17 Must Reads for Real Estate Investors Today (May 12, 2023)

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  1. Blackstone in talks with US regional banks over lending partnerships “Jon Gray, president of Blackstone, told the Financial Times his company was talking to regional banks about entering into partnerships, which would involve lenders making or ‘originating’ loans that the private equity group can funnel to its insurance customers.” (Financial Times)
  2. Sternlicht’s Starwood Real Estate Income Trust Shakes Up Its Leadership “Starwood Real Estate Income Trust this week replaced John McCarthy, who had served as CEO since the REIT launched in November 2017, with Sean Harris, according to a filing with the U.S. Securities & Exchange Commission. Harris, who has served as president of Starwood REIT since January 2021, will continue in that capacity as well and has been added to its board of directors.” (CoStar)
  3. Brookfield CEO seeks to reassure on commercial real estate after mortgage defaults “The alternative-asset manager defaulted on mortgages on office buildings in Los Angeles and around Washington, but Flatt said the problems are ‘discrete to those assets’ and not material to the Toronto-based firm’s huge real estate business.” (Financial Post)
  4. Nuveen Buys Giant New York City-Focused Affordable Housing Portfolio “The properties are largely concentrated in the New York City area, including several large apartment buildings in the Bronx, Brooklyn and Queens. Other buildings are located in Maryland, Massachusetts, Texas and other states, Nuveen said on Tuesday. The portfolio includes developable land and existing buildings in need of rehabilitation that could eventually produce an additional 8,000 low-income apartments, Nuveen said.” (The Wall Street Journal)
  5. ‘It’s hell’: life under the American mobile home king who calls himself a ‘grave dancer’ “Billionaire Sam Zell is the largest mobile home landlord in the US, but his tenants say they reckon with disrepair, neglect, flooding and rising rents. Some have had enough.” (Guardian)
  6. Real Estate’s Lead as Best Investment Shrinks; Gold Rises “The 34% of Americans choosing real estate this year is down sharply from last year’s record-high 45% but is on par with the typical proportion selecting real estate from 2016 to 2020, before housing prices skyrocketed during the pandemic. Higher interest rates over the past year have cooled the housing market, dampening consumer exuberance about real estate as an investment.” (Forbes)
  7. What to Make of Commercial Real Estate? “Taken together, the risk is that commercial real estate values fall due to an imbalance between supply and demand, combined with materially higher financing costs. What does this commercial real estate outlook mean for investors? Prepare for ongoing stress that may ultimately lead to a shakeout, creating opportunities for new capital to enter at more attractive terms.” (Bernstein Private Wealth Management)
  8. A $6 Billion Chicago Real Estate Project Seeks Funds After Delay “Chicago’s $6 billion Lincoln Yards mega development is in talks to receive new financing after delays in getting approvals from the city set the project behind schedule.” (Bloomberg)
  9. Aby Rosen gets extension on $1B Seagram Building refi “The office building loan is among the largest coming due this year, and its extension carries good and bad news about the state of the financing market: Rosen’s RFR Realty wasn’t able to refinance before the loan’s maturity date, despite the building’s good health, but was able to avoid distress.” (The Real Deal)
  10. REITs To Be Impacted By New SEC Share Repurchase Disclosure Requirements “Under the final amendments, the SEC has expanded the disclosure requirements regarding share repurchases to require the inclusion of daily quantitative repurchase data in quarterly filings with the SEC and eliminated the requirement to include monthly repurchase data in these quarterly filings.” (JD Supra)
  11. Tishman Speyer Forms Real Estate Fund With Raffles Family Office “Tishman Speyer, a U.S. property developer and investor, is partnering with an Asian multi-family office to start a real estate fund to further tap into the Asia-Pacific market.” (Mergers & Acquisitions)
  12. CRE X-Factor: For Commercial Real Estate, Banks Aren’t the Only Lender in Town “Nonbanks account for a greater share of lending for most asset classes, though the nonbank share is largest in multifamily lending at about 70 percent. This large nonbank lender share is due to the presence of the GSEs in residential real estate markets, as they regularly purchase and hold residential mortgages originated by other lenders, including mortgages for apartment buildings.” (First American)
  13. Office REITs Look At Diversification For A Life Raft “Once such champions of the asset class that they staked their profits and investors’ money on office buildings, REITs that have specialized in offices are diversifying their holdings, either through development or acquisition, making them the latest segment of commercial real estate to pull away from the troubled office market.” (Bisnow)
  14. The Fed Worries About Bank CRE Loans for a Good Reason “And something that could trigger deposit flight and bank stability is the prospect of large CRE loan losses, which would then upset the base of lending and create the sucking sound of a vicious circle vortex.” (GlobeSt.com)
  15. Wave of lawsuits targets Detroit commercial property owners “The city’s most recent filing is against owners of the former Mammoth shopping center on the west side that has been vacant for about 20 years. Other targeted properties include Perfecting Church at Woodward and 7 Mile and several vacant buildings owned by prominent investor Dennis Kefallinos.” (Axios)
  16. Hundreds of Bed Bath & Beyond leases are prepped for the auction block “Following approval by the United States Bankruptcy Court, leases for nearly 500 Bed Bath & Beyond and buybuy Baby stores will be up for grabs, according to A&G Real Estate Partners, which has been engaged to put them up for auction.” (Chain Store Age)
  17. Real Estate Investors Sue Law Firm For $1.1B In Malpractice Case “The suit alleges the firm missed a number of important deadlines during discovery in Frydman’s federal racketeering suit against a former partner, Eli Verschleiser. As a result, the suit alleges, Frydman missed out on a much higher award in its case against Verschleiser.”(Bisnow)
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