In this issue of Insights, we offer perspectives to capitalize on opportunities that continue to be created in a growing economy, and to maintain a house in order, with preparations made to weather market corrections or flattening economic growth, should those changes occur. Our cover story on office renovations and office amenities samples current building features and services, and discusses why many tenants not only desire, but require, amenity-rich workplaces to support their business strategies. Click to read more at www.transwestern.com.
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.
It all started with an email.
Just days before closing on a home, I got a message from my escrow officer—or at least someone pretending to be her. Our closing costs needed to be wired to the title company right away, she said, or our closing date would be pushed back. Considering the six weeks I’d spent waiting to close on the property—not to mention the disdain I had for our current rental home—the message sent my heart racing. The font was right. The signature was right. There was even a CC to my real estate agent. But something seemed off. A closer look at the header revealed the problem. Each email address—one for my agent, one my mortgage broker and one for my escrow officer—was a single character off. It was a fake. Click to read more at www.forbes.com.
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.
What data points really matter when comparing commercial real estate markets for future investments or business opportunities? Market revitalization and successful economic redevelopment depend on a variety of variables working in sync. More than that, it requires thoughtful planning and an opportunistic mindset to take advantage of the right circumstances at the right time. Having access to reliable, real-time data doesn’t hurt either. As we develop strategies for comparing key markets that may be primed for revitalization, it’s helpful to evaluate examples of past success. By evaluating cities and neighborhoods that have undergone successful revitalization, we can tune into some of the key data points that are useful when trying to replicate such success. Click to read more at www.realmmassive.com.
Texas Had the Fastest Growth in the Fourth Quarter. Real gross domestic product (GDP) increased in 49 states and the District of Columbia in the fourth quarter of 2018, according to statistics released today by the U.S. Bureau of Economic Analysis. The percent change in real GDP in the fourth quarter ranged from 6.6 percent in Texas to 0.0 percent in Delaware (table 1). Percent Change in Real GDP by State, 2018: Q3-2018-Q4. Wholesale trade, mining, and information services were the leading contributors to the increase in real GDP nationally (table 2). Mining and wholesale trade were the leading contributors to the increase in real GDP in Texas, the fastest growing state. Click to read more at www.bea.gov.