Archive for 'Los Angeles'

Commercial real estate vacancy rates are flat and projections for growth have been moderated because economic growth and job creation have been weaker than expected, but modest improvements are expected over the coming year, according to the National Association of Realtors®.

Lawrence Yun, NAR chief economist, said the weakening economy will slow the growth in demand for space. “Disappointing economic growth in recent months means a slower recovery for most of the commercial real estate sectors, although multifamily housing continues to benefit from pent-up demand resulting from an abnormal slowdown in household formation in recent years,” he said. “Many young people, who normally would have struck out on their own from 2008 to 2010, had been doubling up with roommates or moving back into their parents’ homes. However, they’ve been entering the rental market as new households in stronger numbers this year. As a result, apartment vacancy rates are declining and rents are rising at faster rates.”

Growth in the Gross Domestic Product slowed to 0.4 percent in the first quarter and 1.3 percent in the second quarter, much lower than the 4 to 5 percent expansion needed after a recession.

“A healthy recovery is already occurring in the multifamily sector, with average apartment rent expected to rise 2.5 percent this year and another 3.2 percent in 2012,” Yun said. “Normally, rising rents correspond to rising home prices. However, this isn’t happening in this recovery because buyers are constrained by unnecessarily restrictive mortgage underwriting standards, so the underlying demand isn’t drawing inventory down quickly enough to support price growth.”

Looking at commercial vacancy rates from the third quarter of this year to the third quarter of 2012, NAR forecasts vacancies to decline 0.3 percentage point in the office sector, 0.6 point in industrial real estate, 0.7 point in the retail sector and 0.9 percentage point in the multifamily rental market.

The Society of Industrial and Office Realtors®, in its SIOR Commercial Real Estate Index, an attitudinal survey of 266 local market experts,1 shows an erosion in market conditions. All regions posted declines except the West.

The SIOR index, measuring the impact of 10 variables, declined 2.6 percentage points to 54.9 in the second quarter, following a strong gain of 6.8 percentage points in the first quarter.

The SIOR index remains well below the level of 100 that represents a balanced marketplace, but had seen six consecutive quarterly improvements prior to last quarter’s decline. The last time the index was at 100 was in the third quarter of 2007.

Fundamentals are largely unchanged, with vacancy rates relatively flat. Eight out of 10 respondents said office and industrial leasing activity is below historic levels, and seven out of 10 said asking rents are below a year ago. It remains a tenant’s market, with many tenants benefiting from moderate concessions and rent discounts.

Construction activity is nearly nonexistent in most areas, and it is a buyer’s market for development acquisitions. Local experts said commercial office and industrial prices are below construction costs in 83 percent of markets.

NAR’s latest COMMERCIAL REAL ESTATE OUTLOOK2 offers projections for four major commercial sectors and analyzes quarterly data in the office, industrial, retail and multifamily markets. Historic data for metro areas were provided by REIS, Inc.,3 a source of commercial real estate performance information.

Office Markets

Vacancy rates in the office sector are forecast to fall from 16.6 percent in the third quarter of this year to 16.3 percent in the third quarter of 2012.

The markets with the lowest office vacancy rates currently are Washington, D.C., with a vacancy rate of 8.6 percent; New York City, at 10.1 percent; and Long Island, N.Y., 13.0 percent.

Office rents are expected to rise 0.8 percent in 2011 and another 1.5 percent next year. Net absorption of office space in the U.S., which includes the leasing of new space coming on the market as well as space in existing properties, is projected to be 28.3 million square feet this year.

Industrial Markets

Industrial vacancy rates are likely to decline from 12.7 percent in the current quarter to 12.1 percent in the third quarter of 2012.

At present, the areas with the lowest industrial vacancy rates are Los Angeles, with a vacancy rate of 5.5 percent; Orange County, Calif., 6.2 percent; and Miami at 8.9 percent.

Annual industrial rent is expected decline 0.9 percent this year before rising 2.0 percent in 2012. Net absorption of industrial space nationally should be 47.8 million square feet this year.

Retail Markets

Retail vacancy rates are projected to decline from 12.9 percent in the third quarter of this year to 12.2 percent in the third quarter of 2012.

Markets with the lowest retail vacancy rates currently include San Francisco, 3.8 percent; Northern New Jersey, 6.1 percent; and three markets at 6.4 percent each: Los Angeles; Long Island, N.Y.; and San Jose, Calif.

Average retail rent is forecast to decline 0.4 percent this year, and then rise 0.7 percent in 2012. Net absorption of retail space is seen at 5.6 million square feet this year.

Multifamily Markets

The apartment rental market – multifamily housing – should see vacancy rates drop from 5.5 percent in the current quarter to 4.6 percent in the third quarter of 2012. Apartment vacancies below 5 percent generally are considered a landlord’s market.

Areas with the lowest multifamily vacancy rates presently are Minneapolis, 2.5 percent; New York City, 2.8 percent; and Portland, Ore., at 2.9 percent.

Multifamily net absorption is likely to be 237,700 units this year.

The COMMERCIAL REAL ESTATE OUTLOOK is published by the NAR Research Division for the commercial community. NAR’s Commercial Division, formed in 1990, provides targeted products and services to meet the needs of the commercial market and constituency within NAR.

The NAR commercial components include commercial members; commercial committees, subcommittees and forums; commercial real estate boards and structures; and the NAR commercial affiliate organizations – CCIM Institute, Institute of Real Estate Management, Realtors® Land Institute, Society of Industrial and Office Realtors®, and Counselors of Real Estate.

Approximately 79,000 NAR and institute affiliate members specialize in commercial brokerage services, and an additional 171,000 members offer commercial real estate as a secondary business.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.

Housing Market Report Card Released by RE/MAX

Housing Market Report Card Released by RE/MAX

Housing Market Report Card Released by RE/MAX-Image via Wikipedia

The July 2011 RE/MAX National Housing Report, which surveyed 53 U.S. metropolitan areas, shows signs of a continuing, but uneven, recovery in the housing market.  After rising for two straight months, Home Sales fell 12.7% in July when compared with sales in June, following a traditional summer trend.  However, for the first time in six months, Home Sales were higher than one year ago, up an impressive 13.1% from July 2010.  Strict lending standards, bad appraisals and concern about the economy all contributed to lower than normal sales in July.  Many lenders are already using the lower GSE and FHA loan limits set to take effect on September 30.  Home Prices were even and inventory levels continued to fall for a thirteenth straight month.

The fact that July home sales were higher than a year ago, and by such a significant amount, gives us reason for great optimism,” said Margaret Kelly, CEO of RE/MAX, LLC.  “And now that prices have risen for four of the past five months, the housing market is beginning to show definite signs of recovery.”

Transactions – Year-Over-Year Change

In the last 12 months, only January and July had Home Sales higher than the previous year.  January was up fractionally and July was up a solid 13.1% from July 2010.  Both investors and traditional home buyers became a little more skittish about the economy in July, perhaps due to the Debt Ceiling debate.  Traditionally, June sales are the highest of the year, with a slight drop in July.  Overall, sales were 12.7% lower in July than in June. However, 45 metro areas experienced more sales than in July of last year.  Some of those leading their 2010 sales numbers include:  Des Moines, IA +49.9%, Omaha, NE +46.8%,  Milwaukee, WI  +37.7%,  Providence, RI +32.4% and Wichita, KS +29.0.

Median Sales Price – Year-Over-Year Change

The July 2011 RE/MAX National Housing Report shows that Home Prices in July were just 0.18% lower than in June, while the year-over-year decrease of 4.6% is the smallest the survey has recorded in 6 months.  On a monthly basis, prices have now risen for four of the past five months.  There were 11 metro areas that recorded higher prices in July than in the same month last year, most notably:  Detroit +14.3%, Birmingham, AL +9.8%, Des Moines, IA +7.7%, Orlando, FL +5.5% and Pittsburgh, PA +4.4%.

Days on Market – Average of 54 Metro Areas

The average Days on Market for homes sold in July was 88, down just two days from the June level. July marks the first month since September 2010 that the Days on Market figure has been below 90. The July average is identical to September 2010, when the average Days on Market was also 88. Days on Market is the average number of days from listing to receipt of a signed contract.

Months Supply of Inventory – Average of 54 Metro Areas

Perhaps due to fewer foreclosure properties coming on the market, the 53 metro areas surveyed in the July 2011 RE/MAX National Housing Report had an average Months Supply of Inventory of 7.2, which is up slightly from the 6.9 mark registered in June, but down significantly from the 9.3 mark seen in July 2010. Overall inventory continued a 13-month trend to lower levels. Inventories were 5.3% lower in July from June, and down 17.1% from July 2010.  The Florida markets continue to see the largest annual drop in inventory: Miami, FL -52.5%, Tampa, FL -37.3%, Phoenix, AZ -35.6% , Los Angeles, CA -32.4% and  Chicago, IL -26.9%.

About the RE/MAX Network:

RE/MAX was founded in 1973 by Dave and Gail Liniger, real estate industry visionaries who still lead the Denver-based global franchisor today. RE/MAX is recognized as a leading real estate franchisor with the most productive sales force in the industry and a global reach of more than 80 countries. With a passion for the communities in which its agents live and work, RE/MAX is proud to have raised more than $100 million for Children’s Miracle Network Hospitals, Susan G. Komen for the Cure® and other charities. Nobody in the world sells more real estate than RE/MAX. Please visit www.remax.com or www.joinremax.com.

Description

The RE/MAX National Housing Report is distributed each month on or about the 15th. The first Report was distributed in August 2008. The Report is based on MLS data in approximately 54 metropolitan areas, includes all residential property types, and is not annualized. For maximum representation, many of the largest metro areas in the country are represented, and an attempt is made to include at least one metro from each state. Metro area definitions include the specific counties established by the U.S. Government’s Office of Management and Budget, with some exceptions.

Definitions

Transactions are the total number of closed residential transactions during the given month.  Month’s Supply of Inventory is the total number of residential properties listed for sale at the end of the month (active inventory) divided by the number of sales contracts signed (pended) during the month.  Where “pended” data is unavailable, this calculation is made using closed transactions.  Days on Market is the number of days that pass from the time a property is listed until the property goes under contract for all residential properties sold during the month. Median Sales Price is the median price of all residential properties sold during the month.

MLS data is provided by contracted data aggregators, RE/MAX brokerages and regional offices.  While MLS data is believed to be accurate, it cannot be guaranteed.  MLS data is constantly being updated, making any analysis a snapshot at a particular time.  Every month the RE/MAX National Housing Report re-calculates the previous period’s data to ensure accuracy over time.  All raw data remains the intellectual property of each local MLS organization.

http://www.remax.com

Mortgage Lenders to Get More Aggresive With Foreclosures

Mortgage Lenders to Get More Aggresive With Foreclosures-Image by niallkennedy via Flickr

New Study Predicting Continued Economic Troubles Means More Aggressive Approach to Foreclosures by Banks

Recent news of a study claiming the current U.S. housing collapse is worse than during the Great Depression and will continue to fall for the rest of the year means greater emphasis by banks on foreclosures and increased need for homeowners facing foreclosure to protect themselves when dealing with the banks, according to Vito Torchia, Jr. managing attorney of Brookstone Law.

“Banks are more likely now to place a premium on reducing inventory and liabilities so will be more aggressive about foreclosures and fewer consumers will be able to keep their homes,” said Vito Torchia, Jr. “It is already nearly impossible for a homeowner without expert legal help to stop foreclosures, so Banks being even more difficult will be a nightmare for consumers.”

To deal with the needs of homeowners facing foreclosure and help them deal with an institutional bureaucracy that is biased against them, Brookstone Law has created the Emergency Extension Department (EED), a unique service not offered by any other firm that gives homeowners facing foreclosure a fighting chance to keep their homes. The service is offered with no advance fees and consumers pay only if the sale can be stopped. Brookstone Law’s EED attorneys and specialists are experienced in working directly with banks and extensively trained to help homeowners.

According to the study by senior U.S. economist for Capital Economics Paul Dales home prices will fall another 3 percent over the rest of 2011 before potentially hitting bottom and the market likely will continue to fall for the rest of the year before going stagnant. The report indicated that since the collapse began from the pricing peak of 2006, prices have fallen 33 percent which is more than the 31 percent dive recorded between the 1920s and 1930s.

“This report clearly shows the U.S. economy is having trouble emerging from what is the worst recession since the Great Depression and the housing crash has been larger and faster than the one during the Great Depression,” said Vito Torchia, Jr. “It is very likely the Banks are going to do everything they can at the expense of consumers to protect their margins.”

Media coverage of the study also noted that with the national jobless rate rising, home prices in a dozen metropolitan regions hitting the lowest level since the collapse began and struggling to return even to roughly 2002 levels, it is likely there will be a double-dip depression in home prices and the U.S. housing market has not yet hit bottom.

“Dealing with a bank about the loss of a home is a dehumanizing and legally intricate situation and a positive attitude and patience is extremely difficult to maintain,” said Vito Torchia, Jr. “As experts in helping homeowners stop foreclosures, we share daily in the challenges they face and deal with banks on their behalf.”

ABOUT BROOKSTONE LAW, PC
Headquartered in Newport Beach, Calif., and with offices in Los Angeles, Calif., and Ft. Lauderdale, Fla., Brookstone Law, PC is a law firm comprised of attorneys with experience and success in business, corporate and personal finance, employment, entertainment and media, art and museum, intellectual property and real estate law. The firm has a network of more than 40 affiliate attorneys nationwide and employs highly trained specialists, paralegals, paraprofessionals and administrative staff dedicated to serving clients. For information, call (800) 946-8655 or visit Brookstone Law.com (http://www.brookstonelaw.com).

 

Guess?, Inc. (NYSE: GES) Secures $200 Million

Guess?, Inc. (NYSE: GES) today announced that it has entered into a five-year $200 million secured revolving credit facility with a global and strategic syndicate of banks led jointly by J.P. Morgan Securities LLC and Bank of America Merrill Lynch. This new credit facility, which includes an additional $100 million accordion feature, replaces the Company’s existing $85 million revolving line of credit which was scheduled to mature September 30, 2011.

Commenting on the announcement, Maurice Marciano, Chairman of the Board, stated, “The favorable terms of the new facility capitalize on the Company’s solid financial position and our consistent track record of strong performance.  We have assembled a premier group of banks with a presence in all the major markets of the world where we operate and we value their continued support as they have all been key relationships for the Company.”

Mr. Marciano continued, “Our credit facility, combined with the Company’s operating cash flows and strong balance sheet and cash position, provide us the platform to access well over $1 billion of potential capital to pursue our global expansion efforts and any other opportunities.”

At the time of closing, there were no borrowings due under the prior credit facility other than normal letter of credit obligations.

Guess?, Inc. designs, markets, distributes and licenses a lifestyle collection of contemporary apparel, denim, handbags, watches, footwear and other related consumer products.  Guess? products are distributed through branded Guess? stores as well as better department and specialty stores around the world.  As of April 30, 2011, the Company directly operated 484 retail stores in the United States and Canada and 202 retail stores in Europe, Asia and Latin America.  The Company’s licensees and distributors operated an additional 735 retail stores outside of the United States and Canada.  For more information about the Company, please visit www.guess.com.

Except for historical information contained herein, certain matters discussed in this press release, including statements concerning the Company’s global expansion strategies, strategic growth opportunities, and potential access to capital, are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are only expectations, and involve known and unknown risks and uncertainties, which may cause actual results in future periods to differ materially from what is currently anticipated.  Factors which may cause actual results in future periods to differ materially from current expectations include, among other things: domestic and international economic conditions, including economic and other events that could negatively impact consumer confidence and discretionary consumer spending and result in increasingly difficult competitive conditions; our ability to, among other things, anticipate consumer preferences, protect our brand image, effectively operate our various retail concepts, manage inventories, address potential increases to product costs and successfully execute our strategies, including our supply chain and international growth strategies; and risks associated with changes in economic, political, social and other conditions affecting our global operations, including currency fluctuations and global tax rates.  In addition to these factors, the economic, technology, management, litigation-related and other risks identified in the Company’s most recent annual report on Form 10-K and other filings with the Securities and Exchange Commission, including but not limited to the risk factors discussed therein, could cause actual results to differ materially from current expectations.

Contact: Guess?, Inc.
Maili Bergman
VP Investor Relations
(213) 765-5578

http://www.guess.com

L.A. Dodger Woes Come to a Head With Bankruptcy Filing

L.A. Dodger Woes Come to a Head With Bankruptcy Filing-Image via Wikipedia

Chapter 11 to provide Dodgers with process to address its immediate financing requirements and obtain the capital necessary to ensure the Club’s long term financial stability

Action is precipitated by Commissioner Selig’s interference with Club operations and refusal to approve multibillion dollar media rights transaction

The Los Angeles Dodgers filed for protection under Chapter 11 of the U.S. Bankruptcy Code in order to protect the franchise financially and provide a path that will enable the Club to consummate a media transaction and capitalize the team.  Dodger owner Frank McCourt cited Major League Baseball Commissioner Bud Selig’s refusal to approve the Fox transaction as the cause for the Chapter 11 filing.

“The Dodgers have delivered time and again since I became owner, and that’s been good for baseball,” McCourt said.  “We turned the team around financially after years of annual losses before I purchased the team.  We invested $150 million in the stadium. We’ve had excellent on-field performance, including playoff appearances four times in seven years.  And we brought the Commissioner a media rights deal that would have solved the cash flow challenge I presented to him a year ago, when his leadership team called us a ‘model franchise.’  Yet he’s turned his back on the Dodgers, treated us differently, and forced us to the point we find ourselves in today.  I simply cannot allow the Commissioner to knowingly and intentionally be in a position to expose the Dodgers to financial risk any longer.  It is my hope that the Chapter 11 process will create a fair and constructive environment to get done what we couldn’t achieve with the Commissioner directly.”

The Los Angeles Dodgers have tried for almost a year to have Commissioner Bud Selig approve a transaction, which would assure that the Los Angeles Dodgers would be one of the strongest capitalized franchises in Major League Baseball, both now and for years to come.  Indeed, for months, the Dodgers have sought approval from the Commissioner of a multibillion dollar media rights transaction negotiated between the Dodgers and FOX, which would immediately infuse hundreds of millions of dollars of capital into the Los Angeles Dodgers.  The Commissioner’s office last week rejected the deal, despite having been made aware by the Dodgers since the spring of 2010 of the franchises’ cash projections and in turn liquidity needs for 2011.

“The deal with Fox demonstrates that the Dodgers have enormous value which substantially exceeds the team’s current and future liabilities,” said Bruce Bennett, bankruptcy counsel from Dewey & LeBoeuf.  “The team is entering the bankruptcy case with enough committed financing to meet all of its short term expenses and to successful reorganize.  The media rights will, one way or another, generate enough value to facilitate a reorganization.”

Operating under Chapter 11, the Los Angeles Dodgers have received a commitment for $150 million in Debtor-in-Possession (DIP) financing.  This financing will enable the Dodger organization to fully meet its obligations going forward.  There will be no disruption to the Dodgers day-to-day business, the baseball team, or to the Dodger fans.

Under Chapter 11, the Dodgers will continue to operate in the ordinary course of business.  Pursuant to that authority, and additional authority the Dodgers have sought in motions filed today with the bankruptcy court:

  • All salaries of Dodger employees will be paid and all Dodger employee benefits will continue.
  • The Dodgers will operate within their existing budget to sign and acquire amateur, international and professional players.
  • Ticket prices will remain the same and purchased tickets will continue to be honored.
  • All amenities at Dodger stadium will continue in place, and promotions will continue as usual.
  • Dodger vendors and suppliers will be paid any post-petition amounts in the ordinary course, with the intention of paying any pre-petition amounts in full prior to or at the conclusion of the bankruptcy case.

 

McCourt concluded, “The Chapter 11 process provides the path on which to position the Los Angeles Dodgers for long-term success.  The process will allow us to focus on maximizing value in a manner that is transparent and driven by the best interests of the Los Angeles Dodgers and our fans.”

Chapter 11 filings were also made for LA Real Estate LLC, an affiliated entity which owns Dodger Stadium, and three other related holding companies.

Media Contact:

Los Angeles Dodgers
Public Relations
(323) 224-1301

Kekst and Company
Robert Siegfried
(212) 521-4800
robert-siegfried@kekst.com

Sugerman Communications Group
Steve Sugerman
(310) 974-6680
steve@sugermangroup.com

 

Looking for financing solutions, technical assistance and/or contracting opportunities to start or grow your business?

Then please mark your calendar to join us at this Small Business Forum where you will hear from federal, state, and local agency representatives about various resources available to maintain and grow businesses — as well as opportunities to expand through international trade.  Speakers will include representatives from the Small Business Administration, Governor’s Office of Economic Development, Port of Los Angeles and several other entities that are dedicated to stimulating California small businesses.

For more information or to RSVP, you can contact Senator Curren Price’s office at (213) 745-6656 or by email at Senator.Price@senate.ca.gov

Supporting organizations include: CA Small Business Association, National Association of Women Business Owners-Los Angeles, Latin Business Association, Greater Los Angeles African American Chamber of Commerce, Korean American Chamber of Commerce, Culver City Chamber of Commerce, 26th Senate District Commission on Trade and Investment in Africa, and the Port of LA.

Commercial Real Estate Shows Slow Recovery

Average Overall Cap Rates Decrease in 27 of the Survey’s 31 Markets, According to PwC Real Estate Investor Survey™

With signs of a strengthening U.S. economy evident in declining initial jobless claims, rising business and consumer confidence, and growing employment figures, the PwC Real Estate Barometer, a new feature in the just-released first quarter 2011 PwC Real Estate Investor Survey, indicates that the fundamentals of the commercial real estate industry are slowly improving and supports the consensus among surveyed investors that the industry is moving past the bottom of the cycle.

The barometer tracks the anticipated performances of the four main property sectors (office, retail, industrial, and multifamily) from 2011 to 2014. By analyzing historical and forecast stock data, the barometer measures how the inventory of each sector changes over time in relation to the four stages of the real estate cycle – contraction, expansion, recession, and recovery. In addition, barometer analyses are prepared for various geographic regions and specific metro areas.

“Surveyed investors sense that the commercial real estate industry is moving past the bottom of the cycle, but the speed at which the U.S. economy is improving fundamentals has been slow and uneven at best,” said Mitch Roschelle, partner, U.S. real estate advisory practice leader, PwC. “However, as investors become more confident about the long-awaited recovery of the industry, they are eager to get deals done. This bodes well for the industry as the volume of capital chasing deals is expected to increase in all sectors as investors work to deploy capital before interest rates rise, overall cap rates increase, and the industry shifts more in favor of sellers.”

According to the barometer, the majority of office stock will be in recovery by year-end 2011 due to a lack of new supply and signs of decreasing vacancy for the U.S. office market. Even though job creation remains a concern, recovery is on the horizon with 86.2 percent of the U.S. office sector out of the market bottom by year-end 2012. In contrast, individual office markets that are expected to remain in recession through 2012 include Chicago, Las Vegas, Los Angeles, and Tampa.

For the retail market, inconsistent consumer spending and inflationary fears will keep the majority of retail stock (76.6 percent) in recession through 2012. A recovery will materialize by year-end 2013, with 77.1 percent of retail inventory in that phase. Individual retail markets that are expected to perform better than this sector as a whole include Long Island, Nashville, and Fairfield County, which are each expected to be in recovery through 2012.

Availability rates for the U.S. industrial sector are expected to peak in 2011 as tenant demand strengthens on the heels of a growing economy. As a result, the bulk of industrial stock will be in recovery in 2011 and 2012 (71.8 and 86.2 percent, respectively). As imports and exports increase, a larger portion of industrial stock will enter the expansion phase in 2013 and 2014 (20.9 and 40.6 percent, respectively). Individual industrial markets that are expected to lag this sector as a whole include Tampa, Akron, Cleveland, and Minneapolis.

The U.S. multifamily sector is well ahead of the other three sectors in terms of recovery. As tighter lending restrictions limit home-buying opportunities, pent-up housing demand will enlarge the portion of multifamily stock in the expansion phase through 2014, when it hits 30.2 percent. Two multifamily markets that are not expected to enter the expansion phase over the near term include New Orleans (in recovery through 2014) and Syracuse (in recession through 2014).

Lower Overall Cap Rates

The report finds that the average overall capitalization (cap) rate, a reflection of an investment’s anticipated ownership risk, decreased in 27 of the 31 surveyed markets as signs of recovery become more apparent for both the economy and the industry. The highest quarterly decreases occurred in the regional apartment markets, where average cap rates compressed between 39 and 73 basis points this quarter.

Although an increasing number of investors are expanding acquisition searches to include secondary markets and “impaired” assets, cap rate compression continues to mainly occur for better-positioned and well-located assets that exhibit stable rent rolls and limited near-term leasing risk. Looking ahead, strong buyer interest, combined with more fluid debt markets, is recognized in investors’ expectations that overall cap rates will either hold steady or decline over the next six months. Most Survey participants expect overall cap rates to hold steady in 25 of the Survey’s 31 markets over the next six months.

“This year is a pivotal one for the industry, as 2011 began on the right foot with a string of positive news, giving investors the feeling that the recovery is real,” stated Susan Smith, editor-in-chief of PwC’s quarterly survey. “That said, there remain concerns among surveyed participants, such as rising oil prices, a still-shaky residential housing sector, and upcoming debt maturities. Despite these challenges, many investors remain focused on acquiring assets in anticipation of a continued recovery. Strong competition among buyers and the low-interest-rate environment continue to push overall cap rates lower for nearly all of the Survey’s markets.”

Information about subscribing to the PwC Real Estate Investor Survey can be found at www.pwc.com/us/realestatesurvey. Members of the media can obtain an electronic copy of the full report by contacting Scott Cianciulli at (212) 986-6667 or cianciulli@braincomm.com.

About the PwC Real Estate Investor Survey

The PwC Real Estate Investor Survey, now in its 24th year of publication, is one of the industry’s longest continuously produced quarterly surveys. The current report provides overviews of 31 separate markets, including ten national markets — regional mall, power center, strip shopping center, CBD office, suburban office, flex/R&D, warehouse, apartment, net lease, and medical office buildings. The report also includes a review of 18 major U.S. office markets including Atlanta, Boston, Charlotte, Chicago, Dallas, Denver, Houston, Los Angeles, Manhattan, Northern Virginia, Pacific Northwest, Philadelphia, Phoenix, San Diego, San Francisco, Southeast Florida, Suburban Maryland, and Washington, DC. In addition, the report covers three regional apartment markets – – Mid-Atlantic, Pacific, and Southeast.

The first quarter 2011 report also features up-to-date information relating to valuation issues in the industry, such as replacement reserves, property management fees, leasing commissions, and concessions. In addition, each issue of the Survey contains over ten tables of market data focusing on value expectations, tenant improvement allowances, forecast periods, structural vacancy, and growth rates.  Also in this issue is the semiannual National Lodging Highlights with analyses of four lodging segments.

About PwC

PwC (www.pwc.com) provides industry-focused assurance, tax and advisory services to build public trust and enhance value for its clients and their stakeholders. More than 163,000 people in 151 countries across our network share their thinking, experience and solutions to develop fresh perspectives and practical advice.

© 2011 PwC.  All rights reserved. In this document, “PwC” refers to PricewaterhouseCoopers LLP, a Delaware limited liability partnership, which is a member firm of PricewaterhouseCoopers International Limited, each member firm of which is a separate legal entity.

CONTACT: Scott Cianciulli, cianciulli@braincomm.com, Ray Yeung, yeung@braincomm.com, Brainerd Communicators, +1-212-986-6667, or Laura Schooler, PwC US, +1-646-471-3229, laura.schooler@us.pwc.com

Web Site: http://www.pwc.com

Belize Real Estate Sales Climbing

Belize Real Estate Sales Climbing

Belize Real Estate Sales Climbing-Image by Bob Reck via Flickr

One of the biggest eco-developments in Belize Real Estate reportedly sold 16 units in February in what is traditionally considered the weakest month for real estate.  Benefiting from the renowned Caribbean weather and well-coordinated tours to potential buyers, Sanctuary Belize reported that lots were selling at a far quicker rate than originally forecasted.

The Central American country has long been favored by North American investors and vacationers alike for their friendly tax rates, quality of life, weather, environment and being the only Central American country to have English as its official language.  In recent years Belize has begun to earn a reputation as the premier eco-tourist destination in the world. With Belize Real Estate developments like Sanctuary Belize, the road for many potential buyers in colder climates looking for a second or vacation homes in a balmier climate has made real estate in Belize a sound investment.

When contacted, a Sanctuary Belize spokesperson said, “We were ecstatic to see many buyers and the feedback from those that have attended our tours has been extremely positive as we continue to add neighbors to this wonderful community.  Sixteen sales would have been a phenomenal month for anytime of the year but to do so in February just goes to show just how hot the real estate market in Belize is right now.  I strongly encourage anyone looking at real estate to schedule a tour with us to see Belize and get in before prices go up. For the price and quality of life there simply is nowhere else you’d rather be.”

About Sanctuary Belize

Created in a partnership with the Sittee River Wildlife Reserve, in Sanctuary Belize, we wanted to make the dream of property ownership in a Caribbean paradise an affordable reality. We are also committed to developing our community responsibly and respectfully, with as minimal impact to the natural surroundings and wildlife as possible.

As part of this commitment, we partner with architects, designers and builders who employ green technology innovations that are ecologically sound, economically feasible, while conserving the environment. Our mission is to build high-quality living environments that enhance quality of life, generate a return on investment, while leaving a minimal footprint.

CONTACT: Brandi Greenfield, +1-949-673-4270, brandi@sanctuarybelize.com, for Sanctuary Belize

Web Site: http://sanctuarybelize.com

Equator ® (EQ), the country’s leading software provider of default servicing solutions, now offers lenders and servicers three new modules: Loan Segmentation, REO Segmentation and Invoice Management.  “These new modules will seamlessly interface with existing modules to offer a best in class, end-to-end default suite to assist servicers with upcoming inventories,” said CEO Chris Saitta.

“With the velocity and frequency of loans flowing into the foreclosure bucket this year, the need for servicers to adopt a Delinquent Loan Segmentation module is paramount,” said COO John Vella. “By using Equator’s new Loan Segmentation module at the 60-120 day bucket of delinquency, servicers will be able to route the right loan to the right person early on in the delinquency to insure optimal outcome for the loan.” Within the Loan Segmentation module, servicers will also be able to analyze key data variables from the loan and the borrower and combine it with market data and history, so that loans can be channeled through a retention or liquidation strategy.  The end result is the optimum workout path based on the borrower, market and loan data accompanied by an NPV.  “This new module takes months off the timeline of a workout and improves severity as well as customer service while increasing scale for the servicer,” said Vella.

With an increase in REO expected in 2011, Equator is offering an REO Segmentation module which can be used for managing disposition strategies for REO properties by analyzing market and property data, and producing the desired disposition path such as: rental, hold, quick sale, repair, donate or auction. From there, the module determines the expected net proceeds per disposition strategy to support its recommended disposition method. “Using Equator’s REO Segmentation module will allow for consistent disposition strategy amongst outsourcers and internal asset managers as well as maximize net proceeds to the investor,” said Saitta.

Equator’s third new product, an Invoice Management module, is now available for all existing Equator clients as well as companies seeking to leverage Equator’s industry expertise. “Our Invoice Management Solution takes invoice tracking and management to a new level, providing significant efficiency gains and transparency to its users,” said Saitta.  Users will benefit from a full investor-based rules engine, enhanced communication between parties and a complete end-to-end paper trail which provides unprecedented audit control. Users can also set auto-approval thresholds for the system to immediately approve invoices that fall within the pre-specified parameters, saving time and money.

Founded in 2003, Equator is the premier provider of software solutions for the default servicing industry. Three of the top five financial institutions currently use Equator’s platform. Equator’s REO, Short Sale and Loss Mitigation platforms have processed more than $190 billion in transactions. Currently, the EQ Marketplace hosts more than 750,000 agents, 23,000 vendors and 25,000 sellers, all contributing to 239,000 transactions per day. Equator is headquartered in Los Angeles with offices in Dallas, Denver, Irvine, Calif., and Portland, Ore. For more information, log on to www.equator.com.

CONTACT: Equator, +1-310-469-9500, public.relations@equator.com

Web Site: http://www.equator.com

Real Estate Values Decline in 4th Quarter

Real Estate Values Decline in 4th Quarter

Real Estate Values Decline in 4th Quarter-Image via Wikipedia

Negative Equity Rises to 27%; Foreclosure Moratoriums at Least Partly Responsible for Increase, According to Q4 2010 Zillow® Real Estate Market Reports

Home values in the United States posted their largest quarterly decline since the first quarter of 2009, falling 2.6 percent as the temporary stimulus of the home buyer tax credits wore off, according to Zillow’s fourth quarter Real Estate Market Reports(1). The Zillow Home Value Index(2)  declined 5.9 percent year-over-year in the fourth quarter to $175,200. Home values have fallen 27 percent since they peaked in June 2006.

Accelerating home value declines, as well as a slowdown in the nation’s foreclosure rate following the late-2010 robo-signing controversy, contributed to an increase in negative equity. At the end of the fourth quarter, 27 percent of single-family homeowners with mortgages owed more on their mortgage than their homes were worth, up from 23.2 percent in the third quarter.

Less than one in every 1,000 (0.09 percent) U.S. homes were liquidated in foreclosure(3) in December, down from 0.12 percent in October, when foreclosure liquidations peaked. Foreclosures are expected to increase again in early 2011, which may cause negative equity to fall as some underwater homeowners lose their homes to foreclosure and are no longer in negative equity.

With the end of the homebuyer tax credits in mid-2010, home value declines accelerated toward the end of the year. When they were in effect, the credits tempered home values declines – nationally, home values fell only 0.9 percent from the first to the second quarter of 2010 – but values resumed their decline after the credits’ expiration, falling 2.6 percent from the third to the fourth quarter.

“While the tax credits did not hurt the housing market, they did delay its bottom by interrupting the housing correction that was taking place,” said Dr. Stan Humphries, Zillow chief economist. “Home value trends in the fourth quarter remained grim, but the good news is that these declines, while painful in the short-term, mean we’re getting closer to the bottom. The housing recession is likely in its death throes, and we expect to see sales pick up in early 2011. That will lead the way to home values stabilizing and an eventual bottom later this year, although it will take several months of increased sales activity before values begin to respond.”

Largest 25 Metropolitan Statistical Areas Covered by Zillow Zillow Home Value Index
Q4 2010 QoQ Change YoY Change Change from Peak Negative Equity*
United States $175,200 -2.6% -5.9% -26.7% 27.0%
New York, NY $351,900 -2.4% -5.0% -23.0% 15.0%
Los Angeles, CA $399,000 -3.3% -3.1% -34.0% 20.2%
Chicago, IL $175,100 -6.5% -11.3% -35.8% 38.6%
Dallas, TX $125,300 -4.1% -6.0% -13.6% n/a
Philadelphia, PA $191,000 -4.3% -9.4% -18.2% 19.6%
Miami-Fort Lauderdale, FL $139,100 -3.3% -15.4% -54.8% 42.8%
Washington, DC $309,100 -2.5% -5.0% -29.6% 26.0%
Atlanta, GA $128,100 -4.3% -15.3% -27.5% 54.0%
Detroit, MI $73,200 -7.5% -17.4% -52.3% 33.3%
Boston, MA $314,200 -3.2% -1.9% -21.3% 13.9%
San Francisco, CA $485,700 -4.1% -5.0% -31.3% 22.6%
Phoenix, AZ $129,300 -2.5% -11.6% -53.6% 69.9%
Riverside, CA $190,000 -1.3% 0.1% -52.7% 50.1%
Seattle, WA $262,100 -4.3% -12.4% -30.8% 34.3%
Minneapolis-St. Paul, MN $166,300 -5.8% -12.1% -31.9% 42.3%
San Diego, CA $353,700 -3.4% -1.2% -34.3% 21.8%
St. Louis, MO $130,400 -6.1% -7.0% -17.2% 33.9%
Tampa, FL $111,900 -3.0% -9.0% -48.4% 48.4%
Baltimore, MD $223,800 -3.2% -9.7% -24.9% 24.0%
Denver, CO $198,100 -3.5% -6.4% -14.9% 40.7%
Pittsburgh, PA $105,400 -2.1% -0.8% -4.8% 9.3%
Portland, OR $209,900 -5.2% -12.0% -29.0% 32.0%
Cleveland, OH $112,800 -4.0% -5.2% -21.8% 37.6%
Sacramento, CA $216,200 -4.2% -6.8% -47.4% 46.8%
Orlando, FL $118,800 -3.7% -11.1% -54.4% 61.7%
*Negative equity refers to the % of single-family homes with mortgages.

The accelerated decline in home values brought trouble for home sellers, as more were forced to sell their home for less than they purchased it. The rate of homes selling for a loss reached a new peak in December, with more than one-third (34.1 percent) selling for a loss. The rate of homes sold for a loss has increased steadily for the past six months.

The full national report, in its interactive format, is available at www.zillow.com/local-info.  Additionally, in most areas data is available at the state, metro, county, city, ZIP and neighborhood level.

About Zillow.com®

Zillow.com is an online real estate marketplace where homeowners, buyers, sellers, renters, real estate agents and mortgage professionals find and share vital information about homes and mortgages. Launched in early 2006 with Zestimate® home values and data on millions of U.S. homes, Zillow has since added homes for sale and homes for rent, a directory of real estate and lending professionals, Zillow Advice, Zillow Mobile apps and Zillow Mortgage Marketplace. One of the most-visited U.S. real estate websites, with more than 15 million unique visitors per month, Zillow’s goal is to help people become smarter about homes and real estate in every stage of their lives — home buying, selling, renting, remodeling and financing.  The company is headquartered in Seattle.

Zillow.com, Zillow and Zestimate are registered trademarks of Zillow, Inc.

(1) The data in Zillow’s Real Estate Market Reports is aggregated from public sources by a number of data providers for 132 Metropolitan Statistical Areas dating back to 1996. Mortgage and home loan data is typically recorded in each county and publicly available through a county recorder’s office.

(2) The Zillow Home Value Index is the median Zestimate® valuation for a given geographic area on a given day and includes the value of all single-family residences, condominiums and cooperatives, regardless of whether they sold within a given period. The Home Value Index at the national level is calculated using a weighted average of the median home value for each county and includes data from 440 metropolitan statistical areas. It is expressed in dollars and is for a particular geographic region.

(3) Foreclosures are defined as a Trustee’s Deed Upon Sale or equivalent transaction.

CONTACT: Katie Curnutte of Zillow.com, +1-206-757-2701, press@zillow.com

Web Site: http://www.zillow.com

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