From the Editor
BY IVANNA C. SUKKAR, EDITOR
In the Past Month
Many professionals in the coMMercial real estate industry likely saw
both ups and downs this past year. but before you break out the chaM-
pagne bottle, let’s take a look back at 2010 and see what 2011 Might bring.
Both the Troubled Asset Relief Program and the Term Asset-Backed Loan Facility (TALF) expired this year. Although they might not have spurred the economic and real estate recovery that many hoped for, the programs did have some success, analysts say. In particular,
TALF increased confidence in commercial mortgage-backed securities (CMBS) and helped
bring back “a functioning market,” as Annemarie G. DiCola, CEO of Trepp LLC, indicated in our
August issue’s Q&A ( sctsm.in/4232).
In fact, CMBS issuance is up this year as compared to the past two years. After no issuance in
the second half of 2008 and $2.2 billion in ’09, CMBS issuance may reach $10 billion to $15
billion this year, DiCola said.
On the other side of the coin, CMBS delinquency rates also increased this past year. According
to Trepp data, the delinquency rate was 8.58 percent this past October, up from 4. 8 percent in
October ’09. This past October’s rate as compared to September was the first monthly drop
since the summer of ’09, however, indicating a higher volume of loan modifications and liquidations, Trepp says.
Some market sectors have seen more stability this year. Triple-net leases for single-tenant
properties have been one bright spot, David Sobelman of Calkain Cos. says in this month’s
Lead Article (Page 21). Real estate investment trusts also have been going strong — they had
their second-largest year in history in ’09 and are on track for an even bigger 2010. The National Association of Real Estate Investment Trusts’ president and CEO, Steven Wechsler, tells
us more in our Q&A on Page 16.
As we enter 2011, commercial mortgage brokers also can look to emerging markets — both
globally, as Nationwide Business Consultants of South Florida Inc.’s Milton Franklin discusses
on Page 26, and domestically with such initiatives as renewable energy, which Rachael
Maltese of Greener Earth Financial Solutions explains in her article (Page 24).
And how can brokers find these and other opportunities and continue to connect with their
clients? If you’re not using social media to stay in touch with and inform clients and prospects,
you’re likely losing some to competitors who are. Carol M. Flammer of mRELEVANCE LLC provides ideas for how you can use social networking to your advantage (Page 36).
While you’re at it, connect with us on Facebook ( facebook.com/scotsmanguidemedia) and
Twitter ( twitter.com/ScotsmanGuideED and twitter.com/ScotsmanGuideCE).
Announced layoffs up slightly in September
CHICAGO — Announced layoffs increased slightly in
September compared to August, according to employment researchers at Challenger, Gray & Christmas.
Announced job cuts were 37,151 for the month, up
from 34,768 in August, the international outplacement
In September 2009, 66,404 job cuts were announced;
the 12-month drop from September ’09 to this past September is 44 percent.
The U.S. Department of Labor said that the economy
shed 54,000 jobs in August, pushing the national unemployment rate from 9. 5 percent to 9. 6 percent. In
September, the U.S. lost 95,000 private-sector jobs,
but the unemployment rate remained unchanged statistically at 9. 6 percent.
Consumer confidence sees slight increase
NEW YORK — U.S. consumer confidence increased
slightly in October after decreasing in September, the
Conference Board announced.
The monthly Consumer Confidence Index increased
from 48. 6 in September to 50.2 in October, the research
“Consumer confidence, while slightly improved from
September levels, is still hovering at historically low levels,” said Lynn Franco, director of the Conference Board
Consumer Research Center.
“Consumers’ assessment of the current state of the
economy is relatively unchanged, primarily because labor market conditions have yet to significantly improve.
And, despite the uptick in expectations, consumers continue to be quite concerned about the short-term outlook. Both present and future indicators point toward
more of the same in the coming months,” she said.
Consumer Confidence Index: Dec. 28
… in January’s
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The office and retail markets are leading recovery in Russia. Jones Lang LaSalle reports that total real estate investments increased 12 percent
year over year and may reach $4 billion by the
end of the year, according to The Moscow Times.
Office space accounted for 36 percent of investments, while 18 percent of investments went into
retail. In another positive trend for the market,
retail sales increased 3. 4 percent this past first
half, according to the Federal State Statistics
Service. The Vegas shopping center, currently
the largest mall in Russia, opened in Moscow
this past June.
Personal incomes decrease in September
WASHINGTON, D.C. — Personal income decreased
0.1 percent in September after a 0.4-percent increase
the previous month, the U.S. Bureau of Economic
Economists had predicted a 0.2-percent increase for
September. Incomes have now increased an average of
less than 0.2 percent per month since May.
Personal spending, meanwhile, increased by $14.1 billion in September after rising $49.2 billion in August.
Disposable income decreased by $20.3 billion — or 0.2
percent — after increasing $47.9 billion — or 0.4 percent
— in August.
Personal income and outlays: Dec. 23
Construction spending increases slightly
WASHINGTON, D.C. — The U.S. Commerce Department reported that construction outlays increased 0.5 percent in
September with gains in spending on residential projects.
Money spent on private residential projects rose 1.8
percent from a month ago to $231.7 billion. Spending
on private nonresidential construction dropped 1.6 percent to $250.3 billion, the Commerce Department said.
In total, construction rose to $801.7 billion compared to
a revised August estimate of $797.5 billion. Total spending for private and public projects was 10. 4 percent below September ’09 when outlays reached $894.8 billion
for buildings and highways.