Features

Group Bookings Brighten Hotel Outlook for 2017

by Kristin Harlow December 1, 2016

NEW YORK CITY — Committed occupancy and average daily rates (ADR) for the first quarter of 2017 are showing major signs of growth in the hotel sector. Group travel is leading the way despite the continuing lag in transient booking pace in the fourth quarter of 2016, according to new data from TravelClick’s November 2016 North American Hospitality Review (NAHR). TravelClick defines a transient traveler as an individual business or leisure traveler. Transient booking pace is the rate by which these travelers book their reservations. Committed occupancy is defined as the sum of transient rooms and group rooms committed divided by capacity. The November NAHR looks at group sales commitments and individual reservations in the 25 major North American markets for hotel stays that are booked by Nov. 1, 2016, from the period of November 2016 to October 2017. Across all travel segments in the first quarter of 2017, occupancy and ADR are up 6.7 percent and 2.7 percent, respectively. Occupancy for the group segment is up 6.8 percent. “Even with the slowing transient reservation pace this month, especially within the business segment, hoteliers should look to the New Year for a promising outlook,” said John Hach, TravelClick’s senior industry …

December 1, 2016

Features Industrial Top Stories

Self Storage: The Strong, Stable REIT Investment

by Jeff Shaw November 29, 2016

The self storage REIT industry is sizzling hot. Last year, when stocks were flat and REITs generated a mere 2.8 percent return on average, self storage REITs returned a whopping 40 percent, far surpassing all other REIT sectors. Occupancy rates at the 51,000 self storage facilities in the United States have grown by 11 percent from the first quarter of 2012 to the first quarter of 2016. The need for storage facilities continues to increase as Baby Boomers retire and downsize, while millennials flock to rental apartments without garages and basements. In fact, the growth in the inventory of self storage facilities mirrors recent increases in apartment occupancy. Although net absorption of apartments is slowing, self storage REITs remain a solid investment. That’s because the existing inventory of storage facilities is relatively low due to a slowdown of construction during the recession. This lack of sufficient supply prompted Integra Realty Resources to predict record-level prices and continued demand for this strong investment type into 2017. One of the advantages of self storage is that it involves so little capital outlay when compared to other kinds of commercial real estate, such as malls, offices or apartments. Indeed, it requires less capital …

November 29, 2016

Features Retail Top Stories

How Owners Can Drive Revenue for Retail Centers Through Innovative Landscape Design

by Katie Sloan November 22, 2016

The retail experience has and continues to evolve. Online sales are projected to reach $523 billion by 2020, increasing at an annual average rate of 9.32 percent, according to reports by Forrester Research Inc. While brick-and-mortar shopping still remains a dominant channel for American consumers, e-commerce growth continues to increase at a rapid rate, indicating a fundamental shift in the way today’s consumers approach retail. In order to remain competitive in this ever changing landscape, retail owners must adapt their strategies to create retail centers that cater to the evolving demands of today’s shoppers. The majority of consumers that still prefer to make purchases in stores are no longer simply searching for places to shop, but are rather seeking multi-sensory environments and experiences that cannot be replicated through online channels. The question is, how do retail owners create these experiential centers that extend beyond the traditional retail experience? The short answer: innovative landscape design. Landscape design can play an integral, if not essential, role in cultivating these experiences and transforming a center from a cookie-cutter mall to an upscale destination of choice. In fact, the presence of physical beauty has been proven to build and establish an emotional connection with …

November 22, 2016

InterFace Seniors Housing Northeast Conference, Philadelphia

Features Multifamily Seniors Housing Top Stories

Will Trump’s Stance on Immigration Reform Exacerbate Worker Shortage Problem in Seniors Housing?

by Jeff Shaw November 17, 2016

Already facing a labor shortage, the U.S. seniors housing industry could be dealt a “devastating” blow if president-elect Donald Trump were to limit the number of lower-wage immigrants coming into the country in order to accommodate an increased number of high-wage skilled immigrants, says Jeff Sands, managing principal and general counsel for HJ Sims. “It’s a real issue this industry is grappling with,” especially given the growing number of facilities. Sands’ comments came during a “State of the Industry and 2017 Outlook” panel at the InterFace Seniors Housing Northeast conference in Philadelphia on Tuesday, Nov. 15. The U.S. seniors housing market will need to recruit 1.2 million new employees by 2025, Argentum reported in a research report released earlier this year. Because about 70 percent of the 65-plus population — including many people with cognitive impairment — requires some form of long-term care, according to the U.S. Department of Health and Human Services, the nation’s aging population will create unprecedented demand for the services of the senior living industry in the coming decades. According to donaldjtrump.com, the president-elect’s campaign website, his immigration controls will result in the selection of immigrants based on their likelihood of success in the United States …

November 17, 2016

Features Heartland Feature Archive Multifamily Top Stories

Renovation of Older Apartment Buildings in Suburbs is a Win-Win Strategy

by Jeff Shaw November 15, 2016

Strong renter demand for affordable apartments in affluent suburbs easily outstrips the available inventory of such properties. This supply and demand imbalance creates a big gap in the market that renovated older buildings can fill. These undervalued multifamily buildings also provide a healthy investment opportunity. Cranes dot the skylines of many American cities today, and much of the development is new luxury multifamily communities. For the last 10 years, the majority of the new apartments built have been high-end apartments, often in downtown areas. Underlying reasons Two main factors are driving developers’ preference for luxury urban apartments. First, developers are turning to urban areas because many suburbs are using zoning density restrictions to prevent multifamily construction. Developers may want to build in the suburbs, but suburban communities want to maintain the relatively small class sizes in their schools and the low crime rates associated with low-density areas, so they are not granting permits for new construction. Cities, on the other hand, are eager to welcome new residents to grow their tax bases, so they’re quick to provide permits for new multifamily construction. The second factor is rising construction costs. Excluding land costs, construction costs have risen 23 percent since 2010, …

November 15, 2016

Features Heartland Feature Archive Midwest Northeast Northeast Feature Archive Southeast Southeast Feature Archive Texas Texas & Oklahoma Feature Archive Top Stories Western Western Feature Archive

Forecast Survey: What’s Your Take on Real Estate in 2017?

by John Nelson November 8, 2016

REBusinessOnline.com is conducting a brief online survey of brokers, lenders and the owner/developer/manager community to gauge market expectations for 2017, and we welcome your participation. This survey should only take a few minutes to complete. The results will appear as a news feature story in the January 2017 issues of the regional publications. Questions cover a variety of topics, ranging from the outlook for investment sales and leasing activity in 2017 to development and lending opportunities to interest rates. Note: We prefer to attribute comments we quote from open-ended responses, however you may respond anonymously if you prefer. To take our 2017 broker survey, please click here To take our 2017 developer/owner/manager survey, please click here To take our 2017 lender survey, please click here Thanks for your participation! Matt Valley Editorial Director of Regional Real Estate Publications France Media, Inc.

November 8, 2016

Features Hospitality Texas Texas & Oklahoma Feature Archive Top Stories

Beware of RevPAR in Property Tax Valuations

by Haisten Willis November 3, 2016

When comparing hotels for valuation purposes, a common method of making adjustments for the difference between properties is to examine revenue per available room (RevPAR), a measurement of hotel performance. If executed poorly, these calculations can distort property value and lead to unfairly heavy tax burdens on hospitality owners. There are two different ways to calculate RevPAR. The first is to multiply the average rental income per room by the number of rooms occupied, then divide by the number of days in the period. The other method is to divide total guestroom revenue by the number of available rooms and divide that figure by the number of days in the period. In an article titled “Using RevPAR as a Basis for Adjusting Comparable Sales,” published in February 2002 by HospitalityNet.org, appraiser Erich Baum voiced a common argument shared by appraisers who advocate for RevPAR adjustments. Baum contends that the adjustments are appropriate because the revenue a hotel generates is tied to its location and the quality of its product. The question in valuation for property taxation is whether or not RevPAR incorporates additional, non-real estate values such as quality of brand, management, goodwill, etc., and whether or not the RevPAR …

November 3, 2016

Features Retail Top Stories

Finding the Right Strategies and Tactics is Key for Repositioning Retail

by Haisten Willis November 1, 2016

For real estate developers and investors, a time of transition and evolution within the retail world presents abundant opportunities to capitalize by acquiring and investing in underperforming spaces. With an infusion of capital, some strategic restructuring and re-tenanting with regional and national brands, a moribund center or underwhelming site can be transformed. Understanding the strategies deployed to effectively identify, acquire, reposition and re-tenant retail is an essential prerequisite for any commercial real estate professional looking to get involved in the process. The big picture The most critical step in the process is selecting the right opportunities to pursue in the first place. Identifying existing retail assets that are underperforming is one thing. Finding those that can be successfully reinvigorated and repositioned through an infusion of capital and the application of some expertise is a little trickier. It is a best practice to confine your search to well-established trade areas because you generally do not want a project on the fringe. The overall goal is to identify markets and trade areas where there is more demand than quality supply, and then work to find a creative and cost-effective way to deliver that supply. Once you identify those areas, familiarize yourself with …

November 1, 2016

Features Retail Top Stories

Shopping Center Rents Decline for First Time in Five Years, Says Cushman & Wakefield

by John Nelson October 27, 2016

The retail marketplace continues to undergo a period of retrenchment and reinvention, the likes of which we have not seen since the rise of the suburbs starting in the late 1950s. The new period of disruption has been fueled by the rise of e-commerce, in particular Amazon, with the emergence of smartphones and tablets acting as a major accelerator since 2010. Combined with a consumer base that downshifted into frugality mode during the Great Recession, the current marketplace is one of the most challenging retail landscapes of the past 50 years. In spite of these challenges, overall shopping center vacancy has actually continued to trend downward. Despite a significant increase in retail closures (through the third quarter Cushman & Wakefield has tracked over 4,000 major chain closures for 2016, surpassing 2010’s record of 3,600), as well as multiple notable bankruptcies, the disruption has not equally impacted all retail sectors. Digital media has effectively wiped out the video and record store sectors while creating major challenges for the remaining major bookstore chains. The consumer electronics and office supplies categories continue to face major headwinds from e-commerce, as do a number of other retail categories ranging from gifts to home furnishings. The …

October 27, 2016

Alabama Features Southeast Top Stories

Purchase Price Doesn’t Always Equal Property Tax Value

by John Nelson October 25, 2016

Don’t worry about challenging a property tax value that is less than the taxpayer’s purchase price, right? Wrong! There are numerous factors that distinguish a purchase price from a taxable assessed value, and the failure to closely review an assessment can cost a property owner dearly. The legal standard for determining property tax values can differ from state to state, but it is generally equivalent to fair market value. That is the probable price that the property would bring in a voluntary, arms-length transaction between a willing and knowledgeable buyer and seller, in an open and competitive market, with neither party being under undue duress, as of the valuation date. While it is possible for a purchase price to be the same or similar to market value, there are many instances where the two deviate. Here are some common examples: Related Parties Sales A sale is not an arms-length market transaction if it occurs between related parties and isn’t exposed to the open market. A sale between a company and its subsidiary, for example, may not reflect fair market value. Fee Simple vs. Leased Fee For property tax purposes, fair market value is most often based on the fee simple …

October 25, 2016

Newer Posts

Older Posts