GLG News(sm): Real Estate

Brazil | Resin already has 2% of the window market

Daniel Vidal — Sun, 05 Jul 2009 23:43:01 EST

New vinyl applications - New business opportunities

REITs Slow Dance for the Street

Jack Kern — Tue, 30 Jun 2009 17:58:43 EST

The apartment industry is subject to a great deal of coverage, and some of it, justified or not is decidedly negative. As an industry that is subject to great challenges, it also meets property management issues with concessions and no increases at renewal. In many places, the levels of site traffic are down, but submarkets prevail in this business and the downgrading of REIT stocks in multifamily overplays the reality of future rent growth in some markets. Property prices are declining based on in-place rents and so future IRR considerations are vastly more complicated than ever before. With the downgrade of REIT securities, the vast number of shares shorted will be rewarded, but long term, apartments are stable.

Is this happening across the Globe? Or just a localised situation in the affected country.

Roy Soeigiarto — Mon, 29 Jun 2009 11:04:36 EST

Similarities between the Swine Flu & the Lower Rents for Landlords- This does not reflect the commercial / retail industry alone but across the board for all properties. Physical Properties & Equities - Too little with Too Much Where shall it be invested in? Reits? Local Companies? Developers? In this situation where we see the H1N1 aka Swine Flu first infecting the host country ( due to toxic habits) & then being 'transported' by global travellers, the same is also happening to our financial world economy. Should we be surprised by the manufacturing output being slow? Should we be surprised by slower consumer purchases? Should we be surprised by lesser consumer pressence? In my country like Singapore, we are the financial hub for the Asean region with neighbouring countries with huge natural resources. Does this impact the way Funds flow to Singapore from developed countries? Can we trust the current normal system & what can be ...

Restoring CMBS Key to Future CRE

Jack Kern — Fri, 26 Jun 2009 11:08:16 EST

The Federal Reserve Bank of New York, through president Richard Dudley has made restoring CMBS a key priority. This is really good policy while it seems to contradict some of the earlier actions of the Fed, especially in light of the decisions about the eligibility of certain loan terms for loan participation. The ability of owners to refinance their obligations is what is really at stake here and with the advent of $3,400bn in loans coming due, failure to secure a working CMBS facility and market could be a disaster. The Fed's TALF program, with approximately $1,000bn in capital, starting in July is going to be a determining factor in how well the program works.

Sinking Desert Sands for Investors in the Dubai Property Market

Lata Venkataraman — Thu, 25 Jun 2009 21:01:32 EST

Close on the heels of the overall global economic scenario, property investors in the much hyped and speculated Dubai markets got a rude awakening towards the 4th quarter of 2008 . Buildings in the desert were rising like lego blocks .Designer Apartments, Apartments offering all kinds of amenities leading to nirvana, villas set in the ocean on the fronds of the palm,miniature versions of different countries part of the much hyped about World Project.Bollywood stars like Shahrukh Khan competed with International bigwigs the Beckams,Hillary Swank.... Alas all the glitter and glamor were not to shine bright for a long time. With the economic slowdown came the pink slips and the heavy loan payouts were looming closer every month..To add to the misery the absence of a Local Residency not being possible made it difficult for the new owners to meet the loan commitments. Several high rises dot the horizon waiting to welcome their occupants..

When Does a Market Bottom?

Joseph Miller — Thu, 25 Jun 2009 12:50:00 EST

The determination of when a market bottoms is based upon the resurgence of a "free selling market" when sellers are not forced to sell and buyers are not buying because of subsidies, tax bonuses and all sorts of market stimulus. Reaching a decision that buyers are now in the market buying forced sales, short sales and foreclosures in record numbers does not signal a return to a free selling market until all of the short sales, foreclosures and government inducements to buy are not causing the sales. Much of this activity is fueled by speculators who will disappear from the buying market and resurface when the market prices rise then they become sellers which is a signal that a resurgent market is present but not the only signal.

A sharp rise in Demand for properties along the Red Metro Line

Lata Venkataraman — Thu, 25 Jun 2009 08:26:54 EST

As witnessed globally in the real estate market, any change in infrastructure can bring about a direct change in the Property Prices in the vicinity. The much awaited Dubai Metro Red Line will bring about a meteoric rise in Rents and Property Prices for sure.The city which has a large expatriate population with their families will find a major relief in commuting within the city from September 2009. Currently the citys public transport system has only the RTA buses or the Public Taxis to fall back on.Both of which are non -practical. Waiting for long periods of time in the scorching desert heat was a ordeal suffered by residents for decades.People travelling by private cars also had to face a slightly heavy toll charge and also endure traffic jams. . With the Red line trudging along a major part of the city ,families will now try and move closer to the metro station in an attempt to solve their daily commuting problem.

Orlando Metro Market Has Bottomed- A Tale of Two Markets

Anthony Ruben — Thu, 25 Jun 2009 05:29:02 EST

The Orlando (Central Florida) market is comprised of two submarkets. N. Orlando and Seminole County S. Orlando, Polk County and Osceola County. N. Orlando and Seminole County are seeing robust demand among consumer bargain hunters as well as investors. One local firm indicated results were up 40% with bargain inventory being snapped up within days (even bidding wars). In this market, condo sales are being driven by (more) realistic prices (esp. in conversions). This is driving investor interest as strong cash flow and the prospect of strong appreciation in two-to-three years is compelling. Homes are also being snapped up at bargain prices as those with jobs and credit take advantage of the pre-boom pricing that made Orlando an affordable market. S. Orlando et al is still falling as residents are lower income hospitality workers have no jobs/credit and new projects compete with new projects and lots of current and potential inventory. Recovery is years away.

LAS VEGAS: RESIDENTIAL HAS FOUND THE BOTTOM

Steve Bottfeld — Tue, 23 Jun 2009 02:58:15 EST

May housing data strongly suggests that Las Vegas will experience a bottom to the residential recession in the 2nd quarter of this year.

An ugly secret the REITs don't want you to know about

Kenneth Leonard — Fri, 12 Jun 2009 14:44:20 EST

This is the first article I have seen by an industry insider, that blows the whistle on the pending crisis in REIT profits. The implications are significant in that the reporter only talks about the smaller and/or independent retailers that are struggling to survive in shopping centers across America. The reporter pains a bleak picture of what is happening on a daily basis and what is likely to happen by next January after a deluge of retailers call it quits after lasting through the Christmas season and then closing their doors. If the reporter were to investigate the even more dangerous pending crisis brought on by the rapid departure of anchors, REIT stocks would be revealed to all be in serious danger.

Mr. Wood makes assumptions regarding residential constructionwithout facts

Joseph Miller — Thu, 11 Jun 2009 09:49:12 EST

“Residential construction may be bottoming,” said Steven Wood, President of Insight Economics LLC in Danville, California. However, Mr. Wood provided no basis for his opinion. In fact he moved on to "public" construction" in the next sentence. Making statements without supporting the opinion is rather misleading or purposely misleading.

Economic downturn exposes embryonic regulatory framework

Hernan Martinez — Wed, 10 Jun 2009 23:24:25 EST

Gulf States regulatory agencies accelerate the introduction of new regulations as a result of both buyers’ and developers’ defaults. Countries with undeveloped financial markets depend on pre-sales and “saving” schemes to finance project construction. Unless clear rules are developed international buyers and investors may retrench until transparency is established.

Housing Sector Bottom?

Robert Scott — Mon, 08 Jun 2009 10:36:21 EST

First time home buyers may help to put a bottom into the market but they cannot do it alone. First time home buyers may help stabilize the market long enough for confidence to improve and step up buyers to move into the market. However, the market cannot recover until banks get rid of the their inventory. We have more rough times ahead.

Foreign & Domestic Investors Positioning For Florida Distressed Real Estate Deluge

Howard Liggett — Mon, 08 Jun 2009 00:54:35 EST

South Florida's depressed real estate market is still about six months from rock bottom, but now bargain hunters are out in force. At a recent conference, real estate brokers and lawyers agreed the sharpest declines in value and the highest spikes in foreclosures will hit once most of Miami's new condo units are built in late 2008 and into 2009. Still, several brokers are noticing that distressed properties are starting to sell, and buyers - especially foreign buyers - are already eyeing the market to make sure they don't miss a feeding frenzy for cheap real estate. The trifecta of the housing glut, the subprime crisis and the weak dollar has made South Florida real estate attractive again - but for a very different reason than in 2005.

Real Estate Market Projections Based Upon First Time Buyers and Short Sales is Irrelevant

Joseph Miller — Fri, 05 Jun 2009 11:07:56 EST

Any report that portrays a global resurgence of the USA real estate is irrelevant if the projection cites that the path to recovery has begun as almost all data is related to first time buyers with incentives, short sales, builder discounts and foreclosed properties as all of these types of sales are not a present in a stable resurgent marketplace. First time buyer will disappear one the incentives and available properties diminish. A report on the resurgence of the market must be based upon sustainable market events not short term stimulus with events reported in only the lower priced real estate. Any resurgence must include sales that occur across the board in all price ranges.

Digesting This Week's Housing Data

David Lereah — Thu, 04 Jun 2009 15:42:31 EST

The markets have received a spate of housing reports that we need to interpret in order to better understand whether the housing industry is recovering or getting worse. The article analyzes and interprets the following reports: pending home sales; mortgage applications; mortgage delinquencies/foreclosures; Case-Shiller, FHFA, and NAR home prices.

Another Excellent "Comp"

Kenneth Leonard — Thu, 04 Jun 2009 14:20:56 EST

This package of three "urban" strip centers is rather unique in that these centers are very old but successful and well insulated from nearby competition from the Target and Wal Mart super stores. However they can still provide a good indication of value of high quality grocery anchored strips to guide the GLG reader trying to stay current on the market value of strip center REIT's portfolios.

The sale of distressed properties is a short market and not a solution to the Real Estate Market problems

Joseph Miller — Thu, 04 Jun 2009 12:29:53 EST

The stimulus of 1st time buyers and speculators in the foreclosed properties is simply a short term stimulus and doesn't begin a return of the housing market which has not been addressed in a serious manner. The new home and resale market above $350.000 in the Lehigh Valley Pennsylvania market place is not even a glimmer of 2007 and the market for homes in the $500,000 is almost absent of sales even though home prices continue to be reduced in the hopes of a sale. The missing ingredient to a market resurgence is "buyer confidence" which continually is eroded by government deficit spending and will get worse as interest rates rise as a result of government intervention to permit financing of the deficit which will further deepen the market the problems as social agendas trump the return of a strong economy.

Home Prices: This slide is but a taste of things to come

Joseph Chatham — Thu, 04 Jun 2009 12:28:45 EST

Although steep declines in home values are enticing new homebuyers, the overall affordability indices are troublesome. Existing "A" paper laon portfolios suggest trouble ahead. Further declines are not only coming, they should be welcome.

Commercial Real Estate Slump

Michael Cassidy — Wed, 03 Jun 2009 22:47:20 EST

Financing difficulties in the commercial real estate markets