Randybacon - Liberty Realty Capital Group

Inside Sears’ death spiral

January 9, 2017 by Randybaconin Commercial Mortgage Lending, Real EstateLeave a Comment

How an iconic American brand has been driven to the edge of bankruptcy

One morning in late 2015, on Sears’ vast Illinois campus, more than a dozen employees huddled in a videoconference room on a floor dubbed “B6.”

There two mid-level employees were preparing a presentation for the CEO, Eddie Lampert, when their boss rushed in with some last-minute advice.

On a chart pad he wrote three words.

“He looks at the presenters and says, ‘Do not say these words to that guy,'” according to a former Sears executive who described the meeting to Business Insider. “That guy” meant Lampert, who would soon appear on a giant projector screen at the front of the room, beamed in live from a home office inside a $38 million Florida estate — 1,400 miles away from headquarters.

The pad with the three words was out of sight of Lampert’s video feed. One of the words on it was “consumer.”

Read entire article here in Business Insider

Department stores are in real trouble

December 21, 2016 by Randybaconin Real EstateLeave a Comment

Cramer says department stores are in real trouble and Nordstrom is ‘cannibalizing themselves

While some segments of retail are alive and well, Jim Cramer can’t ignore the pain that department stores like Nordstrom are in.

For years, traditional mall-based retailers have struggled desperately to keep up with Amazon, and have made big moves to build out their omnichannel business to compete.

Unfortunately, for some retailers, it simply wasn’t enough.

JPMorgan downgraded Nordstrom to “underweight” on Friday in the wake of recent meetings with the company’s management team. Nordstrom was once considered the best in the business, but the stock declined nearly 9 percent after the note was released.

View entire article on CNBC.com

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PACE Financing

December 5, 2016 by Randybaconin Green financing, Real EstateLeave a Comment

Pulaski County has given green building projects a lucrative green light, and developers of a west Little Rock apartment project have hit the accelerator.

The 50-unit complex, set to rise soon on Aldersgate Road, will be the first project in the county to use a financing option that pays 100 percent of the upfront costs of energy-saving upgrades — an option that lets the capital be repaid over many years as an addition to property tax bills. Energy savings over the payoff period are calculated to cover the cost.

The $6.6 million complex, known for now as the Preserve at Aldersgate, is also the first new construction multifamily project in the nation to adopt PACE financing. The method uses a special improvement district to pay for features that significantly save water and electricity or make other use of sustainable energy.

Learn more about Arkansas real estate financing here or contact Liberty Realty Capital to discuss your project.

Where are millennials moving to?

December 1, 2016 by Randybaconin Real EstateLeave a Comment

Millennials form the largest generation in the US, numbering more than 75 million nationwide. As this young, mobile group enters the workforce and forms new households, their decisions have a significant impact on the cities they choose to live in. Today, we look at Census data from 2005-2015, to understand where young Americans are moving to and choosing to settle down.

Surprisingly, metropolitan areas on the interior saw the biggest increases in millennial population. Among 50 large metropolitan areas, Charlotte, Houston, and Austin saw the most growth. 7 out of the top 10 large metros for millennial population growth were located away from the coasts. The biggest declines, however, happened in the Midwest and South – Detroit, Miami, and Phoenix, for example. These movements appear to be correlated with income growth in these cities.

View entire article at Apartmentlist.com

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An $11 trillion commercial real estate bubble is ready to rock the economy

November 18, 2016 by Randybaconin Real EstateLeave a Comment

Warnings about the loans, bonds, and commercial-mortgage-backed securities (CMBS) tied to the vast $11-trillion commercial property sector in the US have been hailing down for months. Moody’s Investor Services just warned about the rising delinquency rate of some $360 billion in CMBS it rates. Delinquencies of 60+ days jumped from 4.6% last year to 5.6% in September.

Fitch Ratings has been fretting about valuations in the sector, and CMBS, for months. “Valuation and lending trends are not sustainable in the medium term,” it said most recently in its November report. It pinpointed debt backed by apartment buildings as a particular trouble spot. But now it’s also fretting about construction loans, which “experienced the highest loss severity in the last crisis, and we expect a similar trend in the next downturn,” it said.

Read entire article in Business Insider.

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“Problem” Loans Create a Drag on CMBS Refinancing

November 9, 2016 by Randybaconin Commercial Mortgage LendingLeave a Comment

There is no question that the mountain of CMBS loan maturities hanging over the commercial real estate market has been shrinking. Yet there is still a heavy load of high-leverage loans searching for refinancing capital at a time when the CMBS market is battling its own liquidity crunch.

At the start of 2015, there was an estimated $300 billion in CMBS loans set to mature by the end of 2017. The fact that that volume has dropped by about two thirds, to $103 billion as of Oct. 1, is certainly good news.

Read entire article in National Real Estate Investor.

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