Features

State of the Industry Hunter Hotel Conference

Hotel Experts Preach Opportunistic Mindset at Hunter Hotel Conference

by John Nelson March 17, 2016

ATLANTA — Too often hoteliers are so immersed in executing their business plans they miss golden opportunities that suddenly arise, according to hotel experts speaking at the 28th annual Hunter Hotel Conference. During the “State of the Industry” panel, executives from Blackstone, Starwood Capital Group, Rockbridge, MCR Development LLC and Apple Hospitality REIT took the stage to discuss opportunities they see in the marketplace. Tyler Morse, CEO and managing partner of MCR Development, said the lodging industry in the United States will present ample opportunities in the next couple years. “The hotel space in particular in the U.S. economy is going to be great in 2016 and 2017. The rest of the world is kind of a disaster,” said Morse. “Funds are coming to the U.S. as a flight to quality. The U.S. is where the growth is, and the hotel business is a beneficiary of that.” In a real-world example of being opportunistic, Brian Kim, managing director of real estate at Blackstone, spoke about how the firm’s recent $6.5 billion sale of Strategic Hotels & Resorts to Beijing-based Anbang Insurance Group Inc. wasn’t the original strategy for Blackstone. Having just closed on the Strategic purchase in December 2015, Blackstone’s …

March 17, 2016

Features Healthcare Top Stories

Duke Realty Identifies Five Healthcare Real Estate Trends to Watch in 2016

by John Nelson March 15, 2016

INDIANAPOLIS — What does the future hold for the healthcare real estate industry in 2016? In a new white paper penned by Keith Konkoli, executive vice president of healthcare at Duke Realty (NYSE: DRE), the author predicts the industry will experience an increase in the development of new facilities, as well as an uptick in consolidation in 2016. Here’s a summary of five key trends and issues the firm expects this year and beyond: 1. Healthcare real estate construction will continue to increase — Healthcare development has been strong in recent years, and there should be no letup in activity in 2016. A recent study by the American Institute of Architects (AIA) says it expects “healthy growth” for non-residential construction this year. That includes the healthcare sector, which AIA predicts will experience a 5.8 percent increase in construction in 2016. The industry is experiencing an uptick in the development of a wide variety of healthcare properties, including rehabilitation hospitals, medical office buildings and off-campus emergency rooms/community micro-hospitals. Even so, the industry hasn’t reached a point of saturation and providers aren’t yet overbuilding. 2. Healthcare providers will need to deal with the challenges of ‘site neutrality’ — An important but perhaps overlooked …

March 15, 2016

InterFace Seniors Housing West Conference, Los Angeles

Conference Coverage Features Top Stories

InterFace Panelists: Seniors Housing Industry Faces Stiff Competition from Each Other, Multifamily Developers

by Jeff Shaw March 10, 2016

LOS ANGELES — Investors of all types are clamoring to cash in on the Baby Boom generation, as this aging population readies to kick off a 20-year need for care and seniors services. That’s according to panelists at InterFace Conference Group’s Seniors Housing West conference, held March 3 at the Omni Los Angeles Hotel. Those looking for a long-term investment are betting heavily on the Boomer population, which is 76.5 million strong, with the oldest being 69 and the youngest turning 50 this year. “The first Boomers are only turning 70 this year,” said keynote speaker Lynne Katzmann, president and founder of Juniper Communities. “They have a decade to go before they need services, but they are today’s primary buyer.” Much of this demographic will have a strong understanding of seniors housing options by the time they need the services themselves, Katzmann asserted, because they will have been down that road before with their aging parents. With this in mind, Katzmann believes it’s incumbent upon the current developers and operators to not just offer the best in senior care, but to invest in their facilities and in client (aging parents and their children) education as well. “We must take action …

March 10, 2016

InterFace Net Lease conference, March 1, Omni Los Angeles Hotel

Conference Coverage Features Top Stories

Net Lease Investors Are Realists About Potential Changes in the Market, Say InterFace Panelists

by Jeff Shaw March 9, 2016

LOS ANGELES — The net lease market has, by and large, enjoyed a steady run post-recession. But many investors are entering 2016 with a sentiment that an uncertain future may lie ahead, according to panelists at InterFace Conference Group’s Net Lease West conference, held March 1 at the Omni Los Angeles Hotel. This sobering reality was inspired by a few factors, including a likely hike in interest rates, a bulk of CMBS loans coming due, a discrepancy in pricing between buyers and sellers, rising cap rates, the possible dissolution of 1031 exchange transactions and a bull market that has lasted longer than average. CMBS Wall Creates Opportunities for Buyers Gordon Whiting, managing director at Angelo, Gordon & Co. and a “State of the Industry and 2016 Outlook” panelist, believes now is a good time for buyers to begin infiltrating the market due to the girth of CMBS loans coming due. More than $300 billion is set to mature between 2015 and 2017, according to the Mortgage Bankers Association. Rather than refinancing, panelists noted some borrowers were choosing to sell ahead of maturity. “I have clients who have chosen to put their properties on the market because the debt is …

March 9, 2016

Features Retail Top Stories

Sports Authority Unveils List of 140 Store Closures

by Katie Sloan March 7, 2016

ENGLEWOOD, COLO. — Englewood-based Sports Authority Inc. has made public a list of 140 stores it plans to close in conjunction with the retailer’s move to file for Chapter 11 bankruptcy protection. Sports Authority has received access to up to $595 million in debtor-in-possession financing in conjunction with the Chapter 11 filing in the District of Delaware. The company has received court approval to begin liquidating stores with a portion of its $595 million bankruptcy loan. The decision to close stores follows a comprehensive review of the Sports Authority portfolio in light of the increasing amount of shopping that is occurring online, the company stated in a March 2 press release. “As a result of these changes in consumer buying patterns, Sports Authority determined that it needs fewer stores as part of its long-term business model,” according to the press release. (For more on what ultimately led the sporting goods retailer to file for Chapter 11 bankruptcy protection, click here.) The following store locations are set to close in the coming months based on a review of the court filing by REBusinessonine.com State City Address Arizona Casa Grande 1004 N Promenade Parkway, Ste 159 Arizona Mesa 1812 W Rio …

March 7, 2016

Conference Coverage Features Top Stories

Flexibility is King in the Future of Healthcare, Say InterFace Panelists

by Jeff Shaw March 3, 2016

LOS ANGELES — Healthcare providers are taking cues from the retail and hospitality industries and keeping an open mind. That’s according to panelists at InterFace Conference Group’s Healthcare Real Estate West conference, held March 2 at the Omni Los Angeles Hotel. The biggest lessons the healthcare industry has internalized, panelists noted, was making the customer king, remaining flexible and embracing technology — even if the future of that technology is uncertain. “The buzzword today is omnichannel,” said Andy Hoover, real estate manager for the California region of Providence Health and Services and a participant in the “Impact of Consolidation and Changing Healthcare Delivery” panel. “It’s more like retail today. It’s a customer-focused delivery model — essentially a retail delivery model. It’s a blend of physical and digital components. It’s really not what you put into it. It’s what the customer gets out of it and what they’ll pay for.” The healthcare system of the future is looking to integrate mobile apps that allow customers to refill prescriptions, make appointments, view test results and potentially even hold virtual visits with their physicians. Healthcare systems are also moving away from hospitals and campuses with long-held, negative stigmas surrounding them. “The medical office …

March 3, 2016

Features Multifamily Office Retail Top Stories

Construction Deliveries Increase Across Property Types, Says Reis

by Christina Cannon March 1, 2016

As 2015 came to an end, construction deliveries for the office, retail and apartment sectors were on the rise, according to Reis. That trend is expected to continue through 2016, the New York-based commercial real estate data firm says. For the fourth quarter of 2015, the apartment sector recorded its third consecutive quarter above 50,000 units delivered. Deliveries for office properties were above 9 million square feet for the third consecutive quarter. Retail deliveries increased for the second consecutive quarter. Apartment Sector Ramps Up “2015 was the highest year for apartment construction since 1999,” says Ryan Severino, senior economist and director of research at Reis. “With the pipeline continuing to swell, completion figures for 2016 are expected to exceed those from 2015.” Texas markets led deliveries for new apartment units, with Houston posting 4,330 new units and Dallas delivering 3,178 units in the fourth quarter of 2015. Behind the Lone Star State is Seattle, posting 2,806 newly constructed units. Los Angeles delivered 2,795 units, and Denver added 2,671 units to the multifamily landscape. Office Sector Stays Steady Office construction has slowly increased over the last few quarters. The fourth quarter of 2015 ended with just under 11 million square feet …

March 1, 2016

Entertainment Experience Evolution Panel, Los Angeles

Features Retail Top Stories Western

The Only Thing Constant in Retail Today is Change, Say EEE Panelists

by Jeff Shaw February 25, 2016

LOS ANGELES — The old formula for shopping center success no longer applies today, thanks to the advent of mobile technology, e-commerce competition and changing consumer tastes. This was the sentiment put forth by speakers and panelists at Shopping Center Business’s Entertainment Experience Evolution conference, held Feb. 24 and 25 at Regal Cinema House and the J.W. Marriott at L.A. Live in Los Angeles. Jerry France, chairman and CEO of France Media, set the stage during his opening remarks where he noted how far the retail industry has come — and how much potential is still in store. “We live and work in a very interesting country and are in a very exciting industry,” he said. “Having been in this industry for 50 years, I have seen a lot of change. Today we see a change in retail due to e-commerce versus bricks and mortar. We’re now seeing some e-commerce companies becoming bricks and mortar, so it goes both ways.” “I would not write retail off,” France continued. “I see tremendous growth ahead of us, with lots of new projects.” Indeed, there are many “new” projects on the horizon, though the meaning of this term has changed right alongside the retail …

February 25, 2016

Features Georgia Southeast Top Stories

Dhawan: China Spooks Stock Market Bull

by John Nelson February 25, 2016

ATLANTA — China’s “sloppy” attempt to manage the devaluation of its currency, the renminbi, and the declining demand for Chinese products from the United States and Europe are the main culprits behind the stock market’s woes, says economist Dr. Rajeev Dhawan of Georgia State University (GSU). “Who got to the stock market bull?” asked Dhawan during the quarterly forecast conference held at GSU on Wed., Feb 24. “Just like in old Chuck Norris movies, the chief villain is the Chinese economy.” For the second time in six months, China’s attempt to manage the devaluation of its currency sent shockwaves through global equity markets. Year-to-date through Feb. 24, the Dow Jones industrial average was down 940 points, or 5.4 percent. What would lead China to devalue its currency? Dhawan says that China could be attempting to impress the United Nation’s International Monetary Fund (IMF) with the currency manipulation. Countries try to devalue their currencies in order to combat trade imbalances, point out industry experts. A weaker currency could help a country like China to boost trade exports, shrink trade deficits and reduce sovereign debt burdens, since a “weaker currency makes debt payments effectively less expensive over time,” according to Investopedia. Whatever …

February 25, 2016

Features Multifamily Top Stories

Ten-X Selects Orlando as Best Multifamily Market for Buyers

by John Nelson February 23, 2016

IRVINE AND SILICON VALLEY, CALIF. — Ten-X, formerly Auction.com, has released its list of the multifamily sector’s top buy and sell markets in the United States, with Orlando ranked as the No. 1 market for buyers. The list was included in the company’s Multifamily Market Outlook report, which is based on third-quarter 2015 data from Reis and forecasted fundamentals from Ten-X Research. Rounding out the top five apartment markets for buyers are Raleigh-Durham, N.C.; Fort Lauderdale, Fla.; Phoenix; and Sacramento, Calif. Ten-X ranked Orlando as the No.1 market for apartment buyers because the metro’s monthly effective rental rate per unit is expected to jump from $970 in 2015 to $1,169 in 2019, a nearly 21 percent increase during that period. The market’s vacancy rate is also expected to contract from 5.3 percent in 2015 to 4.3 percent in 2019. Ten-X expects Orlando’s multifamily supply pipeline to remain heavy in the near future. Even with the new construction, vacancies are expected to decline to the low 3-percent range and settle in at the low-4 percent range during the next few years. Orlando’s total employment is now at a record high, surpassing its 1990s peak and recently notching greater than 4.5 percent …

February 23, 2016

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