Commercial Real Estate & Business News – January 23, 2014

With declining fees, jittery interest rates and the real prospect of cap rate reversion, I've argued with my friends that the five- to seven-year hold model of multifamily investment has become too risky for the returns to the sponsor community. The risks to long-term value - particularly interest rate risk, refinancing risk and replacement risk - are substantial, and not fully factored into the business model. Owners are chasing the requirements of short-term, IRR-driven capital, but there are alternatives... Read more
As 2014 kicks off, many U.S. bankers say it's high time to start growing everybody's commercial real estate portfolios - except for their own, that is. While projecting significant growth in CRE lending this year in most markets, banks continue to downsize their branch retail networks and streamline headquarters space...Read more
For more than a decade, federal and state lawmakers have attempted to craft legislation to regulate the collection of sales tax on Internet purchases. The Marketplace Fairness Act of 2013 passed the Senate in May with bipartisan support. House bills are now under consideration to achieve the same goals, which are to level the playing field between online retailers and brick-and-mortar competitors and more effectively enforce existing sales tax revenue collection laws. House Judiciary Committee Chairman Bob Goodlatte recently released a list of principles that should form the basis of the House bill, which is also expected to enjoy bipartisan support...Read more
Apartment properties have been investor favorites during the last three years. However, with the pricing cycle peaking, overall transaction activity could eventually change and, with it, the buyer mix. Signs of transaction deceleration are beginning to show. Even if last year's volume was 20 percent higher than 2012's, activity seemed slower during the second half of the year. For example, third quarter 2013 volume was comparable to that observed in the third quarter of 2012. This contrasts with the steady year-over-year growth observed between 2010 and 2012... Read more
In 2012, Congress recognized this problem and finally put an end to the old advertising restrictions for private deals and created a regime for "crowdfunding." The new regulatory framework would empower market participants on both sides of the equation, thereby providing much-needed relief to startups and smaller investors alike, removing some of the old barriers to entry and access to capital... Read more

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