Saturday, November 11, 2006
INVERSIONISTAS MIRAN HACIA PROPIEDADES COMERCIALES
MARRERO REL ESTATE BROKERAGE LLC
JOSE RAUL MARRERO
REAL ESTATE BROKER LIC
SE PREDICE QUE HABRA UNA BUENA DEMANDA DE PROPIEDADES COMERCIALES YA QUE LOS INVERSIONISTAS EN BIENES RAICES COMENZARAN A MIRAR ESTE TIPO DE ALTERNATIVA DEBIDO AL CAMBIO DE MERCADO A FAVOR DE LOS COMPRADORES EN EL MERCADO RESIDENCIAL.
A CONTINUACION EL DETALLE DE LA NOTICIA
Growth predicted for commercial real estate as residential brethren suffer slowdown
NEW YORK (AP) – Nov. 10, 2006 – Judging by recent profit figures, many of the biggest commercial real estate companies have been unscathed by the housing market slowdown.
A strong job market and increase in corporate outsourcing have bolstered real estate services revenues, enough to offset a slower pace of growth in investment sales that has set in since the booming recent years when offshore investors, real estate investment trusts and pension investors flooded the market.
JMP Securities Analyst William Marks said that while all sectors of commercial real estate are performing well, leasing activity and property management in particular are surging ahead. But investment sales are indeed slowing.
"Only so much real estate can change hands," he said, noting that the volume of transactions had been so high in past years that the rate would be difficult to maintain.
The market for leasing office space has been helped by the strength of the job market. In October, the jobless rate fell to the lowest level in five years, and a low unemployment rate boosts demand for office space.
Grubb & Ellis issued a report in late September that said any effect from the housing slowdown on the market for office space would be modest and more muted than the pullback the sector after the technology boom.
And as the industry sustains its strength, the market leader in real estate services, CB Richard Ellis Group Inc., said Oct. 31 it would buy rival Trammel Crow Co. in a deal that would increase its dominance. The acquisition, if completed as planned, would give CB Richard Ellis 10.5 percent of the market, a rise from its current share of 7.9 percent, according to a research note by JPMorgan Analyst Michael J. Fox.
Analysts have cited Trammel Crow's strength in providing outsourcing services - such as property or project management and lease administration - as making the deal a good combination. It would also help diversify CB Richard Ellis's revenue away from its reliance on leasing and sales revenue, which in the third quarter produced a combined 74 percent of the company's revenue.
"As a publicly traded company, it can help smooth out the bumps in revenue," said Chief Executive Bill Goade of Cresa Partners, a Boston-based corporate real estate advisory firm.
CB Richard Ellis CEO Brett White said revenue from outsourcing would rise to 18 percent from 8 percent under the deal. "This is the part of that strategy we've talked with many of you about in the past of continuing to diversify the revenue base of the company going forward," White said in a conference call announcing the transaction. "And this transaction will very much help that."
In the third quarter, CB Richard Ellis posted 62 percent higher profit, and Trammell Crow said income rose 14 percent, due mostly to gains from property management.
Fox wrote that there is substantial opportunity for growth in outsourcing services. "Higher institutional investor ownership of real estate should continue to drive demand for services and enable investment sales to maintain solid growth," Fox wrote.
He warned that interest rates could hurt the industry, though.
"If rising rates cause the economy to slow more than we anticipate or fall into a recession, employment trends will likely soften and leasing commissions could be below our expectations," he wrote.
Meanwhile, in the residential sector, Bloomfield Hills, Mich.-based Pulte Homes Inc., Miami-based Lennar Corp. and Dallas-based Centex Corp. all reported lower profit in the third quarter. D.R. Horton Inc. reported a 61 percent rise in profit in the third quarter.
JOSE RAUL MARRERO
787-486-7906
TODOS SOMOS GUERRERO DE LUZ!
ESTA NAVIDAD REGALA ALEGRIA
www.cantoresdebayamon.com
JOSE RAUL MARRERO
REAL ESTATE BROKER LIC
SE PREDICE QUE HABRA UNA BUENA DEMANDA DE PROPIEDADES COMERCIALES YA QUE LOS INVERSIONISTAS EN BIENES RAICES COMENZARAN A MIRAR ESTE TIPO DE ALTERNATIVA DEBIDO AL CAMBIO DE MERCADO A FAVOR DE LOS COMPRADORES EN EL MERCADO RESIDENCIAL.
A CONTINUACION EL DETALLE DE LA NOTICIA
Growth predicted for commercial real estate as residential brethren suffer slowdown
NEW YORK (AP) – Nov. 10, 2006 – Judging by recent profit figures, many of the biggest commercial real estate companies have been unscathed by the housing market slowdown.
A strong job market and increase in corporate outsourcing have bolstered real estate services revenues, enough to offset a slower pace of growth in investment sales that has set in since the booming recent years when offshore investors, real estate investment trusts and pension investors flooded the market.
JMP Securities Analyst William Marks said that while all sectors of commercial real estate are performing well, leasing activity and property management in particular are surging ahead. But investment sales are indeed slowing.
"Only so much real estate can change hands," he said, noting that the volume of transactions had been so high in past years that the rate would be difficult to maintain.
The market for leasing office space has been helped by the strength of the job market. In October, the jobless rate fell to the lowest level in five years, and a low unemployment rate boosts demand for office space.
Grubb & Ellis issued a report in late September that said any effect from the housing slowdown on the market for office space would be modest and more muted than the pullback the sector after the technology boom.
And as the industry sustains its strength, the market leader in real estate services, CB Richard Ellis Group Inc., said Oct. 31 it would buy rival Trammel Crow Co. in a deal that would increase its dominance. The acquisition, if completed as planned, would give CB Richard Ellis 10.5 percent of the market, a rise from its current share of 7.9 percent, according to a research note by JPMorgan Analyst Michael J. Fox.
Analysts have cited Trammel Crow's strength in providing outsourcing services - such as property or project management and lease administration - as making the deal a good combination. It would also help diversify CB Richard Ellis's revenue away from its reliance on leasing and sales revenue, which in the third quarter produced a combined 74 percent of the company's revenue.
"As a publicly traded company, it can help smooth out the bumps in revenue," said Chief Executive Bill Goade of Cresa Partners, a Boston-based corporate real estate advisory firm.
CB Richard Ellis CEO Brett White said revenue from outsourcing would rise to 18 percent from 8 percent under the deal. "This is the part of that strategy we've talked with many of you about in the past of continuing to diversify the revenue base of the company going forward," White said in a conference call announcing the transaction. "And this transaction will very much help that."
In the third quarter, CB Richard Ellis posted 62 percent higher profit, and Trammell Crow said income rose 14 percent, due mostly to gains from property management.
Fox wrote that there is substantial opportunity for growth in outsourcing services. "Higher institutional investor ownership of real estate should continue to drive demand for services and enable investment sales to maintain solid growth," Fox wrote.
He warned that interest rates could hurt the industry, though.
"If rising rates cause the economy to slow more than we anticipate or fall into a recession, employment trends will likely soften and leasing commissions could be below our expectations," he wrote.
Meanwhile, in the residential sector, Bloomfield Hills, Mich.-based Pulte Homes Inc., Miami-based Lennar Corp. and Dallas-based Centex Corp. all reported lower profit in the third quarter. D.R. Horton Inc. reported a 61 percent rise in profit in the third quarter.
JOSE RAUL MARRERO
787-486-7906
TODOS SOMOS GUERRERO DE LUZ!
ESTA NAVIDAD REGALA ALEGRIA
www.cantoresdebayamon.com
