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Mogul Minute 09/23/2016
September 23 | 2016

Here at RealtyMogul.com, we keep our finger on the pulse of all things real estate, from finance to technology and everything in between. We make a point of sharing interesting articles and think pieces among RealtyMogul.com staff to help our team stay abreast of the market, and ahead of the curve.

So we thought, why not share some of these insights with you, our partners?

Got A Minute? Here’s some recommended reading with key points from the content:

Suburban Apartment Buildings Match Downtowns for Price Appreciation (NREI)

  • Per MPF Research, the market intelligence division of RealPage Inc., “returns from property appreciation over the past five years were virtually tied between suburbs and downtown areas (across the top 50 US apartment markets).” Across both the suburbs and CBD, price appreciation averaged 7.3% over the past five years.
  • Over the past year, rents have grown at more than 4% in prime suburban and suburban markets compared to less than 2% in central business districts (CBDs).
  • “Urban areas have enormous volatility in rent movement—and got hit the hardest in the last recession. Top tier suburbs got hit less in the recession, and perform just as well, if not better, in good times.” – Jay Parson, vice president for MPF.
  • However, apartments in CBDs can generally hold their price appreciation better in downturns. “Urban areas still benefit from superior capital appreciation… They will hold their value better in bad times. Not because of cash flow, obviously, but because of perceived liquidity” says Parsons.

First Conduit Offering of September Prices at Wide Levels (Trepp Talk)

  • The $1B conduit (WFCM 2016-LC24) priced at spreads a fair bit wider than the average of the previous three conduits amid “uncertainty over a potential Fed rate hike, recent financial market volatility, and a packed pipeline of new deals for the rest of the month.”

Student Housing Newsletter Fall 2016 (Axiometrics)

  • Supply for off-campus student housing nationally is down from the highs of 2013-2014 and next fall is “expected to be at a similar level or slightly above, with 45,700 beds identified.” A good visual representation here:

  • Another great chart showing the universities with the most supply for 2016 as well as a comparison to past years and 2017:

Kmart to Shutter 64 More Stores (Connect)

  • Sears is planning to close 64 more Kmarts by the end of the year.

Blackstone Bets Big on Logistics (WSJ)

  • More strong momentum for the industrial sector as Blackstone has just purchased a $1.5B portfolio from Irvine based LBA Realty. The portfolio totals 12M SF and marks Blackstone’s biggest purchase of US distribution centers since they exited the logistics business in 2015 by selling IndCor Properties ($8.1B portfolio).

Facebook Selects Albuquerque for $1.8B Data Center (Commercial Property Executive)

  • Facebook has chosen Los Lunas, NM (just south of Albuquerque) as the site for its brand new data center. The project is a $1.8B build-to-suit for the social media giant and will create 300 temporary jobs as well as 50 permanent jobs.
  • “The Los Lunas facility will be one of the most advanced, energy-efficient data centers in the world. It will feature the latest Open Compute Project hardware designs, and it will be cooled using indirect evaporative cooling systems that emphasize efficiency, while protecting the servers from the frequent dust storms that occur in New Mexico."
 
Tim Ednoff Headshot
Written by , Associate - Commercial Equity at RealtyMogul.com

Tim evaluates investment opportunities as well as performs due diligence and writes content for various equity and debt transactions. Outside of the office, Tim is an avid sneaker collector, a passionate health and fitness advocate, and a dedicated podcast enthusiast.

 
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