NYC Sees Largest Property Values Increase Since '08

New York City's city tax assessors are on the front lines of a resounding boom in the market, with current property values marking the largest increase since the tax year ending in June 2008. Josh Barbanel from the Wall Street Journal wrote an article about the trillion-dollar city, where the total market value of taxable property rose to $1.072 trillion for the fiscal year beginning July 1, a 10.6% increase from the $969.4 billion reported this year. The most valuable office building, according to the new data, is the Bank of America Tower on West 42nd Street at Sixth Avenue valued at $1.7 billion. The most valuable mixed-use building was Time Warner Center at Columbus Circle valued at $2.02 billion.

"This year's tax roll is simply a reflection of New York City's growing real estate market," said Jacques Jiha, commissioner of the NYC Department of Finance. "We know revenues will not continue at this pace, so we must continue to maintain strong reserves to protect the City's fiscal health," added Amy Spitalnick, a spokeswoman for the city's Office of Management and Budget. For the city, the strong property values could mean hundreds of millions in additional tax collections on top of the $23.5 billion forecast for the fiscal year beginning in July in the city's November 2015 Financial Plan.

For more news and information visit Blumberg Partners.

Cluttons First Dubai Office Market Bulletin

Cluttons LLP, the Central London, UK-based real estate firm, has introduced its inaugural Dubai Office Market Bulletin for Spring 2016, which "seeks to unpick the complexities of Dubai's fragmented office market, while providing a detailed overview of the city's office landscape." The bulletin draws from the performance of 22 submarkets across the city in the first quarter of the year, which revealed that 13 markets showed no change in starting rents in 2015, while seven markets had notable increases, and two markets with lower limit rents decrease over the 12 months of 2015.

"Despite sustained demand, occupiers remain cost conscious and budget driven in the face of a softening global economic backdrop, with the key word for many being 'prudence'," said Faisal Durrani, Cluttons' head of research. "Landlords, by contrast appear to be slow to react to the cooling market, with many reluctant to move on asking prices and others demonstrating a lack of flexibility for lease terms at renewal. The emerging gulf between market reality and landlords' expectations is a concern, particularly for a market that is now starting to show signs of maturity."

According to the bulletin, with the establishment of two new free-zones in the form of Dubai Design District (D3) and Dubai World Trade District in 2015, Central Dubai has become the focus of many occupiers and developers, particularly as it has long suffered from a demand-supply imbalance in the face of rising requirement levels. D3's lower and upper limit free-zone rents have registered a 67% and 28% rise respectively since its launch, pushing them to between AED 150 psf and AED 165 psf.

To read the full report, click here. For more news and information visit Blumberg Partners.

CBRE Sees Moderate Investment & Rental Growth for 2016 Global CRE Market

CBRE Group released its 2016 Global Real Estate Market Outlook this month, which anticipates that moderate economic growth with low interest rates are likely to continue in 2016, and expects a year of "volatile markets but steady economic growth." Highlights from sectors include:

Economy
Expect 2016 to be a year of volatile markets but steady economic growth. Consumers in the U.S., EU and many parts of Asia Pacific are spending gains from rising incomes, low interest rates and low oil prices, which should support GDP growth.

Capital Markets
Global commercial real estate investment markets are expected to remain active in 2016, but the pace of growth is anticipated to slow after six years of recovery and price appreciation.

Office
Most U.S. and European office markets are expected to tighten further in 2016 as demand for space is expected to outpace limited new development. However, Asia Pacific office markets will be more mixed.

Industrial
Robust demand from e-commerce and third-party logistics companies for warehouse and distribution space—including for smaller in-fill locations within major metros—will continue to reshape the industrial market.

"The current environment of variable but generally improving growth in the developed world, alongside low interest rates and low inflation, is very supportive of consumers and commercial real estate markets," said Richard Barkham, CBRE's global chief economist. "There are some risks for sure, including weakening sentiment due to volatile stock markets, rising interest rates in the U.S. and the U.K., financial stress in emerging markets and the slowdown of the Chinese economy. However, because consumers in the U.S., Europe and even China are in good shape, we think the global economy is strong enough to withstand these challenges and that the real estate and economic reality will be better than expected in most places in 2016."

To access the full CBRE report, click here. For more news and information visit Blumberg Partners.

CoStar: 2015 Best US Office Year Since 2007

CoStar Group has released its State of the U.S. Office Market 2015 Review and Forecast, which reflects that U.S. office net absorption topped 100 million square feet for the first time since the Great Recession. With the office vacancy rate down from 11.3% in 2014 to 10.8% at the end of 2015, CoStar cites broadening demand and constrained levels of construction contributed to tightening space availability in virtually every metro area.

"The market is overwhelmingly strong at this point in the cycle. With the momentum in the market, I’m sure the next quarter will also be strong," said Hans Nordby, managing director of CoStar Portfolio Strategy, who presented the findings along with CoStar Director of Office Research Walter Page and Vice President and Research Director Dean Violagis.

Highlights from the report include:

— Vacancies declined in 64% of the nation’s office submarkets and 56% of metro office markets during the fourth quarter of 2015. CoStar analysts expect office vacancy to continue trending lower to approximately 10% in 2017.

— Annual net absorption of office space increased to 101 million square feet in 2015, compared with 93 million square feet in 2014, while developers delivered 64 million space feet, a 41% increase over the previous year. The amount of new space under construction, which has trended downward in the last couple of quarters, stood at 126 million square feet at year end, a modest 7% increase from a year ago, and near the historical yearly average since 2000.

— 2015's 4.4% annual rent growth topped the previous year’s growth of 3.8%, with rents surging at a particularly strong rate in CBDs such as San Francisco at 19.4% and Raleigh, NC at 13.9%. Even in the urban core of Atlanta and Detroit, rents in the urban core rose at 11.2% and 10.5%, respectively.

For more news and information visit Blumberg Partners.

CCRSI Price Indices Reflect Strong Year in the CRE Market

CoStar Group has released its year-end Commercial Repeat-Sale Indices (CCRSI), which showed double-digit price growth at the end of 2015 in all regional and property types across the U.S. commercial real estate markets. The CCRSI provides the market's first look at December 2015 commercial real estate pricing, noting that "improving CRE fundamentals, surging investor demand and liquid capital markets propelled the CCRSI composite indices upward in 2015. Demand for core property assets was especially strong." An excerpt from the summary follows:

December transaction activity remained true to its seasonal pattern observed over the last several years, spiking in the final month of the year as investors raced to close transactions prior to year-end. The December composite pair volume of nearly $18 billion was the highest monthly total on record, helping lift total 2015 volume to $128.3 billion, a 26.2% increase from the previous peak reached in 2014.

While pricing in core U.S. markets set records in 2015, investors moving out on the risk spectrum in search of higher yields resulted in equally strong sales activity in non-core markets and property types, as reflected in the equal-weighted U.S. Composite index. Heavily influenced by lower-value properties typical of those in secondary and tertiary markets, the equal-weighted U.S. Composite Index rose 12.6% in 2015 and is now within 3.4% of its previous high water mark.

To review the CCRSI and accompanying graphs, click here. For more news and information visit Blumberg Partners.

Beige Book Looks "Expanded, Upbeat" for 2016 CRE

The Federal Reserve has released the latest Beige Book, summarizing how the economies in the Fed's 12 districts are performing, which finds that the reporting districts are "generally upbeat." With respect to real estate, the data indicated that activity was generally improved over the last Beige Book, with stronger activity cited for multifamily construction and commercial real estate. Overall, most districts reported that loan demand grew, credit quality improved, or loan delinquencies fell, with credit standards changing little. An excerpt from the summary follows:

Most reporting Districts characterized nonresidential real estate activity as modest to moderate; Boston and New York indicated little change. Rental rates rose in more than half of the reporting Districts, and vacancy rates were mixed. Most Districts reported modest or moderate growth in commercial construction, and the Dallas District noted high levels of industrial construction in Dallas-Fort Worth. Contacts in the Atlanta District expect construction activity to increase slightly, while contacts in the Philadelphia, St. Louis, Minneapolis, and Richmond Districts expect overall commercial real estate activity to continue to strengthen at least modestly.

To read the full January 13, 2016 Federal Reserve Summary of Commentary on Current Economic Conditions by Federal Reserve District, click here. For more news and information visit Blumberg Partners.

Latest Beige Book Shows Moderate Growth

The U.S. Federal Reserve has released the latest Beige Book, more formally called the Summary of Commentary on Current Economic Conditions, which indicates that economic activity increased at a modest pace in most regions of the country since the previous Beige Book report. Fed policymakers are widely seen raising interest rates for the first time in almost a decade at their next meeting on Dec. 15-16, but continue to parse data and trends carefully given the uneven nature of the U.S. recovery.

"On balance, economic and financial information received since our October meeting has been consistent with our expectations of continued improvement in the labor market," Fed Chairwoman Janet Yellen said in prepared text for a speech to be delivered in Washington today. "Continuing improvement in the labor market helps strengthen confidence that inflation will move back to our 2% objective over the medium term." A summary of the commercial real estate sectors follows:

Commercial construction strengthened modestly in most Districts since the previous report. The Minneapolis District saw continued strong growth, particularly in cities where commercial permitting increased. The Boston, Cleveland, Atlanta, Chicago, St. Louis, and San Francisco Districts reported moderate commercial construction growth. In the Boston District, office construction grew modestly in the greater Boston region. Demand remained strong in commercial building, multi-family housing, and higher education in the Cleveland District, while in the Atlanta District, non-residential construction was slightly up from a year ago and reports on apartment construction remained robust. The Philadelphia, Richmond and Kansas City Districts reported a modest pace of growth in commercial construction. Commercial construction increased in most major cities in the Richmond District. In contrast, New York reported little change since the previous report. The Dallas District reported that construction remained active, although construction started to taper off in Houston.

Commercial leasing activity generally grew at a moderate pace. Cleveland reported strong growth, while activity in the Districts of Boston, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Dallas and San Francisco expanded at a moderate pace. Commercial real estate improved in the Atlanta District, with increased absorption and rent growth across property types. Improvement in the Chicago District was widely distributed across the retail, industrial, and office segments, with increased demand for both sale and lease properties. Contacts in St. Louis reported slightly higher demand across all sectors, and expected demand to remain the same or increase slightly in the first quarter of 2016. The Minneapolis-St. Paul retail, office, and industrial space had positive net absorption, along with lower vacancy rates. Demand for commercial leasing increased mildly in the Dallas District, while office space activity was strong in the Dallas-Fort Worth area. Commercial leasing activity in New York was unchanged since the previous report.

For more news and information visit Blumberg Partners.

Record Year in the Making for US Industrial

Cushman & Wakefield released its Q3 2015 research findings this week, revealing that despite concerns about slower growth in China and increased volatility in the U.S. and global financial markets, the U.S. economy maintained its trajectory of steady and modest growth in the third quarter. The MarketBeat U.S. Industrial Snapshot report for Q3 shows industrial vacancy rates at their lowest level since 2007, with significant absorption and low vacancies, both of which are placing upward pressure on rents in most major industrial hubs.

"This has been a fairly healthy and long cycle," John Morris, logistics and industrial services lead, Americas, Cushman & Wakefield, told GlobeSt.com. But even though the good times have now stretched out for several years, "there is still a lot of net new development, much of it driven by e-commerce." According to the report, the economic environment in 2016 should support continued job gains, pushing the unemployment rate down below 5% and improving the outlook for the American consumer.

To read the full report, click here. For more news and information visit Blumberg Partners.

Fed's Beige Book and Commercial Real Estate

The U.S. Federal Reserve's latest Beige Book, more formally called the Summary of Commentary on Current Economic Conditions, was released today with figures pointing to continued modest expansion in economic activity during the reporting period from mid-August through early October. Citing "generally weaker" manufacturing activity, "subdued" wage expansion and a "slowed" pace of growth in some regions, the Fed's report highlights a handful of concerns while offering a modestly optimistic economic assessment overall.

According to the report, commercial real estate markets have shown signs of strengthening in all twelve federal reserve districts. Most noted improvement across all major segments, though New York and St. Louis noted some increased slack in the market for retail space. Commercial construction was also stronger, with Boston and St. Louis noting brisk construction in the health sector, including senior care facilities, and Cleveland also indicating strong demand for senior living structures. New York, on the other hand, noted some pullback in new commercial construction, though activity remained fairly brisk.

To read the full report, click here. For more news and information visit Blumberg Partners.

CRE Prices Crest Pre-Recession Peak

The latest Moody's/RCA Commercial Property Price Indices (CPPI) report was released this week, revealing that in August the CPPI rose 1.6%, topping its pre-crisis peak on a Consumer Price Index (CPI) adjusted basis. According to the report, which captures the national all-property composite index over the past three months, the CPPI now stands 14.5% above its pre-crisis peak on a nominal basis and 1.5% above it on a real, CPI adjusted basis. Central business district (CBD) office was the best-performing segment, while core commercial property prices are approximately 8% higher than their prior peak,

"Central business district office was by far the best-performing segment of the CPPI in the past three months, with prices rising 6.3%," says Moody's Director of Commercial Real Estate Research, Tad Philipp. "Suburban office was the next-best-performing segment, with prices up 3%."

Jim Costello, RCA's senior vice president, said prices have been pushed up because the capitalization rates have been falling. The cap rate is a commonly used formula for valuing a commercial-property investment. It's calculated by dividing a property's net operating income by its current market value. If the cap rate falls while the expected income from the property remains roughly the same, the asset values tend to rise. "Most of the strong price appreciation we've seen to date has been a function of cap-rate compression, something like 70% of the price increases, in fact," Costello said.

Moody's/RCA researchers note that the only property sectors where prices have not exceeded their pre-recession peak are retail (still down 7%) and suburban office (down 9%). Moody's research subscribers can access the latest report here. For more news and information visit Blumberg Partners.

DTZ Global Office Cost Report

DTZ has released its 18th annual Global Office Thermometer, a report that reviews worldwide office markets and measures the cost of office occupancy on a workstation basis in 138 cities. According to the report, international occupiers are benefiting from significant falls in workstation occupancy costs. Globally, the average annual USD cost of occupying a workstation fell by 3.9% in 2014, reflecting a sharp depreciation of local currencies against the US dollar, and slower economic growth in Europe and increased supply in emerging markets.

"Broadly, declining occupancy costs reflect the sharp depreciation of local currencies against the U.S. dollar, slower economic growth in Europe and increased supply in emerging markets," said Steven Quick, DTZ Chief Executive, Global Occupier Services. "Additionally, occupiers are reducing costs by using space more efficiently in many cities. International occupiers will continue to benefit from ebbing cost pressures in several markets. Overall, we expect global occupancy costs to increase just 0.5% over the next two years."

DTZ projects occupancy costs in most major U.S. cities to moderate in 2015 and 2016. To read the full DTZ Global Office Thermometer, click here. For more news and information visit Blumberg Partners.

CBRE's Investor Intentions Survey 2015

CBRE has released the results from the CBRE North America 2015 Investor Intentions Survey which reflects a confident market with half of the survey respondents indicating that they expect their purchasing activity to increase in 2015, and of those one-third said they plan to raise investment volumes by 20% or more. Investors identified increased competition and the challenge of finding appropriately priced assets as the greatest—and only—obstacle to investment in 2015.

"The strength of the economy creating real estate demand, improved property fundamentals and measured supply gains make North America extremely attractive, with investors maintaining a hungry appetite for real estate assets. As was the case in 2014, a majority of investors intend to increase their property acquisitions in 2015. A natural consequence of this appetite for real estate assets is the competitive investment environment," said Chris Ludeman, Global President, CBRE Capital Markets.

Investors remain interested primarily in industrial, office and multifamily product, with industrial leading the charge. Industrial is the preferred property type for investors in 2015, with one-third of survey respondents selecting either of the two industrial categories as their preferred sector.

To read the full survey findings, click here. For more news and information visit Blumberg Partners.

IRR 2015 CRE Outlook

Integra Realty Resources (IRR), the largest independent market research and commercial real estate valuation and counseling firm in North America, has released its Viewpoint 2015 report, which reveals projections for commercial real estate in 2015 across all property types. In total, IRR expects real estate values to appreciate across all markets, with improved property fundamentals continuing to drive positive yields and attract additional capital to the sector.

"With our independent position in the marketplace, in IRR Viewpoint we have been able to create an incisive and unbiased report that the industry relies on year after year as a primary resource for research and analysis of the commercial real estate industry in the United States," said John Albrecht, CEO of Integra Realty Resources. "This past year we also completed the largest technology investment that IRR has ever made, giving us even more advanced capabilities to research local and national markets and provide our clients with the benefits of our industry-leading expertise on commercial real estate assets."

Key findings of IRR Viewpoint 2015 for the office market include:

• The office property sector continued its relatively steady recovery in 2014, though the sector lags behind other property sectors in the latest national recovery cycle. More local office markets -- both Central Business District (CBD) and Suburban -- are now mired in the recessionary phase and many more are just beginning a recovery.
• After decades of suburban corporate campus building, a key national trend is the return to new CBD construction, as today's younger workforce wants tech-driven office spaces in populous areas. While developers and investors seemingly prefer the CBD office property sector, property fundamentals for the Suburban office sector strengthened just as much as those in the CBD sector nationally in 2014.
• Recent changes in stabilization expectations reversed the trend from the previous few years and now indicate that the Suburban office sector nationally is more likely to stabilize before the CBD sector, albeit at materially lower rental rates and marginally lower occupancy rates.
• 2014 was another robust year for transaction volumes, with most cities experiencing strong volume increases over five-year historical averages. Activity was notably strong in Cincinnati, Boston, Jacksonville, San Francisco, and Philadelphia; transaction volumes were down only in a handful of cities, including Pittsburgh, Seattle, Cleveland, Hartford, and Richmond.

A free download of the report is available here. For more news and information visit Blumberg Capital Partners.

Technology's Impact on CRE

The Baltimore Business Journal published an article today titled "5 ways technology is overhauling commercial real estate" in which author Alex Kopicki, co-founder and CEO of Kinglet, examines the major intersection between traditional commercial real estate and the fluid technology industry that will affect the way brokers and clients do business. Kopicki's Top 5 list follows, with excerpted commentary:

Mobile takeover
There were 1.75 billion smartphone users in 2014, according to market research firm eMarketer. Not only is that a lot of devices and users, but that's also a lot of time spent on these devices. So what does this mean for commercial real estate professionals? Quite simply, if your company doesn't have a mobile strategy, you better get one — quick.

A new way to work
The number of co-working facilities across the globe has nearly doubled every year for the past five years. Small Business Labs projects that more than 12,000 global co-working spaces will exist by 2018 with over 1 million members. The convenience of short-term rentals, the attraction to community, the hip-to-be-small attitude and new business formation are all positive trends that will lead to the continued growth of co-working facilities.

Big data
While data can't predict the future just yet, big data can tell us the probability of future decisions, which can lead to actionable decision-making. If you are a commercial leasing agent, a landlord or a service provider, what touch points are you recording about your clients? And what can they tell you about your effectiveness?

Crowdfunding
Today accredited and non-accredited investors, through a multitude of platforms, have the ability to invest in early-stage companies. What this means for commercial real estate is that everyone's customer base broadens as fractional "ownership" increases. It also results in more capital outlets and providers for a more competitive landscape. Let the games begin.

The Internet of Things
This is a simple concept; it's all about connecting everyday devices such as your home thermostat to the Internet. Why would you do this? The better question is: Why would you not do this? More connectivity leads to more control and customization, leading to more convenience. For example, if I'm a leasing agent who can unlock a space for a showing with my phone, I'm going to be able to access spaces for customers after hours or even show spaces on a whim— no keys required. The Internet of Things is digitizing more data and connecting environments in commercial real estate that were previously fragmented.

For more news and information visit Blumberg Capital Partners.

CRE Outlook Forum Voices

EisnerAmper & Bloomberg hosted a business and political perspective breakfast forum this week called "Commercial Real Estate Outlook 2015 & Beyond" in New York, inviting a panel of commercial real estate professionals to discuss the outlook of the economy and its impact on CRE. The panelists included Scott Rechler, CEO of RXR Realty, Joseph Sitt CEO of Thor Equities, Steven Witkoff, CEO of The Witkoff Group, Brian Harris, CEO of Ladder Capital, and Peter Sotoloff, CIO of Mack Real Estate Credit Strategies. GlobeSt.com covered the even in an article titled "The Dealer Has Reshuffled the Deck"; an excerpt follows:

What's driving that economy? asked Scott Rechler, CEO of RXR Realty. In word, "talent." Employers, and therefore office landlords, need workplaces that attract that talent, but that imperative goes beyond the office space and into the surrounding neighborhood. It has changed the dynamic not only of office, Rechler said, "but also how everyone looks at real estate in totality."

Rechler also added on to Sitt's observation about a new hand of cards. The deck is reshuffled at least every year, he said, and everyone needs to be aware of shifts in the market as they occur.

As a case in point, he cited RXR's current strategy compared to the one it pursued a few years earlier. As the downturn evolved into the recovery, the company rode the wave by snapping up attractive properties at attractive prices. More recently, the playing field has become far more competitive and "we're not in an investment market right now."

Asked where development is taking place, Sitt countered that a better question would be where it isn't taking place. Cranes dot the horizons everywhere, even amid rising costs for both construction and acquisition of developable parcels, as CEO Steven Witkoff of the Witkoff Group pointed out. On the other hand, Witkoff added, "I think the market is healthy."

For more news and information visit Blumberg Capital Partners.

DTZ Shows US CRE Rise in Q3

DTZ's research and consulting services arm released its quarterly Investment Market Update for Q3 which shows that U.S. investment volumes reached $66 billion in Q3 2014, up 8% from the previous quarter. With the headline "Invest now while pricing remains attractive", DTZ notes that a big share of the activity in eight top markets such as Chicago, Manhattan and San Francisco came from cross-border investments, with signs that investors' interest in secondary markets has perked up.

"The size, attractiveness and liquidity offered by the key eight markets is very appealing to overseas investors," said Nigel Almond, Head of Capital Markets Research at DTZ. "International capital continues to dominate, but we have continued to see interest from Asian investors in particular from China, as well as growth from European sources, with German funds increasingly active alongside the Norwegian Government State Pension Fund."

Although domestic investors continue to dominate investment, over the last quarter the level of activity has dipped. In contrast cross-border investment grew both from the rest of North America, but also from outside of the region. Of note, Non-North American investors stepped-up acquisitions, taking rolling annual volumes to a new post-crisis record of $23.5 billion and net sales posting a record $3 billion over the last year.

To read the full report, click here. For more news and information visit Blumberg Capital Partners.

Real Estate Investors Pushing New Construction

In a new article from the Wall Street Journal titled For Real-Estate Investors, It's Out With the Old, Eliot Brown explores how the global hunt for yield is rippling through the U.S. property market. With foreign investors and pension funds push up prices for top-quality, low-vacancy office buildings, several publicly traded real-estate investment trusts such as Boston Properties are piling into new projects offering better growth potential, even if it means more risk. An excerpt follows:

"Most of the REITs are pivoting to development or heavy redevelopment as an investment strategy," said Jed Reagan, an analyst at Green Street Advisors Inc. who follows office landlords. "There's so much aggressive capital out there that's looking for a home," he said.

Boston Properties' latest deal, for the buildings at 601 Lexington Ave. in Manhattan and 100 Federal St. and Atlantic Wharf in Boston, puts the company on track for more than $2 billion in property sales this year, up from $1.3 billion in 2013. At the same time, it had $3.5 billion of projects under development in the second quarter, including a San Francisco site that is to be the second-tallest tower west of the Mississippi River.

A year earlier the company developed $2.5 billion of projects, its highest level in at least a decade.

"We're certainly more bullish on development than buying buildings," Mr. Zuckerman said in an interview in his Midtown Manhattan office.

"Older buildings are trading at higher prices per square foot than where we can build," added Owen Thomas, the former Morgan Stanley executive who became Boston Properties' chief executive last year.

For more news and information visit Blumberg Capital Partners.

CushWake Q2 Report Reflects Strong Industrial Growth

Cushman & Wakefield released its Marketbeat Snapshot reports for Q2 of 2014, which shows the economy not only growing at an annual rate of 4% but industrial production, which correlates highly with industrial demand, advanced at an annual rate of 5.5% in the second quarter of 2014. An excerpt from the report follows:

With vacancy rates and speculative construction back to per-recession levels, the U.S. industrial sector continues to lead the country's commercial real estate recovery. Strong occupancy gains and dwindling supply of big-box drove the overall vacancy down to 7.6%, 80 basis points lower than a year ago and the lowest level since first quarter 2008. This also represents a significant drop from the recent high of 11.2% posted during first quarter 2010. Net demand remained strong during the second quarter and is on track to surpass last year's total, with 95.7 million square feet of occupancy gains at mid-year. Atlanta is leading the nation, with 8.9 million square feet of space absorbed to date followed by Inland Empire with 7.5 million square feet. Healthy demand led to increased occupancies in almost every major market with only 12 of the 78 markets tracked posting net loss in occupancy at mid-year.

For more news and information visit Blumberg Capital Partners.

Blumberg in the News

Blumberg Grain was featured in a CairoScene article this month titled "US TYCOON: USE YOUR LOAF, EGYPT", which proclaims that Egypt's bread crisis could soon be resolved by Blumberg, which is launching a new venture in Egypt to introduce new nationwide storage facilities that are set to prevent spoilage and reduce price volatility. An excerpt follows:

It was Marie Antionette who once said let them eat cake – well now a US business tycoon could soon have Egyptians scoffing some of the best loaf on the planet.

Philip Blumberg, head of Blumberg Capital Partners, has launched the tasty new venture after successive politicians failed to solve the riddle of lowering bread prices despite the relatively high cost of purchasing grain, thanks to the country’s poor credit rating.

He said: "Egypt is the largest importer of wheat in the world, but they have to buy it on the spot market. It’s crazy. The largest wheat buyer in the world is constrained by storage."

Blumberg has now reached a deal with Egyptian President Abdel Fattah el-Sisi to build 164 grain-storage facilities designed to prevent spoilage, reduce price volatility and eventually lead to a local commodities exchange.

To read the full article, click here. For more news and information, visit Blumberg Capital Partners.

Latest CCRSI Shows Property Price Gains

CoStar has released its latest Commercial Repeat Sale Indices (CCRSI), offering a review of commercial real estate pricing for April, which reflected strong property price gains as the price gap narrowed between buyers and sellers. The CCRSI measures the movement in the prices of commercial properties by collecting data on actual transaction prices. Some hilights from the report include:

The general commercial segment remains on an upward trajectory, despite recent price volatility. The equal-weighted U.S. Composite Index's General Commercial segment declined by 1% in April 2014. Despite the volatility in the monthly data, the overriding trend over the past 12 months for this segment has been outsized pricing gains as capital expanded into secondary markets. The 13.2% year-over-year increase in April 2014 was the largest such gain among the four major indices.

Increased investment activity reflects a healthy market for transactions. Repeat sales transaction volume year-to-date through April 2014 increased 25% from the same period in 2013, and is approaching 2006 transactions levels.

The price gap between buyers and sellers continues to narrow. The delta between sale prices and asking prices closed by more than one percentage point in the 12-month period ended in April 2014. This gauge of liquidity varies by region and property type, however. In the West region, sellers are achieving over 90% of asking prices, while in the Midwest this ratio is 82%, the lowest of the four regions. Multifamily properties are driving much of this improvement in liquidity. In the core coastal markets of Los Angeles, San Francisco, Boston and New York, for example, multifamily sale prices relative to asking prices are back to, or above, 2006-07 peak levels.

Other liquidity measures have also improved. The average time on market for for-sale properties fell 3% in the 12 months ending in April 2014, and the share of properties withdrawn from the market by discouraged sellers declined by more than two percentage points during the same period.

For more news and information visit Blumberg Capital Partners.