CONTAINER ACTIVITY UP IN JULY

August 30, 2006 on 8:07 am | In FASCINATING INDUSTRIAL REAL ESTATE INFORMATION, FASCINATING INFORMATION, Uncategorized | 1 Comment

CONTAINER ACTIVITY UP IN JULY

The ports of Long Beach and Los Angeles handled another record level of containers during July. The total count was up by 10.0% or 122,571 TEUs over the year to 1,344,251 containers. The number of loaded import containers increased by 10.6%, with Los Angeles recording a 14.8% gain to a record (for them) of 404,665 TEUs. The export container count for the two ports was up by 10.0%, with Long Beach posting a decline of 5.7%.

July data for Oakland was softer. The number of import containers was up by just 2.2% over the year, while the export container count declined by 7.7%. The total number of containers moved at Oakland during July was up by only 0.8% over the year to 191,722 TEUs. (Jack Kyser)

(TEUs) July’06 Y/Y %chg
Port of Long Beach 582,925 1.7%
Port of Los Angeles 761,326 17.4%
Port of Oakland 191,722 0.8%

Port of Oakland data: http://www.portofoakland.com/maritime/facts_cargo.asp
Port of LA data: http://www.portoflosangeles.org/factsfigures_Monthly.htm
Port of Long Beach data: http://www.polb.com/about/port_stats/latest_month.asp

Moratorium By FDIC Temporarily Helps Protect The Safety And, Soundness of Banking System

August 27, 2006 on 5:51 pm | In FASCINATING INDUSTRIAL REAL ESTATE INFORMATION, FASCINATING INFORMATION, FUNNY...MONEY, LENDERS + VENDORS, OFFICE FODDER, Uncategorized | 7 Comments

NAR: Moratorium By FDIC Temporarily Helps Protect The Safety And, Soundness of Banking System
——————————————————————————–
WASHINGTON (July 31, 2006) – Last week’s approval by the Federal Deposit Insurance Corp. (FDIC) of a six-month moratorium on Industrial Loan Company (ILC) applications marks a positive turn of events in the campaign to protect the separation of banking and commerce, the National Association of Realtors® said today.

“Recent ILC applications by Wal-Mart and Home Depot highlight our serious concerns about the dangers of mixing banking and commerce,” said Thomas M. Stevens of Vienna, Va., president of NAR. “The moratorium imposed by the FDIC is a necessary measure to halt the approval of these applications by commercial firms which would create an inherent conflict of interest and put the consumer and the financial system in danger.”

NAR has repeatedly spoken out at both congressional and FDIC hearings and in letters to key federal officials on the importance of keeping banking and commerce separate. NAR has stressed the risks to the financial system that would come with a bank owned by a commercial firm that may not have the ability to exercise independent credit judgments.

The moratorium provides that the FDIC will not make any final decisions or accept any future applications for deposit insurance or notices of change in control for ILCs during this six-month period expiring on January 31, 2007. The action also provides the FDIC with a suitable time-frame to evaluate the need for clear-cut statutory, regulatory, or policy changes. NAR urges the FDIC to narrow the loophole that allows retail and commercial firms to own ILCs. In addition, NAR supports swift congressional action on the protection of the separation of banking and commerce by passing bipartisan legislation – The Industrial Bank Holding Company Act of 2006 (H.R. 5746) – before the current legislative session ends in the fall.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing more than 1.3 million members involved in all aspects of the residential and commercial real estate industries. 
 

CONTACT: Steve Cook, (202)383-1104

NEW REAL ESTATE GROWTH AREAS

August 19, 2006 on 7:29 pm | In FASCINATING INFORMATION, Investment Opportunities, LIGHTS…CAMERA…TRANSACTION, New Developments, PROPERTY WISH LIST, Uncategorized | 15 Comments
NEW REAL ESTATE GROWTH AREAS

 This just in – 13 real estate market areas have more than a 50 percent chance of falling house prices within two years. The most recent quarterly report by PMI Mortgage Insurance Co. sites that eight of those areas are in California, three are in Massachusetts, one is in New York and one is in New Jersey. The major real estate markets at the greatest risk of a price decline are San Diego-Carlsbad-San Marcos, Calif.; Nassau-Suffolk, N.Y.; Boston-Quincy, Mass.; Santa Ana-Anaheim-Irvine, Calif.; and Sacramento-Arden-Arcade-Roseville, Calif.
 
Fortunately there are many markets – in California and elsewhere that defy the national downtrend. Locally, CNN/Money likes Victorville, CA. They report, “As Los Angeles grows, development is creeping north of the San Bernardino Mountains. Home construction is on fire in once-sleepy Victorville. Four Wal-Mart Supercenters are coming to the area.”
Locally, it is predicted that trade with China through the country’s largest port will fuel a boom in logistics, warehousing and distribution centers. With freight volume projected to triple by 2030, warehouse builders will become the fastest-growing commercial developers in the region.
Up north, the action is moving east from the Bay Area: The Sacramento metro region will build more housing and office space in the next 25 years than any other Western megapolitan city except Las Vegas. There will be a vulture-like acquisition of property owned by old, declining industrial businesses in the Bay Area for pennies on the dollar.
 
Elsewhere, “The country’s most heavily populated megapolitans brace for another boom,” predict Paul Kaihla and Krysten Crawford of Business 2.0. They say that over the  next 25 years, “Most of the development will go up: Urban infill will outstrip suburban growth.”
 
Obviously, there is a new urban landscape developing on the Gulf Coast from Houston to New Orleans, but urban hubs like Boston, New York, Washington, as well as rustbelt locations like Pittsburgh Detroit and Chicago will see a boom.
Kaihla and Crawford choose places like “Joliet, an old steel-mill boomtown on the Des Plaines River and the hub of Will County, is expected to be among Illinois’s fastest-growing towns by the next quarter-century.
As mentioned last week, south central hot spots include Kansas City, San Antonio, Dallas will cater to “the Latino population boom. A new generation of Hispanic business owners and industrialists will drive the growth, and the area will become a magnet for foreign firms trying to cash in on the U.S. Latino market.”
The U.S. Census Bureau projects that the fastest-growing states in the nation from 2000-2030, will be Nevada, which is expected to grow 114.3 percent, followed by Arizona at 108.8 percent and Florida at 79.5 percent. Other fast-growing states include Texas, with a projected population increase of 59.8 percent; Utah, with projected population growth of 56.1 percent; Idaho at 52.2 percent, North Carolina at 51.9 percent, Georgia at 46.8 percent, Washington at 46.3 percent and Oregon at 41.3 percent.
 
Business 2.0 likes Phoenix and Tucson because of their supply of raw, buildable land at the lowest prices. The big draw is a Palm Springs lifestyle at a substantial discount. It is predicted that Phoenix will remain the top destination city for Americans moving from other states. Expansion at Arizona State University that will increase its enrollment by 50 percent to 90,000 students and generate more than 10,000 new jobs by 2020.
CNN Money likes Buckeye, AZ, stating, “Today it has fewer than 15,000 residents and sits in empty desert. But a handful of mega-development projects will transform Buckeye into a more populous city than Phoenix by the end of the next decade.”
North Carolina is another hotly anticipated market. The North Carolina Association of Realtors reported that statewide sales rose 10 percent from January through May this year compared to the first five months of 2005.
 
 “North Carolina seems to lag behind the rest of the nation in real estate trends,” observes  Renee Hentschel, an associate broker for Realty Executives in Hickory, N.C. “We hear about this big real estate boom and we’re saying, ‘Where’s it at?’ A couple of years later we hear about the slowdown. We’re not slowing down here.”
 
A mid-south real estate bet: Parcels along I-85 in rural North Carolina that will become part of a planned tech-research park to support the Research Triangle.
 
Quantities of cheap, prime greenfield surrounding Seattle, Portland and Eugene give the Northwest megapolitan explosive growth potential. By 2030, the three metro regions will be intertwined. CNN / Money likes Beverton, Oregon, the  home to Nike’s headquarters, and Intel. A light-rail train that went online in the late 1990s is driving development, which has been growing at a rate of $100 million per year.
 
In Idaho’s Ada County, which includes the capital city of Boise, existing-home sales grew 16 percent from May 2005 to May 2006 and the median price increased 26 percent, according to Intermountain Multiple Listing Service statistics.
 
Meanwhile, the National Association of Realtors reported that the national rate of existing-home sales dropped 6.6 percent in May 2006 compared to May 2005.
 
Trela Bird, a Realtor with GMAC Real Estate in Utah, said the Greater Salt Lake City began to boom last year. “We’re seeing a lot (of buyers) from California, and a little bit from some of the East Coast states, some from Texas, Arizona and Nevada. I think the news has gone out — we’re number four in job growth right now and prices compared to a lot of places are still reasonable,” Bird said.
 
Business 2.0 reports that Florida posted the nation’s highest job growth last year. Land scarcity will drive urban growth. The 65-and-up population will continue to swell, doubling by 2025. Best residential real estate bet: Preconstruction condo units between Venice and Tampa, where demand is so high that builders hold lotteries. Best commercial real estate bet: Inland lots in Manatee County, where cities will bloom by 2010. And, there’s no state income tax.
 
For more on Southern California commercial properties there is a great information blog at www.socalindustrialrealestateblog.com.
 
 
Jodi Summers is Director of the Investment Division at Boardwalk Realty. For your real estate needs, e-mail Jodi Summers at jodis@boardwalkrealty.com, or call (310) 309-4219, or visit her website at www.santamonicalandmarks.com.
 
~~
 
SIDEBAR
 
 12 fast-growing cities that are still cheap
The office of Federal Housing Enterprise Oversight, National Association of Realtors, local Realtors associations has named these 12 growing cities that are still affordable.

City                             1-year price rise     5-year rise             Median home price

 
Phoenix-Mesa-Scottsdale, AZ       30.5%                    67.3%                    $169,400 
Coeur d’Alene, ID                29.0%                    59.9%                    $169,000 
St. George, UT                   28.3%                    47.7%                    $200,000 
Pensacola-Ferry Pass-Brent, FL   25.8%                    62.0%                     $131,100 
Tucson, AZ                        22.3%                    61.4%                    $177,300 
Lakeland, FL                       19.4%                    56.7%                    $108,000 
Albany-Schenectady-Troy, NY     18.2%                    65.2%                     $161,300 
Jacksonville, FL                   18.2%                    66.9%                    $150,700 
Eugene-Springfield, OR         17.4%                    40.5%                    $164,900 
Allentown-Bethlehem-Easton, PA  16.9%                    58.2%                    $207,300 
Charleston-North Charleston, SC  16.9%                    49.2%                     $111,300 
Wilmington, DE                   16.2%                    62.5%                    $180,000 
_____________________________________________________________________
USA national average           13.4%                    68.3%                     $218,000 
 
 
 

200M Macerich Mortgage Finances Mall

August 17, 2006 on 11:53 pm | In FASCINATING INFORMATION, FUNNY...MONEY, LENDERS + VENDORS, Uncategorized | 6 Comments
200M Macerich Mortgage Finances Mall
CERRITOS, CA-A partnership of the Santa Monica-based Macerich shopping center REIT and Ontario Teachers’ Pension Plan Board has secured a $200 million mortgage on the 1.3-million-sf Cerritos Center shopping mall. MetLife Real Estate Investments placed the financing, which is a five-year, floating rate first mortgage with an initial funding of $130 million and up to $70 million available in future fundings. 

Richard Benner of MetLife’s Los Angeles office led the transaction team for the financing of the property, which is anchored by Nordstrom, Sears, Mervyn’s and Macy’s. The mall is situated near the intersection of the 91 and 605 freeways, at 183rd St. and Gridley Road.

The new mortgage, an interest-only loan, may be used for improvements at the mall or for other purposes. The mortgage is the second large financing of a Macerich property reported this week, following the Santa Monica-based company’s $61.2 million loan on its 1.1-million-sf Crossroads Mall in Oklahoma City.

In its conference call with financial analysts last week to discuss its quarterly results, the publicly held REIT said that it would rely on borrowings as one source for its continuing development pipeline. The REIT plans to develop and redevelop about $300 million to $500 million of retail properties yearly for the next five to six years.

The new mortgage is the latest in a series of financial moves lately by Macerich, which arranged a new $1.5 billion credit line in July, an increase from the previous credit line of $1 million. At the same time, it reduced its borrowing spread for the credit line to by a quarter of a percentage point to 1.15% over LIBOR and extended the line to April 2010 from its previous expiration of July 2007.

By Bob Howard of GlobeSt.com

NONRESIDENTIAL PERMITS MAINLY PLEASING IN JUNE

August 14, 2006 on 4:51 pm | In FASCINATING INFORMATION, LENDERS + VENDORS, New Developments, Uncategorized | No Comments

NONRESIDENTIAL PERMITS MAINLY PLEASING IN JUNE

The nonresidential construction sector continued to show strength through June according to the Construction Industry Research Board, although Los Angeles County was a tad lackluster.  Its office sector’s permit values through the first 6 months of 2006 were up by 21.2% over the like 2005 period.  However, industrial and retail permit values lagged, by 35.1%.  The news from Orange County was better, with industrial permit values up by 84.6% through 6 months, office up by 434.5% while retail was ahead by 17.6%.  Helping was a $21.7 million office project. 

Riverside County also had a good performance in June, with 6-month permit values up by 296.6% over the year in industrial, by 172.7% in office, and by 48.2% in retail.  The County saw $82.7 million in industrial projects during the month, the bulk of which were in the Moreno Valley (hi ho, hi ho, its’ further east we go).  Through June, the nonresidential picture was a little mixed in San Bernardino County, with industrial and retail ahead by 134.4% and 44.8%, respectively.  However, office permit values lagged last year by 15.2%, although the difference was narrowing.

In San Diego County through June, the industrial sector moved into the plus column (+7.3%), while office permit values were ahead by 15.8% and retail was up by 1.2% over the 6-month 2005 period.  In Ventura County through the first 6 months of 2006, industrial permit values were ahead by 107.6% while office was up by 646.0% (on a small base).  Retail, however, was off by 18.4%.

In the 9 county Bay Area through 6 months, there was significant strength in industrial permits, up by 77.6% helped by activity in Santa Clara County, +145.7%.  Retail permits were up by 13.1%, but office permit values were 66.0% behind last year.  (Jack Kyser).

  Office Industrial Retail Office YTD Industrial YTD Retail YTD

Author Jack Kyser is the Chief Economist on the staff of the Los Angeles County Economic Development Corporation.

 

Ten megapolitans are poised for a boom that, by 2030, will dwarf America’s post WWII buildout.

August 11, 2006 on 4:12 pm | In FASCINATING INFORMATION, FUNNY...MONEY, Investment Opportunities, New Developments, Uncategorized | 6 Comments

 An excerpt from:

The $25 trillion land grab
Ten megapolitans are poised for a boom that, by 2030, will dwarf America’s post WWII buildout.
By Paul Kaihla and Krysten Crawford, Business 2.0
 If you think the real estate boom of the past decade was bounteous, peek a little further over the horizon: Researchers estimate that the massive buildout will constitute a $25 trillion development market by 2030, more than twice the size of the U.S. economy today. According to experts, the bulk of that money will flow into 10 major metro regions that he has christened “megapolitans.”
 
Here are exclusive growth forecasts for each of these regions and — based on interviews with dozens of regional planners, developers and investors — identified the savviest angles to play in the near and long term.
City stats on Best Places to Live:
• Los Angeles
• Las Vegas

Trade with China through the country’s largest port, Los Angeles, will fuel a boom in logistics, warehousing and distribution centers for companies like Target. New military and space programs will do for the Southland what the Internet did for NorCal in the 1990s.

Key demographic shift: By 2020, male illegal immigrants from Mexico will likely make up more than 10 percent of the Southland’s workforce; no other megapolitan comes close to having this supply of cheap labor.

New growth industry: With freight volume projected to triple by 2030, warehouse builders will become the fastest-growing commercial developers in the region.

Best businesses to start: Upscale restaurants near I-15 in San Bernardino County, to give future suburbanites at taste of something better than fast food.

Best residential real estate bet: $325,000 still gets you a 2,300-square-foot house in Apple Valley, one of dozens of suburban boomtowns emerging east of Los Angeles.

Best commercial real estate bet: Parking lots in downtown Los Angeles for tomorrow’s high-rise redevelopments.

Government carrot: Billions in local, state and federal funding that will be used to build 150 miles of truck-only express lanes in Los Angeles, Orange County and the Inland Empire by 2020.

It’s already too late to… Buy raw land around Las Vegas for sprawl development; prices are soaring because it’s hemmed in by federally owned property.

For more information please go to:

Macerich Plans as Much as $500M in Construction

August 10, 2006 on 7:29 pm | In FASCINATING INDUSTRIAL REAL ESTATE INFORMATION, FASCINATING INFORMATION, FUNNY...MONEY, Investment Opportunities, LENDERS + VENDORS, OFFICE FODDER, Uncategorized | 5 Comments

Macerich Plans as Much as $500M in Construction

SANTA MONICA, CA-The Macerich Co. plans to spend an average of $300 million to $500 million per year in new developments and redevelopments over the next five to six years, the company said during its quarterly conference call with financial analysts Thursday. Arthur Coppola, president and CEO, said that the yearly expenditures would tend toward the higher end of the figure, with the funds coming from borrowings as well as proceeds from the sale of non-core assets.

Among the developments that Coppola discussed was the shopping-center REIT’s plans to redesign its Santa Monica Place mall here. Macerich announced plans for the repositioning some time ago, and has been involved since then with planning the project.

As it stands now, Coppola said that the company is looking at an open-air design for the mall that would connect it to the adjacent Third Street Promenade. The company is also considering options for a Robinson’s-May store, which could be redeveloped for several users or for a single specialty department store.

The REIT reported on other redevelopment and development activity including the scheduled Oct. 12 opening of the first phase of Twenty-Ninth Street, an 877,000-sf shopping district in Boulder, CO, with the balance of the project scheduled for completion in the spring. The project is 75% leased with another 15% of the space committed.

Construction began on the 435,000-sf Village at Flagstaff Mall, a 45-acre large format and lifestyle expansion of Flagstaff Mall. The project is expected to be completed in phases starting in the fall of 2007.

At Westside Pavilion in Los Angeles, construction continues on the redevelopment of the western portion of the center that will include a 104,000-sf Landmark Theatre, a Barnes & Noble and restaurants. The estimated completion of the redevelopment is fall 2007.

Macerich continued its strategy of selling non-core assets with the June sale of Scottsdale 101, a power center in Phoenix, for $117.6 million. Macerich owned 46% of the center, which was developed by the company’s Westcor subsidiary.

In July, the company sold Holiday Village Mall, Greeley Mall and Parklane Mall for an aggregate purchase price of $105 million. In addition, the sale of Great Falls Marketplace is scheduled to close in August. The centers totaled 1.6 million sf and averaged $239 per sf in annual tenant sales.

Coppola says that the sale of the four centers “continues our strategy of recycling and redeploying our capital.” Doing so has placed the company in a better position for developing and redeveloping its portfolio, he says.

Macerich reported that net income for the second quarter ended June 30 totaled $25.7 million or 36 cents per share, compared with $6.7 million (11 cents per share) for the comparable quarter last year and funds from operations totaled $85.3 million (96 cents per share) compared to $77 million ($1 per share) for the same period last year.

During the quarter, Macerich signed 398,000 sf of specialty-store leases at average initial rents of $41.14 per sf, and starting base rent on new lease signings was 24.5% higher than the expiring base rent. Total same-center tenant sales for the quarter were up 4.4% compared to sales for the quarter ended June 30, 2005. Total revenues climbed to nearly $208 million for the quarter versus $186 million in the second quarter of last year.

By Bob Howard of GlobeSt.com

Go with the flow - the cash flow, that is

August 7, 2006 on 11:44 pm | In FASCINATING INDUSTRIAL REAL ESTATE INFORMATION, FUNNY...MONEY, Investment Opportunities, Uncategorized | 4 Comments

by Jodi Summers

Go with the flow - the cash flow, that is
 
“I’ve been wanting to buy a shopping center, but every time I start analyzing the numbers, I get a headache,” an investment buyer recently said. “Each property has a different set of numbers and they are not always accurate. How do I know what to buy?”
 
Whenever you review an income and expense analysis for a property or six, you
realize how difficult it is for the average investor to digest the information and make an educated purchase decision. Much like the stock market, what makes a great real estate investment is keyed into timing and interest rates as much as it is to the true operating costs of a property.
 
In the current market, if you’re looking for portfolio properties that have a return on investment, you either need a big down payment or to buy outside of town - Texas, Arizona, Idaho and New Mexico are current favorites. Certainly SoCal has offered a lot in property leverage and appreciation over the years, but at the end of the day the cash flow is what is really sexy to a property investor, and why so many have been buying out of state.
 
Again comes the almighty questions, “How do I know what to buy?”
Real estate analysts offer the following suggestions for using a cash flow analysis in making investment property purchase decisions:
 
v     Examine many similar properties at the same time. You can ascertain how accurate an income and expense statement may be when you compare it with income and expense statements from other properties. One  document may leave out a vacancy rate; the other might exclude property maintenance components. Know vacancy rates in the neighborhood and find out the average time to find a new tenant. Contact lenders and property managers in the area and get their feedback on your potential purchase.
 
v     Review operating expenses and cash flow for the past three years.
Many financial analysts’ reports will exclude capital expenses. Bear in mind that
you need a reserve for property maintenance. If you review three years of income and expenses, you will have a much better idea of real expenses, as well as vacancy rates.
 
v     Obtain comparable rent income numbers. Drive around the neighborhoods where your potential property is located. Call the phone numbers on available properties and confirm the rental rates. Are there any concessions being given on lease space? Use the information to verify the figures you received for the property you wish to buy.
 
v     Examine the vacancy rate in the market place. Each market and specific type of real estate investment has a vacancy rate. Even desirable locations like the westside require a minimum of 3 percent factored in for the vacancy rate. In harder-to-rent areas, look for concessions and rebates being offered by property owners. How might those concessions affect your cash flow? Is your property
rented at fair market value? Banks are hesitant to loan on properties with a high vacancy rate. They will, however, offer construction loans if you are renovating the building. This may give you some time to find tenants to fill a building, otherwise you will be forced to guarantee the rents, which means more money to the bank and less in your pocket.
 
v     Talk to an appraiser about the marketplace. Appraisers are paid to know median incomes and expenses in any given marketplace. An appraiser offers accurate information so you can make an informed decision.
 
v     Review the IREM and/or BOMA expense analysis books for the marketplace. The Institute of Real Estate Management is a professional real estate management association serving both the multi-family and commercial real estate sectors. The Building Owners and Managers Association (BOMA) assembles a report that details income and expense statements for office buildings throughout North America based on members’ responses to a standard survey. The books are updated every year and offer an in-depth look at how properties are operating.
 
v     Ask for schedule “E” tax return information for the property.
Schedule “E,” a.k.a. form 1040, is the supplemental income and loss from rental real estate, royalties, partnerships, S corporations, estates, trusts, etc. It is the information the current property owner gives to the IRS.
 
Keep in mind some property owners keep two sets of books - one for themselves and one for the IRS. Some pay a handyman on the premises for repairs and very little of anything is ever reported. 

If you do your homework, you will have a clear idea of a property’s value. Then read the reports. Analysts suggest an 8 to 10 percent positive cash flow after all deductions. Beyond cash flow, there are several other indicators you can compare and analyze when pursuing your investment strategy. They include CAP rate, cash-on-cash return, debt coverage ratios, price per square foot for comparable properties in the same marketplace, percentage of expenses - are they in line or understated? Also factor in financing and due diligence costs as part of your transaction spread sheets. 

For more on Southern California commercial properties, there is a great information blog at www.socalindustrialrealestateblog.com.

$440M Refinances Landmark Twin Towers

August 3, 2006 on 11:36 am | In FASCINATING INFORMATION, FUNNY...MONEY, LENDERS + VENDORS, LIGHTS…CAMERA…TRANSACTION, OFFICE BUILDINGS, Uncategorized | 1 Comment
$440M Refinances Landmark Twin Towers
CENTURY CITY, CA-The owners of the 2.3-million-sf Century Plaza Towers have refinanced the twin 44-story office towers development with a 10-year mortgage provided by the John Hancock Life Insurance Co. in a deal arranged by Churchill Mortgage of Los Angeles. Churchill says that the $440-million interest-only loan is the largest senior debt financing secured by real estate in the history of John Hancock and its parent, ManuLife Financial.

The Century Plaza Towers development, which includes 29,000 sf of supporting retail shops and restaurants, along with underground parking for 5,670 vehicles, is owned by clients who are advised by JPMorgan Asset Management. The property, at 2029 and 2049 Century Park East, is bounded by Constellation and Olympic boulevards and Century Plaza East.

Peter Thorp, chairman of Churchill, reports that Churchill SVP Michael Thorp originated the loan both on behalf of the borrower and on behalf of John Hancock as its direct access mortgage banker. At John Hancock, the team included Warren Thomson, Bill McPadden and Bill Shields.

The Century Plaza Towers development has been a landmark in Century City and the rest of West Los Angeles since the twin triangular towers were built in the mid-1970’s. The tenant roster of national, local and regional firms includes a number of companies that have signed on or renewed at the complex in recent months. Among them is Lifetime Television Network, which signed a lease to remain its 41,000 sf at the South Tower (2049 Century Park East), where it has been since 1992.

By Bob Howard of GlobeSt.com

 

SECOND QUARTER 2006 ECONOMIC REPORT CARD

August 1, 2006 on 9:39 pm | In FASCINATING INDUSTRIAL REAL ESTATE INFORMATION, FASCINATING INFORMATION, FUNNY...MONEY, LENDERS + VENDORS, OFFICE FODDER, Uncategorized | 1 Comment

SECOND QUARTER 2006 ECONOMIC REPORT CARD

The U.S. economy grew by 2.5% last quarter according to “advance” estimates of the Bureau of Economic Analysis.  This pace was well below the 5.6% registered during first quarter 2006.  [All percentage changes in this article are seasonally adjusted annual rates and adjusted for changes in inflation.]

Consumer spending for nondurable goods and services contributed most to last quarter’s performance, adding 1.9 percentage points to the economy’s overall growth rate compared a contribution of 1.6% the previous quarter. Business investment in nonresidential structures jumped by 12.7%, the best performance in three years, and adding 0.4 percentage points to second quarter growth.  Other positive contributions to last quarter’s economy were made by growth in business inventories (which added 0.4 percentage points), net exports (+0.3 percentage points, as exports grew more rapidly than imports), and government spending (+0.1 percentage point).

Three sectors pulled down the economy’s overall growth rate in second quarter 2006.  Residential investment spending subtracted 0.4 percentage points, the third quarter of marginal-to-negative performance.  More important, consumer purchases of durable goods and business spending for equipment and software each subtracted 0.1 percentage point from second quarter economic growth–down from a combined contribution of 2.6 percentage points in the first quarter. We knew about the weakness in housing and automotive, but not the slowdown in business equipment spending.  On the other hand, the first quarter was a blowout for equipment spending.  Also, monthly orders for capital goods have been pretty healthy; so it’s too soon to worry much about business investment.

All of these figures are preliminary.  The BEA does not yet know what happened to foreign trade, inventories, or construction in June and had to make some assumptions, which may or may not prove correct.  Also, the information on consumer spending during June is still incomplete.  This data can make a difference:  The Bureau’s initial estimate of first quarter growth (made in April) was 4.8%, below the final figure of 5.6% (as released in June).  We’ll get a more complete picture of the second quarter next month, but the main headline–slower economic growth due to a decline in housing and weaker growth in consumer and business spending for durable goods–seems unlikely to change.  (Nancy D. Sidhu)

PR: http://www.bea.gov/bea/newsrel/gdpnewsrelease.htm

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