Archive for the ‘Conference Coverage’ Category
by David Bodamer March 14th, 2007
A second dispatch from the ICSC Carolinas Idea Exchange.
During discussion of current economic trends, Mark Vitner, director and senior economist with Wachovia Bank, said consumer spending will maintain a healthy pace in 2007, in spite of a declining savings rate. The main factors Vitner looks at after consumer spending are after-tax income levels and employment growth. The “savings rate has absolutely nothing to do with it,” he says.
Vitner predicts consumer spending will grow by 3.1 percent in 2007, compared with 3.2 percent in 2006. GDP growth will be approximately 2.6 percent compared with 3.4 percent last year.
Vitner also singled out North Carolina, Arizona, Texas and Georgia as the states that will benefit from population growth. They have not previously enjoyed a housing boom as strong as in some other parts of the country and their affordability now makes them very attractive to newcomers. Ivy Greaner, of Ram Real Estate, a regional firm, compares North Carolina with South Florida, where housing prices have risen at astronomical rates in the past few years. “In North Carolina, it’s slow and steady growth,” she says. “Housing is still affordable, traffic is not an issue and all the major cities have enough critical mass that they [are still attractive].”
Related Topics: Conference Coverage, News, Retail Real Estate, Trends |
by David Bodamer March 13th, 2007
Retail Traffic Associate Editor Elaine Misonzhnik is at the ICSC Carolinas Idea Exchange conference and is offering observations from the show. Here’s her first dispatch.
Cap rate compression is causing some concern in the region. With asking prices often out of sync with market fundamentals, Daniel Taub, senior vice president of Pleasanton, Calif.-based Ross Stores, is worried that buyers will not be able to get sufficient returns to justify these purchases. “Rents have not appreciated enough historically in most markets to justify lower and lower cap rates,” he said.
Taub thinks that lax lending standards are partly to blame. “There is a degradation of discipline in the marketplace because there is so much new, in some cases unsophisticated money, that’s compressing cap rates,” he notes.
Read the rest of this entry »
Related Topics: Conference Coverage, Investment, News, Retail Real Estate |
by David Bodamer March 6th, 2007
Washington D.C. and the surrounding area has undergone a dramatic transformation that has re-cast the area as a dominant retail hub—rivaling for the first time cities like Los Angeles and Boston.
Much of that stems from the city itself, where there continues to be a major push for development from the mayor’s office—started under Anthony Williams and continuing under the current administration of Adrian Fenty.
In recent years the city has put up a new basketball and hockey arena in Gallery Place and a new convention center—site of this week’s ICSC Mid-Atlantic Conference. New retail has cropped around those sites. And the site of the old convention center—now demolished—will be rebuilt as a mixed-use project.
Read the rest of this entry »
Related Topics: Conference Coverage, News, Retail Real Estate |
by David Bodamer February 16th, 2007
The 2007 ICSC Conference on Open Air Centers concluded today in Phoenix at the Arizona Biltmore Resort and Spa with a session billed to highlight the growing popularity of the shopping venue, instead telegraphing what could be its successor.
Most of the panelists for “Strip Malls – Now Open Air Centers . . .Find Out What Retailers are Doing Now” agreed that open-air centers have been overbuilt. The gloomy forecast stems from what they cited as a slowdown in expansion plans by destination retailers such as Target, Williams Sonoma and Restoration Hardware that traditionally anchor the popular centers and whom smaller tenants depend on to draw traffic to their stores.
Their deceleration, Roland L. Mackie, senior vice president of real estate development for Kirkland’s Home, indicates that there may be fewer Open Air centers built in the future as landlords struggle to find anchors for new centers and replacements at old ones.
Read the rest of this entry »
Related Topics: Conference Coverage, News, Retail Real Estate |
by David Bodamer February 16th, 2007
Retail Traffic Managing Editor Riccardo A. Davis is out ICSC’s Conference on Open-Air Centers and will be sending dispatches from the show.
Here’s his first:
Hospitality is top of mind among the attendees of the 2007 ICSC Conference on Open Air Centers.
But, it’s not the accommodations or the level of service being rendered at the conference site in Phoenix, the Arizona Biltmore Resort and Spa.
During the welcoming reception Wednesday evening, upbeat developers and architects were abuzz about their as yet announced mixed-use projects.
Read the rest of this entry »
Related Topics: Conference Coverage, Development, Mixed-Use, News, Retail Real Estate, Trends |
by David Bodamer February 6th, 2007
NREI Online has a longer report about the 2006 volume of commercial mortgages. In total, it looks like the industry hit a new record, topping 2005. Retail volumes, though, were down.
The good news for mortgage bankers is flowing as fast as the capital these days.The good news for mortgage bankers is flowing as fast as the capital these days. Commercial/multifamily mortgage originations rose 3% in the fourth quarter of 2006 over the same period a year earlier, and total annual volume is expected to surpass the previous record of $201 billion set in 2005, according to the Mortgage Bankers Association.
The combination of an abundance of capital, improving property markets and innovative financing vehicles such as commercial-debt obligations (CDOs) are boosting lending volume to unprecedented heights, says Jamie Woodwell, MBA’s senior director of commercial and multifamily research.
“There are a number of fronts parked over the commercial/multifamily world that are leading us to some pretty calm seas,” says Woodwell. The researcher’s remarks came during a media luncheon at the Marriott hotel in downtown San Diego on Monday as part of MBA’s annual commercial/multifamily convention. The event has drawn about 5,000 attendees.
Related Topics: Conference Coverage, Finance, News |
by David Bodamer February 5th, 2007
The Mortgage Bankers Association is still computing final numbers, but preliminary results indicate that loan volume on retail real estate fell in the fourth quarter of 2006.
According to an MBA statement:
Commercial and multifamily mortgage bankers’ loan originations in the fourth quarter were three percent higher than during the same quarter last year. … The increase in commercial/multifamily lending activity during the fourth quarter was driven by increases in originations for hotel properties, offices, industrial and multifamily. When compared to the fourth quarter of 2005, the overall increase included a 20 percent increase in loans for hotel properties, an 8 percent increase in loans for office properties, a 3 percent increase in loans for industrial properties and a 2 percent increase in loans for multifamily. Lending for retail properties saw a 5 percent decrease and health care properties saw a decrease of 7 percent.
Related Topics: Conference Coverage, Finance, News, Retail Real Estate |
by David Bodamer February 5th, 2007
As part of Retail Traffic’s continuing conference coverage, we will be providing updates from this week’s CREF/Multifamily Housing Convention & Expo 2007 being hosted by the Mortgage Bankers Association in San Diego.
One of the hot topics at the show is insurance. This year marks the expiration of the latest version of the Terrorism Risk Insurance Act. Beyond that, there are also concerns about the availability of wind and flood insurance—especially with disputes and hefty payouts still being resolved from 2005’s killer hurricane season.
There have been a lot of conflicts concerning the damage caused by hurricanes and whether it was caused by wind or water. That’s important because it affects who is responsible for recouping the property owner. In addition, with more big storm seasons expected, insurers have been reluctant to provide insurance in coastal markets.
The loss of any of these types of insurance threatens to put mortgages into default and putting a crimp on what continues to be a booming industry. As it stands, 2006 is expected to be a record year for originations. (MBA is still computing final numbers.)
No one wants the party to end because of an issue like insurance. So 2006 promises to be a big year as real estate and insurance groups push for an extension of TRIA and for some kinds of similar backstop or legislation to make wind and flood insurance more available and affordable.
Related Topics: Conference Coverage, Finance, Management & Leasing, News, Retail Real Estate, Trends |
by David Bodamer January 8th, 2007
Commercial real estate financiers are getting a lot of mileage out of their newest toy–commercial real estate collateralized debt obligations. Everyone at the show calls them CRE CDOs. (It rolls off the tongue easier the more you practice saying it.) The final data for 2006 presented at CMSA’s CMBS Investor Conference shows that CRE CDO issuance grew to $34.3 billion in 2006–a 62 percent gain from 2005 and more than four times the volume of issuances in 2004. (Robert Ricci, managing director for Wachovia Securities projects 2007 volume to reach $60 billion)
There are a lot of differences between CMBS and CDO–too many to try and encapsulate here. The key difference is that issuers have the option to actively manage the pool of assets inside CRE CDOs. They can cycle loans in and out, change property types, change geographic distribution (all within limits, of course). Issuers are also not limited to fixed-rate mortgages. It can include that, but more commonly includes floating rate debt of all stripes. Managed pools can also include REIT and REOC debt, mezzanine financing, preferred equity and other derivatives. Another difference is that unlike with CMBS issuances, sponsors can (and often do) retain ownership of some of the pool.
From a sponsor standpoint, it seems to be an attractive option and CRE CDOs promise to play a growing role in provding financing for the commercial real estate sector. And, because the pools are actively managed, sponsors can charge higher fees–as high as 45 basis points compared with 20 basis points for CMBS.
Despite the explosion in CRE CDO issuances, it does have a long way to go to catch up to the popularity of CMBS. CMBS issuances reached $299.2 billion in 2006–a $60 billion gain over 2005 and more than double 2004’s volume of $128 billion.
Related Topics: Conference Coverage, Finance, News, Retail Real Estate |
by David Bodamer January 8th, 2007
When covering retail real estate and largely talking to professionals that specialize in this sector, it’s easy to get caught up in the view that retail will continue to roll along. Sure, there will be some blips and most investors and developers think that retail is not going to see the same kind of growth in 2007 that it has in previous years. It’s no longer the leading light in commercial property circles either. But for the most part the mood is optimistic.
But stepping into a different circle and hearing what a different group of investors and financiers have to say provides a stark contrast. At the Commercial Mortgage Security Association’s CMBS Investors Conference in Miami, a gathering of investors, servicers, sponsors and other professionals involved in securitizing real estate debt, a morning panel discussed the prospects for commercial real estate in 2007. Retail didn’t fare well.
Read the rest of this entry »
Related Topics: Conference Coverage, Finance, Investment, News, Retail Real Estate, Trends |
