Deals are happening in apartment markets, although transaction volume is still down from a year ago. Listings are recovering for smaller properties, but "the bigger and higher quality product usually associated with institutional owners is the segment that is slowest to return to market," says Andrew Rybczynski of CoStar Portfolio Strategies.
Mall owners have felt the effects of the pandemic, and it is unclear what their rental income will look like in the future. Some large retailers are negotiating for rent reductions, and mall owners are also dealing with debt and the growth of e-commerce.
Emergency lending facilities from the Federal Reserve have accomplished the aim of stabilizing markets, despite modest use of some of them, says Daleep Singh, head of the markets group at the Federal Reserve Bank of New York. The central bank will change its approach if conditions require it, Singh says.
Earn up to 30.5 CPE Credits at REITworks
Nareit's REITworks: 2020 Virtual Conference is a new educational conference where attendees will have the opportunity to learn about the latest developments in environmental stewardship, social responsibility, and good governance impacting the real estate sector. Learn more.
Steven Tanger, CEO of Tanger Factory Outlet Centers, has stuck to his belief that people prefer to buy certain kinds of merchandise in-person and has sought to position his company for the return of shoppers as stores reopen. During pandemic-related shutdowns, the business cut executive compensation and suspended its dividend while continuing to pay employees.
Driven by e-commerce, demand for industrial real estate could grow by 1 billion square feet by 2025, a JLL report says. It forecasts that the country will need another 100 million square feet of facilities for cold storage.
Vacancy rates for certain real estate assets edged up in the second quarter on a year-over-year basis, reaching 17.1% for offices and 4.8% for apartments, according to Reis. It said the shift to remote work during the pandemic could affect the office market in the long term, but "demand for apartments could hold steady in most metros."
Some shoppers are hesitant to visit stores amid the coronavirus resurgence. National footfall has recently slipped after rebounding at shopping malls in May and early June, according to Safegraph and Jefferies.
Sunstone Hotel Investors sold the 622-room Renaissance Baltimore Harborplace Hotel to the Buccini/Pollin Group in a deal worth $80 million. "The completed sale further concentrates our portfolio into long-term relevant real estate and increases our already considerable liquidity," says Sunstone President and CEO John Arabia.
Bed Bath & Beyond will permanently shutter about 200 of its approximately 1,500 stores, with the closures expected to start this year. Sales fell by almost half in in the most recent quarter, but online sales surged in April and May.
In this interview, Easterly Government Properties President and CEO William Trimble discusses the REIT's tenant roster and the acquisition outlook. The tenant mix focuses on about three dozen agencies, and Trimble notes that "those agencies are extremely important certainly in what we're seeing this year so far."
The US budget deficit for the first three quarters of the fiscal year reached $2.7 trillion, nearly twice the $1.4 trillion record for the full year of 2009, according to the Congressional Budget Office. The deficit could surpass $3.8 trillion this fiscal year as a result of the coronavirus pandemic.
Nareit recently released the second REIT Industry ESG Report. The report showcases the substantial efforts made by the industry in 2019, before the onset of the pandemic, to build off the baselines established in the inaugural report. It highlights the REIT industry's many initiatives tied to environmental stewardship, social responsibility, and good governance. Download the report.