Stan Sonenshine Discusses Amazon HQ2

Stan Sonenshine Discusses Amazon HQ2

1 year ago 0 0 1622

Stan Sonenshine was featured in Bisnow’s recent article, “Atlanta’s Odds Are Strong, But ‘Conservative Culture’ Could Hamper Amazon HQ2 Chances.” In the article, Stan questions whether Atlanta’s conservative culture could be a drawback and whether landing HQ2 may be disruptive to a city already experiencing healthy growth. You can learn more about Stan’s thoughts on HQ2 in his recent blog “Amazon HQ2 and The Gulch: A Symbiotic Relationship?”

Amazon HQ2 and The Gulch: A Symbiotic Relationship?

1 year ago 2 1 18741

Atlanta was originally called Terminus because the rail lines converged here. Eventually, the interaction of trains and cars became problematic, and streets were built over the railroad tracks. Existing shops were abandoned, and new shops were built on the new streets. Then, the Omni, Phillips Arena and the Georgia Dome were built, creating a big, empty space that you can look into. That area is The Gulch, a 120-acre site, currently made up of parking lots and rail lines. The Gulch: Past and Future Visions  For years, the vision was to turn The Gulch into a multi-modal station and then build mixed-use around the station, but that plan has never come to fruition, mostly because of the number of entities that would have to be involved—county, city, state and federal agencies; MARTA; and Norfolk Southern to name a few. However, according to a recent Atlanta Business Chronicle article, “The Gulch…is

Read more

Intentional Development Around Stadiums: Can It Work?

1 year ago 0 0 706

In my last blog “The Not-So-Obvious Connection Between Stadiums and Community”, I admitted my skepticism related to the community-building aspect of erecting new stadiums while acknowledging my hope for the success of such projects, like the Mercedes-Benz Stadium. But there’s an exception. And that’s the new Georgia State Football Stadium. Once Turner Field. Once the Olympic Stadium. (In fact, did you know this is one of the longest sustainable stadiums in the history of the Olympics?) What’s Different? Why do I think this example is different? It’s all in the approach. And I see private co-developers Georgia State University (GSU) and Atlanta-based Carter & Associates creating Summerhill, a development around the stadium, in an intentional and realistic way. In other words, this is not a “build it and they will come” project. GSU and Carter appear to be assessing what the community needs and then building it. To me, this

Read more

The Not-So-Obvious Connection Between Stadiums and Community

2 years ago 0 1 812

I admit it. I am a skeptic when it comes to the community-building aspect of sports stadiums—and I am not alone. This issue is particularly relevant in Atlanta with the recent openings of the Mercedes-Benz Stadium and SunTrust Park and the soon-to-be completed renovation of Philips Arena, all done with public financial assistance.  In this blog, I focus on the Mercedes-Benz Stadium because it is the most expensive and prominent. Here’s my question: How can a huge building, that looks like either the Lunar Lander or an alien landing zone (think big hole in the roof) and that is used less than 100 days per year, help revitalize a struggling community? Wasn’t this supposed to happen before with Turner Field and the Georgia Dome? Don’t get me wrong. I support public-private partnerships and these revitalization efforts, but in general, I do not see the connection. With that said, I do think the

Read more

Cap Rates: They Have Their Place

2 years ago 0 0 714

Here’s the scenario. You have money you want to invest, and you do not want to manage real estate, but you want an income stream. When considering your options, you find the following: U.S. Treasury bond—2.3 percent return with virtually no risk; Municipal bond—4.5 percent return (with some tax benefits), still with minimal risk; and McDonald’s ground lease—5 to 5.5 percent return, with a slightly higher risk and illiquidity. These examples demonstrate very low risk situations, but make a comparison between similar investment options. So, where do Cap Rates (short for capitalization rates) come in? Cap rates are the benchmark that enable investors to compare various investments. Here’s a straight forward definition: “A cap rate measures a property’s natural rate of return for a single year without taking into account debt on the asset, making it easy to compare the relative value of one property to another.” In most basic

Read more

The Pro Forma: Garbage In, Garbage Out

2 years ago 0 0 772

I clearly remember one speaker’s comments from a 1985 NAIOP conference. His claim was this: One of the worst things that ever happened to the real estate business was the personal computer. How Can This Be?  For those who can remember prior to 1980—before the personal computer and in the early days of the financial calculator—real estate pro formas were done by hand. Income-producing properties were evaluated based on current income, and development pro formas rarely went beyond three years. With the onset of high inflation in the early 80s, pro formas showing annual increases in income became common to achieve high future evaluations, so real estate could compete with high bond rates. Even then you had to get the numbers (rents, expenses, cap ex, etc.) right on the first try because changing them after the initial projection was cumbersome and time-consuming. Enter the Financial Calculator and the Personal Computer. With

Read more

Amazon’s Bold Purchase of Whole Foods: Why Exactly?

2 years ago 0 0 775

Jeff Bezos has done it again. He’s managed to set the retail world on end with his unexpected, and possibly risky, move to purchase Whole Foods. And the move has left a trail of analysts wondering exactly why he did it. So, I guess I will chime in. Stan’s Prediction Amazon bought Whole Foods because it now has 431 convenient pick-up points for existing and future customers to pick-up more Amazon stuff. It’s my thought that future home delivery will only be available for the best of customers, and if you don’t rank, you will be picking up your Amazon shipment, still conveniently, at your local Whole Foods store. That may be one of the main reasons the transaction happened, but let’s look at other factors influencing this just under $14 billion-dollar transaction which recently lit up the retail market. Why Whole Foods? Organic food market becomes flooded. At one

Read more

Development: Unpredictability in the Process

2 years ago 0 0 647

Development: Unpredictability in the Process My last blog, “The Importance of Timing on Real Estate Investment,” focused on the unpredictability in investment, on what can happen over time once you own a property. In development, there is the added unpredictability during the process. For a broker selling a property or an investor buying a property, the complete process can be done in 90 days or less. But that is not the same with development, not even close. Process Derailment Developers have many considerations—they need time for inspections, site tests, neighborhood forums, entitlement or zoning processes, permitting, and soil boring tests, to name a few. While some of these can be controlled, others cannot. For example, everything could be moving forward smoothly and one ruffled neighborhood group at a zoning hearing or one difficult inspector could stop the project dead or at least create a significant delay, with the developer having

Read more

The Importance of Timing on Real Estate Investment

2 years ago 0 0 738

A dollar today is worth more than a dollar tomorrow. So, the farther into the future one expects income or a sale to occur, the less it is worth in today’s dollars. In my opinion, investors don’t contemplate this factor enough when considering a real estate investment. Factors that are commonly considered for real estate investments include location, market, available financing and current cash flow. But when you invest and how long you plan to hold can strongly impact how well you do. The Effect of Timing + Buying Let’s look at some examples: Those who bought properties at the market peak in 2006-2008 with 3- and 5-year loans know the pain of debt maturing in a down market. While it is always prudent to buy in a down market, it is possible to buy too early. This could result in debt maturing before the market recovers or in anticipated

Read more

Old Malls, New Opportunities?

2 years ago 0 0 926

Lately, it seems that one retailer after another is announcing massive store closings or potential bankruptcy. It’s no secret that Macy’s is closing stores, Sears is contemplating bankruptcy and JCPenney’s is struggling. But what happens when a mall anchor closes or the mall itself dies? It affects everyone. Dying malls, especially in small towns where they are the central economic hub, impact the community that live and shop at the mall; the employees that work at the mall; the small tenants that rely on the larger anchors’ foot traffic; the properties surrounding the mall; the investors and developers that own the mall; and the lenders that hold loans on the mall. A dying mall can absolutely create an economic hole in the center of a small town or suburb that once relied on its vibrancy for tax income and as a social gathering place. Last year, in my blog “How

Read more

Seo wordpress plugin by www.seowizard.org.
/*-----------------------------------------------------------------------------------*/ /* Bouncepath 2016 Analytics /*-----------------------------------------------------------------------------------*/