Eight Must Reads for the CRE Industry (March 1, 2021)

  1. CRE lenders’ growing fear: Office workers won’t come back “More square footage is going unoccupied, delinquencies have started edging up, new loans are dwindling and borrowing costs are creeping higher, all signs that the business is growing riskier. Now, many banks are planning to pull back from financing office projects this year, executives said, and opinions vary on when, or even if, the office market will bounce back.” (American Banker)
  2. CoStar Group Submits Revised Proposal to Acquire CoreLogic with Increased Value and Improved Certainty of Closing “Under the terms of the new proposal, CoreLogic shareholders would receive $6.00 per share in cash and 0.1019 shares of CoStar Group common stock in exchange for each share of CoreLogic common stock, representing a value of approximately $90 per share based on CoStar Group’s closing share price on February 26, 2021 and approximately $97 per share based on the latest 30-day volume-weighted average CoStar share price.” (Via press release)
  3. Anyone Who’s Anyone Has a SPAC Right Now “The celebrities aren’t so much the financial decision makers but rather the promoters brought in to attract investors (‘strategic advisers,’ in prospectus parlance). Like marketers of soft drinks or sneakers, SPAC managers are tapping into the power of celebrity to sell a product — in this case, a financial instrument The New York Times has likened to an ‘empty shell.’” (The New York Times)
  4. Fry’s Electronics collapse frees up prime Bay Area real estate “Tech campuses, housing, auto dealerships, research, manufacturing — almost anything other than big-box retail — are among the kinds of projects that have been proposed, could be feasible or are on a community’s wish list for the properties.” (The Mercury News)
  5. Investors pile into risky commercial real estate debt, even as Fed warns of trouble “One of Wall Street’s hottest ‘reopening’ trades has been playing out in the $600 billion commercial mortgage-backed securities (CMBS) market, through bets on risky slices of property debt that could end up with big losses, or rewards, if hotels fill back up with business travelers, workers return to the office and shoppers wander back to shops as the COVID-19 threat subsides.” (Marketwatch)
  6. Golden Opportunity For S.F. Bay Area To Hit Refresh On Growth Strategy “The theory is that in the absence of the virus’s hold on society, the underlying fundamentals should still be healthy. Among other metrics alluding to this, the median Bay Area home price went up by 20% during the pandemic, according to Wunderman.” (Bisnow)
  7. How the Recent Snowstorm Affects the Dallas Office Market “Seeing how unprepared the entire state of Texas was in dealing with this type of event, owners and operators everywhere should take this as an example to be better prepared for the future no matter what the location or obstacle.” (Commercial Property Executive)
  8. Beyond #CancelRent: Real Estate Industry Moves To Flexible Payment Model “Since COVID-19 sent the economy into a tailspin a year ago, much has been written about the movement to cancel rent and the importance of continuing eviction moratoriums. But some in the real estate industry have pointed to solution that may be more viable in the long term for both residential and commercial tenants: flexible rent.” (Forbes)

Article source: https://www.wealthmanagement.com/cre-wire/eight-must-reads-cre-industry-march-1-2021

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