Socal Multiunit Real Estate

NAR PREDICTS THE COMMERCIAL REAL ESTATE MARKET

 

The commercial real estate market has been limping along since the subprime fallout earlier this year, but since it takes an act of god to purchase a commercial property without a bare minimum of 10% down (an SBA loan where the property appraises), the lack of activity much more market jitters and loan oversight panic. All things considered, commercial real estate has been the relative bright spot on the real estate landscape.

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According to Commercial Leading Indicator for Brokerage Activity index published by the National Association of Realtors^®, the commercial market slowed 0.9 percent to an index of 117.9 in the second quarter from a reading of 119.0 in the first quarter, and is 2.1 percent lower than the record 120.5 in the second quarter of 2007; . (An index of 100 is defined as the level of commercial real estate market activity during the first quarter of 1990, the first period to be analyzed in this manner.)

Lawrence Yun, NAR chief economist, noted that commercial real estate activity, as measured by net absorption and the completion of new commercial buildings, is projected to weaken over the next six to nine months. “The pace of decline has intensified due to job cuts and very sluggish economic activity since the beginning of the year, particularly in those industries requiring commercial building spaces,” he said. “We anticipate the weakest commercial brokerage activity in nearly three years as a result.”

NAR’s commercial leading indicator is a tool to assess market behavior in the major commercial real estate sectors. That index incorporates 13 variables that reflect future commercial real estate activity, weighted appropriately to produce a single indicator of future market performance, and is designed to provide early signals of turning points between expansions and slowdowns in commercial real estate.

The next commercial real estate market report and forecast should be released shortly, and the next commercial leading indicator index will be released November 20.

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Info courtesy of http://www.realtor.org/press_room/news_releases/2008/commercial_real_estate_index?&WT.mc_id=LS082008&DCSext.CAT=Comm

 

 

LIVE / WORK LOFT + UNITS - CENTRALLY LOCATED

Jodi Summers | Sotheby’s International Realty | 310.260.8269 6543 WEST BLVD, Inglewood, CA CENTRALLY LOCATED SOHO LIVE / WORK LOFT + UNITS offered at $399,000 Multi-Family, 3 units Year Built 1924 Sq Footage 3,015 Floors 2 Parking Car garage Lot Size 3,746 sqft Style SOHO LIVE / WORK LOFT + UNITS CENTRALLY LOCATED SOHO LIVE / WORK LOFT + UNITS! 6543 WEST BLVD INGLEWOOD, CA 90302 Property Description SOHO comes to Inglewood. Converted quadaplex loft-like interior + units. Truck high door entrance on the alley. Use Code: QUADRUPLEX, Zoning: LA INR2*, commercial street. Affordable and versatile. This is good. Location Description South of Slauson, west of Crenshaw. see additional photos below PROPERTY FEATURES STOREFRONT, TRUCK HIGH DOORS + UNITS Lofty, rugged interior LOCATION FEATURES Centrally Located Renaissance Neighborhood South of Slauson, west of Crenshaw OTHER SPECIAL FEATURES Versatile Property ADDITIONAL PHOTOS Seller contact info: Jodi Summers Sotheby’s International Realty 310.260.8269 For sale by agent/broker   Equal Opportunity Housing Posted: Sep 24, 2008, 3:53pm PDT

 

INVESTORS STILL STRONG ON REAL ESTATE

INVESTORS STILL STRONG ON REAL ESTATE

Statistics are always fun, and we like this set, which surveyed more than 1,000 private and institutional real estate investors and documented their findings in the 2008 Real Estate Investor Outlook, conducted jointly by National Real Estate Investor, Marcus & Millichap and Countrywide Commercial.

Among the key findings:

� Availability and cost of financing moved up to the top concern for 2008. Unforeseen shocks to the economy rank as the second-highest concern among all groups except developers;

� 43 percent of developers express concern over rising surveyed more than 1,000 private and institutional real estate investors and documented their findings in the 2008 Real Estate Investor Outlook, conducted jointly by National Real Estate Investor, Marcus & Millichap and Countrywide Commercial.

interest rates

� Investors are optimistic about rental increases, although not as much as they�ve been in the past. Seventy-eight percent of respondents expect to see an increase in effective

rents for one or more property types compared to 84 percent in 2006. Investors feel

most positive about rental increases in the apartment sector.

� Replacement cost continues to be a key criterion for investors when they make acquisitions. Almost 90 percent of investors agree that replacement value is important. Nearly two-thirds of respondents indicate their most recent acquisition was at or below replacement cost, while 12 percent of respondents say their acquisitions were above replacement costs.

� Sixty-one percent of respondents say that returns are artificially low, with 38 percent

predicting that returns will rise back to long-term averages as conditions change and 23 percent forecasting returns will rise as conditions change but will not reach long-term average levels.

INVEST IN LATIN AMERICAN REAL ESTATE � GET A GOOD RETURN

INVEST IN LATIN AMERICAN REAL ESTATE � GET A GOOD RETURN
The Latin American real market is looking especially ripe as governments implement programs to attract foreign investment and improve their economic growth potential.

1. Chile
Boasting the most stable and advanced economy in South America, Chile enjoys a high standard of living. Chile ranked eleventh�one spot behind Canada�in terms of the country�s degree of economic freedom, according to the 2007 Index of Economic Freedom put forth by The Heritage Foundation and the Wall Street Journal. Chile�s capital, Santiago, is a booming metropolitan center with first-class infrastructure. More than a third of Chile’s population resides in the metro area of Santiago. The capital is a business hub for Latin America and welcomes an abundance of business travelers. However, the bustle of activity in the manufacturing and mining businesses has created a considerable amount of air pollution, particularly in the Santiago area.2. Brazil
The largest country in South America, Brazil is only slightly smaller than the entire U.S., according to the CIA World Factbook. Brazil offers a wide variety of investment opportunities; from cities such as the modern, urban Sao Paulo and the beach resort city of Rio de Janeiro to vast areas of farmland and timberland. Brazil still struggles with social problems such as income inequality and poverty, the country�s outlook remains positive, as indicated by the country�s impressive economic strides during the past few years. The growing success of its economy is reflected in the government�s efforts to attract foreign investment, especially in development of the Northeast coastal areas of Brazil.

Brazil�s two major cities, Sao Paulo and Rio de Janeiro, have already been discovered by investors and tourists, and the demand has driven up property prices. However, there are still millions of acres of terrain for investors to purchase and capitalize upon.As an added bonus, Brazil accounts for 14.9 percent of total freshwater resources in the world, outranking all other countries, according to AQUASTAT. Brazil is also the largest producer and exporter of ethanol in the world, according to the Economic Research Service of the U.S. Department of Agriculture, placing the country in an excellent position for future economic growth. 3. Uruguay

Uruguay�s real estate market offers special advantages in terms of the country�s social and economic structure. �Uruguay is the safest country, has the least economic disparity, and the most highly educated population in Latin America,� David Hammond, realtor for ParadiseUruguay.com, said. �It is the second least corrupt country in Latin America, behind Chile; [it also] has good health care, and is one of the most affordable places in the world to live.�
Uruguay is the fifth wealthiest country in Latin America, with a per capita GDP of $10,900, according to the CIA World Factbook. The average per capita GDP for all Latin American countries, in contrast, is $7,200. The country has seen healthy economic growth over the past few years, with 12 percent growth in 2004 followed by 7 percent growth in 2005 and 2006.The capital city of Montevideo is a major hub for investment and home to approximately half the country’s population. It is a relatively modern city where investors can find a variety of residential facilities to choose from, from elegant apartments to old colonial homes. Montevideo is only a three-hour ferry ride from Buenos Aires. The city of Punta del Este, on Uruguay�s southern border, has also attracted a large amount of foreign investment. The city is considered by some to be a playground for the rich. 4. Peru

Peru has been generally overlooked as a place for major investment; consequently, property prices have remained low. Peru made headlines in 2006 when it had the best stock market performance in the world, with a staggering gain of 182 percent, according to the annual review of world stock market performance by Thomson Financial. Investments in Peru present low risk and chances of good return, Doron Weisbarth of Lima Real Estate, said.

�A severe housing shortage and short construction cycles ensure strong prices, easy sales and quick returns,� Weisbarth said. In addition, �local, Peruvian banks provide 70 to 75 percent of the financing and close scrutiny of the builders, [so] investors enjoy smaller risk yet.�Peru has successfully attracted foreign capital with investment-friendly policies

Get the whole story info@ http://www.nuwireinvestor.com/articles/top-five-latin-american-real-estate-markets-51342.aspx

INVESTORS EXPECT CONSTRUCTION COSTS TO INCREASE

INVESTORS EXPECT CONSTRUCTION COSTS TO INCREASE

70% of investors have experienced an increase in construction costs over the past 12 months, and more than half expect an increase in the next 12 months, according to the 2008 Real Estate Investor Outlook, which consulted 1,000� seasoned investors.

The Outlook suggests that construction costs increased an average of 16 percent. Going forward, respondents forecast construction costs to increase six percent.

Many experts believe the slowdown in single-family housing construction has decreased demand for commonly used building materials, therefore mitigating extreme price increases.

�Demand for concrete and steel hasn�t dropped off because there are still a lot of projects under development that use these materials � particularly public projects,� observes Rick Cavenaugh, president and COO of Fifield Cos., a Midwestern developer specializing in multifamily and office properties.

Statistics show global demand for building products continues to grow. These market dynamics make a substantial price correction unlikely. In fact, only eight percent of respondents expect a major pricing correction, while 90 percent expect there to be a minor or modest pricing correction for commercial real estate assets.

INVESTORS PREDICT THE MULTIUNIT MARKET WILL STAY STRONG

INVESTORS PREDICT THE MULTIUNIT MARKET WILL STAY STRONG�A recent survey of more than 1,000 private and institutional real estate investors � found that four out of five do not expect a decrease in the effective rents for any property type. In fact, 78 percent of respondents expect to see an increase in effective rents for one or more property types with apartments leading the way, according to the 2008 Real Estate Investor Outlook, conducted jointly by National Real Estate Investor, Marcus & Millichap and Countrywide Commercial.

COMMERCIAL PROPERTY MARKET BELIEVED TO BE REACHING THE BOTTOM

COMMERCIAL�PROPERTY MARKET BELIEVED TO BE REACHING THE BOTTOM

Real Capital Analytics has calculated that July was one of the worst months for investment-property sales during the credit crisis. with year-to-date sales volume down 70% from the same period a year ago. At the end of June, volume was down just 62% from the year-ago period.

The office, industrial, multifamily and retail sectors all reported their lowest July volumes since 2002 and 2003 when real estate markets were rebounding from the last down cycle.
The New York research firm attributed much of the sales decline to wide gaps between bid and ask prices, noting. “The key unanswered question is whether sellers are ready to recognize changed market conditions and accept pricing that will bring investors back into the market.”
It further noted that the next few weeks should be particularly critical in determining this year’s final tallies because September is traditionally one of the strongest periods for new offerings. “If sellers unveil a new round of offerings, that could add to an already backlogged inventory,” Real Capital warned.

THE McCAIN�S REAL ESTATE HOLDINGS

THE McCAIN�S REAL ESTATE HOLDINGS

Are we seeing shades of Ronald Reagan already?
John McCain’s inability to recall the extent of his personal real estate holdings was certainly the chuckle around the Labor Day barbeque this weekend. Ironically, as Inman New notes, the Republican presidential candidate�s property collection has been the subject of more ink than his thoughts on housing policy.

For the record, according to the Los Angeles Times, McCain and his wife Cindy own:

� a nine-acre property with a main residence and two guest cabins in Sedona, Ariz.;
� a separate six-acre parcel also in Sedona;
� a 2,100-square-foot condominium in Arlington, Va.;
� three condominiums, one of approximately 6,600 square feet, in Phoenix;
� two condominiums in Coronado, Calif.; and one condominium in La Jolla, Calif.�

All the dirt @ http://www.inman.com/buyers-sellers/columnists/marciegeffner/mccain-keeps-hands-housing
Pix: http://www.esoterically.net/weblog/wp-content/uploads/2008/02/mcain_cindy_john.jpg
http://blog.mlive.com/elections_source/2008/02/large_20080221-john-cindy-mccain.jpg