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NEW YORK — The U.S. CMBS loan delinquency rate across the five major property types rose by five basis points in June, reports New York-based research firm Trepp LLC. Still, the delinquency rate is 60 basis points lower than it was a year ago. The rate of CMBS loans at least 30 days delinquent inched up to 5.45 percent in June from 5.40 percent in May. By comparison, the delinquency rate registered 6.05 percent in June 2014. The cause for the rise in the delinquency rate in June was $1.4 billion in newly delinquent loans, fueled by several that are each nearly $100 million, according to Trepp research analyst Sean Barrie. The newly delinquent loans include $97.9 million for 390 Park Ave. in New York City and two identical $99.75 million loans for the NGP Rubicon GSA Pool, which covers industrial and office buildings in multiple markets. The $1.4 billion in new delinquencies was partially balanced by $1.1 billion in previously delinquent CMBS loans that were paid off either at par or with a loss, says Barrie. By property type, the multifamily and retail sectors each saw an increase of 11 basis points in the delinquency rate — to 8.73 …

Two compelling trends have emerged on the commercial real estate lending and investment front during the first half of 2015. First, commercial real estate buyers with an abundance of funds and a yearning for yield have poured more capital into the Midwest amid heady prices in major coastal markets. Second, the increase in spending has transpired in an environment marked by two potential market-disrupting forces: interest rate volatility and temporary anxiety over the role Fannie Mae and Freddie Mac will play in the apartment financing market. Investment sales of office, industrial, retail, apartment and hotel properties through the first five months of 2015 in the Midwest totaled $19.6 billion, according to New York-based Real Capital Analytics (RCA), which tracks property and portfolio sales of $2.5 million and above. That $19.6 billion sum has already surpassed the volume of property and portfolio sales in the 10-state region during the first half of 2014 by $3 billion, and it represents 10 percent of national dollar volume year-to-date through May, according to RCA. Over the past 17 months, capitalization rates in the Midwest have generally remained flat or declined by approximately 30 basis points, reports RCA. The cap rates across the region are …

Technological innovation is radically changing how and where people choose to work, live and play, essentially forcing us to rethink the built environment — and our place in it. Elie Finegold, senior vice president of global innovation and business intelligence at CBRE, recently discussed three trends that are reshaping the way people will use real estate in the future with Blueprint, CBRE’s online magazine. According to Finegold, from broad access to WiFi and smartphones to ever-lighter laptops and more powerful tablet devices, technology has created an inextricably connected world. With the virtual barrier between work and home all but gone, the way people think about real estate is fundamentally changing. “This industrial-era concept that there is a separation between work and home is becoming increasingly less relevant,” says Finegold. “Because you can work from anywhere, space has become more fungible.” Finegold believes there are three emerging trends reshaping the way people will use real estate in the future. 1. Radical Mobility The ability of people and machines to work from anywhere is transforming the utilization of traditional spaces. “If you conduct a survey and ask people, ‘Have you worked in a living room, a bedroom, a plane, an office, an …

CHICAGO — Demographic shifts such as the impact of retiring Baby Boomers and the rise of the Millennial generation will likely have the most significant impact on real estate for the long term, according to The Counselors of Real Estate (CRE), which recently released its 2015-16 Top 10 Issues Affecting Real Estate. Many of the issues on the list have strong interrelationships and affect multiple property sectors. Excess capital supply — funds largely flowing into U.S. real estate purchases from foreign institutional and private investors, and rising interest rates — was ranked second and third on the list. “This list reflects a higher degree of economic uncertainty than in years past,” says Noah Shlaes, 2015 CRE chair. “Anticipation of rising interest rates, continued currency devaluation, and excess capital flowing into the United States are all on the minds of our membership. Combine this with a growing wage gap and major changes in demographics, and we’ve got a lot to think about this year.” The CRE 2015-16 Top 10 issues Affecting Real Estate  1. Demographic Shifts: Two key demographics groups, large numbers of retiring “Baby Boomers” (born between 1946-1964) and the next large population wave, the Millennials (born between 1980-2000), will have …

WASHINGTON — Office rents in the second quarter of 2015 increased in more than 70 percent of markets in the United States, according to a soon-to-be-released report by global commercial real estate services firm DTZ. U.S. office rents increased 2.7 percent in the second quarter of this year compared to a year ago, the strongest quarterly gain since peaking in 2008, the report found. Office rents rose in 59 out of the 80 metros tracked, and the construction pipeline continued to expand. U.S. markets absorbed 20.1 million square feet of office space in the second quarter of 2015, up 15.3 percent from the same quarter one year ago, DTZ has discovered. Demand for office space continues to outpace new development, which pushed vacancy rates down 20 basis points from the first quarter of 2015 to 14.2 percent in the second quarter of 2015. In the second quarter of 2015, there was 107.7 million square feet of new office construction, up 36 percent compared to the same quarter one year ago. Of the 80 metropolitan areas tracked by DTZ, 68 of them reported occupancy gains. “Net absorption is solid and picking up steam, which links directly to office-using job growth and …

After lending at a furious pace during the first quarter, Fannie Mae and Freddie Mac’s multifamily business divisions were in serious jeopardy of exceeding annual loan production of $30 billion apiece — the mandated cap for the agencies in 2015. Fannie Mae provided $10.4 billion of multifamily loans in the first quarter alone, while Freddie Mac nearly matched that total with $10 billion. Compared to the first quarter of 2014 when Fannie’s multifamily loan volume was $3.5 billion and Freddie’s was $3 billion, the agencies have posted a year-over-year growth of 197 percent and 233 percent, respectively. Due to the heavy deal volume already generated by the two government-sponsored enterprises (GSEs) this year, the consensus among capital markets experts was that the Federal Housing Finance Agency (FHFA) — which regulates their activity — would raise the cap. Instead, in early May the FHFA revised its list of exclusions, thereby expanding the types of multifamily properties that don’t count against the lending cap. The FHFA’s newly revised exclusions now include properties with units affordable to renters at 60 percent of area median income (AMI) in all markets, 80 percent of AMI in “high-cost” markets, 100 percent of AMI in “very high-cost” …

Don’t look now, but there could be a land rush taking place as fast casual restaurant chains expand across the United States. Fast casual restaurants, a blend of quick service and casual dining, are quickly growing in popularity as consumers gravitate toward higher-quality foods when grabbing a quick lunch or dinner. The fast casual concept offers customization in menu choices and freshly prepared dishes. Fast casual restaurants usually do not include a drive-thru window or table service. While there is no standard definition for fast casual, most in the industry agree on certain aspects of the category. “Fast casual is typically a non drive-thru restaurant where customers order at the counter and seat themselves,” says Michael Walters, vice president of Falcon Restaurant Advisors, a Dallas-based company that represents restaurant concepts and landlords on a national basis. “Fast casual restaurants also source most of their products locally, and avoid frozen foods wherever possible.” Walters says the restaurants are growing so fast because there is a high demand for them and, for now, a lack of supply of space for them to locate. The combined sales of fast casual restaurants in the United States grew by 10.5 percent in 2014, compared with …

WASHINGTON, D.C. — The Architecture Billings Index (ABI) has increased in May following its second monthly drop this year. The ABI posted a score of 51.9, up from a mark of 48.8 in April. The score reflects an increase in design activity, with any score above 50 indicating an increase in billings. The increase in design activity was led by a growing demand for new schools, hospitals, cultural facilities and municipal buildings. A barometer of future non-residential construction activity, the ABI reflects the roughly nine- to 12-month lead time between architecture billings and construction spending. The index is produced by The American Institute of Architects (AIA) Economics & Market Research Group. The score is tabulated based on a monthly survey sent to a panel of AIA member-owned architecture firms. “As has been the case for the past several years, while the design and construction industry has been in a recovery phase, we continue to receive mixed signals on business conditions in the marketplace,” says Kermit Baker, AIA’s chief economist. “Generally, the business climate is favorable, but there are still construction sectors and regions of the country that are struggling, producing the occasional backslide in the midst of what seems to …

The “first-quarter blues” are over for the U.S. economy, which bodes well for commercial real estate during the reminder of 2015, according to real estate services firm DTZ. The report, titled U.S. Macro Forecast June 2015, written by the company’s chief economist Kevin Thorpe and economist Rebecca Rockey, suggests the disappointing GDP figure recorded during the first quarter (GDP contracted 0.7 percent on an annualized basis) has been a recurring issue in recent years. “This has been such a pronounced post-recession trend — weak first-quarter figures followed by solid growth in the remaining three quarters — that the U.S. Department of Commerce is actually revisiting how it calculates seasonal factors, which may be missing important features of the economy’s performance during the winter months,” according to the report. One reason for DTZ’s optimism is that low oil and gas prices haven’t yet stimulated increased consumer spending up to this point — a trend the report says “will soon change.” Additionally, U.S. consumers have been very conservative, increasing the personal savings rate from 4.6 percent to 5 percent from November 2014 to April 2015. “In other words, consumers are choosing to hold on to any extra savings from the gas pump …