Situs Newswatch 5/10/2017

Co-Housing: Designing The Future for CRE Multifamily Development

From the outside, the small Seattle building looks like any other; the nine apartments inside have individual living rooms, bedrooms, kitchens and baths. But the design, modeled on Danish co-housing communities, has a central common house and courtyard. In the common house, everyone dines together three times a week, taking turns cooking for each other. Call them dorms for adults.

“Co-housing will help build better living environments; people will take better care of the buildings and amenities because of the sense of ownership,” says Jennifer Rasmussen, Assistant Vice President at Situs RERC, who has a doctorate in industrial and organizational psychology from Texas A&M University.

“As a psychologist,” says Situs RERC’s Rasmussen, “I can attest to the detrimental physical and psychological effects of isolation and the integral importance of social capital — the networks of people that inspire trust and cooperation among their members — for well-being.”

Fast Company reports that more Americans are single than ever before, and more are living alone. That is one of the reasons we’re also starting to die earlier: One study found that living alone increases mortality risk 32 percent. Vivek Murthy, the former U.S. surgeon general, has called isolation the most common health issue in the country.

Situs RERC’s Rasmussen says, “Multifamily developers and owners win because it is cheaper to build spaces with communal amenities such as kitchens; you can fit more tenants into the same amount of space. From a consumer standpoint, co-housing also makes sense. With so many millennials living with their parents because they can’t afford exorbitantly high rents, the solution may well be to set up similar living situations with non-relatives, driving a sense of community from face-to-face interactions.”

Architect Grace Kim agrees that the solution may be co-housing. “Loneliness can be the result of our built environment,” she told an audience at TED 2017. “It turns out when you eat together, you start planning more activities together.”

Even couples or families, she said, can be socially isolated in the typical house, and barely know neighbors. In an apartment building, residents might be more likely to stare at their phones in the elevator than start a conversation. Kim, by contrast, lives and works in a co-housing community she designed in Seattle, where families or individuals each have their own homes, but the space was designed for interaction.

Says Situs RERC’s Rasmussen, “CRE is where we live, work and play. By combining multipurpose spaces, ideas such as co-housing will breathe new life into the CRE multi-family environment and help our businesses appeal to millennials and future generations.”

Millennial Homebuyers Running Into Regulatory Buzz Saw

Older generations might think millennials are doing it all wrong, but the truth is, millennials aren’t all that different from their grandparents — especially when it comes to buying their first homes.

New research from Zillow confirms that while younger people are buying homes later than previous generations, they still have a sizable impact on the housing market.

rood I24.png
“The biggest issue holding back millennials is that home inventory is anemic,” says the Collingwood Group Chairman Tim Rood, in an interview with the I24 News Clearcut Program. “While existing-home sales are picking up, we’re going to run out of inventory especially in lower-priced homes that appeal to millennials.”

Millennials are generally defined as those born in the 1980s to the early 2000s. Last year, millennials made up 42 percent of homebuyers. Their home preferences are most similar to that of their grandparents. Millennials are choosing homes with shared community amenities, for example, and considering buying townhouses more than the next most recent generations.

The study found that almost 50 percent of millennials live in the suburbs, while 33 percent live in urban areas and the remaining 20 percent are in rural areas. Almost 30 percent of the population in both San Diego, CA, and Austin, TX, is made up of millennials, while Los Angeles, San Antonio and Columbus, OH, have millennial populations of over 25 percent. But warns Collingwood’s Rood, “Until you find a way to incentivize builders, and take the regulatory morass off their shoulders allowing them to start constructing starter homes, than you are going to run into a buzz saw.”

Mall Madness: Hip Restaurants Are Attracting Millennials

While many retailers are struggling, new life is being breathed into the restaurant scene that is helping draw in shoppers and create the whole shopping experience.

“The increasing popularity of dining out is energizing retail real estate around the globe by creating a true sense of community where people can go out to dinner, take in a movie and shop, all in one place,” International Council of Shopping Centers CEO Tom McGee said.

Consumers spent more last year at restaurants than they did at grocery stores, according to McGee.

McGee’s sentiment reflects the increased importance of dining on shopping centers found in ICSC’s recently published “The Successful Integration of Food & Beverage Within Retail Real Estate.”

The study quotes a report by New York market research firm YPulse that shows 61% of Millennials ages 21 to 24 would rather have dinner at a new restaurant than buy a new pair of shoes.

A growing trend is the emphasis on casual dining with even upscale restaurants taking steps to appear less formal, according to the ICSC report.

This is being done to keep up with market demands, putting those restaurants in a more competitive, but more lucrative, market, the report states.

The report stresses the importance of landlords knowing about trends and what their customers want as well as being knowledgeable about their communities, so they can customize their food offerings.

read more: BisNow


With the latest Situs take on “Mall Madness” and more, join Ken Riggs, President of Situs RERC, at 7:30 p.m. ET Thursday as he talks live with I24News.


Jared Kushner’s Sister Woos Chinese Investors with CRE Green Card Program

The sister of President Donald Trump’s son-in-law Jared Kushner has been in China courting individual investors with a much-criticized federal visa program that provides a path toward obtaining U.S. green cards.

Kushner’s sister Nicole Meyer promoted 1 Journal Square, a Kushner Companies’ development in Jersey City, at an event Sunday at the Four Seasons Hotel in Shanghai, according to participants.

The pitch seeks to raise funds from Chinese investors through the U.S. government’s EB-5 visa program, which allows permanent U.S. residency for those who finance projects that create a certain amount of jobs.

The event was organized by Beijing-based immigration services company QWOS and Kushner Companies, according to an advertisement on the Chinese company’s website, which says the project is seeking $150 million from 300 EB-5 investors.

Kushner, a senior adviser to Trump, stepped down as chief executive of the Kushner Companies in January and has sold stakes in several properties to help allay concerns about conflict of interest. His family’s promotional efforts in China come amid widespread criticism of the EB-5 visa program, which has grown popular among wealthy foreigners seeking to move to the U.S. but faces allegations of fraud and misuse.

Critics say many of the investments purportedly aimed at assisting poor areas of the U.S. have instead wound up going to projects in more affluent neighborhoods, while many programs have been badly hit by fraud scandals. U.S. lawmakers have been weighing proposed changes to the program, which would likely affect companies such as Kushner Cos. should it want to raise funds from such investors. Earlier this month, Congress extended the EB-5 program in its current form through Sept. 30.

read more: NY Post

House Panel Approves Plan to Undo Parts of Dodd-Frank Financial Law

The House Financial Services Committee launched a Republican-supported rollback of Obama-era financial regulations, voting 34-26 along party lines for a plan to undo significant parts of the 2010 Dodd-Frank law.
The committee vote sent the Financial Choice Act to the full House, where it likely will be approved in the coming weeks.

The legislation by the panel’s chairman, Rep. Jeb Hensarling (R., Texas), would relieve banks of some regulatory requirements as long as they meet certain capital requirements; subject banks to stress tests biennially instead of every year; repeal the Volcker rule, which restricts how banks invest taxpayer-insured deposits; force failing firms to go through bankruptcy; and restructure the Consumer Financial Protection Bureau, an agency created after the financial crisis.

The bill has the broad backing of the financial-services industry. But it is opposed by consumer groups that worry the plan would introduce more risk into the financial system.

During three days of committee debate, Democrats fought unsuccessfully to stop its passage. They proposed nearly two dozen amendments, all of them rejected and many of which would have preserved components of the Dodd-Frank law that Republicans want to eliminate.

Rep. Maxine Waters (D., Calif.) said the bill “is a deeply misguided measure that would bring harm to consumers, investors and our whole economy.”

The GOP plan is expected to clear the House when it comes up for vote, but faces uncertain prospects in the Senate, where Republicans will need to negotiate with Democrats to get a bill through that chamber.

read more: Wall St Journal

As ‘Brexit’ Tensions Rise, E.U. Proposal Targets London Finance

European Union officials fired an opening salvo in a “Brexit”-related dispute that could threaten London’s status as the undisputed financial capital of Europe and affect hundreds of trillions of dollars’ worth of financial products.
In the course of a series of proposed technical changes, the European Commission, the executive arm of the 28-nation bloc, hinted that it may seek a more centralized role in supervising the complex financial contracts known as derivatives when they are denominated in euros. It also suggested that it could institute requirements that clearing houses, which act as middlemen in derivatives transactions, be located within the European Union.

Those rules, if enacted, could force clearing houses for derivatives to be regulated by European authorities even after Britain leaves the bloc, or to relocate part of their operations in order to avoid losing business to competitors.

The proposals, released in briefing documents, form part of an increasingly heated negotiating process over Britain’s withdrawal from the European Union. Tensions have played out in recent days in newspapers in Britain and on the Continent.

read more: NY Times

Markets Rise as France Stays with EU

French voters elected centrist Emmanuel Macron as the country’s youngest president ever on Sunday, delivering a resounding victory to the unabashedly pro-European former investment banker and strengthening France’s place as a central pillar of the European Union.

A crowd of Macron supporters roared with delight at the news, jubilantly waving red, white and blue tricolor flags at a victory party outside the Louvre Museum in Paris.

Marine Le Pen, his far-right opponent in the presidential runoff, quickly called the 39-year-old Macron to concede defeat after voters rejected her “French-first” nationalism by a large margin.

The result wasn’t even close: Pollsters projected that Macron won 65 percent of the votes. Le Pen’s projected 35 percent score was lower than her polling numbers earlier in the campaign, and dashed her hopes that the populist wave which swept Donald Trump into the White House would also carry her to France’s presidential Elysee Palace.

Macron’s victory marked the third time in six months — following elections in Austria and the Netherlands — that European voters shot down far-right populists who wanted to restore borders across Europe. The election of a French president who championed European unity could strengthen the EU’s hand in its complex divorce proceedings with Britain, which voted last year to leave the bloc.

read more: Fortune

Elliman Made Only $100K in Profits in Q1

No, that’s not a typo: Douglas Elliman’s profits dipped to just $100,000 during the first quarter of 2017, down from $7.1 million during the same period last year, parent company Vector Group reported.

The paltry sum was attributed to fewer closings at new development projects, Vector executives said. Elliman closed sales worth $5.6 billion during the first quarter, compared to last year’s $5.7 billion, the company said. That resulted in $155.5 million in first-quarter revenue, down slightly from $157.6 million last year. … Overall, Vector’s first-quarter revenue was $415.2 million, up from $380.8 million in 2016’s first quarter. Vector reported a net loss of $4.2 million compared with net income of $19.3 million during the first quarter of last year.

read more: Real Deal

Former Fox News CEO Roger Ailes Really Wants to Sell N.J. Home

Former Fox News chairman Roger Ailes has chopped the price of his longtime home by 25 percent since listing it less than two months ago, bringing it down to $1.65 million.

He lowered the price by $300,000 this week, matching his first price drop in late March after three weeks on the market. He is now seeking less than he paid for the 3,500-square-foot home in 2000 — $1.85 million.

The 76-year-old Ailes was forced out of Fox News last summer amid a sexual harassment scandal at the network stemming from former Fox anchor Gretchen Carlson’s lawsuit, which was later settled. Ailes has denied any wrongdoing. But the shakeup has continued, with another sexual harassment scandal claiming Fox News’ marquee star Bill O’Reilly last month, and this week, the network axed co-president Bill Shine, who has been accused in lawsuits of covering up Ailes’ alleged harassment. Shine has also denied those allegations.

read more: NJ.com

Have a prosperous day ahead.

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