California home sales register nominal year-over-year increase in September for first time in seven months

- Existing, single-family home sales totaled 425,680 in September on a seasonally adjusted annualized rate, up 1.3 percent from August and 0.8 percent from September 2015.

- September’s statewide median home price was $514,320, down 2.3 percent from August and up 6.1 percent from September 2015.

- Statewide sales of condos and townhomes fell 8.5 percent from August and were up 1.4 percent from September a year ago.

LOS ANGELES (Oct. 17) – California existing home sales ticked up in September on a year-to-year basis for the first time in seven months as a shortage of homes available for sale continues to hold back the market, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) said today.
  
Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 425,680 units in September, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide. The statewide sales figure represents what would be the total number of homes sold during 2016 if sales maintained the September pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

The September figure was up 1.3 percent from the revised 420,360 level in August and up 0.8 percent compared with home sales in September 2015 of a revised 422,360. Home sales remained above the 400,000 pace for the sixth straight month, and the year-over-year increase was the first since January.

“While higher sales both on a monthly and an annual basis is a glimmer of good news, with most of the home-buying season behind us for 2016, it’s not enough to tip the scales for an increase above 2015’s sales pace,” said C.A.R. President Pat “Ziggy” Zicarelli. “With listings continuing to decline and demand still strong, especially at the lower end of the market, affordability will remain a challenge for would-be buyers.”

The statewide median price remained above the $500,000 mark for the sixth straight month, with minimal signs of cooling down outside of a few select markets. The median price of an existing, single-family detached California home was down 2.3 percent in September to $514,320 from $526,580 in August. September’s median price increased 6.1 percent from the revised $484,670 recorded in September 2015. The median sales price is the point at which half of homes sold for more and half sold for less; it is influenced by the types of homes selling, as well as a general change in values. The monthly price decline is primarily due to seasonal factors.

“While demand remains strong for lower-priced homes, which are more inventory constrained, sales of homes at the higher-end have slowed significantly,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. “For example, sales of properties priced between $2 million and $3 million, which are the least inventory constrained, grew by high double-digits in 2014 and 2015, but the pace has slowed down to a negligible 0.2 percent increase through the first nine months of this year.”

Other key points from C.A.R.’s September 2016 resale housing report include:

• Current home prices in the state are still 13.5 percent below their previous peak, though most parts of the San Francisco Bay Area have already reached new all-time highs.

• C.A.R.’s Unsold Inventory Index, which indicates the number of months needed to sell the supply of homes on the market at the current sales rate inched up to 3.5 months in September from 3.4 months in August. The index stood at 3.6 months in September 2015.

• Statewide active listings continue to decline, falling 3.1 percent from August and 4.9 percent from a year ago. The year-over-year listings decline is the highest since January 2016.

• The median number of days it took to sell a single-family home was unchanged from August at 28.9 days but was down from 31.8 days in September 2015.

• C.A.R.’s sales-to-list price ratio* dipped slightly in September, with sales prices slightly decreasing to 98.6 percent of listing prices statewide in September from 98.9 percent in August and flat from September 2015.

• The average price per square foot** for an existing, single-family home statewide reached a post-recession high in September at $249, up from $246 in August and from $235 in September 2015.

• San Francisco County had the highest price per square foot in September at $852/sq. ft., followed by San Mateo ($759/sq. ft.), and Santa Clara ($612/sq. ft.). Counties with the lowest price per square foot in September include Tehama ($123/sq. ft.), Siskiyou ($126/sq. ft.), and Tulare and Kings both at $128/sq. ft.

• Mortgage rates are expected to remain low in the foreseeable future, though the Federal Reserve is expected to raise interest rates by year’s end. Mortgage rates edged slightly higher in September, with the 30-year, fixed-mortgage interest rate averaging 3.46 percent, up from 3.44 percent in August but down from 3.89 percent in September 2015, according to Freddie Mac.  The five-year, adjustable-rate mortgage interest rates also rose in September to an average of 2.81 percent, up from 2.75 percent in August but down from 2.92 percent in September 2015.

Graphics (click links to open):

• September sales at-a-glance infographic.
• Calif. historical existing home sales.
• Share of sales by price range.
• Historical condo sales.
• CA price per square foot.
• Regional ratio of sales to active listings.

Note:  The County MLS median price and sales data in the tables are generated from a survey of more than 90 associations of REALTORS® throughout the state, and represent statistics of existing single-family detached homes only.  County sales data are not adjusted to account for seasonal factors that can influence home sales.  Movements in sales prices should not be interpreted as changes in the cost of a standard home.  The median price is where half sold for more and half sold for less; medians are more typical than average prices, which are skewed by a relatively small share of transactions at either the lower-end or the upper-end. Median prices can be influenced by changes in cost, as well as changes in the characteristics and the size of homes sold.  The change in median prices should not be construed as actual price changes in specific homes.

*Sales-to-list price ratio is an indicator that reflects the negotiation power of home buyers and home sellers under current market conditions.  The ratio is calculated by dividing the final sales price of a property by its last list price and is expressed as a percentage.  A sales-to-list ratio with 100 percent or above suggests that the property sold for more than the list price, and a ratio below 100 percent indicates that the price sold below the asking price.

**Price per square foot is a measure commonly used by real estate agents and brokers to determine how much a square foot of space a buyer will pay for a property.  It is calculated as the sale price of the home divided by the number of finished square feet.  C.A.R. currently tracks price-per-square foot statistics for 39 counties.

Leading the way…® in California real estate for more than 110 years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of the largest state trade organizations in the United States with 185,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

September 2016 County Sales and Price Activity(Regional and condo sales data not seasonally adjusted)

September-16	Median Sold Price of Existing Single-Family Homes							Sales
State/Region/County	Sep-16	Aug-16		Sep-15		MTM% Chg	YTY% Chg	MTM% Chg	YTY% Chg
CA SFH (SAAR)	$514,320	$526,580		$484,670	r	-2.3%	6.1%	1.3%	0.8%
CA Condo/Townhomes	$414,570	$418,750		$388,740	r	-1.0%	6.6%	-8.5%	1.4%
Los Angeles Metro Area	$463,330	$473,950		$440,870	r	-2.2%	5.1%	-2.4%	2.8%
Inland Empire	$319,350	$317,050		$289,690	r	0.7%	10.2%	-1.9%	8.1%
S.F. Bay Area	$770,150	$777,160		$734,330	r	-0.9%	4.9%	-6.4%	-2.1%
S.F. Bay Area
Alameda	$762,250	$775,000		$731,000	r	-1.6%	4.3%	-3.0%	6.7%
Contra-Costa	$552,000	$570,000		$525,000	r	-3.2%	5.1%	-10.0%	-8.6%
Marin	$1,165,000	$1,200,000		$1,050,000	r	-2.9%	11.0%	-13.9%	-16.4%
Napa	$650,000	$625,000		$617,500	r	4.0%	5.3%	9.0%	0.8%
San Francisco	$1,218,750	$1,257,500		$1,189,000	r	-3.1%	2.5%	-11.3%	5.1%
San Mateo	$1,290,000	$1,250,000		$1,200,000		3.2%	7.5%	-12.1%	-8.1%
Santa Clara	$1,000,000	$975,000		$955,000		2.6%	4.7%	1.3%	-0.9%
Solano	$389,500	$410,000		$350,000	r	-5.0%	11.3%	-12.2%	-5.8%
Sonoma	$590,000	$585,000		$541,500	r	0.9%	9.0%	-8.6%	4.9%
Southern California
Los Angeles	$546,920	$517,400		$517,750		5.7%	5.6%	2.8%	2.5%
Orange	$739,000	$749,000		$705,000	r	-1.3%	4.8%	-11.1%	-0.8%
Riverside	$352,250	$355,000		$329,000	r	-0.8%	7.1%	-1.8%	11.1%
San Bernardino	$254,330	$243,370		$229,890		4.5%	10.6%	-2.1%	3.6%
San Diego	$569,000	$563,000		$525,000	r	1.1%	8.4%	-8.8%	6.4%
Ventura	$629,420	$652,330		$599,710	r	-3.5%	5.0%	-10.1%	-14.2%
Central Coast
Monterey	$566,500	$515,000		$480,000		10.0%	18.0%	1.7%	3.5%
San Luis Obispo	$574,750	$535,000		$518,000	r	7.4%	11.0%	5.7%	6.1%
Santa Barbara	$732,500	$775,000		$745,000	r	-5.5%	-1.7%	-9.0%	3.4%
Santa Cruz	$774,500	$824,000		$755,000		-6.0%	2.6%	-17.6%	-19.6%
Central Valley
Fresno	$240,000	$239,000		$220,000	r	0.4%	9.1%	-6.8%	16.4%
Glenn	$220,500	$230,500		$231,250	r	-4.3%	-4.6%	50.0%	50.0%
Kern	$215,000	$220,000		$219,900	r	-2.3%	-2.2%	-2.6%	-7.2%
Kings	$197,000	$209,220		$198,000	r	-5.8%	-0.5%	-3.2%	-4.2%
Madera	$240,000	$245,000		$218,480	r	-2.0%	9.8%	-19.8%	35.2%
Merced	$214,000	$220,000		$205,050	r	-2.7%	4.4%	-8.9%	4.2%
Placer	$430,240	$430,000		$390,000	r	0.1%	10.3%	-4.3%	1.1%
Sacramento	$317,500	$323,500		$290,700	r	-1.9%	9.2%	-7.6%	2.9%
San Benito	$527,500	$538,380		$466,000		-2.0%	13.2%	-8.0%	12.2%
San Joaquin	$322,000	$325,000		$295,000	r	-0.9%	9.2%	-5.7%	-6.0%
Stanislaus	$270,000	$272,750		$252,000	r	-1.0%	7.1%	-13.2%	-14.2%
Tulare	$209,900	$204,900		$189,540	r	2.4%	10.7%	-12.1%	8.5%
Other Counties in California
Amador	$243,500	$257,500		$240,500	r	-5.4%	1.2%	0.0%	15.0%
Butte	$275,000	$264,120		$248,000	r	4.1%	10.9%	-15.8%	4.3%
Calaveras	$285,000	$310,000		$262,000	r	-8.1%	8.8%	-12.9%	6.3%
Del Norte	$239,500	$174,500		$216,500	r	37.2%	10.6%	-44.4%	-37.5%
El Dorado	$419,000	$425,000		$399,000	r	-1.4%	5.0%	-12.3%	0.3%
Humboldt	$290,000	$290,000		$270,000	r	0.0%	7.4%	-13.3%	18.2%
Lake	$220,000	$234,500		$225,000	r	-6.2%	-2.2%	-39.4%	-6.0%
Mariposa	$332,500	$311,500		$236,150	r	6.7%	40.8%	-65.0%	-41.7%
Mendocino	$370,000	$362,500		$340,000	r	2.1%	8.8%	-17.2%	23.3%
Mono	$465,000	$532,500	r	$550,000		-12.7%	-15.5%	-8.3%	100.0%
Nevada	$348,700	$343,000		$339,900	r	1.7%	2.6%	-14.1%	5.8%
Plumas	$278,500	$275,000		$267,500	r	1.3%	4.1%	-9.5%	-20.8%
Shasta	$239,000	$248,000		$238,450	r	-3.6%	0.2%	-5.8%	9.0%
Siskiyou	$192,000	$204,500		$175,000	r	-6.1%	9.7%	11.5%	18.4%
Sutter	$247,500	$267,410		$231,000	r	-7.4%	7.1%	-13.4%	4.4%
Tehama	$219,000	$202,000		$192,500	r	8.4%	13.8%	-31.4%	-7.9%
Tuolumne	$242,500	$266,450		$249,000	r	-9.0%	-2.6%	-22.1%	0.0%
Yolo	$407,000	$410,480		$409,000	r	-0.8%	-0.5%	-25.0%	0.7%
Yuba	$245,000	$249,900		$230,000	r	-2.0%	6.5%	-14.4%	2.5%

r = revised

September 2016 County Unsold Inventory and Time on Market(Regional and condo sales data not seasonally adjusted)

September-16	Unsold Inventory Index					Median Time on Market
State/Region/County	Sep-16	Aug-16		Sep-15		Sep-16	Aug-16		Sep-15
CA SFH (SAAR)	3.5	3.4		3.6	r	28.9	28.9		31.8	r
CA Condo/Townhomes	2.8	2.6		2.8		27.3	29.2		29.6
Los Angeles Metro Area	3.7	3.7		3.9		42.1	45.2		47.1
Inland Empire	4.0	4.1		4.5	r	42.9	45.3		48.9
S.F. Bay Area	2.6	2.4		2.2	r	24.3	23.5		22.4	r
S.F. Bay Area
Alameda	2.1	2.1		2.3		19.8	18.4		18.0
Contra-Costa	2.5	2.4		2.4		21.4	19.7		21.2	r
Marin	4.3	3.6		3.3	r	37.2	41.0		36.3	r
Napa	4.4	4.8		4.2	r	53.1	47.1		59.0	r
San Francisco	3.2	2.2		3.0		25.2	25.1		21.5
San Mateo	2.4	1.9		1.9		20.6	20.2		18.7
Santa Clara	2.2	2.3		2.1		21.7	21.8		19.1
Solano	3.0	2.8		2.5	r	43.0	42.8		41.3	r
Sonoma	3.0	2.9		3.6	r	46.4	49.5		45.6	r
Southern California
Los Angeles	3.3	3.3		3.6	r	35.7	40.3		42.3	r
Orange	3.8	3.7		3.7		49.2	52.4		53.0
Riverside	4.1	4.1		4.6	r	44.0	48.0		50.3	r
San Bernardino	3.9	4.1		4.3		41.0	40.2		46.5
San Diego	3.4	3.3		3.7		23.6	22.5		24.3
Ventura	4.2	4.0		3.7		56.7	53.3		52.4
Central Coast
Monterey	4.3	4.4		4.2		27.3	25.3		26.2
San Luis Obispo	4.0	4.4		4.3		31.5	33.2		42.4
Santa Barbara	4.9	4.6		4.4	r	32.5	33.2		26.3	r
Santa Cruz	2.9	2.7		2.8		26.0	24.8		25.2
Central Valley
Fresno	3.7	3.5		4.8		24.7	24.9		27.1
Glenn	4.3	6.9		5.8		50.3	26.4		31.0
Kern	3.7	3.8		3.7		27.1	26.6		26.0	r
Kings	3.4	3.2		3.2		25.0	22.6		33.3
Madera	4.7	4.1		8.0		45.5	54.1		75.5
Merced	2.9	2.8		4.1		31.5	35.0		38.3
Placer	2.9	3.0		3.2		23.9	23.7		25.5
Sacramento	2.6	2.5		2.7		20.3	19.5		22.4
San Benito	3.8	3.7		3.3		26.7	23.0		26.2
San Joaquin	3.2	3.1		3.1		21.3	21.7		23.1
Stanislaus	3.5	3.1		3.2		24.0	21.7		23.7
Tulare	3.9	3.5		4.6		27.7	28.4		32.6	r
Other Counties in California
Amador	5.3	5.8		5.9		52.8	49.5		63.9
Butte	3.7	3.3		4.2		27.1	26.5		39.1
Calaveras	5.4	4.9		6.3		58.2	29.5		69.5
Del Norte	16.1	9.6		10.1		95.8	110.3		84.2
El Dorado	4.0	3.8		4.4		45.9	33.9		46.8
Humboldt	3.6	3.3		4.9		27.5	24.0		46.5
Lake	7.3	4.6		6.8		74.1	95.0		94.6
Mariposa	13.0	4.3		9.8		98.3	91.0		31.0
Mendocino	7.0	6.0		9.0	r	77.3	71.9		80.8	r
Mono	6.5	10.4	r	NA		123.4	94.6		123.4
Nevada	3.7	3.3		4.8		31.0	26.4		40.4
Plumas	10.7	10.3		8.8		108.4	94.2		126.8
Shasta	4.7	4.5		5.7		41.5	36.4		46.0
Siskiyou	5.0	6.0		6.8		38.7	40.3		78.4
Sutter	3.3	2.8		3.5		24.9	23.4		33.2
Tehama	6.8	4.7		6.6		52.2	51.5		41.9
Tuolumne	6.4	5.4		6.7		46.7	39.3		71.9
Yolo	2.8	2.1		3.0		23.0	23.3		24.0
Yuba	2.7	2.4		3.3		22.1	19.5		23.2

r = revised
NA = not available

Landlords Score Big on College Football Locales

Football and real estate may go hand in hand. Investors are learning that renting off-campus corridors to college students near big-time college football schools can be a smart move.

“There’s a perceived value — and probably a real value,” says Jeanette Rice, head of investment research for the Americas at commercial real estate firm CBRE Group.

Fifty out of 68 off-campus student housing complexes that were sold in the first half of this year were at schools with football teams in the NCAA’s Division I, the highest level for college teams. Investors paid higher prices for apartments near these football stadiums, but they also may command higher rents in turn. Their investments also may have greater assurance of a steady stream of new tenants flowing in.

Rice says the demand for housing is higher near powerhouse football schools, which usually have a student body that is willing to pay higher rents.

Source: “College Football Is Big Money for Landlords, Too,” National Real Estate Investor (Oct. 11, 2016)

DAILY REAL ESTATE NEWS | WEDNESDAY, OCTOBER 12, 2016

Great Spaces: Pharrell Williams’ Miami Penthouse Sells for $9.25 Million

Pharrell Williams has every reason to be “Happy” after finally selling his Miami penthouse to a New Jersey businessman. With his main residence in the swanky Laurel Canyon in Los Angeles that he bought in 2015, it wasn’t feasible to hold onto the penthouse—even if it were in what many would call the best location in South Florida.

Perched on top of the 40-story Bristol Tower at the entrance to Key Biscayne, the property is just a stone’s throw from trendy Coconut Grove and a quick drive in the other direction to South Beach—locations with quite possibly the best restaurants, clubs, beaches and marinas in Miami. At 10,000 square feet, the penthouse has five bedrooms, seven bathrooms and an additional 5,000 square feet of terraces, with its own rooftop swimming pool and a second-level summer kitchen. Pharrell purchased the condo in 2007 for $12.5 million, then transformed it into a mogul palace with his art and furniture collection. The home offers 360-degree views of Biscayne Bay, the Atlantic Ocean, Key Biscayne, Coconut Grove and the Miami skyline.

Originally listed in 2012 for $16.8 million, the property had gone on and off the market with several price cuts until recently selling for $9.25 million.

In addition to his songwriting and performance skills, Pharrell’s explosion of creativity has led him into exciting musical collaborations and productions, as well as avenues where he can express other unexpected talents. He has his own clothing lines, BBC and BGC, along with Ice Cream Footware designed by Pharrell and produced by Reebok; a jewelry line through Louis Vuitton; sunglass designs; furniture and sculpture, in addition to many other creative and business pursuits.

Photo courtesy of toptenrealestatedeals.com.

By Nick Caruso

5 Tips for Buying Foreclosed Homes

(TNS)—Despite increases in home prices and a stabilizing housing market, many experts say the foreclosure crisis is far from over. But buying a foreclosed home is different from buying a typical resale. In many cases:

— Only one real estate agent is involved.
— The seller wants a preapproval letter from a lender before accepting an offer.
— There is little, if any, room for negotiation.
— The home comes as-is, and it’s up to the buyer to pay for repairs.

On the upside, most bank-owned homes are vacant, which can speed up the process of moving in.

“Buying a foreclosure is definitely a bit of a grind. It’s not easy,” says Robert Jensen, a broker in Las Vegas. “You’re getting fantastic pricing, but sometimes it takes going through a lot of houses and writing a lot of offers to get the home you want.”

Get a Broker and Lender
The first two steps in buying a foreclosure should happen almost simultaneously: Find a real estate broker who works directly with banks that own foreclosed homes and get a preapproval from a lender.

Elaine Zimmerman, a real estate investor and author, recommends that shoppers first visit any site with a database of foreclosed homes. You also could look at a local real estate website that lets you filter the results to see only foreclosures. You might find the acronym REO, which means “real estate owned” (by a bank, that is). This signifies that a home has been through foreclosure and the lender is selling it.

Get a Broker on Your Side
The goal of combing through foreclosure listings is not to find a house; it’s to find an agent. Banks usually hire a few real estate brokers to handle their REO properties in a market. In a lot of cases, the buyer works directly with the bank’s broker instead of using a buyer’s agent. That way, the commission doesn’t have to be split between two brokers.

“A lot of these realtors have a long-term relationship with these banks, and they know of listings that haven’t even come on the list yet,” Zimmerman says. “Call them about the listings that you’re interested in, but also ask them about listings that may be coming up because sometimes it may take a day or two or even a week before a listing actually comes onto the database.”

In places where thousands of foreclosed properties are for sale, you might not get much one-on-one attention from overloaded agents. To prove that you’re serious about buying, says Jensen, “right before or after you meet with the agent, meet with the lender.”

Get a Preapproval Letter
Unless you plan to pay cash, you’ll need a recent preapproval letter from a lender. The letter will describe how much money you can borrow, based upon the lender’s assessment of your credit score and income.

“The problem is, buyers want to find the house first, and then they think they’ll work out the financing,” Jensen says. “But the problem is, the really good deals on these bank-owned, they go quick — and the buyer doesn’t necessarily have time to try to work out the financing afterward. They need to work that out first.”

Zimmerman says some first-time buyers make the mistake of assuming that the bank selling the home will also finance the mortgage as part of the deal. “Don’t expect to get financing from the bank that foreclosed on it,” she says. “That’s a totally separate transaction, and they view it that way. The people in the (bank’s) REO department are not loan officers. They are getting rid of bad assets.”

Pricing Depends on Sales Pace
There’s no rule of thumb on what the bank’s bottom line is on price. Just as with any other real-estate purchase, you have to look at the recent sales prices of comparable properties, or “comps.”

Jensen says: “You really have to look at the comps in today’s current market conditions and write a competitive offer based on that. Sometimes the bank prices the homes really low, and the home will have multiple offers over list price within hours. Sometimes it’s priced too high, and you can come in lower. A lot of times, buyers will come to me and say, ‘We want to write offers for half price.’ It just doesn’t work that way.”

Don’t Expect a Repair Discount
Keep in mind that foreclosed houses generally are sold as-is. Jensen says: “Let’s say the house is listed for $200,000, all the comps are $200,000, and so the client comes in and said, ‘Hey, look, I want to buy this house but I’ve got to do paint, carpet and fix some mold damage, so I want to take $15,000 off the price.’ You know what? All the other ones were in the same condition, and they sold for $200,000.”

Jensen further counsels to look at the “absorption rate for your product class.” That means you should find out how quickly comparable houses are selling. In foreclosure, a 3,500-square-foot house with a pool in a gated community might sell within days or hours, whereas more modest homes might sit on the market for weeks.

If homes in your product class are selling swiftly, “the best advice on a bank-owned property is to come in at your highest and best, unless the property has been sitting on the market forever with no activity,” Jensen says. “If you’re going to be upset because you would have gone $5,000 more, but you lost the property, just bid the higher price in the first place.”

Jensen and Zimmerman recommend getting to know tradespeople who can assess and repair damage from pests, mold and leaks.

©2016 Bankrate.com
Distributed by Tribune Content Agency, LLC.

By Holden Lewis

Germany’s Union Investment Makes First Acquisitions in U.S. Retail

Union Investment is further diversifying its international real estate portfolio by making its first investments in U.S. urban retail. Union is acquiring a 49% stake in four high street properties with a total area of 113,500 square feet for its open-ended real estate fund Unimmo: Global. 

The buy will be done via a joint venture with TH Real Estate (a division of TIAA Global Asset Management). London-based TH Real Estate last month unveiled its U.S. Cities Fund series, a re-launch of the $2 billion TIAA-CREF Core Property Fund LP that plans to invest in retail, office, industrial and multifamily properties in major urban markets in the U.S. The four assets are owned by this fund, which originally paid $150 million for them. 

TH Real Estate will act as the managing member and will continue to hold a 51% stake in the portfolio. 

The four properties are located in prime shopping locations in New York, San Francisco and Philadelphia. The purchase price is not disclosed. 

Two of the properties that make up the urban retail portfolio are in New York and together represent around 70% of the total value. Located in the Upper East Side of New York, 1511 Third Ave., which comprises approximately 43,300 square feet, is occupied by fashion retailer GAP and a fitness studio. TIAA-CREF acquired the property in December 2012 for $60 million. 

In 636 Sixth Ave., 18,300 square feet of ground floor space belongs to the portfolio and is let to CVS Pharmacy on a long lease. TIAA bought the first floor condo in December 2014 for $42 million. 

The remaining 30% of the portfolio is split between 856 Market St. in San Francisco and 1608 Chestnut St. in Philadelphia. The tenant of the approximately 9,100 square feet of space close to Union Square in San Francisco is sportswear manufacturer New Balance. TIAA acquired the property in October 2014 for $23.5 million. 

The property in Philadelphia is located in the City Center, the historic and cultural heart of the city. The entire 42,800 square feet three-story building, which is let to Japanese fashion retailer Uniqlo, belongs to the portfolio. TIAA paid $24.5 million for the building in December 2014. 

This deal marks Union Investment’s first step in building a retail portfolio in the U.S. The company’s investment strategy targets the full spectrum of the retail property universe, from urban retail to grocery anchored shopping centers and malls. 

“Diversification and internationalization are two strategic goals for our retail portfolio that go hand in hand. Four properties in major cities with global reputations are an excellent start in the US market, with our ambition being to significantly increase our retail exposure,” said Henrike Waldburg, head of retail investment management at Union Investment Real Estate GmbH.

Copyright © 2016 CoStar News

L.A. Times building sold to Canadian developer

Chicago media company Tribune Media Co. has sold a trio of properties for a combined $430 million, including the Los Angeles Times building in downtown Los Angeles.

The sale of Times Mirror Square to Onni Group paves the way for the redevelopment of a historic building the paper has called home since 1935. The Vancouver firm has explored turning the property at 202 W. 1st St. into a collection of creative offices, shops and residential units.

The Times reported in June that Onni had signed an agreement to buy the building.  The sale officially closed Monday night, a source familiar with the deal said Tuesday.

Tribune Media formally announced the sale Wednesday morning, in addition to the sale of two other properties — The Times printing facility off Olympic Boulevard and Tribune Tower in Chicago.

In its news release, Tribune didn’t mention individual buyers or prices, but the source familiar with the Times Mirror deal said that Onni paid more than $100 million for the 750,000-square-foot complex.

An executive at Onni Group did not return messages seeking comment.

Known as Times Mirror Square, the L.A. Times’  headquarters is a mix of five interconnected structures that fill an entire city block, bounded by Broadway and Spring and 1st and 2nd streets. A redevelopment would dramatically remake the City Center neighborhood by turning the aging buildings occupied by The Times and other businesses into a bustling, mixed-use center.

The W. 2nd St. entrance to the Los Angeles Times building in downtown L.A. (Jerome Adamstein / Los Angeles Times)

A person familiar with Onni’s pursuit of the Times building said in late June that the developer was considering tearing down a section of the complex along 1st Street to build apartments. That portion dates back to the 1970s and currently houses a Bank of America branch and offices.

The acquisition is a significant gain for Onni, which has been on a buying spree in downtown L.A., where it also owns at least eight other properties — including offices, apartments and an extended-stay hotel.

Among the more ambitious developments is a 49-story residential tower under construction near the corner of 8th and Hill streets and Level DTLA, a 33-story building with fully furnished extended-stay apartments that opened on Olive Street last year.

It’s unclear if the Los Angeles Times will stay in the building, known for its Art Deco lobby with a large revolving globe.

For now, the newspaper — located downtown since its founding as the Los Angeles Daily Times in 1881 — has a lease until 2018, with two consecutive five-year options beyond that, a person familiar with the terms said in June.

The historic Globe Lobby at the Los Angeles Times building in downtown L.A.. (Jerome Adamstein / Los Angeles Times)

“The Los Angeles Times has a long-term lease in place with options to renew and no immediate plans to move,” a spokeswoman for the paper’s owner, Tronc Inc., said Tuesday.

Onni was founded by Italian immigrant Inno De Cotiis with the company’s name an anagram of his first name. It has helped transform Vancouver from a sleepy town to a dense city with soaring glass towers.

Onni has offices in Los Angeles, Phoenix, Chicago and Ensenada, Mexico, and is run by Inno’s son Rossano.

It has built more than 6,000 residences in North America over the last decade and owns and manages 6.5 million square feet of commercial space and more than 4,600 apartments, according to its website.

“They are one of the more prolific and successful developers in the country,” said Anne McMullin, president of the Urban Development Institute in Vancouver, a trade group that counts Onni as a member.

The Times building sale was triggered by the 2014 spinoff of The Times, the Chicago Tribune and other newspapers from Tribune Co. into a separate company, Tribune Publishing, now known as Tronc.

Tribune Co., which was renamed Tribune Media, retained the Times building and other real estate, including The Times’ downtown printing facility off Olympic Boulevard.

The printing facility was purchased by a partnership headed by L.A.-based Harridge Development Group, its chief executive, David  Schwartzman, said Tuesday. He declined to discuss plans for the property.

Los Angeles developer CIM Group was the buyer of the Tribune tower in Chicago, which it purchased for at least $205 million.

Tribune, which owns television stations across the country, including KTLA in Los Angeles, has been selling its real estate assets.

The closing of the Times Mirror Square sale was first reported by the Los Angeles Business Journal.

The Los Angeles Times building in downtown L.A. has been sold to Onni Group of Vancouver. (Jerome Adamstein / Los Angeles Times) http://www.latimes.com/business/la-fi-times-building-sale-20160926-snap-story.html

By Andrew Khouri

Sneak Peek: The ‘It’ Paint Color for 2017

Sherwin-Williams Poised Taupe (SW 6039)

Time to paint the house taupe. Sherwin-Williams revealed its 2017 Color of the Year: Poised Taupe (SW 6039).

The company expects the brownish-gray hue to become the year’s go-to color for home interiors.

Taupe marks a departure from the company’s mostly cool-toned neutrals it has tended to favor recently. A 2016 industry survey suggests a transition from gray to taupe. Nearly 40 percent of survey respondents said they would like to use warmer neutrals – such as warm grays, taupes, or beiges – in their home’s colors. What’s more, about two in five respondents said taupe was the neutral they would most choose.

For a perfect pairing, Sherwin-Williams designers recommend combining Poised Taupe with pastels, brights, and jewel tones (such as a faded indigo hue for a French countryside look or combine it with a teal or sunny yellow for a more bold impact).

“Poised Taupe celebrates everything people love about cool gray as a neutral, and also brings in the warmth of brown, taking a color to an entirely new level,” says Sue Wadden, director of color marketing for Sherwin-Williams. “Not cool or warm, nor gray or brown, Poised Taupe is a weathered, woodsy neutral bringing a sense of coziness and harmony that people are seeking.”

Take a look.

Photo courtesy: Sherwin-Williams

Photo courtesy: Sherwin-Williams

Photo courtesy: Sherwin-Williams

Article courtesy of:  Melissa Dittmann Tracey, REALTOR® Magazine

U.S. Commercial Real Estate: A Favorite among Foreign Investors

Considerable press has been given lately to high-profile real estate acquisitions made by foreign investors, particularly those from China. China Life Insurance Group Co. recently purchased a $1.65 billion Manhattan office tower on Sixth Avenue; Anbang Insurance Group Co. bought Manhattan’s Waldorf-Astoria Hotel for $2 billion; and Chinese real estate giant Greenland Group is midway through the acquisition of a massive, $1 billion mixed-use project in downtown Los Angeles called “Metropolis.”

These high-ticket projects make headlines. But the real story lies in the steady growth of overseas investment in small- to mid-balance commercial real estate transactions, particularly as they have become available through marketplace lending.

What’s the draw for foreign investors?

Global instability, Brexit and the threat of a debt-fueled bubble bursting in the Chinese economy has made U.S. commercial real estate one of the most desired investments on the planet. The Wall Street Journal recently reported a 19 percent year-over-year increase in investment by China in U.S. commercial real estate for the first half of 2016.

Generally speaking, real estate, especially income-producing commercial real estate, is seen by foreign investors as a solid investment. Why? Because not only does it retain significant value at all points in the cycle, it also provides a tangible, saleable and income-producing form of collateral in the form of lease and lodging payments.

Overseas interest in office, multifamily and hospitality properties from coast to coast has been rising steadily all over the U.S., but more so in traditional metropolitan centers such as Los Angeles, New York, San Francisco and Chicago.

China’s high-net-worth individuals are buying up luxury apartments, hotels and retail developments, but they’re also investing in funds and REITs to spread their investments among multiple properties that will diversify their interests across the market and, in some instances, provide for greater liquidity. Many upper middle class professionals in China are doing the same: pooling their money with other investors to buy smaller-scale commercial properties such as budget hotels, shopping centers and apartment communities.

New opportunities

Marketplace lending, also known as a peer-to-peer platform, gives foreign investors the opportunity to get involved in the financial side of commercial real estate without the headache of having to manage commercial real estate as an owner or part owner in the property.

Marketplace lending is nothing new to the Chinese. In fact, the China peer-to-peer lending market is the largest in the world, topping more than $150 billion in 2015. TheWall Street Journal reported last year that there were 1,575 peer-to-peer platforms in China, up from 50 three years ago.

But few, if any, of those platforms offer the benefits of U.S.-based marketplace lending, where foreign investors can participate in loans for individual properties stateside, such as hotels, retail centers or multifamily communities. Investment funds offer the same opportunities, but for multiple properties instead of just one, frequently creating preference among investors for providing diversity, reduced risk and, in many cases, stronger yields.

As foreign investors continue to look for new commercial real estate investment platforms, marketplace lending will continue to create new opportunities for this group.

Courtesy of Gary Bechtel / National Real Estate Investor http://nreionline.com/investment/us-commercial-real-estate-favorite-among-foreign-investors

Gary Bechtel serves as president of Money360. Prior to joining the company, he was chief lending/originations officer of CU Business Partners, LLC, one of the nation’s largest credit union service organizations (CUSO).

California Today: ‘Sticker Shock’ in Los Angeles Housing

Development in downtown Los Angeles, where high rents have led many to flee for the suburbs.CreditMonica Almeida/The New York Times

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Welcome to California Today, a morning update on the stories that matter to Californians (and anyone else interested in the state).

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Let’s turn it over to Jennifer Medina, a national correspondent based in Los Angeles.

What does it take to be middle class in Los Angeles?

That was the question Ross DeVol started out asking himself when he began calculating how much a resident would need to make to spend 30 percent of earned after-tax income on rent for a two-bedroom apartment in Los Angeles County.

The answer: a whopping $145,000.

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“It really challenges what we think of what we speak of the middle income family,” said Mr. DeVol, a researcher with the Milken Institute, a Santa Monica-based think tank. “It significantly changes the requirements for living a middle-class life here.”

To arrive at the figure, Mr. DeVol used median rents in the county, with a two-bedroom landing at roughly $2,000, a figure that varies greatly, of course, on the exact location. (A two-bedroom in Santa Monica, for example, is far higher than a two-bedroom in Glendale.) Mr. DeVol then looked at tax brackets to arrive at his conclusion.

It’s not simply a matter of complaining about the rent being too high, Mr. DeVol explained. It presents a challenge to the economy, forcing many would-be Angelenos out of the city and into the surrounding suburbs or even out of state.

The problem stems in part from the fact that more jobs have been created in the city than new housing. And though Los Angeles has not yet reached San Francisco-sized rents, economists like Mr. DeVol worry that it will stop the city from growing.

“It becomes a real challenge for companies recruiting people,” he said, invoking his own experience in trying to get new employees. “There’s a real sticker shock in getting them to come here. What we think of as approaching the middle class barely gets you there here.”

The median income in the county is roughly $45,000, Mr. DeVol said. And by some estimates people spend an average of half their income on rent today, he added.

“I really fear losing a big chunk of families and an economy that is vibrant enough to sustain it in the future,” Mr. DeVol said.

Courtesy of nytimes.com by Mike McPhate

What’s your experience of rising rents in the region? How much of your paycheck goes to rent or mortgage? How have you dealt with the climbing costs of housing? Share your story with us: CAtoday@nytimes.com.