The real estate sector includes companies that own, develop, and manage residential, commercial, and industrial properties. Each of these three real estate segments includes publicly traded real estate investment trusts (REITs). REITs are vehicles that legally allow individual investors to buy shares in real estate portfolios that receive income from a variety of properties. REITs’ key metric is funds from operations (FFO), a measure of earnings particular to the industry. Some big names within the sector include American Tower Corp. (AMT), Prologis Inc. (PLD), and Digital Realty Trust Inc. (DLR). Real estate stocks, as represented by the Real Estate Select Sector SPDR ETF (XLRE), have underperformed the broader market with a total return of -5.8% compared to the S&P 500’s total return of 8.7% over the past 12 months.1 These market performance numbers and the statistics in the tables below are as of May 26. Here are the top 3 real estate stocks with the best value, the fastest earnings growth, and the most momentum. Best Value Real Estate Stocks: These are the real estate stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows you’re paying less for each dollar of profit generated. Click to read more at www.investopedia.com.
American cities face an increasingly uncertain future in what is already an uncertain time for when and how to reopen businesses and public spaces during the coronavirus outbreak. Elevated concerns over density and a shift in the mindset about remote work underscore the need to assess what matters most to urban residents. Measuring the value of urban amenities such as arts, cultural activities, recreation opportunities, and overall quality of life and how they relate to a neighborhood’s perception and satisfaction is more important than ever as cities look for a way forward in the post-pandemic future. A landmark Urban Institute report, commissioned by the Knight Foundation, surveyed 11,000 residents across 26 metro areas before the national coronavirus shutdown to understand what determines residents’ sense of attachment and connection to their city or community. It examines the trade-offs people make and the role they think amenities play in their satisfaction of locations. Click to read more at www.forbes.com.
Three tasks can ensure your financing plan is on point when starting a redevelopment project.
The redevelopment of property is crucial to a community’s renewal and economic health. Naturally, commercial real estate professionals are in business to make a profit, but revitalizing a property and turning it into a revenue-generating piece of a neighborhood is a financial benefit to more than just the developer. Before a blighted property can be reinvigorated, though, you need the funds to acquire it. Acquisition can mean more than just taking the title — it can refer to a lease, lease-purchase, land lease, or multiple vehicles.
Projecting Expenditures and Revenue
First things first, in an acquisition, how much money will you need and where will it come from? If your redevelopment project will be 100 percent equity, that’s fantastic. But rarely is it so simple. If you need to include debt, know what you can afford. Click to read more at www.ccim.com.
Holt Lunsford Commercial Investments (HLCI, formerly Frontier Equity), a commercial real estate investment and development firm headquartered in Dallas, has recently completed Southlake Business Park. The 182,000-square-foot industrial development is located just north of DFW International Airport in the affluent town of Southlake, Texas. The development site was one of the last industrial zoned tracts of land in Southlake and was acquired as part of a larger, four-building portfolio transaction. Southlake Business Park caters to 13,000-100,000 square foot tenants in the North Airport submarket. Holt Lunsford Commercial, Inc. will lease the project. Click to read more at www.rejournals.com.
The spread of coronavirus and millions of job losses have put the real estate market on shaky ground. But one property sector shows no sign of a slowdown, even in the face of the pandemic. If anything, the North Texas industrial building market seems to be gaining ground as demand for consumer products and e-commerce soars in the area. “I believe the industrial market is going to be more insulated from the effects of the pandemic than the other property types,” said Jeff Thornton, regional senior vice president of Duke Realty. “There is clearly evidence that the industrial market continues to move forward. “At Duke alone, we have had more than a half-million square feet of leases during the pandemic,” said Thornton, whose firm owns multiple Dallas-Fort Worth area industrial properties. Duke Realty just did a major expansion with tech firm Samsung in one of its Coppell warehouse buildings. Big warehouse and distribution deals have recently been announced all over the area for companies including Ocean Spray, Mars Inc., U.S. Auto Parts Network, ICU Medical, and FedEx. The pandemic has increased demand for distribution space for e-commerce companies that deliver products directly to consumers, said Tom Pearson, executive vice president of Colliers International. “Just a 5% increase in e-commerce sales would equate to millions of square feet of new industrial space requirements around the country,” Pearson said. Click to read more at www.dallasnews.com.
In cities all over the country, construction sites are shutting down due to the COVID-19 crisis, while others are taking steps to limit exposure as work continues. Regardless of the tactic—sustained operations or stoppage— ignoring specific risks can lead to serious cost and project management implications. For sites that are continuing construction during the pandemic, the contractor should establish several measures to mitigate the spread of the disease. The first step is to limit exposure before anyone even makes it onto the property. Many sites now require a temperature check of anybody entering the site, as well as when they come and go, including upon return from lunch or break. Other sites are asking workers—either verbally or by signing a form—if they, someone in their household or someone they may have been in contact with is exhibiting symptoms of or is confirmed to have contracted COVID-19. The most effective weapon against the disease is social distancing, but that can be hard to maintain on an active work site. Some contractors are juggling their teams with shifts so that there are fewer people on site at any one time, but the project can still move ahead on schedule. Click to read more at www.rednews.com.