Each Wednesday, The Wrap
presents a compilation of recent noteworthy commercial real estate stories from
a variety of publications. Below are four stories that caught our eyes in
recent days.
• “Retail
Industry Expecting the Strongest Holiday Season in Years in 2012” by Elaine
Misonzhnik of Retail Traffic.
The retail real estate sector could be set for a very merry
Christmas, Misonzhnik reports. “Judging by early forecasts, the 2012
holiday season might turn out to be the strongest in years, with preliminary
surveys showing that consumers plan to spend more on gifts this year than they
did in 2011,” she wrote.
In a recent survey conducted by the International Council of
Shopping Centers and Goldman Sachs, 19 percent of the respondents said they
planned to spend more on gifts this year than last, and 5 percent intend to
spend substantially more.
A number of surveys say online shopping will again be a
substantial component of holiday shopping this year. In a Discover Financial
Services survey, 75 percent of respondents said they would research prices
online before making a purchase. Deloitte also predicted that non-store sales —
including online, mobile and catalog channels — will grow 15 to 17 percent this
year.
Among one of the reasons for the
widespread optimism is the fact Black Friday comes a week earlier than usual
this year. Still, several retailers aren’t waiting that long to kick off the retail
frenzy. Wal-Mart, Target and Sears are among the firms that have announced they
will begin the shopping season by opening stores on Thanksgiving evening.
• “Economy
Watch: Industrial Production Dips Due to Sandy; Thanksgiving Travel, E-commerce
Rise” by Dees Stribling of Commercial Property Executive.
Industrial production in the United States decreased by 0.4
percent in October after increasing 0.2 percent in September, according to the
Federal Reserve.
Hurricane Sandy’s lasting effects have resulted in
reductions in the output of utilities, chemicals, food, transportation
equipment and electronics. Industrial production would have increased during
October if not for the storm, Stribling reports. Unemployment claims also
spiked as a result of Sandy.
• “Retailers’
Preference for Strongest Locations Complicate Retail Property Recovery” by
Randyl Drummer of CoStar.
While the multifamily, office and industrial sectors saw
continued growth during the third quarter, demand for retail space remained
lukewarm, according to CoStar’s Third Quarter 2012 Retail Review and Outlook.
U.S. retail properties absorbed only 7 million square feet
in the third quarter. Large retailers are holding out for the only the best
spaces for their new stores, opting in many cases for new space instead of
vacant space in existing facilities, leaving the latter sites struggling to
find tenants, Drummer reports. Consequently, asking rents are dropping across
much of the available retail space, while landlords at shopping centers in
prime locations have been able to push rents.
• “Miami
Booms Like Never Before on Rental Demand: Mortgage” by Nadja Brandt of
Bloomberg.
Hit hard by the recession, the real estate market in Miami
is finally booming again, Brandt reports.
The average monthly rent for a two-bedroom apartment
increased 6 percent (to $2,568) in the third quarter when compared with the
same time last year, according to Condo Vultures LLC. “There’s a boom in Miami
that we’ve never seen before,” Stephen Ross of Related Cos. told Brandt. “Miami
is probably the hottest real estate market in the U.S. from a residential
perspective.”
Most of the city’s unsold condos have been converted into
rentals, and the number of multifamily developments is soaring, Brandt says. In
other areas of the United States, investor interest in the multifamily sector is
starting to wane as low mortgage rates persuade more people to buy homes.
Apartment rents are projected to rise through 2017, with a 4
percent gain nationally expected this year.