial property prices broke a four-month streak of increases with a 1.4 percent decline in September, according to Moody’s.
However, on a quarterly basis, prices rose in all four commercial property sectors from the previous quarter. Retail and apartments posted the highest gains rising 10.4 percent and 6.3 percent, respectively."
Read more...Commercial Prices Post Decline After 4 Months of Increases - DSNews.com
Tuesday, November 22, 2011
REIT.com - Acquisitions, Not development, to Drive Majority of REIT Growth
When it comes to describing the current state of commercial real fundamentals, “strong” is too strong of a word, according to Ross Nussbaum, managing director and senior REIT analyst with UBS.
Speaking with REIT.com during REITWorld 2011: NAREIT’s Annual Convention for All Things REIT in Dallas last week, Nussbaum said there are a number of problems the market still has to deal with including Europe falling into recession. He said he would describe the recovery in the U.S. as “slow and gradual.”
“If there was one area where I would be tempted to use the word strong, it would be multifamily,” Nussbaum said. “Multifamily rent growth has been absolutely phenomenal over the last year to year-and-a-half. We do think that will continue into the next year.”
When it comes to how REITs will most likely grow their portfolios, either acquisitions or development, Nussbaum said it all depends on the sector in which they operate.
Read more...Acquisitions, Not development, to Drive Majority of REIT Growth - REIT.com
Speaking with REIT.com during REITWorld 2011: NAREIT’s Annual Convention for All Things REIT in Dallas last week, Nussbaum said there are a number of problems the market still has to deal with including Europe falling into recession. He said he would describe the recovery in the U.S. as “slow and gradual.”
“If there was one area where I would be tempted to use the word strong, it would be multifamily,” Nussbaum said. “Multifamily rent growth has been absolutely phenomenal over the last year to year-and-a-half. We do think that will continue into the next year.”
When it comes to how REITs will most likely grow their portfolios, either acquisitions or development, Nussbaum said it all depends on the sector in which they operate.
Read more...Acquisitions, Not development, to Drive Majority of REIT Growth - REIT.com
Axiometrics Reports October Apartment Market Data - MultifamilyBiz.com
Axiometrics Inc., a provider of data and analysis on the apartment market, notes in its latest research that effective rents (rent net of concessions) and occupancy declined slightly in October, typical for the market as it heads into the fourth quarter. Nationally, effective rents declined 0.28% between September and October, similar to the 0.21% decline in October of 2010 but far ahead of the -0.73% and -0.63% growth rates in October of 2009 and 2008.
The national occupancy rate also declined slightly, from 94.07% in September to 93.83% in October. This trend is also seasonal and similar to the decline in October of 2010. Overall, occupancy is up 0.71% year-to-date.
“The market typically sees negative growth for effective rent and occupancy in the fourth quarter, and this year the rates are likely to be negative again, though much milder than for the average fourth quarter,” said Jay Denton, vice president of research for Axiometrics. “Year-to-date growth has slowed somewhat from our last forecast. We continue to expect a strong apartment market for 2012, but perhaps not as robust as previously forecasted.”
Read more...Axiometrics Reports October Apartment Market Data - Multifamily News Headlines – Breaking News, Stories, Top Headlines :: MultifamilyBiz.com
The national occupancy rate also declined slightly, from 94.07% in September to 93.83% in October. This trend is also seasonal and similar to the decline in October of 2010. Overall, occupancy is up 0.71% year-to-date.
“The market typically sees negative growth for effective rent and occupancy in the fourth quarter, and this year the rates are likely to be negative again, though much milder than for the average fourth quarter,” said Jay Denton, vice president of research for Axiometrics. “Year-to-date growth has slowed somewhat from our last forecast. We continue to expect a strong apartment market for 2012, but perhaps not as robust as previously forecasted.”
Read more...Axiometrics Reports October Apartment Market Data - Multifamily News Headlines – Breaking News, Stories, Top Headlines :: MultifamilyBiz.com
Mixed Signals on Improving Renter Quality - Rent Trends - Multifamily Executive Magazine
"In their recent third-quarter earnings calls, apartment REIT CEOs noted that as occupancies tighten and rents move up, something else encouraging is happening—the quality of residents is also improving.
For instance, Houston-based Camden Property Trust saw its average household income move up about 4.5 percent in its portfolio—rising from $62,000 to $65,000. The company’s rent-to-income ratio dropped from 18.5 percent to 18.1 percent. That improvement is striking, says Jay Harris, vice president of business services at Santa Ana, Calif.-based CoreLogic SafeRent, since the second quarter is usually when owners and managers see the best applicants come through their doors.
“The net-net result of that is that we end up with a more qualified resident as indicated by the household income and, really, a better ability to pay even in the face of raising rental rates,” said CEO Ric Campo in its third-quarter earnings conference call, transcribed by seekingalpha.com."
Read more...Mixed Signals on Improving Renter Quality - Rent Trends - Multifamily Executive Magazine
For instance, Houston-based Camden Property Trust saw its average household income move up about 4.5 percent in its portfolio—rising from $62,000 to $65,000. The company’s rent-to-income ratio dropped from 18.5 percent to 18.1 percent. That improvement is striking, says Jay Harris, vice president of business services at Santa Ana, Calif.-based CoreLogic SafeRent, since the second quarter is usually when owners and managers see the best applicants come through their doors.
“The net-net result of that is that we end up with a more qualified resident as indicated by the household income and, really, a better ability to pay even in the face of raising rental rates,” said CEO Ric Campo in its third-quarter earnings conference call, transcribed by seekingalpha.com."
Read more...Mixed Signals on Improving Renter Quality - Rent Trends - Multifamily Executive Magazine
Monday, November 21, 2011
Housing and the economy: Rising from the ruins | The Economist
THERE are two things everyone knows about American economic recoveries. The first is that the housing sector traditionally leads the economy out of recession. The second is that there is no chance of the housing sector leading the present economy anywhere, except deeper into the mire. In the two years after the recession of the early 1980s housing investment rose 56%; it is down 6.3% in the present recovery. America is saddled with a debilitating overhang of excess housing, the thinking goes, and as a result is doomed to years of slow growth and underemployment.
The economic landscape is unquestionably littered with the wreckage of the crash. Home prices languish near post-bubble lows, over 30% below peak. The plunge in prices has left nearly a quarter of all mortgage borrowers owing more than the value of their homes; nearly 10m are seriously delinquent on their loans or in foreclosure. The hardest-hit markets are ghost neighbourhoods, filled with dilapidated properties. Housing markets are far from healthy. Yet current pessimism seems overdone. A turnaround in sales, prices and construction may be closer than many imagine.
The potential for a strong housing recovery lies in the depths of the bust. America’s housing boom was remarkable for its impact on prices and for the flow of new households into the market, which pushed the home-ownership rate above 69%, the highest on record. Construction also boomed, but less wildly. Housing completions were above average during the boom, but not unusually so, particularly in light of the relatively restrained growth in housing supply during the 1990s (see chart 1). The bust, by contrast, dragged new construction to unprecedented depths. At the current rate, fewer homes will be added to the housing stock this year than in any year since records began in 1968.
Read more...Housing and the economy: Rising from the ruins | The Economist
The economic landscape is unquestionably littered with the wreckage of the crash. Home prices languish near post-bubble lows, over 30% below peak. The plunge in prices has left nearly a quarter of all mortgage borrowers owing more than the value of their homes; nearly 10m are seriously delinquent on their loans or in foreclosure. The hardest-hit markets are ghost neighbourhoods, filled with dilapidated properties. Housing markets are far from healthy. Yet current pessimism seems overdone. A turnaround in sales, prices and construction may be closer than many imagine.
The potential for a strong housing recovery lies in the depths of the bust. America’s housing boom was remarkable for its impact on prices and for the flow of new households into the market, which pushed the home-ownership rate above 69%, the highest on record. Construction also boomed, but less wildly. Housing completions were above average during the boom, but not unusually so, particularly in light of the relatively restrained growth in housing supply during the 1990s (see chart 1). The bust, by contrast, dragged new construction to unprecedented depths. At the current rate, fewer homes will be added to the housing stock this year than in any year since records began in 1968.
Read more...Housing and the economy: Rising from the ruins | The Economist
RECON - JOB GROWTH SUSTAINING AUSTIN MULTIFAMILY MARKET AUSTIN
JOB GROWTH SUSTAINING AUSTIN MULTIFAMILY MARKET AUSTIN (Marcus & Millichap) – In its fourth quarter 2011 multifamily market report, Marcus & Millichap said Austin’s "expanding economy and highly educated workforce is propelling job seekers and employers to pursue opportunities in the metro, helping improve apartment operations."
Here are highlights from the firm's apartment market forecast for the remainder of the year:
Led by a recovering private sector, 30,000 jobs will be added in the metro this year, a 3 percent increase and the first annual job growth since 2007.
Last year, 7,200 positions were cut in the metro.
After adding 2,600 units to the metro in 2010, developers will slow completions to 320 units this year. In 2012, construction will increase to more than 2,600 units as builders attempt to capture demand.
Healthy demand growth will be unregulated by supply additions this year, supporting a vacancy improvement of 200 basis points to 5 percent. In 2010, vacancy recorded a 310-basis-point decline.
Asking rents will climb 3.1 percent to $885 per month in 2011, while effective rents increase 3.6 percent to $805 per month. Last year, asking rents inched up 1.7 percent and effective rents pushed up 2.6 percent.
Here are highlights from the firm's apartment market forecast for the remainder of the year:
Led by a recovering private sector, 30,000 jobs will be added in the metro this year, a 3 percent increase and the first annual job growth since 2007.
Last year, 7,200 positions were cut in the metro.
After adding 2,600 units to the metro in 2010, developers will slow completions to 320 units this year. In 2012, construction will increase to more than 2,600 units as builders attempt to capture demand.
Healthy demand growth will be unregulated by supply additions this year, supporting a vacancy improvement of 200 basis points to 5 percent. In 2010, vacancy recorded a 310-basis-point decline.
Asking rents will climb 3.1 percent to $885 per month in 2011, while effective rents increase 3.6 percent to $805 per month. Last year, asking rents inched up 1.7 percent and effective rents pushed up 2.6 percent.
RECON - TEXAS' 'WHOLE WHEAT' ECONOMY
Add “baked goods” to the list of colorful analogies used to compare Texas’ relatively strong economy to that of the United States. That’s what State Comptroller Susan Combs did at yesterday’s 2012 Forecast Conference in Houston.
“The U.S. has what has been referred to as a ‘Twinkie economy,’” she said. “There are no natural ingredients. [Texas is] whole wheat, if you want to take a look at us versus the U.S. economy.”
Combs was speaking to a crowd of more than 400 business leaders, developers and students at the half-day event, which was presented by Urban Land Institute Houston and the Real Estate Center.
“We are now, as an economy, more diverse than either of our neighbors Canada or Mexico,” Combs said. “Our GDP, per capita, since 2001, [has] been larger than the U.S. every single year.”
Read more...RECON - TEXAS' 'WHOLE WHEAT' ECONOMY:
“The U.S. has what has been referred to as a ‘Twinkie economy,’” she said. “There are no natural ingredients. [Texas is] whole wheat, if you want to take a look at us versus the U.S. economy.”
Combs was speaking to a crowd of more than 400 business leaders, developers and students at the half-day event, which was presented by Urban Land Institute Houston and the Real Estate Center.
“We are now, as an economy, more diverse than either of our neighbors Canada or Mexico,” Combs said. “Our GDP, per capita, since 2001, [has] been larger than the U.S. every single year.”
Read more...RECON - TEXAS' 'WHOLE WHEAT' ECONOMY:
The Impact of Dodd-Frank on Resident Screening and Adverse Action Letters
In recent years, we’ve seen AIG’s liquidity crisis, Lehman Brothers’ bankruptcy, the subprime mortgage meltdown and resulting Troubled Asset Relief Program (TARP), and the Dodd-Frank Wall Street Reform and Consumer Protection Act passed last year.
As it relates to applicant screening for apartment owners and property managers, there hasn’t been much new legislative news in the past 20 years. Sure, we had the USA PATRIOT Act, FACT Act, and the Red Flag rules that helped fight terrorism and identity theft, but otherwise it has been pretty straightforward. For 30 years or so, the multifamily industry’s primary regulatory responsibility has been to provide applicants a letter explaining their Fair Credit rights when adverse action is taken.
The Impact of Dodd-Frank on Resident Screening and Adverse Action Letters
As it relates to applicant screening for apartment owners and property managers, there hasn’t been much new legislative news in the past 20 years. Sure, we had the USA PATRIOT Act, FACT Act, and the Red Flag rules that helped fight terrorism and identity theft, but otherwise it has been pretty straightforward. For 30 years or so, the multifamily industry’s primary regulatory responsibility has been to provide applicants a letter explaining their Fair Credit rights when adverse action is taken.
The Impact of Dodd-Frank on Resident Screening and Adverse Action Letters
Economists expect moderate growth in 2012: NABE « HousingWire
"The nation's gross domestic product will grow at a modest 2.5% in the final quarter of this year and by 2.4% in 2012, according to economists responding to the latest National Association of Business Economics survey, which managed to find some bright spots concerning next year's economic outlook.
"Business spending remains a strong positive and housing starts are expected to continue to rise from the bottom seen in 2010," the report said. Corporate profits and stocks are predicted to strengthen."
Read more...Economists expect moderate growth in 2012: NABE « HousingWire
"Business spending remains a strong positive and housing starts are expected to continue to rise from the bottom seen in 2010," the report said. Corporate profits and stocks are predicted to strengthen."
Read more...Economists expect moderate growth in 2012: NABE « HousingWire
GlobeSt.com - Smaller Loans Back in Vogue with Conduits - Daily News Article
Conduit lenders are showing an increasing appetite for smaller-sized loans, at least on assets in the Washington, DC-area. One broker, Phil Mudd with Cassidy Turley, dates this shift in interest to the beginning of fall. “For the last couple of months I have noticed that lenders, especially conduit lenders, have been much more interested in these kinds of transactions,” Mudd tells GlobeSt.com.
Cassidy Turley, he reports, is in the process of marketing seven smaller-sized loans with an aggregate value of $35 million. According to Mudd, “There is a significant level of interest in these from both the conduits and regional banks.”
This appetite for smaller-sized deals is less so for life companies, although exceptions can be made. Mudd, along with colleagues Christian Miles and Brad Geiger, recently closed on a small loan from a life company for Empire Apartments, a 151-unit, eight-story building located at 2000 F St., NW, on behalf of an investment entity controlled by Calvin Cafritz.
Read more...GlobeSt.com - Smaller Loans Back in Vogue with Conduits - Daily News Article
Cassidy Turley, he reports, is in the process of marketing seven smaller-sized loans with an aggregate value of $35 million. According to Mudd, “There is a significant level of interest in these from both the conduits and regional banks.”
This appetite for smaller-sized deals is less so for life companies, although exceptions can be made. Mudd, along with colleagues Christian Miles and Brad Geiger, recently closed on a small loan from a life company for Empire Apartments, a 151-unit, eight-story building located at 2000 F St., NW, on behalf of an investment entity controlled by Calvin Cafritz.
Read more...GlobeSt.com - Smaller Loans Back in Vogue with Conduits - Daily News Article
Existing-Home Sales Rise Unexpectedly in October - DSNews.com
Sales of previously owned homes got an unexpected boost last month while the number of homes on the market continued to decline, according to data just released by the National Association of Realtors (NAR).
The trade group recorded a 1.4 percent month-over-month increase in existing-home sales in October, pushing the annual rate of sales to 4.97 million."
Read more...Existing-Home Sales Rise Unexpectedly in October - DSNews.com
The trade group recorded a 1.4 percent month-over-month increase in existing-home sales in October, pushing the annual rate of sales to 4.97 million."
Read more...Existing-Home Sales Rise Unexpectedly in October - DSNews.com
Friday, November 18, 2011
NewsTalk Texas - Austin area apartment 4Q 2011: Marcus & Millichap
Year to date, the Austin market boasts one of the highest rates of employment growth nationwide, helping improve apartment operations.
After adding 2,600 units to the metro in 2010, developers will slow completions to 320 units this year.
Asking rents will climb 3.1 percent to $885 per month in 2011, while effective rents increase 3.6 percent to $805 per month. Last year, asking rents inched up 1.7 percent and effective rents pushed up 2.6 percent.
Read more...NewsTalk Texas - Austin area apartment 4Q 2011: Marcus & Millichap
After adding 2,600 units to the metro in 2010, developers will slow completions to 320 units this year.
Asking rents will climb 3.1 percent to $885 per month in 2011, while effective rents increase 3.6 percent to $805 per month. Last year, asking rents inched up 1.7 percent and effective rents pushed up 2.6 percent.
Read more...NewsTalk Texas - Austin area apartment 4Q 2011: Marcus & Millichap
Alternative Capital Steps Up to Fill the Gaps - Debt, Equity, Mezzanine Financing - Multifamily Executive Magazine
Fannie Mae, Freddie Mac, and the Federal Housing Administration held this industry together in the darkest days of the Great Recession. But as the economy slowly recovers, the private sector is growing more eager to pick up the slack.
Banks have jumped back aggressively, and an increasing number of them are using the balance sheet to go out longer than five years, which is traditionally the bank's sweet spot. A bank perm loan may be a little more expensive and offer a bit less leverage than an agency deal. But banks often feature more underwriting flexibility, such as more flexible prepayment structures.
Read more...Alternative Capital Steps Up to Fill the Gaps - Debt, Equity, Mezzanine Financing - Multifamily Executive Magazine:
Banks have jumped back aggressively, and an increasing number of them are using the balance sheet to go out longer than five years, which is traditionally the bank's sweet spot. A bank perm loan may be a little more expensive and offer a bit less leverage than an agency deal. But banks often feature more underwriting flexibility, such as more flexible prepayment structures.
Read more...Alternative Capital Steps Up to Fill the Gaps - Debt, Equity, Mezzanine Financing - Multifamily Executive Magazine:
Thursday, November 17, 2011
MSNBC - Foreclosure crisis only about halfway over
If the U.S. foreclosure crisis were a baseball game, we’d probably be in the bottom of the fourth inning.
That’s roughly the message from the latest data on home foreclosures and delinquencies released by an industry association Thursday.
The pace of new home foreclosures edged up again in the third quarter and the number of borrowers falling behind on their payments eased a bit, according to the Mortgage Bankers Association. The good news was that the rate of borrowers who have fallen three or more months behind on their payments has dropped to about 3.5 percent of all mortgages. That’s down from a peak of 5 percent in late 2009. But it’s still three and a half times the “normal” rate of about 1 percent that prevailed before the mortgage meltdown hit in late 2007.
“If you look at the pace of improvement I think we’re three to four years away from the typical pattern of seriously delinquent loans," said Michael Fratantoni, MBA's vice president of research and economics.
MSNBC - Foreclosure crisis only about halfway over
That’s roughly the message from the latest data on home foreclosures and delinquencies released by an industry association Thursday.
The pace of new home foreclosures edged up again in the third quarter and the number of borrowers falling behind on their payments eased a bit, according to the Mortgage Bankers Association. The good news was that the rate of borrowers who have fallen three or more months behind on their payments has dropped to about 3.5 percent of all mortgages. That’s down from a peak of 5 percent in late 2009. But it’s still three and a half times the “normal” rate of about 1 percent that prevailed before the mortgage meltdown hit in late 2007.
“If you look at the pace of improvement I think we’re three to four years away from the typical pattern of seriously delinquent loans," said Michael Fratantoni, MBA's vice president of research and economics.
MSNBC - Foreclosure crisis only about halfway over
GlobeSt.com - NAREIT: Multifamily Experts Explain Trends, Bust Assumptions - Daily News Article
The Residential Sector Spotlight Session at this year’s NAREIT convention subtitle could have been “busting assumptions and myths.” During the hour-long session on Nov. 16, heads of multifamily REITs provided an entertaining and sometimes humorous discussion about trends, predictions and why the multifamily sector was doing so well despite lousy job growth.
The general consensus of the panel, moderated by Richard Anderson, managing director, IBG Research, BMO Capital Markets, was that, job growth or no job growth, people need to live somewhere. And given the skepticism of the American Dream of home ownership, apartments seem to be it.
However, cautioned Equity Residential’s president and CEO David Neithercut, don’t make the mistake of assuming that people are moving out of foreclosed homes into apartments. Those foreclosed folks are moving into rental housing, rather than multihousing.
Read more...GlobeSt.com - NAREIT: Multifamily Experts Explain Trends, Bust Assumptions - Daily News Article
The general consensus of the panel, moderated by Richard Anderson, managing director, IBG Research, BMO Capital Markets, was that, job growth or no job growth, people need to live somewhere. And given the skepticism of the American Dream of home ownership, apartments seem to be it.
However, cautioned Equity Residential’s president and CEO David Neithercut, don’t make the mistake of assuming that people are moving out of foreclosed homes into apartments. Those foreclosed folks are moving into rental housing, rather than multihousing.
Read more...GlobeSt.com - NAREIT: Multifamily Experts Explain Trends, Bust Assumptions - Daily News Article
The Top 5 Myths of Tenant Retention - Property Management Insider
I’ve worked with a lot of apartment properties over the years, both on the owner/operator side as well as the tenant feedback side. In that time, I’ve run across a lot of myths that seem to be passed along from team member to team member until no one is sure how the information first came about or thinks to question it. I’d like to dispel some of the most common myths surrounding tenant retention based on data that comes from hundreds of thousands of tenants across the country through our resident feedback programs. The truth may pleasantly surprise you.
Read more...The Top 5 Myths of Tenant Retention - Property Management Insider
Read more...The Top 5 Myths of Tenant Retention - Property Management Insider
Expense Management Solution: The Value of Energy Saving LED Lighting
Total Cost of Ownership (TCO), also known as “ownership cost,” is a metric I like to use when explaining the value of using energy- and water-efficient products. TCO includes the up-front cost of the product and the costs associated with using that product for the duration of its life. Often, we use TCO, along with payback and return on investment (ROI) to compare two products, to determine which product to purchase that will make the most financial sense.
LED lighting have several advantages over traditional lighting such as longer average hour life, they are dimmable, color temperatures similar to incandescent lights, and low power consumption. LED lighting is a great example of when to use TCO to compare it to the alternatives. Let’s take a look at how an MR-16 LED bulb (MR-16 bulbs are used in pin-based applications such as track or accent lighting and are most commonly found in lobbies) compares to a halogen MR-16 bulb:
Read more...Expense Management Solution: The Value of Energy Saving LED Lighting
LED lighting have several advantages over traditional lighting such as longer average hour life, they are dimmable, color temperatures similar to incandescent lights, and low power consumption. LED lighting is a great example of when to use TCO to compare it to the alternatives. Let’s take a look at how an MR-16 LED bulb (MR-16 bulbs are used in pin-based applications such as track or accent lighting and are most commonly found in lobbies) compares to a halogen MR-16 bulb:
Read more...Expense Management Solution: The Value of Energy Saving LED Lighting
Not 2007 by a Long Shot, But Apartment Sales White Hot - CoStar Group
Going into the fourth quarter, multifamily sales have already bested 2010 total sales volume by more than $1 billion. The $33 billion in multifamily sales in the first three quarters are up 70% year-over-year compared to the first three quarters of 2010.
And the momentum is not slowing down, said Erica Champion, senior real estate economist for CoStar Group in a presentation at CoStar's State of the U.S. Multi-Family Market - Q3 2011 Review & Forecast this past week.
Still, Champion added, while it appears that the apartment investment sales market is white hot, this year's sales volume is still dwarfed by 2007 -- the peak year for investment activity. For example, in New York, Washington DC and Los Angeles, activity is only about one-third of the unusually high level of sales activity that occurred in 2007, Champion noted.
Read more...Not 2007 by a Long Shot, But Apartment Sales White Hot - CoStar Group
And the momentum is not slowing down, said Erica Champion, senior real estate economist for CoStar Group in a presentation at CoStar's State of the U.S. Multi-Family Market - Q3 2011 Review & Forecast this past week.
Still, Champion added, while it appears that the apartment investment sales market is white hot, this year's sales volume is still dwarfed by 2007 -- the peak year for investment activity. For example, in New York, Washington DC and Los Angeles, activity is only about one-third of the unusually high level of sales activity that occurred in 2007, Champion noted.
Read more...Not 2007 by a Long Shot, But Apartment Sales White Hot - CoStar Group
Nontraditional Lenders Gain Multifamily Market Share - National Real Estate Investor
Multifamily housing is leading commercial real estate’s recovery with strong rent growth, rising values and high occupancies, which is enticing non-traditional funding sources—especially life insurance companies—to attempt to gain market share.
James Tramuto, the Houston, Texas-based executive vice president of Jones Lang LaSalle’s capital markets group, real estate investment banking, notes that major life insurance companies—including MetLife, Northwestern Mutual, Teachers, and Alliance—have been a big component of multifamily finance this year.
“A lot of these big life insurance companies began really competing, and competing hard, with Freddie Mac and Fannie Mae,” he says.
Read more...Nontraditional Lenders Gain Multifamily Market Share - National Real Estate Investor
James Tramuto, the Houston, Texas-based executive vice president of Jones Lang LaSalle’s capital markets group, real estate investment banking, notes that major life insurance companies—including MetLife, Northwestern Mutual, Teachers, and Alliance—have been a big component of multifamily finance this year.
“A lot of these big life insurance companies began really competing, and competing hard, with Freddie Mac and Fannie Mae,” he says.
Read more...Nontraditional Lenders Gain Multifamily Market Share - National Real Estate Investor
Wednesday, November 16, 2011
Increasing Revenue, Not Rents, With Utility Billing Systems
Residents will fight tooth and nail over a raised rent. And, even in the current environment where there’s not a huge vacancy rate, residents might refuse to renew their leases if the rent gets raised too much. However, there is a way to increase revenue while keeping rents stagnant. And—bonus!—it’s also good news for the environment.
In a recent report from the American Conservation & Billing Solutions Inc. (AmCoBi), titled “The Multifamily Owners Complete Guide to Resident Utility Billing,” if property managers and owners set up a utility billing system—charging residences for their utility consumption—it will lower costs overall.
Read more...Increasing Revenue, Not Rents, With Utility Billing Systems - multihousingnews.com
In a recent report from the American Conservation & Billing Solutions Inc. (AmCoBi), titled “The Multifamily Owners Complete Guide to Resident Utility Billing,” if property managers and owners set up a utility billing system—charging residences for their utility consumption—it will lower costs overall.
Read more...Increasing Revenue, Not Rents, With Utility Billing Systems - multihousingnews.com
Texas Ahead: Economic Outlook
Updated November 10, 2011
Job growth, sales tax collections – both from business and consumer purchases – as well as automobile sales, signal that the Texas economy has emerged from the recent recession.
Another indicator that the state’s economy has been comparatively healthy was the U.S. Bureau of the Census report that Texas added more people (nearly 4.3 million) than any other state between the census counts of 2000 and 2010.
Through September 2011, more than 90 percent of the total jobs shed by employers during Texas’ shorter recession have already been recovered as our economy has rebounded more quickly than the U.S. as a whole. Nationally, only 26 percent of recession-hit jobs have been recovered.
Read more...Texas Ahead: Economic Outlook:
Job growth, sales tax collections – both from business and consumer purchases – as well as automobile sales, signal that the Texas economy has emerged from the recent recession.
Another indicator that the state’s economy has been comparatively healthy was the U.S. Bureau of the Census report that Texas added more people (nearly 4.3 million) than any other state between the census counts of 2000 and 2010.
Through September 2011, more than 90 percent of the total jobs shed by employers during Texas’ shorter recession have already been recovered as our economy has rebounded more quickly than the U.S. as a whole. Nationally, only 26 percent of recession-hit jobs have been recovered.
Read more...Texas Ahead: Economic Outlook:
Clean fracking: Moving to replace chemicals - Nov. 16, 2011
Last summer a Halliburton executive did the unthinkable: He took a big ol' swig of hydrologic fracturing fluid.
No, he didn't have a death wish. And yes, he appears to be doing just fine. He did it to prove a point: fracking fluid need not be toxic.
What the exec drank was a new formulation of fracking fluid made with ingredients sourced from the food industry rather than the chemical industry.
As public concern over the controversial practice of fracking mounts, Halliburton and a host of other companies are racing to fill a major void: finding a way of cracking rock to unlock oil and natural gas that is also environmentally benign.
Read More...Clean fracking: Moving to replace chemicals - Nov. 16, 2011
No, he didn't have a death wish. And yes, he appears to be doing just fine. He did it to prove a point: fracking fluid need not be toxic.
What the exec drank was a new formulation of fracking fluid made with ingredients sourced from the food industry rather than the chemical industry.
As public concern over the controversial practice of fracking mounts, Halliburton and a host of other companies are racing to fill a major void: finding a way of cracking rock to unlock oil and natural gas that is also environmentally benign.
Read More...Clean fracking: Moving to replace chemicals - Nov. 16, 2011
GlobeSt.com - Discounted Real Estate Notes Can Be Taxing - Building Opportunity Article
Developers and investors are accelerating the pace of note acquisitions, an already popular strategy for acquiring troubled real estate. With the continued weak economy, buyers have found it can be an effective tool for eventually acquiring property at dramatic discounts, and banks are tiring of holding troubled real estate. However, tax implications and other potential pitfalls can trip up unwary buyers.
Read more...GlobeSt.com - Discounted Real Estate Notes Can Be Taxing - Building Opportunity Article
Read more...GlobeSt.com - Discounted Real Estate Notes Can Be Taxing - Building Opportunity Article
GlobeSt.com - Lower Valuations Persist for Commercial Real Estate - Commercial Property Advisor Article
Why are many sellers of assets in denial about today’s lower valuations? The Moodys/REAL Index, which is based on actual sales transactions valued at $2.5 million and above, fell over 40% and continues to bounce along the bottom. Unless you are buying trophies in select cities such as New York and San Francisco, fair valuations for most assets are dramatically below those established at the market peak.
One valuation challenge for sellers is that they often expect to receive lofty valuations on the potential rent resulting from vacant space leasing and tenant renewals. During these troubled economic times, most buyers are extremely cautious when valuing such cash flows. Vacant space may provide little incremental value to the purchase price on a risk adjusted basis. Lease renewals might only happen at lower rents, if at all.
Read more...GlobeSt.com - Lower Valuations Persist for Commercial Real Estate - Commercial Property Advisor Article
One valuation challenge for sellers is that they often expect to receive lofty valuations on the potential rent resulting from vacant space leasing and tenant renewals. During these troubled economic times, most buyers are extremely cautious when valuing such cash flows. Vacant space may provide little incremental value to the purchase price on a risk adjusted basis. Lease renewals might only happen at lower rents, if at all.
Read more...GlobeSt.com - Lower Valuations Persist for Commercial Real Estate - Commercial Property Advisor Article
Tuesday, November 15, 2011
HUD Fiscal 2012 Funding Gives Priority to Sec. 8 Renewals
Congressional appropriations committees working on fiscal 2012 funding legislation have shown they are still willing to take care of Sec. 8 contract renewal needs, but other programs are being squeezed because of budget defi- cit concerns.
The final shape of the 2012 appropriations bill is unclear, and a temporary continuing resolution may be needed to keep the Department of Housing and Urban Development (HUD) and other government agencies in business. However, the House and Senate committees have put together bills with a similar pattern—cuts in other programs to provide money for Sec. 8—though they differ in the details."
Read more...HUD Fiscal 2012 Funding Gives Priority to Sec. 8 Renewals
The final shape of the 2012 appropriations bill is unclear, and a temporary continuing resolution may be needed to keep the Department of Housing and Urban Development (HUD) and other government agencies in business. However, the House and Senate committees have put together bills with a similar pattern—cuts in other programs to provide money for Sec. 8—though they differ in the details."
Read more...HUD Fiscal 2012 Funding Gives Priority to Sec. 8 Renewals
Fourth Quarter 2011 Survey of Professional Forecasters - Philadelphia Fed
Forecasters Predict Lower Growth and Higher Unemployment in 2012 and 2013
The outlook for growth and unemployment in the U.S. economy looks a little weaker now than it did three months ago, according to 45 forecasters surveyed by the Federal Reserve Bank of Philadelphia. The forecasters predict lower real GDP growth and higher unemployment rates in 2012 and 2013 than they did in August. Our panelists expect real GDP to grow at an annual rate of 2.6 percent this quarter, unchanged from the previous estimate. On an annual-average over annual-average basis, the forecasters see real GDP growing 1.8 percent in 2011 (1.7 percent previously). The forecasters predict real GDP will grow 2.4 percent in 2012 (2.6 percent previously) and 2.7 percent in 2013 (2.9 percent previously). The downward revision in 2012 and 2013 is accompanied by an upward revision for growth in 2014.
Read more...Fourth Quarter 2011 Survey of Professional Forecasters - Philadelphia Fed
The outlook for growth and unemployment in the U.S. economy looks a little weaker now than it did three months ago, according to 45 forecasters surveyed by the Federal Reserve Bank of Philadelphia. The forecasters predict lower real GDP growth and higher unemployment rates in 2012 and 2013 than they did in August. Our panelists expect real GDP to grow at an annual rate of 2.6 percent this quarter, unchanged from the previous estimate. On an annual-average over annual-average basis, the forecasters see real GDP growing 1.8 percent in 2011 (1.7 percent previously). The forecasters predict real GDP will grow 2.4 percent in 2012 (2.6 percent previously) and 2.7 percent in 2013 (2.9 percent previously). The downward revision in 2012 and 2013 is accompanied by an upward revision for growth in 2014.
Read more...Fourth Quarter 2011 Survey of Professional Forecasters - Philadelphia Fed
What's Your Exit Strategy? | CCIM Institute
There are many factors to consider when entering into a fixed-rate commercial real estate loan; what’s often forgotten is how to get out. Negotiating a solid exit strategy should be a critical aspect of all fixed-rate loan originations. Proactive borrowers who invest the time to plan an exit strategy upon origination may find that they can minimize penalties later.
When looking to extinguish fixed-rate debt, borrowers have two alternatives: yield maintenance or defeasance. Both methods allow the borrower to unencumber the underlying real estate asset and compensate for the lender’s reinvestment risk following prepayment. However, each method carries unique costs and implications, which can be punitive to a borrower.
Read more...What's Your Exit Strategy? | CCIM Institute
When looking to extinguish fixed-rate debt, borrowers have two alternatives: yield maintenance or defeasance. Both methods allow the borrower to unencumber the underlying real estate asset and compensate for the lender’s reinvestment risk following prepayment. However, each method carries unique costs and implications, which can be punitive to a borrower.
Read more...What's Your Exit Strategy? | CCIM Institute
Monday, November 14, 2011
NewsTalk Texas - Austin apartment pipeline drying up
In the past year, 30,000 people have moved to the Austin area, while only 1,065 new apartments came online during that time, according to Apartment Realty Advisors.
The influx of new residents is not slowing, and apartment building is not getting much more prevalent.
In all, 317 units at six projects are actually under construction, city planners said, and another 563 units across four projects have city approval, but have not started construction.
Read more...NewsTalk Texas - Austin apartment pipeline drying up
The influx of new residents is not slowing, and apartment building is not getting much more prevalent.
In all, 317 units at six projects are actually under construction, city planners said, and another 563 units across four projects have city approval, but have not started construction.
Read more...NewsTalk Texas - Austin apartment pipeline drying up
Commercial Real Estate Direct - FASB Develops Guidelines for Fair-Value Accounting Proposal
The rule maker for financial reporting is developing guidelines for a new standard that would prohibit a vast majority of commercial real estate investors from depreciating property values in their financial reports.
The Financial Accounting Standards Board, or FASB, has issued an exposure draft of the proposed guidelines and is seeking public comment on them until Jan. 5.
The "Topic 973" proposal defines what would be considered an investment-property entity, a business classification that would have to use fair-value accounting. Under that accounting, reporting companies record profits and losses for investment properties based on their market values, and would not depreciate their values in financial reports.
Read more...Commercial Real Estate Direct - FASB Develops Guidelines for Fair-Value Accounting Proposal
The Financial Accounting Standards Board, or FASB, has issued an exposure draft of the proposed guidelines and is seeking public comment on them until Jan. 5.
The "Topic 973" proposal defines what would be considered an investment-property entity, a business classification that would have to use fair-value accounting. Under that accounting, reporting companies record profits and losses for investment properties based on their market values, and would not depreciate their values in financial reports.
Read more...Commercial Real Estate Direct - FASB Develops Guidelines for Fair-Value Accounting Proposal
Selling Multifamily Properties: Five Contract Provisions to Worry About
Your firm has previously constructed a multifamily housing property. The property looks great; it has strong cash flow, and your company has a number of offers from potential buyers to purchase the property. You can pick an offer, have the purchase and sale agreement drafted, and you will be set, right? Not so fast! There are a number of significant provisions within the agreement that you, the seller, should pay close attention to.
Read More...Selling Multifamily Properties: Five Contract Provisions to Worry About
Read More...Selling Multifamily Properties: Five Contract Provisions to Worry About
GlobeSt.com - Apartments Will Continue With Modest Growth - Daily News Article
On a recent apartment webcast, 57% of participants predict that renter demand will get stronger in 2012, while 2% says it will be weaker, with 40% saying it will stay the same. The 2012 Apartment Market Outlook Video Webcast was put on by Marcus & Millichap Real Estate Investment Services, and was generally optimistic in the sector’s “continuation of modest growth in 2012.”
Read more...GlobeSt.com - Apartments Will Continue With Modest Growth - Daily News Article
Read more...GlobeSt.com - Apartments Will Continue With Modest Growth - Daily News Article
GlobeSt.com - Survey: Multifamily Investment Not Cooling Off - Daily News Article
Even though the European debt crisis is on the minds of commercial real estate investors and the job picture isn't looking like it's going to get a whole lot brighter any time soon, it doesn't look like the multifamily sector is losing steam.
Read more...GlobeSt.com - Survey: Multifamily Investment Not Cooling Off - Daily News Article
Read more...GlobeSt.com - Survey: Multifamily Investment Not Cooling Off - Daily News Article
Friday, November 11, 2011
RECON - Multifamily Market Overview: El Paso
El Paso's average apartment occupancy rate declined slightly between first quarter and third quarter 2011, according to the latest data from Apartment Realty Advisors.
Rad more...RECON - Multifamily Market Overview: El Paso
Rad more...RECON - Multifamily Market Overview: El Paso
RECON - Multifamily Market Overview: College Station-Bryan
College Station-Bryan apartment occupancy and rental rates were higher in third quarter 2011 than they were in the first quarter, according to the latest data from Apartment Realty Advisors.
Read more...RECON - Multifamily Market Overview: College Station-Bryan
Read more...RECON - Multifamily Market Overview: College Station-Bryan
Apartment Firms Not Energy Benchmarking Face Competitive Disadvantage - Energy Efficiency, Energy Star, Technology - Multifamily Executive Magazine
NMHC Technology Conference keynoter warns apartment operators unconcerned with benchmarking efforts of dire consequences.
Apartment Firms Not Energy Benchmarking Face Competitive Disadvantage - Energy Efficiency, Energy Star, Technology - Multifamily Executive Magazine
Apartment Firms Not Energy Benchmarking Face Competitive Disadvantage - Energy Efficiency, Energy Star, Technology - Multifamily Executive Magazine
Economy Watch: Foreclosures Jump in October, Still Low Compared With 2010
Foreclosure activity nationwide was up 7 percent in October compared with September, according to foreclosure specialist RealtyTrac on Thursday. But foreclosure activity — which for RealtyTrac includes the spectrum of default notices, scheduled auctions and bank repossessions — was down a considerable 31 percent compared with October 2010. Things haven’t been quite the same since robo-signing became frowned upon, it seems.
Read more...Economy Watch: Foreclosures Jump in October, Still Low Compared With 2010
Read more...Economy Watch: Foreclosures Jump in October, Still Low Compared With 2010
REITs Report Uneven Traffic - Reits - Multifamily Executive Magazine
Coming into the apartment REITs third quarter conference calls, analysts had one overriding concern.
“People were really focused on fundamental trends,” says Paula Poskon, a senior research analyst with Robert W. Baird & Co., a Milwaukee-based wealth management, capital markets, asset management, and private equity firm. “Because these stocks have been priced to perfection for a long time, the market is hyper sensitize to bad news. In this round of calls, I think there was a lot of questioning in trying to understand if there was real slowdown happening.”
Coming in, one analyst saw observers in two specific camps. "Heading into earnings, the bears were saying apartments were going to show weakness from the summer pause and thus the apartment rebound was coming to an end. The bulls were saying the landlords had pushed hard during the summer and post-peak summer leasing were switching to focus on occupancy," says Alexander Goldfarb, managing director of equity research of REITs for New York-based Sandler O'Neill + Partners. "We still think the apartment recovery has legs but third quarter results were not strong enough either way to dissuade the bulls or the bears from their respective views."
Read more...REITs Report Uneven Traffic - Reits - Multifamily Executive Magazine
“People were really focused on fundamental trends,” says Paula Poskon, a senior research analyst with Robert W. Baird & Co., a Milwaukee-based wealth management, capital markets, asset management, and private equity firm. “Because these stocks have been priced to perfection for a long time, the market is hyper sensitize to bad news. In this round of calls, I think there was a lot of questioning in trying to understand if there was real slowdown happening.”
Coming in, one analyst saw observers in two specific camps. "Heading into earnings, the bears were saying apartments were going to show weakness from the summer pause and thus the apartment rebound was coming to an end. The bulls were saying the landlords had pushed hard during the summer and post-peak summer leasing were switching to focus on occupancy," says Alexander Goldfarb, managing director of equity research of REITs for New York-based Sandler O'Neill + Partners. "We still think the apartment recovery has legs but third quarter results were not strong enough either way to dissuade the bulls or the bears from their respective views."
Read more...REITs Report Uneven Traffic - Reits - Multifamily Executive Magazine
Thursday, November 10, 2011
Environmental Risk: 10 Myths | CCIM Institute
Buyers, sellers, borrowers, and lenders frequently misperceive environmental liability risk in acquisitions and financings. These misperceptions make it difficult to identify, quantify, and apportion environmental risk appropriately between parties to a transaction. This article identifies — and debunks — 10 common myths about environmental liability that frequently arise in business transactions.
Read more...Environmental Risk: 10 Myths | CCIM Institute
Read more...Environmental Risk: 10 Myths | CCIM Institute
CMBS Delinquencies Hit Second Highest Level, Could Go Higher - CoStar Group
The CMBS delinquency rate moved significantly higher in October as investors continued to ask whether the glass was three quarters empty or one quarter full.
In October, the delinquency rate for U.S. commercial real estate loans in CMBS moved up 21 basis points to 9.77%. The CMBS delinquency rate is now at its second highest level ever. Only the 9.88% reading in July 2011 was higher, according to Trepp LLC.
After experiencing a big dip in the delinquency rate in August, the rate has now increased for two straight months.
Read more...CMBS Delinquencies Hit Second Highest Level, Could Go Higher - CoStar Group
In October, the delinquency rate for U.S. commercial real estate loans in CMBS moved up 21 basis points to 9.77%. The CMBS delinquency rate is now at its second highest level ever. Only the 9.88% reading in July 2011 was higher, according to Trepp LLC.
After experiencing a big dip in the delinquency rate in August, the rate has now increased for two straight months.
Read more...CMBS Delinquencies Hit Second Highest Level, Could Go Higher - CoStar Group
CMBS Sales Seen Little Changed in 2012 as Lenders Cut Back - Businessweek
Sales of commercial mortgage-backed securities aren’t likely to increase much next year as borrowing costs remain high and lenders back off making new loans, according to CMBS executives.
“The Street’s not really taking risk, they’re very concerned,” Steven Schwartz, managing director of loan acquisitions for Torchlight Investors, said at the Bloomberg Commercial Real Estate Summit in New York. “The first quarter’s going to be grim.”
CMBS Sales Seen Little Changed in 2012 as Lenders Cut Back - Businessweek
“The Street’s not really taking risk, they’re very concerned,” Steven Schwartz, managing director of loan acquisitions for Torchlight Investors, said at the Bloomberg Commercial Real Estate Summit in New York. “The first quarter’s going to be grim.”
CMBS Sales Seen Little Changed in 2012 as Lenders Cut Back - Businessweek
GlobeSt.com - GSEs Still Need Support from Uncle Sam - Daily News Article
Both Fannie Mae and Freddie Mac have approached the Treasury Department for additional funding in recent days. Last week, Freddie Mac requested another $6 billion in aid after reporting that its loss had grown to $4.4 billion for the third quarter. On Wednesday Fannie Mae reported a $7.6 billion loss for the quarter and asked the Treasury Department for $7.8 billion. Both GSEs have cited low mortgage rates, declining home prices and growing defaults as the source of their red ink.
Congress, needless to say, is hardly pleased with this latest trip to the Treasury’s coffers, to say nothing of their general performance. The latest sign of its discontent is a measure proposed by Sens. John McCain (R-AZ) and Jay Rockefeller (D-WV) to prohibit executives at GSEs from receiving bonuses so long as the agencies are in conservatorship.
Read more...GlobeSt.com - GSEs Still Need Support from Uncle Sam - Daily News Article
Congress, needless to say, is hardly pleased with this latest trip to the Treasury’s coffers, to say nothing of their general performance. The latest sign of its discontent is a measure proposed by Sens. John McCain (R-AZ) and Jay Rockefeller (D-WV) to prohibit executives at GSEs from receiving bonuses so long as the agencies are in conservatorship.
Read more...GlobeSt.com - GSEs Still Need Support from Uncle Sam - Daily News Article
Wednesday, November 9, 2011
Will Renter Demand be Even Stronger in 2012? Industry Says Yes - MHN Daily News
Despite tepid job growth, net absorption in the apartment market continues, according to Hessam Nadji, managing director of Marcus & Millichap Real Estate Investment Services, who spoke at a webcast today, entitled, “2012 U.S. Economic and Apartment Market Outlook.”>
While there are several reasons for this continued absorption despite a real economic recovery, Nadji pointed to the fact that the majority (71 percent) of those who have been hired in 2010-2011 are those in the 20- to 34-year-old range—that is, those who had moved out of their parents’ home, creating positive household formation.
Even with a moderate recovery pace, 57 percent of attendees believe that renter demand will be even stronger over the next year, and 63 percent believe demand will stay about the same, even without additional job growth. And even with a growing supply, Nadji does not believe this will derail a recovery (with the exception, perhaps, of some pockets).
Read more...Will Renter Demand be Even Stronger in 2012? Industry Says Yes
While there are several reasons for this continued absorption despite a real economic recovery, Nadji pointed to the fact that the majority (71 percent) of those who have been hired in 2010-2011 are those in the 20- to 34-year-old range—that is, those who had moved out of their parents’ home, creating positive household formation.
Even with a moderate recovery pace, 57 percent of attendees believe that renter demand will be even stronger over the next year, and 63 percent believe demand will stay about the same, even without additional job growth. And even with a growing supply, Nadji does not believe this will derail a recovery (with the exception, perhaps, of some pockets).
Read more...Will Renter Demand be Even Stronger in 2012? Industry Says Yes
Multifamily Will Lead Real Estate Recovery - Multifamily, Demographics - Multifamily Executive Magazine
There’s no doubt: Multifamily is best poised to lead the real estate sector toward a recovery.
Major demographic and global capital transformations unfolding in the wake of the economic downturn are creating a new foundation for the U.S. real estate industry. Consider that America is experiencing a rapid population increase and is expected to swell from 306 million residents in 2009 to more than 400 million by 2050. The majority of that escalation will be absorbed into the nation’s metropolitan areas—the leading hubs for population growth and the engines of the national economy—as the country becomes increasingly more urbanized.
Read more...Multifamily Will Lead Real Estate Recovery - Multifamily, Demographics - Multifamily Executive Magazine
Major demographic and global capital transformations unfolding in the wake of the economic downturn are creating a new foundation for the U.S. real estate industry. Consider that America is experiencing a rapid population increase and is expected to swell from 306 million residents in 2009 to more than 400 million by 2050. The majority of that escalation will be absorbed into the nation’s metropolitan areas—the leading hubs for population growth and the engines of the national economy—as the country becomes increasingly more urbanized.
Read more...Multifamily Will Lead Real Estate Recovery - Multifamily, Demographics - Multifamily Executive Magazine
International Economic Update, November 2011 - Globalization & Monetary Policy Institute - FRB Dallas
A slowdown in economic activity has materialized at the global level. In October, both advanced and emerging economies faced downward revisions in real gross domestic product (GDP) growth prospects for 2011. Investor uncertainty has heightened, causing increased market volatility. Recent economic activity suggests a more optimistic outlook for the U.S. relative to other advanced economies. The U.S. is benefiting from high labor productivity, which creates positive implications for capital inflows and international trade.
Read more...International Economic Update, November 2011 - Globalization & Monetary Policy Institute - FRB Dallas:
Read more...International Economic Update, November 2011 - Globalization & Monetary Policy Institute - FRB Dallas:
GlobeSt.com - Don’t Panic! The 2012 Real Estate Guide - Daily News Article
The cover title of the digital Commercial Real Estate Guide to the 2012 Economy should read, with all respect to the late Douglas Adams, “Don’t Panic!”
The commercial real estate markets will likely continue to improve, though it will be an anemic growth, so slow that it will barely feel like upward movement, according to industry experts. This weak strength will come even though the economy has taken a step back due to the global debt crisis, the politicians in Washington, DC aren’t likely to agree on a Turkey Day seating chart much less a financial plan, and even Fed Chairman Ben Bernanke, who recently put out a doom-and-gloom economic hex on next year.
Read more...GlobeSt.com - Don’t Panic! The 2012 Real Estate Guide
The commercial real estate markets will likely continue to improve, though it will be an anemic growth, so slow that it will barely feel like upward movement, according to industry experts. This weak strength will come even though the economy has taken a step back due to the global debt crisis, the politicians in Washington, DC aren’t likely to agree on a Turkey Day seating chart much less a financial plan, and even Fed Chairman Ben Bernanke, who recently put out a doom-and-gloom economic hex on next year.
Read more...GlobeSt.com - Don’t Panic! The 2012 Real Estate Guide
Tuesday, November 8, 2011
National Economic Update, November 2011 - Economic Research Publications - FRB Dallas
Indicators of real economic activity for the U.S. have held up surprisingly well given the lack of confidence signaled through surveys and financial markets. Real gross domestic product (GDP) grew at an annualized pace of 2.5 percent in third quarter 2011. Inflationary pressures were subdued and show signs of converging to 2 percent.
Read more...National Economic Update, November 2011 - Economic Research Publications - FRB Dallas:
Read more...National Economic Update, November 2011 - Economic Research Publications - FRB Dallas:
Texas Economy Continues to Expand at a Moderate Pace - November 2011 - Economic Research - FRB Dallas
Texas economic growth continues at a moderate rate. Conditions in the housing market are improving, with increased home sales and lower inventories; house prices, however, are stagnant. Despite recent weakness in oil prices, energy activity remains strong. Concerns regarding the European debt crisis, continued sluggishness in the national economy and prospects of further job losses in the state and local government pose notable downside risks.
Read more...Texas Economy Continues to Expand at a Moderate Pace - November 2011 - Economic Research - FRB Dallas
Read more...Texas Economy Continues to Expand at a Moderate Pace - November 2011 - Economic Research - FRB Dallas
Foreclosure Starts Rise as Servicers Process Backlog of Delinquent Loans
Foreclosure starts among private-label residential mortgage-backed securities (RMBS) have been rising toward historic averages over the past six months, which will lead to an influx of distressed properties bringing downward pressure to the housing market, according to recent RMBS Performance Metrics from Fitch Ratings.
According to Fitch, foreclosure start rates for severely delinquent RMBS loans have stayed above 10 percent since September — a rate they have not reached since November 2009 — and have been working their way toward their 14 percent average between 2000 and 2010.
“Rising foreclosure start rates are likely a sign that servicers are playing catch-up on actions that have been delayed over the past year,” states Diane Pendley, managing director of Fitch Ratings.
Read more...Foreclosure Starts Rise as Servicers Process Backlog of Delinquent Loans:
According to Fitch, foreclosure start rates for severely delinquent RMBS loans have stayed above 10 percent since September — a rate they have not reached since November 2009 — and have been working their way toward their 14 percent average between 2000 and 2010.
“Rising foreclosure start rates are likely a sign that servicers are playing catch-up on actions that have been delayed over the past year,” states Diane Pendley, managing director of Fitch Ratings.
Read more...Foreclosure Starts Rise as Servicers Process Backlog of Delinquent Loans:
CRE Exposure Pushes 11 More Banks to Insolvency
While the roots of the financial crisis can be found in the nation’s residential housing sector, it’s now exposure to bad commercial real estate loans that’s battering banks’ balance sheets.
The research and analytics firm Trepp LLC released a new report Monday on recent U.S. bank failures and the drivers behind their demise.
In total, 11 banks failed during the month of October – up sharply from six in September and seven in August. The count through October is 85 failures year-to-date. Trepp says that puts the annualized pace at just over 100 for the full 2011 calendar year.
Read more at Commercial Real Estate Exposure Pushes 11 More Banks to Insolvency:
The research and analytics firm Trepp LLC released a new report Monday on recent U.S. bank failures and the drivers behind their demise.
In total, 11 banks failed during the month of October – up sharply from six in September and seven in August. The count through October is 85 failures year-to-date. Trepp says that puts the annualized pace at just over 100 for the full 2011 calendar year.
Read more at Commercial Real Estate Exposure Pushes 11 More Banks to Insolvency:
Nearly 29% of mortgaged homes underwater, report finds
A whopping 28.6 percent of homeowners with mortgages owe more on their loans than their homes could sell for, according to quarterly data released Tuesday by Zillow, a real estate website. That's up from 26.8 percent in the second quarter. Home values declined only 0.2 percent from the second quarter but were down 4.4 percent year over year.
Read more...Nearly 29% of mortgaged homes underwater, report finds
Read more...Nearly 29% of mortgaged homes underwater, report finds
Monday, November 7, 2011
San Antonio Apartment Market Continues to Steadily Progress
San Antonio recorded another quarter of good rent growth, though occupancy didn’t show any progress in 3rd quarter. But that’s not especially concerning, as Jay Parsons explains in this video edition of Apartment Market Dynamics.
Watch the video here...San Antonio Apartment Market Continues to Steadily Progress
Watch the video here...San Antonio Apartment Market Continues to Steadily Progress
TEXAS CLAIMS 'TOP BUSINESS CLIMATE' TITLE
By most measures, including Site Selection's own Governor's Cup and Business Climate Rankings, Texas is the place to be for business and industry. Companies are flocking to the Lone Star State — Atlas Van Lines' annual study of corporate relocations in 2010 logged more than 7,200 relocations inbound to Texas, the sixth highest, and 5,300 outbound relocations. Overall, Texas claimed 58 percent of the inbound relocations. More to the point, 40 percent of the new U.S. jobs created since June 2009 were created in Texas, giving Gov. Rick Perry an enviable credential with which to make a run for the Republican presidential nomination.
Read More... Cover Story: Top U.S. Business Climates: A Better Moustrap:
Read More... Cover Story: Top U.S. Business Climates: A Better Moustrap:
HUD Offers REO Homes for $100 Down in Select States
In addition to $100 down instead of FHA’s typical 3.5 percent down payment, HUD says it will also cover up to 3 percent of the closing costs in most cases.
Read more...HUD Offers REO Homes for $100 Down in Select States:
Read more...HUD Offers REO Homes for $100 Down in Select States:
Property Management Tips: Turning Up the Heat on Bed Bugs in Apartment Units
Bed bugs are literally catching a lot of heat these days.
The nation’s bed bug infestation, which made headlines a couple of years ago, is still on the move, and every recliner, sock or backpack is a suspect – not just those satin sheets. Multifamily properties, as well as hotels and college dorms, are prime targets.
These appleseed-size pests that multiply like wildfire are not welcome guests. Once inside, every room, nook and cranny is inviting. Bed bugs cling to clothing, squeeze into suit cases and hide in your laptops. Wooden studs and sheet rock aren’t big enough barriers to keep bed bugs from migrating unit to unit.
However, a sure-fire way to control the problem is heat.
Read more...Property Management Tips: Turning Up the Heat on Bed Bugs in Apartment Units
The nation’s bed bug infestation, which made headlines a couple of years ago, is still on the move, and every recliner, sock or backpack is a suspect – not just those satin sheets. Multifamily properties, as well as hotels and college dorms, are prime targets.
These appleseed-size pests that multiply like wildfire are not welcome guests. Once inside, every room, nook and cranny is inviting. Bed bugs cling to clothing, squeeze into suit cases and hide in your laptops. Wooden studs and sheet rock aren’t big enough barriers to keep bed bugs from migrating unit to unit.
However, a sure-fire way to control the problem is heat.
Read more...Property Management Tips: Turning Up the Heat on Bed Bugs in Apartment Units
GlobeSt.com - How to review title to a commercial real property - Practical Counsel Article
The common goal of all due diligence efforts is to find out precisely what the seller is selling and what the buyer is buying. (Or, what the landlord is offering to rent, and the tenant is going to get if it leases the property.)
This sounds simple, but is not so easy: the challenge is to find out about the property while relying only on sources of information that are known to be highly accurate (and, if possible, on sources that carry liability insurance against their own errors). One of the most important tools available to a buyer or tenant is a title report.
A title report will disclose who owns the land, and precisely what legal interest the owner/landlord has in the land, together with a list of other interests in the land owned by other people.
Read the entire article below.
GlobeSt.com - How to review title to a commercial real property - Practical Counsel Article
This sounds simple, but is not so easy: the challenge is to find out about the property while relying only on sources of information that are known to be highly accurate (and, if possible, on sources that carry liability insurance against their own errors). One of the most important tools available to a buyer or tenant is a title report.
A title report will disclose who owns the land, and precisely what legal interest the owner/landlord has in the land, together with a list of other interests in the land owned by other people.
Read the entire article below.
GlobeSt.com - How to review title to a commercial real property - Practical Counsel Article
Friday, November 4, 2011
Trepp: Slow Decline in Delinquencies Suggests Prolonged Recovery
Recording a slight decrease in delinquencies in its preliminary third quarter estimate, Trepp predicts full market recovery will not occur for years.
Read the entire article below
Trepp: Slow Decline in Delinquencies Suggests Prolonged Recovery:
Read the entire article below
Trepp: Slow Decline in Delinquencies Suggests Prolonged Recovery:
FHA Takes Bigger Role in Financing Apartments - Rent Trends, Government Projects, Lenders - Multifamily Executive Magazine
"The Federal Housing Administration (FHA) invested $11 billion in multifamily rental in 2010, which put that agency on nearly equal footing as a funding resource with Fannie Mae, which provided $16.9 billion in debt financing for apartments (down 14% from 2009); and Freddie Mac, which invested $13 billion."
FHA Takes Bigger Role in Financing Apartments - Rent Trends, Government Projects, Lenders - Multifamily Executive Magazine:
FHA Takes Bigger Role in Financing Apartments - Rent Trends, Government Projects, Lenders - Multifamily Executive Magazine:
Class B Shows Strength - Rent Trends - Multifamily Executive Magazine
As the entire apartment market continued to tighten in the third quarter, rental data said one group of apartments is coming on strong. And it wasn’t necessarily the Class A sector that one would expect.
“The hot segment of the market is that middle market,” says Greg Willett, who heads the research and analysis team at Carrollton, Texas–based MPF Research. “There’s some progress, particularly in the middle market."
Read the entire article below.
Class B Shows Strength - Rent Trends - Multifamily Executive Magazine:
“The hot segment of the market is that middle market,” says Greg Willett, who heads the research and analysis team at Carrollton, Texas–based MPF Research. “There’s some progress, particularly in the middle market."
Read the entire article below.
Class B Shows Strength - Rent Trends - Multifamily Executive Magazine:
Distress CRE Shows a Decline - GlobeSt.com
Finally, distressed commercial real estate in the United States appears to have broken through its plateau and has started heading for a decline. The level of distress in the commercial real estate market totaled $171.6 billion in October 2011—down $9.5 billion since June, according to soon-to-be released figures from Delta Associates and Real Capital Analytics.
GlobeSt.com - Distress CRE Shows a Decline - Daily News Article
GlobeSt.com - Distress CRE Shows a Decline - Daily News Article
Good Graph Friday: Where the renewable energy is.
We hear a lot of talk about the need to reduce the nation’s dependence on costly fossil fuels, but what’s actually being done about it?
The Natural Resources Defense Council has created an interactive map showing where some major types of renewable energy facilities have either already been built in the United States, or are being planned.
Want to know if your air conditioner may soon be powered by the sun? The new graphic will show exactly where the new solar facilities are planned, who is constructing them and what the capacity is. It also allows you to zero in on your state or even zip code. The list includes wind, solar, advanced biofuels and geothermal facilities, as well as biodigesters. That’s energy based on animal manure.
Good Graph Friday: Where the renewable energy is
Want to know if your air conditioner may soon be powered by the sun? The new graphic will show exactly where the new solar facilities are planned, who is constructing them and what the capacity is. It also allows you to zero in on your state or even zip code. The list includes wind, solar, advanced biofuels and geothermal facilities, as well as biodigesters. That’s energy based on animal manure.
Good Graph Friday: Where the renewable energy is
Thursday, November 3, 2011
The Coming Rental Housing Wave - CoStar Group
While widespread recovery continues to elude the housing sector, the apartment market has become one of the real estate industry's -- and the broader economy's -- best hopes for a return to the good old days, with robust property values attracting keen investor interest. And it has the Great Recession to thank for it.
The Coming Rental Housing Wave - CoStar Group:
The Coming Rental Housing Wave - CoStar Group:
Wednesday, November 2, 2011
Texas Economic Indicators Federal Reserve Bank of Dallas November 2011
The Texas economy continues to expand, although at a slow pace,
with employment growing at a 0.1 percent annual rate in September.
Texas home sales fell in September, but single-family permits and
housing starts rose. Texas exports inched up in August, and
manufacturing activity increased in October, according to the
Texas Manufacturing Outlook Survey's production index.
Texas Economic Indicators Federal Reserve Bank of Dallas November 2011
Texas Economic Indicators Federal Reserve Bank of Dallas November 2011
Emerging Trends 2012: A Long Grind Awaits
The outlook has dimmed for commercial real estate, according to the Emerging Trends in Real Estate 2012 report released by PwC and the Urban Land Institute at the ULI Fall Conference in Los Angeles.
Last year, the report talked of an industry recovery playing out in an “era of less,” which presented its own challenges. But at least the theme was about the industry rebounding. This year, the report signals that the recovery may be on hold for all of 2012.
The best opportunities within commercial real estate remain in familiar places—24-hour gateway cities, markets with strong energy or tech sectors and the multifamily sector.
' Emerging Trends 2012: A Long Grind Awaits
Last year, the report talked of an industry recovery playing out in an “era of less,” which presented its own challenges. But at least the theme was about the industry rebounding. This year, the report signals that the recovery may be on hold for all of 2012.
The best opportunities within commercial real estate remain in familiar places—24-hour gateway cities, markets with strong energy or tech sectors and the multifamily sector.
' Emerging Trends 2012: A Long Grind Awaits
2011 Changes to Environmental Due Diligence
The standards for Environmental Due Diligence and Phase I Environmental Site Assessments continue to develop. Below is a review of a few significant changes to the environmental due diligence standards that occurred in 2011:
GlobeSt.com - 2011 Changes to Environmental Due Diligence - The Science of Real Estate Article
GlobeSt.com - 2011 Changes to Environmental Due Diligence - The Science of Real Estate Article
Tuesday, November 1, 2011
Texas Multifamily Statistics September 2011
O’Connor & Associates just released their Texas Multifamily Statistics for September 2011.
To view the report click on the link below.
Texas Market Update September 2011
To view the report click on the link below.
Texas Market Update September 2011
Could America turn out worse than Japan? | Mohamed El-Erian
Scary, but thoughtful, article by Pimco's CEO and co-CIO.
American policymakers, together with their European counterparts, are realizing something that Japan has been experiencing for a while: It is very difficult to manage well an economy hobbled by structural impediments and balance sheet excesses. Read the entire article at the link below.
Could America turn out worse than Japan? | Mohamed El-Erian:
American policymakers, together with their European counterparts, are realizing something that Japan has been experiencing for a while: It is very difficult to manage well an economy hobbled by structural impediments and balance sheet excesses. Read the entire article at the link below.
Could America turn out worse than Japan? | Mohamed El-Erian:
Subscribe to:
Posts (Atom)