NNN Lease Market News
U.K. Housing Market is in Firm dDecline After a Rebound in 2010
The figures are the latest to suggest the U.K. housing market is in firm decline after a rebound in 2010. The Halifax mortgage lender said last week that prices in April fell at their fastest annual rate since October 2009.
Prices have been depressed by a variety of factors. Many prospective buyers have seen their monthly income fall in real terms as inflation has outpaced wage growth, making it less appealing to invest in a bigger property. The threat of job loss has also dissuaded some from taking on a bigger mortgage. First-time buyers in particular have been deterred by tight lending conditions.
The RICS said the fall in its balance in May was driven by a rise in the number of prospective sellers on the market, coinciding with a modest drop in people looking to buy.
Tuesday, June 14, 2011
Monday, June 13, 2011
Lease Market On Demand
NNN Lease Market News
The NNN Lease Market on Demand. It looks like another banner year for the NNN leasing market, with demand far exceeding supply in most areas of the country. Thanks largely to the baby boomer population seeking out new types of retirement investments, NNN Lease demand continues to be high, and the demand, for the most part, comes from people who are in the midst of 1031 tax deferred exchanges. And even in light of interest rates trending upwards, cap rates tend to remain low with prices holding steady. Shopping Center Business recently spoke with several companies that are active in the NNN Lease market to find out more about these trends and what we can expect for 2012.
Demographic Shift
The main reason for the current state of the NNN Lease market is the significant demographic shift of baby boomers moving into their retirement years. According to Bruce McDonald, president of Net Lease Capital Advisors, there are about 75 million baby boomers, the oldest of which are just hitting the age of 60, so there are a lot of older Americans who have built up substantial wealth in real estate portfolios. Their ability to go into the net lease market allows them to avoid paying capital gains tax and move from management-intensive real estate to passive real estate that provides a stable income. “There are a lot of people who have built their portfolios out of single-family, duplexes or triplexes, and they are getting too old to bother with that and now have a yin for a management-free investment that produces a regular cash flow,” says Ralph Bunje, president of Reverse Exchange Services, Inc. “The traditional NNN Lease market model for these investors was a single-tenant property, such as a Burger King or post office because it fit their criteria. Now, as a result of this demographic shift, there has been the creation of the TIC [tenant in common] industry.” In addition to a management-free investment, a lot of these retirees are looking for “safer” investments as opposed to the traditional stock market approach.
The NNN Lease Market on Demand. It looks like another banner year for the NNN leasing market, with demand far exceeding supply in most areas of the country. Thanks largely to the baby boomer population seeking out new types of retirement investments, NNN Lease demand continues to be high, and the demand, for the most part, comes from people who are in the midst of 1031 tax deferred exchanges. And even in light of interest rates trending upwards, cap rates tend to remain low with prices holding steady. Shopping Center Business recently spoke with several companies that are active in the NNN Lease market to find out more about these trends and what we can expect for 2012.
Demographic Shift
The main reason for the current state of the NNN Lease market is the significant demographic shift of baby boomers moving into their retirement years. According to Bruce McDonald, president of Net Lease Capital Advisors, there are about 75 million baby boomers, the oldest of which are just hitting the age of 60, so there are a lot of older Americans who have built up substantial wealth in real estate portfolios. Their ability to go into the net lease market allows them to avoid paying capital gains tax and move from management-intensive real estate to passive real estate that provides a stable income. “There are a lot of people who have built their portfolios out of single-family, duplexes or triplexes, and they are getting too old to bother with that and now have a yin for a management-free investment that produces a regular cash flow,” says Ralph Bunje, president of Reverse Exchange Services, Inc. “The traditional NNN Lease market model for these investors was a single-tenant property, such as a Burger King or post office because it fit their criteria. Now, as a result of this demographic shift, there has been the creation of the TIC [tenant in common] industry.” In addition to a management-free investment, a lot of these retirees are looking for “safer” investments as opposed to the traditional stock market approach.
Thursday, June 9, 2011
Dubai The Worst Performing Market
NNN Lease Market News
The Dubai Financial Market Real Estate Index, a measure of five developers’ stocks, has slumped 73 percent since mid-2008. The index was up 0.7 percent at 12:54 p.m. today and is still down 9.3 percent this year.
Residential property prices in Dubai, the worst-performing market in the Middle East for the past three years, haven’t yet benefited from political turmoil in other parts of the region, Deutsche Bank AG said.
The Dubai Financial Market (Arabic: سوق دبي المالي) is a stock exchange located in Dubai, United Arab Emirates. It was founded on March 26, 2000.
There are about 57 companies listed (as of August 2007) on DFM, most of them are UAE-based companies and a few dual listings for companies based in other MENA region countries. Many companies allow foreigners to own their shares. Total market cap is around $360bn, which is roughly equal to the market cap of Abu Dhabi Securities Market ($380bn) (as of August 2007). In comparison, the market cap for ExxonMobil (as of Oct. 2008) is $360bn.
During 2004 and 2005, there were significant increases in the volume of shares traded and the share prices of many companies. However, towards the end of 2005 and through the first few months of 2006 the bubble burst and share values dropped by around 60% on DFM, along with similar decreases in most other Persian Gulf stock markets.
The Dubai Financial Market Real Estate Index, a measure of five developers’ stocks, has slumped 73 percent since mid-2008. The index was up 0.7 percent at 12:54 p.m. today and is still down 9.3 percent this year.
Residential property prices in Dubai, the worst-performing market in the Middle East for the past three years, haven’t yet benefited from political turmoil in other parts of the region, Deutsche Bank AG said.
The Dubai Financial Market (Arabic: سوق دبي المالي) is a stock exchange located in Dubai, United Arab Emirates. It was founded on March 26, 2000.
There are about 57 companies listed (as of August 2007) on DFM, most of them are UAE-based companies and a few dual listings for companies based in other MENA region countries. Many companies allow foreigners to own their shares. Total market cap is around $360bn, which is roughly equal to the market cap of Abu Dhabi Securities Market ($380bn) (as of August 2007). In comparison, the market cap for ExxonMobil (as of Oct. 2008) is $360bn.
During 2004 and 2005, there were significant increases in the volume of shares traded and the share prices of many companies. However, towards the end of 2005 and through the first few months of 2006 the bubble burst and share values dropped by around 60% on DFM, along with similar decreases in most other Persian Gulf stock markets.
The NNN Lease Market is Booming
NNN Lease Market News
The NNN Lease Market is Booming In the past 18 months, cap rates for quality net leased properties have tightened more than 100 basis points. New CVS & Walgreen’s properties are selling in the low 7 to the low 6 cap ranges and ground leases with investment grade bank tenants are consistently in the 6’s and starting to break into the 5’s. Investors are attracted to the consistent cash flow stream of net leased properties and with A rated corporate bonds trading in the low 4’s, those looking for better yields are finding net lease properties an attractive alternative. In addition, since the recession started in late 2007, few new net leased assets have come onto the market which has further increased the demand for the existing inventory.
Lenders are bullish and fueling the NNN boom especially the conduits
As lenders have come back into the market, the availability of financing has been a boon for the acquisition of net leased properties. Banks, in regions where they are healthy, are attempting to carve out niches where they know the geographic market and have existing relationships with borrowers.
kwentzel@fantinigorga.com
http://www.fantinigorga.com/
The NNN Lease Market is Booming In the past 18 months, cap rates for quality net leased properties have tightened more than 100 basis points. New CVS & Walgreen’s properties are selling in the low 7 to the low 6 cap ranges and ground leases with investment grade bank tenants are consistently in the 6’s and starting to break into the 5’s. Investors are attracted to the consistent cash flow stream of net leased properties and with A rated corporate bonds trading in the low 4’s, those looking for better yields are finding net lease properties an attractive alternative. In addition, since the recession started in late 2007, few new net leased assets have come onto the market which has further increased the demand for the existing inventory.
Lenders are bullish and fueling the NNN boom especially the conduits
As lenders have come back into the market, the availability of financing has been a boon for the acquisition of net leased properties. Banks, in regions where they are healthy, are attempting to carve out niches where they know the geographic market and have existing relationships with borrowers.
kwentzel@fantinigorga.com
http://www.fantinigorga.com/
Boom Game Market In China
NNN Lease Market News
The game maker Perfect World told a Chinese newspaper recently that Chinese game operators are "irresistibly excited about digging gold in overseas markets."
China had 290 million Internet users nationwide as of November, with the number of Web surfers expanding at a 50% annual pace. At midyear, more than half that figure--some 147 million people--were playing online games, a nearly 20% increase from six months earlier, according to government figures. That's about 4 million new game players a month.
"We expect that in the next few years, the growth of the online gaming market in China will maintain its current speed," says Jasmine Liang, spokeswoman for Netease, which produces the highly popular "Fantastic Westward Journey." "When the economy is gloomy, you might feel it's expensive to spend 100 or 200 yuan [about $7 to $14] on a dinner or a movie, but dozens of [yuan] for one month on gaming is not that big a deal."
Online gaming is cheap indeed--less than 10 cents an hour, or free for some games that make money by selling bonus features such as weapons to top-end players. Since it's also a form of social networking, it provides an inexpensive social alternative to dinner and drinks with friends. For workers with downtime at state-owned enterprises, it is a popular time-killer, a social-networking version of solitaire. For a growing pool of computer-savvy college graduates facing a tough job market, it is a diverting way to stay in touch with former classmates. Shanda Interactive boasts the largest overall market share in China, according to iResearch, with 15.7% of revenue; 2nd-ranked Netease.Besides the increase in users and the increase in games, the Chinese market has room to grow, in part, because their product is still catching up to the global standard-bearer, "World of Warcraft."The game maker Perfect World told a Chinese newspaper recently that Chinese game operators are "irresistibly excited about digging gold in overseas markets."And after conducting research, the company decided only one market outside of China will be particularly lucrative: The United States.
http://www.forbes.com/forbes/
The game maker Perfect World told a Chinese newspaper recently that Chinese game operators are "irresistibly excited about digging gold in overseas markets."
China had 290 million Internet users nationwide as of November, with the number of Web surfers expanding at a 50% annual pace. At midyear, more than half that figure--some 147 million people--were playing online games, a nearly 20% increase from six months earlier, according to government figures. That's about 4 million new game players a month.
"We expect that in the next few years, the growth of the online gaming market in China will maintain its current speed," says Jasmine Liang, spokeswoman for Netease, which produces the highly popular "Fantastic Westward Journey." "When the economy is gloomy, you might feel it's expensive to spend 100 or 200 yuan [about $7 to $14] on a dinner or a movie, but dozens of [yuan] for one month on gaming is not that big a deal."
Online gaming is cheap indeed--less than 10 cents an hour, or free for some games that make money by selling bonus features such as weapons to top-end players. Since it's also a form of social networking, it provides an inexpensive social alternative to dinner and drinks with friends. For workers with downtime at state-owned enterprises, it is a popular time-killer, a social-networking version of solitaire. For a growing pool of computer-savvy college graduates facing a tough job market, it is a diverting way to stay in touch with former classmates. Shanda Interactive boasts the largest overall market share in China, according to iResearch, with 15.7% of revenue; 2nd-ranked Netease.Besides the increase in users and the increase in games, the Chinese market has room to grow, in part, because their product is still catching up to the global standard-bearer, "World of Warcraft."The game maker Perfect World told a Chinese newspaper recently that Chinese game operators are "irresistibly excited about digging gold in overseas markets."And after conducting research, the company decided only one market outside of China will be particularly lucrative: The United States.
http://www.forbes.com/forbes/
Wednesday, June 8, 2011
Office Owners Seek to Cash In as Prices Boom
NNN Lease Market News
Big-Name Buildings Go on Block as Prices Boom; 'Who Knows What Market Will Be Like' in a Year? says Tim Jaroch, one of the general partners who own the 1.4 million-square-foot Constitution Center.
Until recently, post-recession sales activity in the office market has been slow. Lenders have held onto distressed assets rather than sell them, frustrating many investors who hoped to take advantage of the pain of others. Even as values rise, many owners continue to resist selling because they don't like their options for investing the proceeds.
The sharp rise in values has come over the past year, a relatively short time frame in the real-estate market. Recent deals include the sale of 750 Seventh Ave. in New York's Times Square by Hines Interests for a surprisingly high $485 million and Beacon Capital Partners' sale of Market Square in Washington for a record $905 a square foot. Beacon also is considering bringing to market 1211 Ave. of the Americas in coming weeks, for which the company would look to retrieve well above the $1.5 billion that it paid in 2006, according to people familiar with the matter.
Building owners in some office markets contrast sharply with the residential market, where home prices have declined for months. Last week, the S&P/Case-Shiller Home Price Index reported home prices were down 4.2% in the first quarter of 2011.While new buyers are betting on a strong future in the market, the high prices—back so rapidly from the market's trough—have given some investors pause. Building owners in some office markets contrast sharply with the residential market, where home prices have declined for months. Large New York City developers, including Douglas Durst, have said prices have risen too high to justify acquisitions.
http://online.wsj.com/article
Office Owners Seek to Cash In
Big-Name Buildings Go on Block as Prices Boom; 'Who Knows What Market Will Be Like' in a Year? says Tim Jaroch, one of the general partners who own the 1.4 million-square-foot Constitution Center.
Until recently, post-recession sales activity in the office market has been slow. Lenders have held onto distressed assets rather than sell them, frustrating many investors who hoped to take advantage of the pain of others. Even as values rise, many owners continue to resist selling because they don't like their options for investing the proceeds.
The sharp rise in values has come over the past year, a relatively short time frame in the real-estate market. Recent deals include the sale of 750 Seventh Ave. in New York's Times Square by Hines Interests for a surprisingly high $485 million and Beacon Capital Partners' sale of Market Square in Washington for a record $905 a square foot. Beacon also is considering bringing to market 1211 Ave. of the Americas in coming weeks, for which the company would look to retrieve well above the $1.5 billion that it paid in 2006, according to people familiar with the matter.
Building owners in some office markets contrast sharply with the residential market, where home prices have declined for months. Last week, the S&P/Case-Shiller Home Price Index reported home prices were down 4.2% in the first quarter of 2011.While new buyers are betting on a strong future in the market, the high prices—back so rapidly from the market's trough—have given some investors pause. Building owners in some office markets contrast sharply with the residential market, where home prices have declined for months. Large New York City developers, including Douglas Durst, have said prices have risen too high to justify acquisitions.
http://online.wsj.com/article
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