Archive for February 1st, 2013
Week in Review for January 26 – February 1:
- The Federal Reserve announces it will continue to boost the economy by acquiring bonds and holding down interest rates. The Fed indicated it would continue this strategy until unemployment has fallen to 6.5%, reports CNBC. The current unemployment rate is 7.9%.
- In positive news for the commercial real estate industry, CoStar Group reports improvement in demand and occupancy for the office sector, which analysts believe will lead to rent growth in many markets. Office real estate has been extremely slow to recover from the 2008-09 financial crisis, partly due to pre-recession overbuilding. But limited new development and the demolition or repurposing of older office buildings have led to a decrease in vacancy rates.
- In San Diego, Pebblebrook Hotel Trust (NYSE: PEB) acquires the Embassy Suites San Diego Bay hotel for $112.5 million. The REIT purchased the 337-room property following a $3.5 million renovation by the previous owner.
- Also in California, WPV San Jose, LLC, a subsidiary of Vornado Realty Trust (NYSE: VNO), sells its share of a 650,500-SF San Jose shopping center to Cole Real Estate Investments. Because some retailers own their own space, portions of the property, which is called The Plant, were not included in the $205 million transaction.
- This deal reflects ongoing investor interest in the Silicon Valley real estate market, where numerous technology and Internet firms show potential for further expansion. One example is Ebay Inc., which has leased an additional 50,000 SF to accommodate its growth.