Tweet I recently received a marketing email for a vacant restaurant building in Las Vegas. The very first “selling point” was as follows: FDIC Owned! I see these type of statements all the time now and I just wanted to make a few comments on the matter. My question is simply this: Why does the [...]
Tweet This is my first post in a very long time. The only reason I am posting today is because I didn’t really have to do anything to put this post up. The following analysis is from an email I just received breaking down a recently listed retail center. Needless to say, the property is [...]
Tweet The Phoenix Business Journal published a not-so-surprising article this past Friday about the state of retail shopping centers in the Phoenix MSA. The article paints a dismal picture for the state of retail in Phoenix. According to David Wetta, director of Marcus & Millichap’s national retail group, there are 1,753 retail properties in the [...]
Tweet I have been receiving numerous emails from CREOBA every single day for a very long time and just archiving them for some future post or action that I have yet to think of. Today’s email does require a quick mention though. Apparently, CREOBA has decided to start offering their hugely valuable (ha!) courses via [...]
Tweet Bill Gross, PIMCO’s revered managing director, has just published his most recent investment outlook. In it, he calls the end of the recent market rally and warns of a necessity to come to grips with the fact that a new normal is headed our way. The closing sentences sum up his point nicely and [...]
Tweet Standard & Poor’s had downgraded 15 classes of bonds backed by a $425 million loan secured against the Four Seasons Hotel in New York and 3 other luxury resort hotels. The action was triggered by a drop in cash flow which was 46% below S&P expectations. Surely, the expected cash flow figure had already [...]
Tweet I wanted to make another quick point on CRE underwriting as it relates to vacancy. Some of the more “with it” sellers have begun allowing vacancy factors underwritten into their offering memorandums. What is often overlooked is the actual relation of the vacancy factor to operations. Often you will see a vacancy factor of [...]
Tweet I received a marketing brochure today that, quite frankly, left me a bit shocked. The property is a multi-tenant retail building in a power center in Southern California. The shocking part of the offering was that the seller and broker were NOT attempting to capitalize income from the vacant suites. Maybe CRE practitioners are [...]
Tweet Another post from Calculated Risk showing office vacancy rates since 1991. We are not as bad as we were in 1991 but it looks like we are heading there. Graph below from CR.
Tweet I just came across this article in which Mike Kirby, Director of Research at Green Street Advisors claims that CRE values may not drop any further than they already have. My head is spinning now. I don’t know what to think anymore. Its almost as if everyone is entitled to their own opinion. Maybe [...]
Tweet It looks like retailers are not faring so well after all. From an article published today at DallasNews.com titled “Speakers at Retailing Summit in Dallas offer sobering assessment” (emphasis mine): Retailers shouldn’t expect to see the pre-recession shopper in this economic recovery, and a shakeout with store closings is still ahead, speakers said Thursday [...]
Tweet Lately I have been receiving a high volume of calls from appraisers. Appraiser calls are nothing new. Normally, I receive a handful a month calling to ask questions about properties I have sold or asking for my opinion on a particular property they are trying to value. Now, I am receiving several appraisal calls [...]
Tweet I presume investors will be lining up to get a shot at this beauty. The good news is that the property is zoned M-1 (light manufacturing) so if you can’t stabilize with the currently approved use you can convert the building into a manufacturing facility making the products that will be used in other [...]
Tweet Today, Moody’s Investors Services posted its most recent Moody’s/REAL Commercial Property Price Index. The results show continued price declines in US commercial real estate across the board. According to the report, CRE values are now 30.8% below those of 1 year ago and 38.7% below peak levels of October 2007. I found this article [...]
Tweet I have embedded a presentation from Oaktree Capital Management, L.P. outlining their strategy for participating in the PPIP program. It is quite interesting as it outlines their view of the investment opportunity presented through PPIP. One key item that caught my eye was their prediction that retail property capitalization rates will be 900 basis [...]