Commercial deal volumes remain down so far this year. Total first-quarter deal volume fell below $100B, registering at about $90B. Quarterly deal volume has not fallen below $100B since 2014. “In addition to a new presidential administration that has yet to signal a clear direction on various issues affecting the economy and commercial real estate, deal flow is being hampered by shifts in Fed policy and political upheaval around the world. Furthermore, investors are exercising caution specifically because of the length of this bull market, as many wonder how long this unusually prolonged recovery can last,” said Ten-X Chief Economist Peter Muoio. (Via Mortgage Professional America)
Charles Evans, president of the Chicago Federal Reserve Bank, has voiced concerns over the Bank’s ability to meet its 2% inflation objectives, saying global competition and new technology is changing the way markets are behaving.”I will say that the most recent inflation data made me a little nervous about that. I think it’s much more challenging from here on out,” Evans told CNBC. “In a world of global competition and new technology, I think competition is coming from new places. New partners are choosing to merge and sort of changing the marketplace, and (there’s) more competitive pressure potentially on price margins.” If inflation data continues to not hit the mark, the Fed may follow “a shallower path” in raising interest rates. Evans also said the timing for Fed balance sheet plans is “pretty close.” (Via Reuters)
Hudson’s Bay is the latest retail operator facing “activist investor” pressure to monetize its real estate holdings. Johnathan Litt, the chief investment officer of Stamford, Conn.-based Land & Buildings Investment Management LLC, penned an open letter to HBC on June 19, saying that it should close and redevelop any stores or locations that it cannot run profitability. “If there is a smarter and better use of any or all of the locations, stores should be closed and redeveloped and put towards their optimal use,” Litt wrote, urging the operator to explore selling and repurposing real estate or going private. Litt calls HBC’s Saks Fifth Avenue location across from Rockefeller Center “likely one of the most valuable locations not only in Manhattan, but in the United States.” Land & Building Investment Management owns 4.3% of HBC shares. (Via TheStar.com)
More News to Note:
Committee of Global Banks Votes June 22 on LIBOR Alternative for Benchmarking
$1.2B Nevada Health Care-Focused Development Underway
HUD Program Results in $560M for Upgrades to NYCHA Far Rockaway Community
Spike in ‘Supercommuters’ Shows Reality of U.S. Housing Landscape