Blogroll

We have read some amazing industrial reports this week from CBRE, Grubb & Ellis (Grubb), Cushman & Wakefield (CW), and REAL Capital Analytics (REAL). Here are some great take-aways: Sales of significant industrial properties totaled $890M in February, a 33% increase from a year earlier(REAL). Total industrial activity increased to $18.9 billion in 2010 up 77% from 2009(REAL). Demand has been stronger than supply in Atlanta, Dallas and the Inland Empire(REAL). Rental rates remain flat, but due to the limited amount of construction activity, this may change...

---

Great insight to the global economic environment from Pimco. Q: What is PIMCO’s outlook on inflation and interest rates if the situation in the Middle East does not lead to a severe oil shock? Parikh: Setting aside immediate oil shocks, we believe global inflation has cyclically troughed and we see a secular upswing in inflation, which naturally will put upward pressure on interest rates. We see three key global factors as potentially adding to inflation over a long horizon: The degradation of sovereign balance sheets and the structural inflexibility of fiscal deficits. Emerging...

---

Article from GlobeSt.com NEW YORK CITY-The pace of US CMBS loans transferring to special servicing has slackened since 2009, and the year-to-date tally is about one-third of what it was 12 months ago, Fitch Ratings said Friday. That being said, a slowdown does not mean a full stop: earlier in the week, Moody’s Investors Service noted that the delinquency rate for CMBS continued to tick upward last month, albeit at the more moderate pace seen since June 2010. About 200 Fitch-rated CMBS loans have gone into special servicing since the start of 2011. That compares to 631 for the same...

---

January CoStar Commercial Repeat Sales Index Illustrates How Rapidly Prices were Falling a Year Ago - And How Much They've Improved CoStar's index tracking repeat sales of investment-grade commercial properties jumped 10.6% in January over the same period last year, the largest year-over-year gain since the height of the real estate boom in 2006. The increase in the index for higher-quality properties hit a five-year high for January despite dipping slightly from December, a reflection of how hard the index fell a year ago and how strongly it has recovered within 12 months. "Pricing...

---

Story from Globe St. BALTIMORE-Multifamily has been the rock star commercial real estate asset class for some time. Signs, though, are pointing to a contender for that title: industrial--especially properties on the Eastern Seaboard. Case in point, the recent trade of 1900 Clark Rd., a 613,000-square-foot distribution center in the Havre de Grace submarket. It sold for $26.4 million--a 35% increase from the last time it traded in September 2009. “Nothing else changed about this product,” Cassidy Turley’s Jonathan Carpenter tells me. “The cap rate was just north of 7% with this...

---

According to the data: The current annualized rate of growth (4Q2010) is 1.24 percent, which is in line with the historical average of 1 to 2 percent. Prior to 3Q2010, industrial space demand had been in "contraction mode" marked by seven consecutive quarters of negative demand for industrial space. In 4Q09, demand declined at an average annualized rate of 1.2 percent, which was below the rate of decline in the prior quarters of 2009. The two main variables used in the calculation - Purchasing Manager Index and Index of Manufacturing Output (see below for details) - are strong and suggest...

---

A great article on Industrial Real Estate. We agree with CBRE.  Industrial Real Estate will rebound very fast. The Prologis/AMB merger will create some great opportunity as they reposition their global portfolio. CAP rates will compress as long as interest rates stay low. To explore the topic of investing in industrial real estate we need to take a look at the sector's recent performance and the trends that are evolving and emerging in 2011. U.S. industrial investment transaction volume in 2010 was $18.9 billion which represents a 77% improvement over 2009 but it is still 65% below the average...

---

Good News from Commercial Real Estate CMBS activity has flourished in the past few weeks with more than $6.5 billion in new securitization coming to market. In addition, Freddie Mac brought two multifamily-backed offerings totaling $1.86 billion to market. The activity in February alone is almost two-thirds of all CMBS deals offered last year - and for some is reminiscent of 2007 when commercial mortgage-backed securities offerings were at their peak, which has the commercial real estate market bullish and fretful at the same time. Read the entire article HERE

---

Great stats on Industrial Real Estate, only having 3.79% of CMBS in special servicing.

---

The formal vote comes amid a gradual change by the giant pension fund after losing 42% of the value of its real estate portfolio during the recession. Marc Lifsher, Los Angeles Times February 15, 2011 Reporting from Sacramento — After losing 42% of the value of its extensive real estate portfolio during the recession, the state's biggest public pension fund has approved a formal plan to pursue a less risky investment strategy. Board members of the $229-billion California Public Employees' Retirement System endorsed a plan to shift away from residential properties, raw land and highly...

---