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WINNING IN GROWTH CITIES- Cushman & Wakefield Capital Markets Research- #CRE


Guy Masse, CCIM, SIOR
Senior Vice President
Cushman & Wakefield
999 de Maisonneuve Blvd. W., Suite 1500
Montreal, Quebec H3A 3L4
Tel.: 514 841 3830
guy.masse@ca.cushwake.com
http://guymasse.com
https://twitter.com/YourTenantRep

Categories: Investment

C&W MARKETBEAT-U.S. Capital Markets Q1 2016 – #CRE


Guy Masse, CCIM, SIOR
Senior Vice President
Cushman & Wakefield

999 de Maisonneuve Blvd. W., Suite 1500
Montreal, Quebec H3A 3L4
Tel.: 514 841 3830
guy.masse@ca.cushwake.com

http://guymasse.com

https://twitter.com/YourTenantRep

Categories: Investment

C&W INTERNATIONAL INVESTMENT ATLAS 2014


INTERNATIONAL INVESTMENT ATLAS 2014
Our Global Capital Markets and Research teams are pleased to announce the latest release of our market-leading International Investment Atlas, launched this morning at an exclusive client event at MIPIM, the international real estate show. The report provides an introduction to the world’s key commercial real estate investment markets in 2013 and an indication of activity in 2014.
This year, the scope of the report has altered to include four separate parts, including a Global Summary as well as three Regional Market Profiles for The Americas, Asia Pacific and EMEA, which include page by page country overviews totalling 55 global countries.

KEY MESSAGES:
Momentum is building as confidence returns
Demand is broadening to new areas and sectors
A rapid but front-loaded recovery is now underway
Change, not growth, is set to drive medium term demand and performance
Investors are well advised to buy the stock – not the market

HIGHLIGHTS FOR 2013 AND THE• YEAR AHEAD: Global property investment rose 22.6% in 2013 over 2012, with volumes reaching USD1.18 trillion – the highest global total since 2007.
• Asia Pacific saw the fastest growth in investment volumes of any region in 2013, with a 25% increase delivering a year-end volume of USD568.6 billion, 48% of the global market.
• In EMEA a strong final quarter drove volumes to a six year high of USD246.3 billion in 2013, 23% up on the previous year.
• In Latin America investment activity fell 13% in 2013 to USD5.7 billion after a weaker second half of 2013.
• North America saw overall volumes rise by 19% to USD359 billion (30% of the global market), driven by the USA but with demand in Canada also strong, albeit activity levels were similar to that of 2012.
• Global investment volumes in 2014 are expected to be above that of 2013, reaching USD1.33 trillion, with the USA and Western Europe driving the increase.
ACCESS
All sections of the report as well as global contacts are free to download at our dedicated report website, which you can access either following the link provided or by clicking on the image below:
http://investmentatlas.cushwake.com

Alternatively, this report and a wide range of White Papers, Special Reports and more can be easily accessed on the Research page of our global website.

Market Trends | CCIM Institute

November 25, 2013 Leave a comment

images

Market Trends | CCIM Institute.

Market Trends

High-Priced Office Markets

The location for the top five most expensive streets for office space — San Francisco Bay Area, New York City, Fairfield County, Conn., and Washington, D.C. — haven’t changed in two years, they’ve simply shuffled places, according to Jones Lang LaSalle’s recent report. However, a comparison of the 2013 and 2011 rankings illustrate the difference between the fates of the No.1 and No.5 markets. The Bay Area registered a 30 percent increase in average market rents psf from 2011 to 2013; No.5 ranking Washington, D.C., clocked a 33 percent decrease in average office rents psf. In between, New York, Silicon Valley, and Fairfield County registered increases of 12 percent, 21 percent, and 14 percent respectively.

“The pendulum is slowly shifting from a tenant’s market to a landlord’s market. Supply/demand fundamentals suggest the bulk of the country will be pushing office rents upward by this time next year.”

Kevin Thorpe, Chief Economist at Cassidy Turley, 3Q13 Office Market Report

Briefly Noted

Hospitality — Fifteen of the top 25 hotel markets tracked have recovered their prerecession peak revenue per available room rate as of August, according to STR. Two more markets are expected to recover by year-end, with four more recovering in 2014 and the final four in 2015. San Francisco tops the list with a $148.60 RevPAR, a 20 percent increase over its prerecession peak.

Industrial — No one is sure how etailing will change U.S. logistics, but CBRE suggests that a combination of large national or regional distribution centers and local or urban parcel hubs will be the norm going forward. Online retailing will support “a substantial expansion in leasing demand for smaller cross-docked parcel delivery centers that are close to major urban areas, with parcel courier companies accounting for a growing proportion of demand,” says Richard Holberton, director of CBRE Econometrics.

Multifamily — The average overall apartment capitalization rate is at 5.6 percent, according to the 3Q13 PwC Real Estate Investor Survey, the lowest cap rate in five years. Investors surveyed for the report see cap rates holding steady for the next six months.

Office — Nine of the 13 largest markets issued declining office vacancy rates in 3Q13, according to CBRE. Dallas showed the largest decline — 100 bps — followed by Phoenix, Washington, D.C., and Seattle.

Retail — Is it time for new big-box development? Perhaps says Marcus & Millichap’s 3Q13 Net-Leased Report. While big-box retailers are downsizing to smaller formats in urban areas, elsewhere the infill inventory is shrinking due to re-leasing during the recession. Net lease sales of big-box product increased 16 percent YOY, as appliance, furniture, and DIY enjoyed brisk sales, spurred by a stronger housing market.

“The lack of a knee-jerk reaction to higher interest rates on the part of investors also reflects their confidence in the industry.”

3Q13 PwC Real Estate Investor Survey

Legislative Update: FASB

More than 500 comments were submitted to the Financial Accounting Standards Board and the International Accounting Standards Board’s advisory committee, many of them criticizing the plan to overhaul lease accounting rules next year. CCIM Institute participated in coalitions that submitted comments to FASB/IASB. Concerns specific to the real estate industry include:

•  Increase in recorded lessee liabilities would result in unexpected technical violations of financial debt covenants, offering lenders the opportunity to restrict credit availability.

•  Lenders will likely require monetary penalties that violate debt covenants.

•  Changes would increase the cost of lending and reduce availability of credit.

•  Firms would face increased administrative costs for financial reporting, accounting functions, and internal controls.

•  Companies may seek shorter lease terms, resulting in reduced borrowing capacity for investment real estate.

FASB/IASB plans to make a final decision in 2014 with a goal of implementing new rules in 2017.

Go to CCIM.com for further updates on current legislation and look for the 2014 Legislative Outlook in January/February 2014 CIRE. 

– See more at: http://www.ccim.com/cire-magazine/articles/323307/2013/11/market-trends#sthash.TaSUsCnd.dpuf

—————————————————————————————————————————————————

Guy Masse, CCIM, SIOR

Senior Vice President Cushman & Wakefield

2001 University, suite 1950

Montreal, Quebec

H3A 2A6

Tel.: 514 841 3830

guy.masse@ca.cushwake.com

http://guymasse.com

Hold, Sell, or Exchange? | CCIM Institute| #CRE #SIOR

November 13, 2013 Leave a comment

images

Financial analysis

Hold, Sell, or Exchange?

Consider Financial and Nonfinancial Issues When Determining Whether to Sell an Investment Property.by Letty M. Bierschenk, CCIM, Kurt R. Bierschenk, CCIM, and William C. Bierschenk, CCIM

CCIMs and other commercial real estate professionals are often involved with raising money from groups of investors to purchase income-producing properties. Since this activity generally means working under the federal securities laws, the ability to advertise and solicit investors has historically been restricted. However, the Jumpstart Our Business Startups Act, known as the Jobs Act, has dramatically changed the way group investment money is going to be raised.

What Changed?

In its July 10, 2013, meeting, the Securities and Exchange Commission adopted the new Regulation D, Rule 506(c) as authorized by the Jobs Act (Title II), which became effective September 23, 2013. (See SEC Release No. 33-9415, Eliminating the Prohibition Against General Solicitation and General Advertising in Rule 506 and Rule 144A Offerings.) Under the new rule, persons such as issuers, sponsors, syndicators, or promoters selling “securities” to private investors to fund their companies or real estate transactions will be able to advertise their private-investment opportunities under certain conditions.

Anyone who is raising money from multiple investors is probably selling securities. Securities include promissory notes or investment contracts between a manager and passive investors. Under the Securities Act of 1933, sales of securities must be registered with the SEC unless exempt.

By far the most common exemption has been the Rule 506 private offering exemption. As much as $898 billion may have been raised in Rule 506 offerings in 2012, according to the SEC. From 2009 to 2012, the average offering size was $30 million and the median offering size was $1.5 million.

The Old Rule 506

Under the original Rule 506, which will now be known as Rule 506(b) and is still in effect, issuers of securities are exempt from SEC registration as long as they follow the rules for the exemption. Rule 506(b) allows issuers to raise an unlimited amount of money from an unlimited number of accredited investors and up to 35 “sophisticated” investors, but issuers cannot make any offers or sales of the securities by any means of general advertising or solicitation. To prove they didn’t solicit investors, issuers must be able to demonstrate a pre-existing relationship with an investor that predates any current or contemplated offer to sell securities. For issuers relying on Rule 506(b), investors may self-certify that they are accredited or sophisticated by checking a box on a prequalification form the issuer provides.

For real estate syndicators who want to issue their own securities, the pre-existing relationship and nonsolicitation provisions of Rule 506(b) have been a source of great confusion, misinterpretation, and a significant impediment to funding their real estate transactions. The new Rule 506(c), which allows syndicators to advertise their real estate offerings, eliminates that obstacle and provides new opportunity for CCIMs and other commercial real estate professionals.

The New Rule 506(c) Solution

Under Rule 506(c), real estate syndicators can advertise to anyone as long as they only accept accredited investors in their offerings and comply with the rest of the Rule 506(c) provisions.

However, there are strings attached. Issuers of Rule 506(c) offerings must demonstrate that they are “reasonably assured” that all investors are accredited. The SEC has offered some nonexclusive methods to verify an investor’s accredited status, which include:

• reviewing filed tax forms for the past two years and written assertions from the investor(s) that the income is expected to continue;

• reviewing brokerage house or bank statement balances or tax assessments and third-party appraisals of real estate holdings and liabilities through an investor’s credit report;

• obtaining a written confirmation from a securities broker-dealer, registered investment adviser, licensed attorney, or certified public accountant, who asserts having taken reasonable steps to verify an investor’s accredited status within the past three months; and

• using repeat investors: there is an exemption for investors who have previously invested with an issuer as an accredited investor.

“Bad Boy” Prohibitions

The SEC also adopted amendments to existing rules 501 and 506 to implement Section 926 of the Dodd-Frank Act, also effective September 23, 2013, to be known as Rule 506(d). These amendments disqualify certain convicted felons and other “bad actors” from claiming a Rule 506 exemption. Bad actors are defined as persons who have been convicted of, or are subject to, a cease-and-desist order, injunction, or disciplinary order issued by certain federal financial regulatory agencies or the Postal Service. If these events occurred before the effective date of September 23, 2013, these individuals may still operate under Rule 506, but mandatory disclosure of such disqualifying events is required.

The SEC has proposed other amendments to Rule 506(c) offerings, including requiring additional Form D filings for presale, first sale, and closing notices of securities; filing of additional information about the issuer, marketing methods to be used, additional legends, and disclosures; and temporarily submitting written ads to the SEC prior to use. The SEC is taking public comment on these amendments and the final rule could be issued by year-end.

Clarifying Crowd Funding

However, none of these rulings should be confused with crowd funding, which is completely unrelated to Rule 506. Crowd funding is a different funding scenario authorized in a separate part of the Jobs Act (Title III). The premise is that investors will be able to invest as little as $1,000 for offerings advertised through SEC-authorized funding portals. To further confuse matters, the media and certain promoters have hijacked the term crowd funding to describe Rule 506(c) offerings conducted on the Internet.

Despite Internet and news reports to the contrary, the SEC has not approved crowd funding. On October 23, 2013, the SEC met and the commissioners voted to submit for public comment the proposed rule that will authorize crowd funding. The public comment period is 90 days. After that, the SEC will determine if revisions to the proposed rule are required and vote on a final rule. The rule becomes effective 60 days after it is published in the Federal Register. Crowd funding will probably become a reality during first quarter 2014. However, according to the SEC’s own website, until the final rules are effective, all crowd funding offerings are unlawful.

While the changes authorized in the Jobs Act are exciting, many have yet to be implemented. Commercial real estate professionals involved with group investing should proceed with caution and verify information heard in the media and on the Internet through the most reliable source: http://www.sec.gov.

Kim Lisa Taylor, Esq., is a California and Florida licensed attorney with practice areas in real estate investment and securities law. Contact her at kim@syndicationlawyers.com. Gene Trowbridge, Esq., CCIM, is a California licensed attorney, senior CCIM instructor, and author of “It’s a Whole New Business,” on real estate syndication. Contact him at gene@genetrowbridge.com. A version of this article previously appeared in Personal Real Estate Investor.
– See more at: http://www.ccim.com/cire-magazine/articles/323317/2013/11/group-investing-update#sthash.1pvuux57.dpuf

Categories: Investment

Intro to real estate investing from @CarltonDeanCRE #CRE #CCIM #SIOR

November 2, 2013 Leave a comment

Intro to real estate investing from Carlton Dean </div

http://carltondean.blogspot.ca/

Carlton Dean
@CarltonDeanCRE
Investment Real Estate Advisor covering FL and SE, Purveyor of Multifamily, Retail and NNN Income properties, CCIM, amateur comedian Tallahassee, FL · svnNorthFlorida.com

Categories: Investment

C&W Report – Global property investment volumes to exceed $1tn in 2013 | #CRE #CCIM #SIOR

March 14, 2013 Leave a comment

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Global property investment volumes to exceed $1tn in 2013.

According to Cushman & Wakefield’s latest International Investment Atlas released today, the global property investment market saw a modest 6% rise in activity during 2012 with volumes reaching US$929bn (€714bn).
In what was a difficult year in most markets, investment volumes rallied in Q4 signalling the beginning of real momentum and a return of confidence in the market which could see volumes this year increase 14% to exceed US$1 trillion mark (€815bn) for the first time since 2007.

According to Cushman & Wakefield, the increase in activity this year will be led by North America and Asian markets and driven by increased allocations to property by institutions and high net worth individuals/families plus increased stock on coming to the market.

Glenn Rufrano, Global President & CEO of Cushman & Wakefield said: “2012 was a year of profound uncertainty in the global economy which impeded decision making and market activity. We anticipate there will be less uncertainly this year and in fact, a true change in market confidence and indeed momentum seems to have been confirmed in the early months of 2013 as major global risk factors are seen to be receding – albeit not yet disappearing.”

In 2012, China and the USA were two key engines of the strong finish – the former benefitting from a record high in land right sales and the latter seeing a rush of activity to beat year-end capital gains tax hikes. However growth was far from limited to these two global heavyweights and a range of other markets in all regions saw a final quarter rally notably Spain, Poland, Norway, Switzerland, Indonesia, Thailand, India and Australia.

The market to date has remained selective and focussed on core product. By region, North America and Developing Asia drove the overall global rise, with mature European and Asian markets largely flat and emerging markets in Europe, the Middle East, Africa and South America all down.

In 2012 by country, the USA and Mexico were the biggest gainers in the Americas, Malaysia, Vietnam, Australia and New Zealand enjoyed the strongest growth rates in Asia, while for Europe, Finland, Norway, Switzerland and Ireland saw the highest growth. More modest increases in big markets like China, Germany and Hong Kong were also clearly instrumental in delivering growth at the global level.

Regional Trends – The Americas is strongest performer overall and Europe is top for cross border investment
In terms of market performance the Americas saw stronger investment activity, a bigger contraction in yields and more positive rental growth. Asia was more stable with EMEA clearly taking the biggest hit from the market slowdown.

The Americas share of global trading rose to 32% in 2012 from 28% in 2011 while EMEA slipped to 21% (from 24%). Asia remained the largest global trading block, accounting for 47% of market activity, down from 48% in 2011. Interestingly, this remains a domestically driven picture however.

Among cross border players, Europe is the biggest target market, attracting 51% of capital, up from 45% in 2011. By contrast Asia speaks for 31% of cross border investment and the Americas 18% – down from 20% in 2011.

Occupier markets were clearly a lot more cautious last year leading to slower demand and rental falls in some areas. Overall, low supply has been a key support in all regions and while rents did reverse in some areas later in 2012, overall growth for the year was broadly positive. Retail tended to be the best performing sector and the Americas the best performing region in all sectors, typically led by South America ahead of the USA and Canada.

Greg Vorwaller, head of global capital markets at Cushman &Wakefield: “Global capital flows from sovereign wealth funds have been dominating the market notably from North American funds but with a very diverse base including rising Far and Middle Eastern interest as well as more European buying. To date, the move of global pension funds has been led by Canadian and Far Eastern money but Australian funds are becoming more important as pension allocations there are raised further.”

He continued: “More Far Eastern and Central Asian players will also be looking to go global and more Chinese funds will also add to the weight of capital in the market in the short-term. Family offices and high net worth individuals are a key part of global demand, and again a very diverse group coming from all corners of the globe. Most adopt a ‘safety first’ approach as long-term players and high quality trophy assets in gateway cities are favoured across a broadening lot size range.”

Outlook and regional investment opportunities and strategies in 2013
David Hutchings, head of EMEA research at Cushman & Wakefield said: “There is a growing consensus that we are past the worst for the risk cycle and that 2013 risks are weighted towards the earlier part of the year which if proven true will support a more marked pick up in confidence and hence activity later this year. There will be a very polarised landscape in terms of risk and performance: by country, city and sector, and a key theme of the year will be about finding value in second tier markets as investor yield demand grows and as cost sensitive occupier interest grows.”

Americas to lead the recovery in 2013 as favoured global destination for real estate investment
North America will be a favoured market in 2013 despite ongoing political and fiscal uncertainties. Early signs of a recovery in occupational demand together with an improving economy and debt market, low vacancy and high liquidity augers well for investment demand and performance. As a result, a 15-20% increase in investment activity is forecast, alongside modest cap rate contraction , led by the best second tier markets, and a steady normalisation in occupational markets and hence some rental growth. While yields are likely to flatten out for already low cap rate markets, there will be further compression in higher cap rate markets such as suburban offices and industrial as debt availability is boosted by an upturn in CMBS issuance.

Greg Vorwaller, head of global capital markets at Cushman & Wakefield, said: “While the US will be a preferred investment market for yield, investors will have to move up the risk curve possibly through buying vacancies in top tier markets or acquiring top assets in secondary markets.”

Asia Pacific – investment activity to rise 15-20% in 2013
Improved macroeconomic conditions with sustainable growth across the region will boost activity and performance resulting in 15-20% increase in investment activity forecast. Investment demand will increase as faith grows in China’s soft landing but demand will also broaden and other markets such as Australia and Japan will be an increasing target for overseas investors while markets such as India and Indonesia are likely to be on the rise. Long term trends such as urbanisation and the increasing middle class will add to demand to access a range of sectors including residential, especially in Chinese cities as well as higher growth markets as Indonesia and Vietnam.

John Stinson, head of capital markets in Asia Pacific for Cushman & Wakefield, said: “There are clear opportunities in all sectors. In office we expect global banks to follow regional banks in expansion plans fuelling office demand and generating steady rent growth in the major gateway markets of Tokyo, Shanghai, Hong Kong, Singapore and Sydney. Retail will be boosted by strong retail turnover growth off the back of buoyant GDP forecasts this year with Kuala Lumpar, Bangkok, Beijing and Jakarta likely to benefit the most. Overall the hottest sector this year will be logistics with major hubs of Osaka, Tokyo, Shanghai, Hong Kong and Singapore with strong demand and investment activity anticipated. For value add opportunities we see strong interest in Indonesia and Malaysia which have performed strongly during uncertain global markets and continuing strong sentiment for India which is now offering some of the most attractive returns in the region.”

Stronger trading forecast for European markets 2013 but in an increasingly diverse market
European investment activity is likely to remain subdued in the short term by the lack of quality product and affordable financing but the signs are that more stock released by the banks, the public sector and corporate owners should produce greater activity in 2013 generating a modest 5% increase.
European market trends will continue to diverge with a number of peripheral European markets bouncing along the bottom for some time.

Michael Rhydderch, Head of European Capital Markets at Cushman & Wakefield, said: “The supply of investment stock generally is likely to improve meanwhile as banks increasingly release legacy assets through loan and real asset sales. Although we do anticipate more buyers going up the risk curve in 2013, core markets and strategies are likely to dominate again. Germany in particular will remain a top pick for most investors, with a further gain in its market share forecast in 2013, as in the Nordics. London and Paris are also likely to benefit from the safety-first attitude.”