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Monthly Archives: March 2014

Non-listed REITs Accounted for $21B of 2013 Total Sales; Moving at Faster Rate in 2014 YTD

Since 2013, non-listed REITs have aggressively accumulated the U.S. commercial real estate investment market. Data from Real Capital Analytics (RCA), a global research firm focused exclusively on commercial real estate data and analytics, shows that non-listed REITs are the fastest growing segment of the market, accounting for $21 billion of total U.S. sales transactions last year, an 85% increase from 2012.

“There were more private REIT deals last year than in 2007,” says Dan Fasulo, RCA Managing Director.

Trends from 2014 show non-listed REITs are raising money at even faster rates than last year, with experts projecting a $6.5 billion return in Q1’14 alone.

Although non-listed REITs include all major property types and subtypes, they are greatly focused on office and retail properties priced well below $100 million.

“They tend to go for bite-sized properties,” Fasulo notes. An exception to this rule last year was American Realty Capital New York Recovery REIT’s purchase of a 48.9% interest in One Wordwide Plaza, a class-A office tower in Manhattan.

Non-listed REITs Accounted for $21B of 2013 Total Sales; Moving at Faster Rate in 2014 YTD

Since 2013, non-listed REITs have aggressively accumulated the U.S. commercial real estate investment market. Data from Real Capital Analytics (RCA), a global research firm focused exclusively on commercial real estate data and analytics, shows that non-listed REITs are the fastest growing segment of the market, accounting for $21 billion of total U.S. sales transactions last year, an 85% increase from 2012.

“There were more private REIT deals last year than in 2007,” says Dan Fasulo, RCA Managing Director.

Trends from 2014 show non-listed REITs are raising money at even faster rates than last year, with experts projecting a $6.5 billion return in Q1’14 alone.

Although non-listed REITs include all major property types and subtypes, they are greatly focused on office and retail properties priced well below $100 million.

“They tend to go for bite-sized properties,” Fasulo notes. An exception to this rule last year was American Realty Capital New York Recovery REIT’s purchase of a 48.9% interest in One Wordwide Plaza, a class-A office tower in Manhattan.

Investors Gamble Southern Europe’s Slow Recovery Rate for Higher Returns

Investors of European real estate are increasingly setting their sights on Southern Europe, gambling the region’s slow recovery rate in search of higher returns in the future.

According to data from Real Capital Analytics (RCA), a global research firm focused exclusively on commercial real estate data and analytics, investors poured 177.8 billion ($245.3 billion) into Europe in 2013, the highest since 2007. During Q4’13, commercial property purchases in Southern Europe (which consists of Spain, Portugal, Italy and Greece) reached €3.0 billion ($4.1 billion), double the amount from the same year-ago period.

A large deal so far in Q1’14 includes the €61.0 million ($84.0 million) purchase made by a UBS real-estate fund of a shopping center in San Sebastian, Spain, that included 62 stores and 11 restaurants.

Cross-border investors are also taking advantage of the abundance of financially distressed owners and lenders in Greece, the slowest recovering country in Southern Europe.
Opportunistic investors are creating high demands for distressed property loans in Southern Europe. One example is Project Octopus, a portfolio of Spanish loans from Commerzbank AG with a face value of €4.4 billion ($6.1 billion), expected to be one of the biggest such deals in Europe in 2014.

New players to Southern Europe real estate are coming from South Korea, Malaysia and China. Recent deals made by new players include the €280.0 million ($385.4 million) purchase of an iconic Madrid Skyscraper by Chinese developer Dalian Wanda Group, whom purchased the property from Spanish lender Santader, RCA data shows.

RCA data also indicates that sovereign wealth funds are showing increased interest in Europe, purchasing €13.6 billion ($18.7 billion) worth of commercial real estate in 2013, a 31% rise from 2012. Globally, real estate transactions from sovereign wealth funds increased by only 9%.

Investors Gamble Southern Europe’s Slow Recovery Rate for Higher Returns

Investors of European real estate are increasingly setting their sights on Southern Europe, gambling the region’s slow recovery rate in search of higher returns in the future.

According to data from Real Capital Analytics (RCA), a global research firm focused exclusively on commercial real estate data and analytics, investors poured 177.8 billion ($245.3 billion) into Europe in 2013, the highest since 2007. During Q4’13, commercial property purchases in Southern Europe (which consists of Spain, Portugal, Italy and Greece) reached €3.0 billion ($4.1 billion), double the amount from the same year-ago period.

A large deal so far in Q1’14 includes the €61.0 million ($84.0 million) purchase made by a UBS real-estate fund of a shopping center in San Sebastian, Spain, that included 62 stores and 11 restaurants.

Cross-border investors are also taking advantage of the abundance of financially distressed owners and lenders in Greece, the slowest recovering country in Southern Europe.
Opportunistic investors are creating high demands for distressed property loans in Southern Europe. One example is Project Octopus, a portfolio of Spanish loans from Commerzbank AG with a face value of €4.4 billion ($6.1 billion), expected to be one of the biggest such deals in Europe in 2014.

New players to Southern Europe real estate are coming from South Korea, Malaysia and China. Recent deals made by new players include the €280.0 million ($385.4 million) purchase of an iconic Madrid Skyscraper by Chinese developer Dalian Wanda Group, whom purchased the property from Spanish lender Santader, RCA data shows.

RCA data also indicates that sovereign wealth funds are showing increased interest in Europe, purchasing €13.6 billion ($18.7 billion) worth of commercial real estate in 2013, a 31% rise from 2012. Globally, real estate transactions from sovereign wealth funds increased by only 9%.

Hotel Sector Expecting A Strong 2014, Driven by Increased Lending and CMBS Issuances

Industry experts are predicting that 2014 will be a great year for the hotel sector, especially after a strong 2013. Factors that are expected to drive the hotel industry’s growth are increased lending and the resurgence of Commercial Mortgage Backed Securities (CMBS).

Brought by increased lending in the past four quarters, the recent abundance of capital coupled with low interest rates has created a more aggressive atmosphere among hotel investors. As a result, new market players are coming up with creative lending structures such as mezzanine financing and quasi-equity debt, bringing more protection to banks, more stimulus to the marketplace, and ultimately, more liquidity for transactions.

The resurgence of Commercial Mortgage Backed Securities (CMBS) has been a major factor in driving hotel sales. According to data from Real Capital Analytics (RCA), a global research firm exclusively focused on commercial real estate data and analytics, 41% of total lending composition in 2013 came from CMBS.

RCA data also shows that hotel investors are increasingly turning to U.S. secondary markets, with sales volume in Non-Major Metros increasing by 49% in 2013 while sales in the 6 Major Metros fell. The Southeast and Southwest regions showed the strongest growth in sales volume, up 82% and 55%, respectively.

According to RCA’s publication US Capital Trends®: Hotel 2013 Year In Review, the top three hotel buyers of 2013 were Blackstone Group, GIC (Government of Singapore), and Starwood Capital Group.

Hotel Sector Expecting A Strong 2014, Driven by Increased Lending and CMBS Issuances

Industry experts are predicting that 2014 will be a great year for the hotel sector, especially after a strong 2013. Factors that are expected to drive the hotel industry’s growth are increased lending and the resurgence of Commercial Mortgage Backed Securities (CMBS).

Brought by increased lending in the past four quarters, the recent abundance of capital coupled with low interest rates has created a more aggressive atmosphere among hotel investors. As a result, new market players are coming up with creative lending structures such as mezzanine financing and quasi-equity debt, bringing more protection to banks, more stimulus to the marketplace, and ultimately, more liquidity for transactions.

The resurgence of Commercial Mortgage Backed Securities (CMBS) has been a major factor in driving hotel sales. According to data from Real Capital Analytics (RCA), a global research firm exclusively focused on commercial real estate data and analytics, 41% of total lending composition in 2013 came from CMBS.

RCA data also shows that hotel investors are increasingly turning to U.S. secondary markets, with sales volume in Non-Major Metros increasing by 49% in 2013 while sales in the 6 Major Metros fell. The Southeast and Southwest regions showed the strongest growth in sales volume, up 82% and 55%, respectively.

According to RCA’s publication US Capital Trends®: Hotel 2013 Year In Review, the top three hotel buyers of 2013 were Blackstone Group, GIC (Government of Singapore), and Starwood Capital Group.

Love and Success in Real Estate for Eastern Consolidated Properties’ Owners

Peter Hauspurg and Daun Paris have both a successful marriage and a prosperous business partnership in Eastern Consolidated Properties, a feat that would prove daunting to most couples. Over the last three decades, they have built Eastern Consolidated into one of New York’s leading commercial real estate sales brokerages, with 60 brokers and about $1.1 billion in deals a year.

These days, the firm is reaping the benefits of New York’s hot commercial property sales market. Volume hit $46.7 billion in the city last year, up from $39.9 billion in 2012, according to data and analytics firm Real Capital Analytics.

Love and Success in Real Estate for Eastern Consolidated Properties’ Owners

Peter Hauspurg and Daun Paris have both a successful marriage and a prosperous business partnership in Eastern Consolidated Properties, a feat that would prove daunting to most couples. Over the last three decades, they have built Eastern Consolidated into one of New York’s leading commercial real estate sales brokerages, with 60 brokers and about $1.1 billion in deals a year.

These days, the firm is reaping the benefits of New York’s hot commercial property sales market. Volume hit $46.7 billion in the city last year, up from $39.9 billion in 2012, according to data and analytics firm Real Capital Analytics.

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