Archive for May, 2010
It is interesting to read recently in the press (or perhaps not to read) about Mexico’s economic strength and recovery. All eyes have been on Brazil and it seems as though many people have gotten so bedazzled by the Carioca sun that they have written off Mexico as a competing Latin America doyen. Well, some very interesting news was announced recently that belies that chosen disregard. In April, the Mexican Treasury sold US$1 billion worth of 30-year bonds on the international market and they were snapped up like hotcakes. So much was the demand that the offering was apparently two times oversubscribed – this during a time when capital is supposedly tight and the owners thereof are being very circumspect about their investment targets. That is a lot of investment-sensitive people acquiring Mexican sovereign debt. And just prior to that in March, the Mexican government sold US$1 billion of 10-year bonds at 5.125% interest. And before that in January, when the global economy was just beginning to see signs of recovery, Mexico sold the same quantity of bonds – US$1 billion. More >
Creation of a portfolio strategy for an organization begins with determination of what assets are strategic to the organization. For instance, the research and development laboratories of a pharmaceutical firm may be considered strategic or the factories of a pulp and paper manufacturer. On the other hand, the sales offices, warehouses and distribution centers are probably not strategic to these industry participants. For a firm whose business is logistics, then perhaps the warehouse is strategic. The concept is a firm most likely wants to control the strategic assets through fee ownership and lease the non-strategic assets. One can blur the lines a little by lengthening a lease term so that a leased asset has long term stability as if it were an owned asset.
Ted Parcel is Executive Vice President of Corporate Services for NAI Global.
Two weeks after the Gulf of Mexico oil spill, a residential broker in the Florida Panhandle blogged that the oil spill was already taking its toll on their local housing market. The location of the spill is 50 miles offshore and at that time was only seen in pictures and video. There were no effects yet on coastal wildlife or property. The broker explained that he lives in an area where property values are dependent on access to white sandy beaches and anything that threatens that has to be taken into account. “Part of what we sell is the lifestyle of living on or near the beach,” he blogged. More >
Most large corporations have a significant portion of their balance sheets tied up in illiquid real estate. The most common sources of funds available to these entities are through the bond market and conventional debt financing. A third and more effective source of financing is the sale-leaseback, in which the owner of a real estate asset sells the property for current market value and then instantly leases it back, usually on a long-term basis. More >
When I entered the commercial real estate industry in late 1984, the agent with the relationships and data won. There was no such thing as CoStar or LoopNet or email or the World Wide Web. I got data and developed relationships by putting my wingtips on the ground. I spent hours each week walking door to door talking with tenants and owners gathering the data and developing the relationships that I hoped would set me apart from my competition. Today, with a few simple key strokes, I can easily access the same data that took years for me to gather and, chances are, even better that I’ve accomplished this with my cell phone. More >