Commercial Real Estate

Commercial Real Estate


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Commercial Real EstateGlancing through real estate news across the country, I noticed these commercial real estate closings:

  • Penney’s to pare store count – JC. Penney Co. plans to close 130 to 140 stores over the next few months. It implements a plan to “optimize” its national retail operations.
  • HHGregg considers bankruptcy – Indianapolis-based HHGregg Inc., the 61-year-old seller of appliances and electronics, is preparing to file for bankruptcy as it grapples with slumping sales
  • Family Christian Bookstores closing all store locations – Family Christian Bookstores is going out of business. It has launched liquidation sales at 240 stores in 36 states.
  • Here in Omaha, we have Gordmans the department store chain, founded in Omaha in 1915, is preparing to file for bankruptcy as early as this month, Bloomberg News reported Monday.

A recent article at Zero Hedge predicts The Next Domino To Fall: Commercial Real Estate

“Talk about an overvalued market set up for a fall. It isn’t just malls becoming empty retail wastelands, it’s Corporate America shifting to flex-work and work-at-home. That shift slashes the need for floor after floor of costly business-park office space.

It’s about restaurants moving to smaller spaces as they move to serving more meals via delivery services.

“Commercial real estate is grossly overbuilt in retail and office space. We have trouble when we combine sky-high valuations with cratering demand,  while billions in short-term CRE loans must be rolled over into new loans. We don’t have a liquidity crisis, we have a collateral crisis— the assets supporting the debt are no longer worth the loan balance.

 “Unless the Federal Reserve intends to buy up every dead and dying mall in America, this is one crisis that the Fed can’t bail out with a few digital keystrokes.”

The authors say we have been through two waves, with a third, the biggest, to come.

  1. The first wave to hit was Factory Closings characterized by the DotCom bubble offshoring, outsourcing, and downsizing.
  2. The second wave was the collapse of Office Space and the housing bubble. Those hurt beside homeowners were mortgage brokers, real estate, builders, contractors, remodelers, and insurance.
  3. The third wave and the biggest to come is the Retail Space. Those affected are malls, strip malls, shopping centers, big box stores, and franchises.

How important is commercial real estate to a community?

Bill Florent Co-Founder of Selequity and former CFO of Cassidy Turley said, “It is not news that commercial real estate plays a seminal role in our nation’s economy.

Commercial real estate provides places for people to live, work, eat, drink and receive a full range of services. Renting an apartment by an individual or a company is leasing space to house its business, produces income. That’s why these businesses exist, which in turn generate tax revenue for local, state, and the federal government. In addition, all of these proceeds create the foundation for further economic growth.

Just one fact: The office building industry contributed $227.6 billion to the U.S. economy in 2013 alone, roughly twice the annual contribution made by pharmaceutical or auto-industry Research & Development annually.

Styl Properties, Inc. is here to help homeowners out of any kind of distressed situation.  

As investors, we are in business to make a modest profit on any deal. We can help homeowners out of just about any situation, no matter what!  There are no fees, upfront costs, commissions, or anything else.  We offer you the simple honest truth about your home, in addition, we can help you sell it fast to resolve any situation.

If you’d like to give us a ring we would be more than happy to spend some time with you, because then  you’ll understand the process and to get all of your questions answered.  You can reach us at

You can reach us at 402 999.0577

 

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