10 Must Reads for the CRE Industry Today (February 8, 2016)

  Brixmor Property’s Top Executives Exit after Accounting Review “Shopping center operator Brixmor Property Group Inc said three of its top officers, including its chief executive, had resigned after an internal accounting review showed discrepancies in the company's financial statements. The company said on Monday that its quarterly statements had been tampered with to show consistent growth in same-property net operating income.” (Reuters) John L. Tishman, Builder Who Shaped American Skylines, Dies at 90 “John L. Tishman, a master builder of the 20th century whose Tishman Realty and Construction Company transformed the skylines of Chicago, Detroit, Los Angeles and New York, died on Saturday at his home in Bedford, N.Y. He was 90. An heir to the company founded by his grandfather Julius in 1898, Mr. Tishman supervised the construction of three of the world’s earliest 100-story-plus skyscrapers.” (The New York Times) Colleges Eye More Private Equity, Alternatives as Returns Trail “College endowments are looking to get better returns from private equity and other alternative strategies as investment performance has underwhelmed, according to a new poll. Alternatives were the top-performing asset classes for endowments, with venture capital delivering an average return of 15.1 percent in the year ended June 30, followed by private real estate at 9.9 percent and buyout and other types of private equity at 9.3 percent, according to a study released last week.” (Bloomberg) 5 Reasons Investors are Likely to Bet on Real Estate in 2016 “With everything that has happened in recent months, including the Federal Reserve's interest rate hike and the turmoil in global equity markets, many investors will likely be seeking refuge in real estate. For them, real estate may seem like a less risky investment with potentially significant returns. The year is already shaping positively for real estate worldwide.” (The Street) Canadian Love Affair with Manhattan Real Estate Seen Continuing “Strong Canadian investment in the Manhattan commercial property market is expected to continue this year after quadrupling and hitting a record level in 2015, real estate specialists said. Canadians accounted for almost a third of the $25.6 billion in foreign capital that poured into Manhattan commercial properties last year, with investment swelling to $8.3 billion from $1.97 billion a year earlier, according to data from Real Capital Analytics.” (Reuters) Blackstone Welcomes $200,000 Bets in Cosmopolitan Casino Reboot “Bill McBeath knew exactly what was missing at the Cosmopolitan Las Vegas: gamblers. In the 14 months since Blackstone Group LP brought him in to run the 3,000-room resort, McBeath has created a new high-limit slot machine lounge and added more baccarat tables to the hotel’s speakeasy-like Talon Club. Just in time for Super Bowl Sunday, he opened a new sports betting area, moving it to the main level from the second floor and doubling the size.” (Bloomberg) Chubb Boosts Coverage for North American Real Estate Clients “The world's largest property and casualty insurer now offers more coverage to its real estate and hospitality clients in the hopes of mitigating risk in these industries. Less than a month after Swiss insurance giant ACE Ltd. acquired Chubb Corp. in the biggest insurance industry deal in history, the company—which retained the Chubb name—has expanded its offerings and capacity for United States and Canadian commercial real estate owners and managers and tapped Michael Chang to lead the Real Estate & Hospitality Practice.” (Commercial Property Executive) Dallas Hedge Fund Investor Kyle Bass Rips Real Estate ‘Ponzi Scheme’ UDF “Hedge fund investor Kyle Bass launched a new website Friday laying out his firm’s views on United Development Funding (UDF). Back in December I wrote an article on Forbes.com suggesting that UDF had become a ‘high risk’ security based upon the controversial practices revealed by defaults, bankruptcies, lawsuits, and resignations. At the time of my article, the source for my research was disclosed publicly on the website Harvest Exchange.” (Forbes) Redfin: Higher Rents Pushing More People to Purchase Homes “Higher rents are leading more people into the housing market, according to a Redfin survey reported by the company’s data analyst Taylor Marr. In November, 21% of respondents cited high rent as their top reason for house hunting, which is up from 13% in July. It’s no surprise, given that rents have been rising rapidly while wages haven’t. Nationally, rents rose between 4% and 5% in 2015 and have advanced by double digits in tech hubs and other cities.” (Multifamily Executive) 7 Lessons I Learned from Failing at Real Estate Investing “A lot of people make money investing in real estate. But there’s the real version and the TV version. I fell for the TV version. Based on little more than a book from a self-proclaimed real estate superstar, I blazed forward and bought my first real estate investment property. It was a complete failure. I learned seven lessons from that failure, and now I’ll share them with you.” (Forbes)