Category: Uncategorized

Major Texas Cities Panel: CCIM Houston October Luncheon

Posted on by Sarah

Biggest office year yet-up to $36-37 rents; traffic bad in CBD; much of CRE growth is actually north of Austin where development permitting is much faster (1-2 months instead of 10+)
• Cap rate compression; many groups are scouring the market looking for value-add opportunities in the various segments; offerings are picked over; what’s left is at a premium
• “Houston is a better place to find value-adds”
• Austin total has less than 70 million SF industrial total, and much of it is in R & D and specialized manufacturing, such as in wafer chips which cannot have a building with any vibrations; minimal number of distribution centers; not much bulk distribution
• Development west of MoPac is on strong limestone ground, BUT is in the Edwards Aquifer Recharge Zone and there are strict limits on impervious cover; on the east side of MoPac the ground is ‘gumbo’, clay that expands and contracts with the moisture content in the soil-each area provides unique challenges and costs to developers
• Austin is only large Texas city with no Loop Road around the city
Click to read more at www.rednews.com.

JC Penney Surges After The Retailer Reports A Narrower-Than-Expected Loss, But It Still Sees A Steep Sales Decline

Posted on by Sarah

J.C. Penney reported a narrower-than-expected loss for its latest quarter, sending its shares higher Friday morning. Its stock, which closed Thursday at $1.10, surged more than 22% at one point during premarket trading. It was up nearly 11% shortly before the opening bell. Here’s how Penney did for the quarter ended Nov. 2 compared with what analysts were expecting, based on Refinitiv data: Earnings per share: a loss of 30 cents vs. a loss of 55 cents expected Revenue: $2.38 billion vs. $2.51 billion expected Adjusted same-store sales: down 6.6% vs. a drop of 7.7% expected “The past quarter was an exciting and energizing time at JCPenney as we made significant progress on our efforts to return JCPenney to sustainable, profitable growth,” CEO Jill Soltau said in a statement. Click to read more at www.cnbc.com.

Adapt or Die

Posted on by Sarah

Amazon isn’t just an online book retailer, just as IBM was never solely about keyboards and microchips. These companies leveraged innovation to become global giants that changed everyday life for billions. With technology affecting commercial real estate – from multifamily to industrial – the success stories of tomorrow are dependent on making the right decisions today. While no one can predict the future, some have spent years studying technology and its impact on commercial real estate. To gauge what’s ahead for the industry, we talked to four tech experts in commercial real estate: Michael Beckerman, CEO of CREtech; Gary Beasley, CEO of online marketplace Roofstock; Noah Isaacs, co-CEO at Bowery Valuation; and Nate Loewentheil, senior associate at venture capital firm Camber Creek. Predicting an Uncertain Future. Though much of the corporate world shudders when they hear the word disruption, Beckerman, CEO of CREtech, a leading event, data, and content platform focused on tech in commercial real estate, sees it in less turbulent terms. “I don’t use words like ‘disruption’ because I don’t think that’s what is happening,” he says. “I prefer to use language like ‘tech enhancement’ because that is truly the byproduct of technology’s impact on CRE.” Click to read more at www.ccim.com.

Texas Quarterly Apartment Report

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The Texas economy remained strong in the midst of the longest U.S. expansion. Payroll employment grew at a steady pace, and unemployment remained historically low. Headline wage growth rate levels were sluggish despite labor-market tightness and decreased inflationary pressure. Low interest rates and job growth supported commercial investments and pushed housing sales to a record high. Total commodity exports stalled in the first quarter and could continue to struggle amid the ongoing U.S.-China trade spat. Political tension, trade uncertainty, and a slowdown in the global economy present the greatest challenges to extending the current expansion. For additional commentary and statistics, see Outlook for the Texas Economy. The Texas Residential Construction Cycle (Coincident) Index, which measures current units under construction, followed the downward trend of the Texas Residential Construction Cycle (Leading) Index. A slowdown in construction permits hindered the Residential Construction (Leading) Index, pointing to slower residential construction going forward. Only the DFW leading index pointed toward a construction slowdown while the Austin, Houston, and San Antonio indices pointed toward higher activity. Overall market trends for the majority of Texas areas (metropolitan and micro) show positive occupancy rate growth combined with positive rent growth. Only Bryan-College Station and Lufkin registered negative rent growth. With the supply of single-family starter homes being constrained, young adults continue to rent units in the apartment sector. Click to read more at www.recenter.tamu.edu.

Pooch Power: On-site Doggie Daycare Can Help Companies Keep Workers

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Office workers log long hours these days. What if their favorite pooch is left at home all day alone? That could be stressful, for both workers and their pets. At one Michigan office, though, this isn’t a concern: This office offers an on-site doggie daycare. Employees can sign their dogs in for the day and get to work, knowing that their dogs will be played with and cared for. When the workday ends, employees can pick up their dogs and head home. This might sound like an unusual luxury. But with unemployment still low and demand for talented workers higher, companies that want to attract and retain young workers have to offer perks to set themselves apart. That’s why Rockford, Michigan-based footwear manufacturer Wolverine Worldwide earlier this year opened its on-site dog daycare service. This service comes courtesy of Dogtopia, a Phoenix, Arizona-based dog daycare and boarding provider. The Wolverine Worldwide location is the first of the company’s Dogtopia@Work campuses. But Kathy Halter, vice president of new center development for Dogtopia, says that she expects a growing number of companies to take advantage of this service. “Millennial workers are really mobile. They are also focused on their pets because many are starting families later in life,” Halter said. “Millennials have this sense of adventure. They’re not averse to moving from job to job to take on new challenges. They are very comfortable looking for the next business opportunity.” Click to read more at www.rejournals.com.

CEO Of Biggest US Mall Owner Says Retail Industry Is ‘Reaching The Bottom’ Of Bankruptcies

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The CEO of the biggest mall owner in the U.S., Simon Property Group, says the retail industry looks to be “reaching the bottom” of a tumultuous wave of bankruptcies. “We are having a high bankruptcy year. … There’s no denying that,” David Simon told analysts during a post-earnings conference call on Wednesday morning. “But I think we’re kind of reaching the bottom in … 2019 on that stuff. It’s rivaling what happened in 2017. So, it’s not like something that we haven’t experienced before. But we know [what] we have to do.” Simon shares were last down about 3.5% Wednesday afternoon, having fallen about 12% this year. The CEO’s comments come on the heels of Forever 21 and Barneys New York, among other retail chains, filing for bankruptcy this year. So far in 2019, U.S. retailers have announced 8,993 store closures and 3,780 store openings, compared with 5,844 closures and 3,258 openings in all of 2018, according to tracking by Coresight Research. The consulting firm expects closures could still hit a record 12,000 by the end of this year. “As we put together our plans for next year, I think we’ll be OK,” Simon said. “We’re hustling. We’re finding new tenants.” Click here to read more at www.cnbc.com.