Each Wednesday, The Wrap
presents a compilation of recent noteworthy commercial real estate stories from
a variety of publications. Below are links to five stories that caught our eyes
in recent days.
• Will
‘Wisdom of the Crowd’ Become a Major Financing Source for CRE Deals? by Mark
Heschmeyer of CoStar.
Key excerpt:
“‘The
basic concept [of crowdfunding] is simple: it allows the wisdom of the crowd to
identify, and reward with capital, good ideas," said SEC Commissioner Kara
Stein. "Different methods of crowdfunding have expanded rapidly over the
last few years with the help of the Internet and social sites that bring
together individuals and the projects in need of financing.’”
• Deloitte Forecasts Moderating Growth in 2014
Real Estate Market by Sarah
Borchersen-Keto of REIT.com.
Key
excerpt:
“The anticipated moderation in 2014 would
follow a year in which asset prices, transactions and capital availability all
saw a continued recovery. So far in 2013, asset prices have moved close to
their 2007 peaks in major metropolitan markets and transaction activity has
improved in secondary markets, the Deloitte report stated.‘We expect that the recovery will continue,
we just expect that the pace of it will slow down in 2014,’ said Bob O’Brien,
U.S. real estate services leader at Deloitte.”
• Institutions
Work to Increase CRE Allocations by Beth Mattson-Teig for NREI.
Key excerpt:
“U.S.-based public
pension funds currently have 7.4 percent of their total assets, or an average
of $950 million, allocated to commercial real estate, according to London-based
research firm Preqin. Private pension funds have 6.1 percent of their assets,
or an average of $381 million, tied up in real estate investments.Endowment plans have
allocated 6 percent of their money, or $129 million, to commercial property.
For all three groups, these allocations are below target goals. Public pension
funds aim to have up to 8.4 percent of their total assets allocated to
commercial real estate, while private pension funds aim for 7.2 percent and
endowments for 8 percent, Preqin reports.”
• Top
Execs: What is the Biggest Threat to Multifamily's Momentum? by Lindsay
Machak of Multifamily Executive.
Key excerpt:
“‘As
always, we have to be careful about overbuilding. In addition, I am also
concerned that while the economy is recovering, rents are rising higher than
salaries, and that newer product will be priced above what people can afford.
This also translates into the prices investors are paying for multifamily. In
order to meet their returns at the prices they are paying for communities,
rents will need to continue to grow at a healthy pace. If incomes don’t
increase to meet the rent increases, we could see challenges in the market,’
said Cindy Clare, CEO of Kettler Management.”
• Land
Prices Hit the Brakes by Kris Hudson of The Wall Street Journal.
Key excerpt:
“Since the housing
market began recovering in 2011, investors have been bidding up the price of
finished lots, which are home pads outfitted with infrastructure such as
utilities and sewer pipes and thus ready for construction. But with new-home
sales and prices cooling, some builders are renegotiating land buys to get
lower prices or even walking away from deals.Nationally, lot prices
have gone from a gain of nearly 7% in the first quarter of 2013 compared with
the previous quarter, to gains of about 6% in the second quarter and 4% in the
third quarter, according to a survey of land buyers and sellers in 55 U.S.
markets conducted by housing-research and advisory firm Zelman &
Associates.”