Category: US/Texas Market Reports

Only Ripples Likely From Next CMBS Maturity Wave

Posted on by Sarah

What begins, must end, one way or another. As loan originators gradually ramped up after the Great Recession, and the packaging of commercial mortgage-backed securities grew apace, so the CMBS sector now faces a wave of maturities from 2020 through 2023 that totals more than $170 billion. According to a new Morningstar research report, the good news is that the on-time payoff rate is likely to remain in the range of 80 to 85 percent. This would be stronger than the payoff rate than during 2015 and 2017, when $222.48 billion in CMBS hit maturity, “because of more selective underwriting standards, rising valuations, and the Fed’s dovish interest-rate outlook amid a slowing economy,” the company says. Click to read more at www.cpexecutive.com.

Ramping Up Retail

Posted on by Sarah

Confidence in the retail commercial real estate market is on the rise in 2019, according to Marcus & Millichap. In its 2019 Retail North American Investment Forecast, the national brokerage firm points to a steady year of completions ahead, “on par with 2018.” The U.S. economy, it argues, is Strong due to tax-induced growth and a tight labor market. The future of brick-and-mortar retail development, the firm suggests, will be dictated by online competition. Retailers are now tasked with offering something that isn’t available via a quick Google search: service-oriented businesses, “from healthcare to fitness to dining and a variety of entertainment venues.” Even in the face of multiple big-box retailers closing up shop, property owners have managed to turn things around, filling the storefronts instead with retailers looking for a smaller space. Click to read more at www.rednews.com.

Commercial Real Estate Pricing Drops Nationally For Ninth Month Straight In January

Posted on by ginger

Commercial real estate pricing entered 2018 on a low note. Nationwide prices fell 0.3% last month, representing the ninth consecutive month of declines. “We edged off historic highs. The declines over the last three quarters have been mild and more of a stagnation than a decline,” Ten-X Senior Quantitative Strategist Chris Muoio said. “Prices have plateaued.”

As prices continue to fall, the industry’s aggressive fundraising efforts have left an abundance of dry powder — cash reserves set aside for investment purposes — in the market.  Billions in capital that is not deployed, coupled with a lack of attractive investment opportunities, has contributed to the slight drop in commercial real estate valuations. 

Read more at: //www.bisnow.com/national/news/capital-markets/commercial-real-estate-pricing-drops-nationally-as-the-search-for-attractive-assets-persists-84666?utm_source=CopyShare&utm_medium=Browser

Dallas-Fort Worth still ranks as a top U.S. market for real estate investors

Posted on by ginger

Even though Dallas-Fort Worth has fallen in the rankings from the top spot two years ago to the No. 5 ranked city in the Emerging Trends in Real Estate 2018 report, PwC Partner Mitchell Roschelle said there’s no indication investor interest has swayed from Big D.

Dallas-Fort Worth, the most populous city in the Lone Star state, ranked behind smaller U.S. cities, including Seattle (No. 1), Austin (No. 2), Salt Lake City (No. 3) and Raleigh-Durham, North Carolina (No. 4), on the investor sentiment published by PwC and the Urban Land Institute.

Real estate investors have had a growing interest in smaller cities because of their relative affordability, coupled with a concentration of young, skilled workers, said Roschelle, who authored the report based on interviews and survey responses from more than 1,600 real estate professionals.

Click to read more at Dallas Business Journal. 

Amazon Reinforces Importance of Brick-and-Mortar Presence, leaps Into Grocery Business With Acquisition of Whole Foods

Posted on by ginger

Amazon enters grocery business with $13.7 billion purchase of Whole Foods. After testing a variety of concepts to enter the grocery store segment, Amazon recently announced an agreement to acquire Whole Foods Market for $13.7 billion. The purchase gives the e-commerce giant instant access to the grocery store business, which accounts for consumer spending of more than $636  billion per annum. More importantly the purchase highlights the importance of omnichannel platforms, which incorporate a blend of brick-and-mortor establishments with an online footprint to drive traffice and sales.

 

Click to read the rest of this article.

Marcus & Millichap

Recent Legislative Updates: E.V. “Rusty” Adams, Research Attorney Real Estate Center Texas A&M University

Posted on by ginger

A number of bills passed creating and/or empowering MUDs and giving them road district powers.

  • HB 777: Effective immediately. Prevents the loss of open space ag appraisal while owner is on military deployment or stationed outside the state.
  • HB 1288: Effective immediately. County commissioner’s courts may contract with a broker to lease property owned by the county.
  • SB 345: Effective immediately. Certain municipalities may use certain tax revenue from hotel projects to pay certain hotel-related bonds or other obligations.
  • SB 550: Effective immediately. Deals with sale or assignment of tax credits for certified rehabilitation of certified historic structures.
  • SB 1086: Effective immediately. Prohibits a state agency from public internet posting of information that identifies taxable receipts of an individual business if they are contained in or derived from information required to be provided in a HOT tax report.
  • SB 1229: Effective immediately. County commissioner’s courts may contract for solid waste services in certain municipal ETJs.
  • SB 1365: Effective immediately. Use of HOT taxes for sporting event tourism expanded.
  • HB 807: Effective 9/1/17. Clarifies provisions relating to choice of law and venue for construction contracts.
  • HB 1774: Effective 9/1/17. Clarifies procedures and damages in deceptive, unfair, and prohibited insurance practices. Provides for an increase in damages.
  • SB 347: Effective 9/1/17. Regional water planning groups and their committees are subject to the Open Meetings Act.

Click to download this Article.