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The case for lower Multifamily Cap Rates Attend any number of multifamily conferences around the Tri-State region and cap rates are sure to be a topic of discussion. But while many suggest that cap rates for multifamily rental properties will flatten in the future or even rise, I would argue that they can (and likely will) go lower. There are number of factors driving this compression, including a healthy amount of cash that is ready to return to the market; record low interest rates; and a desire among both Generation Y consumers and the Baby Boomer generation (some 76 million strong) to forgo homeownership in favor of renting. But what’s arguably most important to the cap rate debate will be the fate of the home mortgage interest deduction. More...

GGP Refinances $1.2B in Property-Level Loans General Growth Properties Inc. (GGP), the second-largest retail REIT in the country, completed the financing of $1.2 billion in property-level debt. The new loans have a weighted average interest rate of 3.65 percent and an average term of 8.4 years, compared to the 4.62 percent interest rate on the previous loans, which were due to mature in about a year. More...

Are Rising Rents Too Much of a Good Thing? It seems like such good news—apartment rents are rising faster than inflation. That means more profits for real estate investors. More...

New Financing Facility Bolsters Waypoint’s Push into Single-Family Rentals Waypoint Real Estate Group, which has acquired 2,000 single-family homes since early 2009, has received a $245 million revolving credit facility that will support the continued expansion of a growing portfolio of single family rental homes. More...

Multifamily Occupancy Rates Stabilize, Rent Growth Slows Apartment rents are still growing across the country, but not as quickly as they were in the summer of 2011, when growth in effective rents peaked. More...

Fits and Starts for Commercial Real Estate Volume The commercial real estate recovery, like the rest of the economy, had a late spring slowdown. “We had a strong first quarter and a softer second quarter as investors became concerned about sovereign debt issues,” says Janice Stanton, senior managing director of Capital Markets for commercial real estate broker Cushman & Wakefield. More...

Price Indices Show CRE Values on the Rise Prices keep rising for commercial real estate properties, according to indices kept by top real estate firms—but not as quickly as in the years just after the crash. More...

Commercial Properties are Returning to Health, but Property Managers Remain on Active Duty A property manager’s job is never done. Especially not in today’s world, where the need to retain old tenants and attract new ones, combined with those tenants’ heightened expectations for round-the-clock service, have left property managers with more responsibilities than ever. More...

Observers Say Concerns Over Multifamily Overbuilding are Overblown After several years of little new apartment construction, development activity has ramped up. But industry experts aren’t worried about overbuilding. The number of units under construction is still below historic norms. Plus, most properties coming online today are leasing quickly—with some rental rates well above expectations. More...

The Early Phase of Real Estate Recovery We consider real estate to be in the early phase of a cyclical recovery. After a hiring slump in mid-2011, the job market has begun to show signs of strength, as the unemployment rate continued declining in the first quarter of 2012. More...

A Coming Deluge of Apartment Construction Apartment fundamentals are performing at robust levels, with vacancies cratering to levels unseen in more than a decade. With few other real estate sectors offering such promising returns, developers are planning to open hundreds of thousands of new rental units in the next few years. Will the growth in new supply arrest improvements in occupancy and rents? More...

NCB, FSB Reports $72 Million in New Financing Activity NCB, FSB senior vice president Sheldon Gartenstein originated over $17 million in new loans during March, including a $7.4 million first mortgage for Hudson View Gardens Inc., a 353-unit co-op located at 116 Pinehurst Avenue in Manhattan; a $2.5 million first mortgage and a $500,000 line of credit for a 55-unit co-op located at 157 West 79th Street in Manhattan; and a $2 million first mortgage and a $500,000 line of credit for a 70-unit co-op located at 98-120 Queens Boulevard in Rego Park. More...

Seniors Housing Pros Expect More Access to Capital, Increasing Construction Starts While the bulk of the real estate industry spent much of 2011 focused on shoring up weak fundamentals, the seniors housing sector quietly posted near record sales numbers, according to a research study conducted by NREI and Seniors Housing Investment Advisors. More...

Multifamily Sales Decrease in 1Q12, But Average Price Increases After recording more than 360 U.S. apartment sales valued at $10 million or more during the fourth quarter of 2011, total sales closed during January, February and March probably declined by one-third or more. The average price of a unit traded in the first quarter of 2012, increased, however, rising 5 percent from $122,400 in the fourth quarter of 2011 to $128,600 during the first quarter of 2012. More...

Investor confidence hits a high note P ositive news in recent months on everything from jobs data and consumer spending to rising occupancies appears to be striking a chord with commercial real estate investors. The latest NREI/Marcus & Millichap Investor Sentiment Survey shows that investor confidence has once again surged forward. The Investor Sentiment Index hit a high of 166—the highest level since the index began in 2004. More...

U.S. Moves Toward Home 'Rentership Society,' Morgan Stanley Says
The U.S. homeownership rate has fallen below 60 percent when delinquent borrowers are excluded, a sign of the country's move toward a "rentership society," Morgan Stanley said in a report today.

The national rate, which stood at 66.4 percent at March 31, would be 59.7 percent without an estimated 7.5 million delinquent homeowners who may be forced into renting, according to Morgan Stanley analysts led by Oliver Chang. The lowest U.S. homeownership rate on record was 62.9 percent in 1965, the first year the Census Bureau began reporting the data. More...

LESS DISTRESS: CRE Taking Less of Toll on Nations' Banks
Although FDIC's "Problem List" Increased from 884 to 888 Institutions During the Quarter, Nonresidential Assets Continue Slide, Construction & Development Problems Abating, Multifamily on Verge of Turnaround

While commercial real estate continues to burden the nation's 7,584 insured banks and thrifts, the severity of the CRE-related impairment is gradually decreasing. Most of the recuperation is stemming from write-downs and attrition in construction and development loans, the dearth of new lending and from improvement in the multifamily sector. More...

Money for CRE Deals Starting To Flow
Numerous indications over the past few weeks point to an easing of investment capital for real estate deals. Life insurers have become more active lenders; new CMBS offerings are hitting the street; syndicators are starting to assemble new CDO offerings; and bank loan officers are reporting the first easing of lending standards in years. More...

U.S. Apartment Rents and Occupancies Seen Set to Rise
Apartment rents and occupancies are likely to continue to rise as the U.S. home and labor markets remain depressed, economists said at a conference sponsored by investment-advisory firm Bentall Kennedy.

"There are fewer jobs today than 10 years ago," said Doug Poutasse, head of North American strategy and research at Toronto-based Bentall Kennedy, which oversees $23 billion of real estate assets. "There has been a tremendous demographic shift." More...

Multifamily is Back; 8 Million More Renters on the Way?
A year ago, the folks who worked in Freddie Mac's multi-family section were sitting around waiting for the phones to ring. Now they can't keep up. "It's remarkable how quickly things changed," said Freddie Mac's Kimball Griffith. "We're now the 'P' in the P&L at Freddie Mac." (P&L is business jargon for profit and loss.)

Patrick Fitzgerald, an Orlando-based vice president at BankUnited, is seeing the same kind of activity. "Multi-family is in a full-fledged healing mode," he said at the American Bankers Association's annual Real Estate Lending Conference in Baltimore. More...

Apartment Companies Cut Back on In-House Tech Support
The percentage of information technology (IT) employees at apartment companies has declined significantly over the past two years, according to a new benchmarking report by the National Multi-Housing Council, an apartment trade group based in Washington, D.C. More...

Most residential landlords drop concessions
Gap between posted rents and what tenants actually pay narrowed hugely last year in Manhattan as apartment market stabilized. The average unit now takes only 44 days to rent... More...

U.S. Apartment Vacancies Fall to 2-Year Low
U.S. apartment vacancies fell to a two-year low in the fourth quarter and rents rose, extending a market recovery that began in early 2010, property research firm Reis Inc. said. More...

MultiFamily Monday:Up and Away
There's been an increase in multifamily investment since August, particularly for A and B locations close to the subway system, says Marcus & Millichap regional manager JD Parker, whose firm is marketing over $400M of apartments in the Tri-State area. More...

No Fits, Just Starts:
Apartment development ramps up The apartment sector is the only sector within the commercial real estate industry where development makes sense, according to industry experts. While other sectors such as office, retail and industrial are not overbuilt, existing demand is minimal and future demand is not forecasted to be strong. Demand for apartments, on the other hand, is expected to increase substantially over the next three to five years, and apartment owners and operators are ramping up their development activity. More...

Multifamily Sales Defy the Slump
Apartment Deals Jump 32% as New Inventory Hits Market; Distressed Sellers

Home buyers might be sitting on the sidelines, but multifamily-building sales are on the rise, reversing the slowdown that followed the financial market's collapse two years ago.
Apartment transactions totaled $7.1 billion in the second quarter, up 32% from a year earlier, according to Marcus & Millichap Research Services. Real Capital Analytics reports that closed sales hit $2.6 billion in August, the highest month this year and the most active month since August 2008. More...