Less Than One Week To Kickoff 2014

The Race To Eight . . .

Last season, the Ohio State Buckeyes were the only undefeated, yet unranked, Division 1 football team in the U.S.

This year it's different.

Go Bucks!

Lenders Are Back In The Market!

Lenders are back in the CRE market in a big way.

So much so, that in projects where our office had to search some 20 or so lenders two years ago to get a deal done, today we have them battling each other for our investors' large acquisitions.

How bad do they want to differentiate themselves? A fellow agent heard from two lenders that did not get a particular deal in our office, asking via email "what could we have done differently to have been chosen by your buyer?"

Wow.

Chrome Divas To Hold Event for Stephanie Spielman Fund For Breast Cancer Research

Not commercial real estate related, but an incredibly important cause to mention.

The Columbus chapter of Chrome Divas, a national group of charitable-minded motorcycle-riding women, are holding their annual "Rockers For Knockers" fundraiser to benefit the Stephanie Spielman Fund For Breast Cancer Research.

The event, in partnership with The Blitz, 99.7 FM WRKZ, takes place August 10 at Screamin' Willies in Columbus. Eight bands are scheduled to play during the fundraiser, which runs from 3 pm on the 10th, to 2:30 am Sunday, August 11.

A rockin' event for a very important cause. Hope you can come out, and/or support the fight against breast cancer. For tickets, go to:  www.columbuschromedivas.ticketbud.com.

I Like 'Em Raised N Glazed, But . . .

This Central Ohio boy prefers his donuts like many southerners -- raised n glazed.

Raised in this area, the home of the Max & Erma's "Garbage Burger," the Thurman Cafe's "Thurman Burger," and the birthplace of Wendy's, which gave us "Hot & Juicy" burgers going way back to the 1970s, gives me a unique aspect on burger quality.

But I have to draw the line on a Krispy Kreme Burger, which is now available at the currently running Ohio State Fair. Bogey & Bacall, Country & Western, Rhythm & Blues, Bacon & Eggs . . . yeah they go together well.

But a huge dripping burger sandwiched between two Krispy Kreme glazed donuts? Nope. Even I have my limits . . .

Prudential Co-Parent, Brookfield, Completes Fundraising for $4.4B Global Real Estate Fund

CRE Powerhouse Brookfield Asset Management, which, with Berkshire Hathaway, owns HSF Affiliates LLC, operator of Prudential Real Estate, announced it has completed fundraising for a $4.4 billion global real-estate fund, one of the biggest property funds raised since the economic crisis.

It marks a new direction for the giant asset manager, according to The Wall Street Journal.

The fund's amount was well ahead of the firm's official target of $3.5 billion, and even ahead of the Brookfield's internal goal of reaching $4 billion, fund officials said. The fund looks to buy individual buildings and property-related companies, primarily in the U.S. and Western Europe. Fund officials say they also invest in Canada and Brazil and other markets, and have made significant investments in Australia. The new global fund already has invested about $1.1 billion, including paying about £210 million ($322.6 million) in June to acquire EZW Gazeley, a U.K.-based logistics firm with industrial properties throughout Western Europe. The fund also invested about $500 million last year to acquire Australia's Thakral Holdings Group, which owns hotels, office-development rights and other real estate in that country.

Things are looking up. I'm proud to be associated with two such influential companies as Brookfield Asset Management and Berkshire Hathaway.

Disclose Disclose Disclose

While the headline for this post could easily be "DUH," the content is as current today as it was a decade ago.

If you're pursuing a CRE transaction, disclose any known financial issues up front. Yes, there are lenders that will put your various body parts through the proverbial ringer. But knowing any "defects" in a financial statement upfront will go a LONG way toward moving a transaction along.  I routinely counsel my buyers looking at investment properties on this very subject. Often asking some hard questions. And I'm not talking about the individual or two-doc LLC looking to buy a small building. Financial "issues" during the Great Recession have impacted buyers at all levels.

Steve Bram of George Smith Partners reiterates this common sense theme in a bylined article appearing at GlobeSt.com this week. Now, I do take exception to his saying we are out of the Recession. But that's my personal professional opinion. Nevertheless, the main theme is right on!

His bottom line? Like mine. Disclose everything to potential lenders. Surprises freak them out.

Equity Investors Pouring Millions Into Single Family Homes

More and more evidence is piling up that a big chunk of the single family housing resurgence is due to institutional investors of a sort. Which is creating a paradox – many private owners-to-be who rely on conventional mortgages are being crowded out of the market by big buyers with buckets of cash.

To name but a few:

n  Title Capital Management is helping big investors scout, buy and manage homes in Florida. The company has plowed more than $100 million into residential real estate for investors in the past year, and is on course to spend $250 million to buy an additional 2,000 homes in 2013, according to the Washington Post. The firm bids on about 200 houses a day, making it one of the largest players in Florida that help hedge funds and other Wall Street firm buy distressed properties.

n  Who are those firms? Private equity groups like Blackstone, which in the past year has amassed a portfolio of 20,000 rental homes worth $3 billion. Another, American Homes 4 Rent, owned by warehouse magnate B. Wayne Hughes, has purchased approximately 10,000 rental properties, according to news reports.

n  Delavaco Residential Property Trust in Fort Lauderdale says it is scooping up many homes for $60,000 to $70,000 – a fraction of the building costs. After some repairs, the company rents them out for as much as $1,700 per month.

Delavaco co-founder Dallas Wharton says investors are propping up the market, and asks where the bottom would be in neighborhoods. The alternative, he says, is that they “sit there and rot.” Others disagree, saying well monied investors are crowding out those families who want a chance at the American Dream – home ownership.

“Investors are making it hard for a regular homeowner to buy a property,” says Robert Ruscotto, a broker with Better Homes and Gardens Real Estate in Fort Lauderdale. “They are getting outbid by people with cash.” He notes that out of some 20 home sale contracts he has in process, 17 of the buyers are major investors.

Before the housing crash, big investors almost never wanted single family homes, largely because of slow returns and the money-draining hassle of managing tenants in often far-flung properties. But with prices still depressed and with low interest rates and high stock prices limiting prospective returns elsewhere, major investors see the prospect of healthy profits in single family homes.

Time will tell whether this is a good thing…..