August 29, 2015

MBS RECAP: Battle of Fed Speakers Results in Firmer Rate Hike Hints

I was writing reprice alerts and chatting with the MBS Live community during the time that I’d normally be writing the Mid-Day commentary.  By the time I wrote it, everything interesting that was going to happen today had already happened!  (This happens from time to time.)  As such, your best bet for a recap of the entire day is to get the details from the Mid-Day commentary (HERE). 

For those who don’t click links, here’s another run-down:

Fed speakers were the most prevalent market movers today as the Jackson Hole symposium continued (a big party in the mountains where people who make important decisions about the global economy get together and talk about the global economy.  It’s long been seen as a venue for Fed officials to be a bit more candid than they otherwise would be, thus providing better clues about upcoming policy changes). 

This year’s Jackson Hole confab couldn’t come at a more relevant time in that regard.  The long and the short of this one is that earlier Fed speakers generally swayed markets farther away from a September rate hike while Fed Vice Chair Fischer brought the consensus right back.  All Fischer had to do was start talking VERY candidly about how the Fed wouldn’t raise rates again very soon after the first bump.  With that, markets assumed it was his way of saying “hey guys… it’s coming, yeah…  BUT!  It won’t be too bad, and here’s why!”  From there, he did leave the door open for something crazy to happen in the next 2 weeks that would sway the Fed’s decision.

Caveat: Fischer is only one Fed member, but he’s also the Vice Chair, and well-respected. 

Either way, markets bought it.  Shorter term rates (more sensitive to Fed expectations) lost the most ground while longer term rates managed to hold steady at unchanged levels after the Fischer-inspired sell-off.  With his “2 weeks” comment, Fischer made every single economic report on the near term horizon much more important than it otherwise would be.  Next week should be fun.

Article source: http://www.mortgagenewsdaily.com/mortgage_rates/blog/506394.aspx

CoStar’s People of Note (Aug. 23


It’s time to update those contact managers with CoStar’s People of Note, reporting news on significant new CRE hires and promotions. This week’s issue includes the following markets: Atlanta, Los Angeles, Indianapolis, Northern New Jersey, Dallas / Fort Worth, Chicago, Orange County, South Florida, Minneapolis, Phoenix / Tucson, and Boston.

ATLANTA

Ackerman Co. Adds Key Retail Developer to Team

By Max Williams

Leo Wiener joins Ackerman Co. to become president of Ackerman Retail. He will be focusing on maintaining and improving its Southeastern retail portfolio.

With more than1 million square feet of retail space accounted for, Wiener has goals to expand this portfolio to around 3 million square feet by the end of 2016.

Previously, Wiener was a partner of the Glenwood Development Co. His focus was on retail development, as well as directing key acquisitions across the Southeast and Mid-Atlantic. Wiener also has served as a chairman of the Gwinnett Place Community Improvement District since 2011.


LOS ANGELES

Zlatkov Joins Matthews Retail Group

By Christi Acuña

Radoslav (Raddie) Zlatkov joined Matthews Retail Group, Inc. as a chief financial and operating officer.

In his new role, Zlatkov will head strategic planning, oversee financial analysis and manage the treasury. In addition he will be responsible for underwriting and business operations.

During his time as director of finance for Keurig Green Mountain, Inc., he helped expand the company from $500 million to over $4.5 billion. Before that he was a senior director of finance for SharkNinja.


CoStar’s People of Note is published each Friday covering the latest commercial real estate executive level promotions and new hires. Click on the headline of each article to jump to full coverage. Follow the news on Twitter @TheCoStarGroup and @JSumner2.
Send your new executive hires and promotion announcements to news@costar.com.


INDIANAPOLIS

Milhaus Hires Sturman as Principal, CIO

By Justin Sumner

Jason Sturman has joined Milhaus as a principal and chief investment officer. Based in the firm’s Indianapolis office, Sturman will oversee acquisitions and dispositions, capital markets, investment management, and investor relations.

Sturman most recently served as regional senior vice president at Duke Realty, overseeing the company’s 10 million-square-foot portfolio in the Western Region. Before that he was senior vice president acquisitions, responsible for more than $3 billion in completed transactions across the country and $1 billion in joint-venture partnerships.

Sturman holds an MBA from the University of Chicago and received his bachelor’s degree from the University of Pennsylvania’s Wharton School.


NORTHERN NEW JERSEY

Giordano Joins Avison Young as Principal

By Timothy Stuart

Industrial real estate leader J.C. Giordano has joined Avison’s Young’s NJ office as a principal.

Giordano brings almost 35 years of experience to his new position, where he will bolster the firm’s tenant representation focus. He previously served as executive vice president at JLL and also worked in tenant representation at Cushman Wakefield.

“With his significant experience, J.C. Giordano will be a valuable addition to our New Jersey office, and I look forward to working with J.C. as we continue to bolster our platform in the region,” said Arthur Mirante, Avison Young principal and Tri-State president.


DALLAS / FT. WORTH

Monogram Residential REIT Names New EVP, CFO Elect

By Randyl Drummer

Plano, TX-based multifamily REIT Monogram Residential Trust (NYSE: MORE) has appointed Dan Swanstrom as executive vice president and CFO-elect, effective Oct. 26.

Swanstrom, who comes to Monogram from Morgan Stanley, succeeds Howard Garfield, who will remain with the company as senior vice president and chief accounting officer, and will serve as CFO through the filing of the company’s 10-Q for the third quarter.


The Modal Group and Taurus Realty Partners Merge

By Courtney Phillips


ORANGE COUNTY

Gabbert Joins Premier Design+Build as Southwest Div Head

By Justin Sumner

PREMIER Design + Build Group LLC has hired Steven Gabbert to lead the firm’s Southwest division as a vice president, director of construction.

In his new role, Gabbert will spearhead the firm’s expansion into California, Nevada and Arizona.

Gabbert was most recently the director of sustainability for Snyder Langston, an environmentally-responsible builder in Southern California, where he spent the last 11 years leading construction initiatives across the region, with a focus on the Los Angeles metro area. He has worked on several projects including Hyundai’s LEED Gold-certified headquarters, the University Research Park in Irvine, and a resort in Newport Beach.


LOS ANGELES

JLL Promotes Morales to Brokerage Lead

By Justin Sumner

JLL has promoted Tony Morales to brokerage lead in the Los Angeles region.

In his new role, Morales will set the strategic direction of the firm’s growth while overseeing a team of approximately 80 brokers across six area offices, in addition to driving recruiting and new business opportunities in the region.

Morales will continue in his previous role as managing director for JLL in Los Angeles, advising clients on their office needs. Throughout his 25-year career, Morales has worked with numerous high-profile companies like Yahoo!, DirecTV, Boston Consulting Group, Electronic Arts, William Morris Endeavor, and Morrison Foerster.


SOUTH FLORIDA

Colliers Taps Krasnow as Executive Managing Director

By Justin Sumner

Kenneth Krasnow has joined Colliers International (NASDAQ: CIGI) as an executive managing director.

Based in the firm’s Miami office, Krasnow will focus on the continued strategic expansion of dedicated resources and services in South Florida for the global CRE firm.

Most recently a managing director with CBRE, Krasnow oversaw operations across its South Florida offices, providing business development support while growing the firm’s operations and market share in the region and managing more than 460 employees.


MINNEAPOLIS

Conlon Joins Opus Group as Senior Director

By Justin Sumner

The Opus Group has hired Peter Conlon as a senior director, capital markets with Opus Development Company LLC. Based in the firm’s Minneapolis office, Conlon will assist the company’s rapidly expanding capital platform.

Conlon most recently served as group manager of corporate real estate at Target Corporation, where he focused on office and industrial properties around the globe. Before that he held acquisitions and investment roles with Buchanan Street Partners and Cassidy Turley.

Conlon earned his bachelor’s degree in economics from the University of California, Davis and holds a Master’s Degree in real estate finance and investment from New York University. He is a member of ULI and NAIOP.


DALLAS / FT. WORTH

Sorg Rejoins Prologis Dallas Office

By James Lutz

Jon Sorg will be returning to the Prologis office in Dallas as a vice president and market officer.

Sorg has been with Prologis since 2007. He spent two years in Chicago as a member of the capital deployment team before serving four years in the Dallas office in a leasing role and later in capital deployment. Most recently, Sorg served as market officer of Indianapolis and Louisville.

Sorg has been active in NAIOP’s Central Indiana Chapter, where he serves as current president.


Graham Sibbald Recruits Inverness Partner in London

By Faye Tudor


PHOENIX / TUCSON
Nelson Moves to NAI Horizon
By Jon Murphy

NAI Horizon has hired Troy Nelson as a vice president with the firm’s Phoenix brokerage team. Nelson specializes in the leasing of medical office properties for investors, developers, and owner / users…


BOSTON
Storz Joins KeyBank as VP
By Justin Sumner

Erik Storz has joined KeyBank Real Estate Capital, the commercial real estate business unit of KeyCorp (NYSE: KEY), as a vice president in its commercial mortgage group. In his new role, Storz will be responsible…


CHICAGO
Ffrench Joins SVN
By Elise Planchet

Lee Ffrench has joined Sperry Van Ness as senior advisor. Ffrench has worked with both landlords and tenants on the local and national level. She is a member of the ICSC and Women in Retail Leasing, and holds…


Send your new executive hires and promotion announcements to news@costar.com. Follow the news on Twitter @TheCoStarGroup and @JSumner2.
Check out last week’s edition of People of Note.


Article source: http://www.costar.com/News/Article/CoStars-People-of-Note-Aug-23-29/174861?ref=/News/Article/CoStars-People-of-Note-Aug-23-29/174861&src=rss

JLL Promotes Morales to Brokerage Lead


JLL has promoted Tony Morales to brokerage lead in the Los Angeles region.

In his new role, Morales will set the strategic direction of the firm’s growth while overseeing a team of approximately 80 brokers across six area offices, in addition to driving recruiting and new business opportunities in the region.

JLL Acquires SoCal Brokerage Firm Wilson Retail Grp

Morales will continue in his previous role as managing director for JLL in Los Angeles, advising clients on their office needs. Throughout his 25-year career, Morales has worked with numerous high-profile companies like Yahoo!, DirecTV, Boston Consulting Group, Electronic Arts, William Morris Endeavor, and Morrison Foerster.

“We selected Tony as our new broker lead for Los Angeles because of his broad depth of knowledge and unique experience as a senior level real estate expert in the LA market,” said Peter Belisle, market director for JLL’s Southwest Region. “His leadership will be instrumental in differentiating our service delivery platform and continuing JLL’s expansion in the Los Angeles market.”

Article source: http://www.costar.com/News/Article/JLL-Promotes-Morales-to-Brokerage-Lead/174846?ref=/News/Article/JLL-Promotes-Morales-to-Brokerage-Lead/174846&src=rss

MBS RECAP: Bond Markets Mostly Put Their Foot Down

After two days of relatively brutal selling, bond markets finally opted for much less brutal selling.  In fact, 10yr yields were in positive territory as of the official 3pm ET closing time.  They’ve since trickled back to slightly higher yields, but even then, only by about 1bp.  MBS are in a similar boat with Fannie 3.0s down only 2 ticks and Fannie 3.5s down only 1 tick on the day.  None of that is too shabby considering the previous 2 days combined for a 17bp increase in 10yr yields and a half point drop in MBS.  Additionally, bonds were resilient in spite of a 47 point gain in the SP.

Early movement came courtesy of stronger-than-expected GDP.  Bonds were at their weakest levels shortly thereafter, but found support there.  Trading was sideways into the afternoon, but improved markedly after the 7yr Treasury auction.  For instance, 10yr yields dropped from 2.204 to 2.166 in the 30 minutes following the auction.  MBS made a similarly perky move.  All this having been said, these are very small movements that stand as an epilogue to a story that’s already been told. 

2015-8-27 Dashboard

Article source: http://www.mortgagenewsdaily.com/mortgage_rates/blog/505713.aspx

Henry Silverman Creates New Property Firm

Private-equity veteran Henry Silverman, who turned real estate and travel company Cendant Corp. into a multibillion-dollar business, has started a new property investment firm that will focus on hotels and hospitality.

The New York company, 54 Madison Partners LLC, has financial backing from diversified holding company Leucadia National Corp. and the investment bank Jefferies Group, one of Leucadia’s operating companies, according to…

Article source: http://www.wsj.com/articles/henry-silverman-creates-new-property-investment-firm-1440533825?mod=residential_real_estate

TIAA-CREF, Swedish Pension Funds Form Property Venture

TIAA-CREF has created a joint venture with two Swedish pension funds  to invest in European office real estate.
ENLARGE

U.S. investor TIAA-CREF and Swedish National Pension Funds AP1 and AP2 have teamed up on European office investments.

Their joint venture will combine €2.2 billion ($2.5 billion) worth of 15 properties already owned by the firms, and over the next three years will aim to buy another €2 billion of office space.

By merging the property portfolios, “we’re going to be able to diversity our European office portfolio without any more capital requirements,” said Phil McAndrews, chief investment officer of TIAA-CREF Global Real Estate.

The groups plan to make further office acquisitions in Europe, focusing on London, Paris and cities across Germany.

“We believe there is a case for core assets in Europe,” Mr. McAndrews said.

The tie-up comes amid a surge of demand for commercial property in Europe, where the pace of deal-making in the first half of this year was the strongest since 2007, according to Real Capital Analytics. Investors bought $49.4 billion of office properties in Europe in the first half of 2015, up 17% from the year before, data show.

Returns in real estate look attractive to investors facing low interest rates. In the London neighborhood of Mayfair, home to many of Europe’s biggest hedge funds, the capitalization rate—a measure of yield—was at a historic low of 3.5% in June, according to real-estate broker Cushman Wakefield. This is still above the yield on 10-year U.K. government bonds, which Tuesday was around 1.87%, according to Tradeweb.

The new investment vehicle, called Cityhold Office Partnership, will be managed by TH Real Estate, an overseas investment manager owned by TIAA-CREF, which has $86 billion of real-estate assets under management.

The funds will target core assets in major cities because “in the short term, our preference is liquidity,” said Jasper Gilbey, director at TH Real Estate.

Investments can also branch out into areas that typically offer greater returns. The funds can be invested into leasing, renovation and development projects in London, Paris and Germany, as well as target core assets in cities like Madrid, Milan and Amsterdam.

AP1 and AP2 are two of five such funds in the Swedish pension system. Both funds have about 300 billion Swedish kronor ($36 billion) of assets under management.

Write to Art Patnaude at art.patnaude@wsj.com

Article source: http://www.wsj.com/articles/tiaa-cref-teams-up-with-swedish-pension-funds-to-invest-in-european-property-1440561660?mod=residential_real_estate

Kious Joins NGKF

Newmark Grubb Knight Frank has recruited Lynn Kious as a senior managing director in the firm’s Los Angeles, CA office. In her new role, Kious will focus on tenant representation.

With 25 years of experience, Kious joins NGKF from Johnson Controls, Inc. where she served as vice president and general manager of global real estate and workplace service. She was responsible for real estate accounts, corporate real estate lines of business, and supporting new business development.

“I look forward to returning to my roots in the brokerage community, especially with this firm. NGKF provides the entrepreneurial flexibility, financial strength, and forward-looking leadership that the industry demands today,” Kious shared.

Kious began her career as a commercial and investment real estate broker in downtown Los Angeles. Her background also includes the role of vice president of global real estate for The Walt Disney Company. Prior to Johnson Controls she acted as senior managing director for CB Richard Ellis/Trammell Crow Company where she was responsible for all corporate accounts in the Western region.

“Lynn brings an incredible depth to this role because she has been on all sides of the corporate real estate business, having managed corporate real estate at a global level. Her experience is priceless having provided her real life insight into what matters today to corporate real estate decision makers, and what truly comprises a strategic and practical solution. Lynn’s real-time perspective will be of great value to our current and future clients,” said Josef Farrar, executive managing director, NGKF.

Article source: http://www.costar.com/News/Article/Kious-Joins-NGKF/174706?ref=/News/Article/Kious-Joins-NGKF/174706&src=rss

Hong Kong Property Developer Invests in Co-Working Space Company NeueHouse

People work on the main floor of NeueHouse located on East 25th Street in New York.
ENLARGE

Hong Kong property company Great Eagle Holdings Ltd.
0041


-2.51
%




is betting on the shared-office trend that is taking off in the U.S.

Great Eagle recently invested $25 million in NeueHouse, a New York-based provider of upscale co-working space, according to people familiar with the matter. Its plan: to open a number of co-working spaces adjacent to Great Eagle’s new lifestyle hotel brand, which is still unnamed but is expected to be introduced later this year.

A Great Eagle spokesperson declined to comment.

Over the past few years, New York-based WeWork Cos. has reignited the shared-office model, which first took off during the technology boom of the late 1990s. The privately held company, whose value has doubled this year to $10 billion based on a recent investment round, leases office space, refurbishes it and adds quirky elements such as table tennis and free beer and coffee. It then rents out the space at a big markup.


WeWork and other companies have had success thus far attracting small businesses looking for hip office space and a chance to collaborate with like-minded entrepreneurs.

The shared-office crowd could be a good match for lifestyle hotels, a segment that typically appeals to younger people through attention to design and public spaces that serve as social hubs. NeueHouse’s co-working space attracts a similarly hip and creative clientele, and Great Eagle is hoping synergy between the two brands will increase exposure for both.

Great Eagle is entering the crowded lifestyle segment after many small firms and major hotel companies, including Marriott International Inc. and Hilton Worldwide Holdings Inc., launched new brands in recent months.

“It’s a pretty interesting opportunity,” said Sean Hennessey, chief executive officer of Lodging Advisors, a hotel consulting firm. “It could help differentiate the new hotel brand, especially if they are planning to compete in international markets where boutique is already well established.”

The partnership shows how different types of real estate aimed at the millennial generation are beginning to converge, as office space starts to resemble a lifestyle hotel and hotels see value in partnering with office space.

Hotel investor Hospitality Ventures Management Group co-owns and operates a co-working space in downtown Chicago with Serendipity Labs. HVMG is looking to put these work spaces in future hotel projects.

“It’s a great offering for our guests and it can bring a fresh dynamic to a lobby space,” said Mary Beth Cutshall, HVMG’s senior vice president of acquisitions and business development.

NeueHouse started in 2013 with its first location in Manhattan. Properties in Los Angeles and London are poised to open in the coming months, a spokeswoman said. The company expects to add locations in Shanghai, Washington, D.C., and a second New York property by the end of next year, say people familiar with its plans.

The company is a fraction of the size of WeWork, which has 44 locations in the U.S. and abroad, and six more on the way. WeWork leases about 3.5 million square feet of office space in all.

NeueHouse aims for more international and affluent customers than WeWork, which is reflected in the membership price. Monthly dues start at $300 a month for evening and weekend access and rise to nearly $2,000 for a private desk in a studio office. That’s several times the amounts charged by WeWork, where monthly fees start at $45.

The library on the lower level of NeueHouse, a co-working space in Manhattan which opened in 2013.
ENLARGE

The New York property, filled with stacks of art books and glossy magazines, mixes chic with an industrial feel and concrete floors. The location has several hundred members and thousands of applicants, according to a person familiar with the company.

A NeueHouse spokeswoman declined to discuss the admission process, though she said members work in a mix of creative industries like film, fashion and design, and that about one-third of them are from overseas.

The New York location has attracted a number of high-profile guest speakers, including German film director Werner Herzog, Michelin-starred chef Daniel Boulud and rapper Fab 5 Freddy.

Miami-based private equity and venture firm Aeterna Capital led NeueHouse’s previous round of funding.

Great Eagle also owns Langham Hospitality Group, a luxury hotel chain. The new Great Eagle boutique brand is under the supervision of Katherine Lo, the Yale-educated daughter of Great Eagle chairman Lo Ka Shui and granddaughter of the company’s founder.

Write to Craig Karmin at craig.karmin@wsj.com

Article source: http://www.wsj.com/articles/hong-kong-property-developer-invests-in-co-working-space-company-neuehouse-1440515615?mod=residential_real_estate

FHA/VA Boosts Otherwise Flat Mortgage Apps

There was virtually no
movement last week in the various indices measuring mortgage application
volume.  The Mortgage Bankers Association’s
(MBA’s) Market Composite Index, a gauge of overall application activity, eked
out a 0.2 percent increase during the week ended August 21 while the unadjusted
index declined by 1.0 percent.

The Refinance Index also
lost ground compared to the previous week, down 1.0 percent. The refinance
share of total mortgage applications dipped from 55.5 percent during the week
ended August 14 to 55.3 percent. 

The seasonally
adjusted Purchase Index did stir a bit, rising 2.0 percent but on an unadjusted
basis the Purchase Index was down 0.3 percent week-over-week while remaining 18
percent higher than it was during the same period in 2014.

Refinance Index vs 30 Yr Fixed

Purchase Index vs 30 Yr Fixed

The minimal increase
in the Market Composite Index was driven by an uptick in applications for
government-backed mortgages while conventional purchase applications were
essentially unchanged.  The seasonally
adjusted FHA purchase index rose 5.6 percent while the index for VA
applications increased by 5.2 percent. 
The share of FHA applications inched up to 13.1 percent from 12.9
percent and the VA share from 11.1 percent to 11.4 percent.  The USDA application share was unchanged at
0.8 percent of the total.

With the exception of a
slight increase for FHA-backed mortgages, interest rates, both contract and
effective, declined during the week.  The
contract interest rate for FHA 30-year fixed-rate mortgages (FRM) increased
from 3.88 percent with 0.17 point to 3.90 percent with 0.21 point.  The effective rate also increased.

The average rate for
30-year
FRM with conforming loan balances of $417,000 or less was 4.08 percent,
a 3 basis point decrease from the previous week.  Points declined to 0.36, from 0.37.

The jumbo 30-year
FRM, loans with balances over $417,000, had a contract rate of 4.0 percent with
0.24 point.  The previous week the rate
was 4.03 percent with 0.29 point.

Fifteen
year
-FRM rates fell 4 basis points to an average of 3.33 percent.  Points averaged 0.31 compared to 0.36.

The share of applications that were for
adjustable rate mortgages (ARMs) ticked down from 6.9 percent to 6.8.  The average contract interest rate for 5/1
ARMs dipped to 2.96 percent from 2.98 percent, and points decreased to 0.36
from 0.40.

MBA’s Weekly Mortgage Application Survey,
which has been conducted since 1990, covers over 75 percent of all U.S. retail
residential mortgage applications. Respondents include mortgage bankers,
commercial banks and thrifts. Base period and value for all indexes is March
16, 1990=100.  Interest rate data assumes loans with 80
percent loan-to-value ratios with points that include the origination fee.

Article source: http://www.mortgagenewsdaily.com/08262015_application_volume.asp

McDonald’s Lands in a Real-Estate Dilemma

For McDonald’s Corp., the suggestion that it should spin off its vast property holdings poses an existential question: What are the Golden Arches without real estate?

As McDonald’s approaches the third anniversary of declining sales, some analysts have asked whether shareholders could get better returns if the company placed its U.S. properties in a publicly traded real-estate investment trust.

McDonald’s has always maintained…

Article source: http://www.wsj.com/articles/mcdonalds-lands-in-a-real-estate-dilemma-1440495181?mod=residential_real_estate