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TCN Worldwide

TCN Worldwide State of Market – Central Edition (2016-Q3) | by Hugh F. Kelly, PhD, CRE

National and Macroeconomic Market Overview
The Bureau of Economic Analysis “final” GDP estimate for the Second Quarter was released on September 29, 2016.   It showed overall economic growth at a 1.4 percent annual rate.  This was the third consecutive subpar quarter, and confirmed that the long expansion (now at 86 months in duration) is slowing its momentum.  The initial Third Quarter estimate will not be out until early November.  Preliminary data indicate continued sluggishness. Retail sales are up just 1.9 percent year over year.  Housing starts, permits, and home prices slipped during the summer.  Industrial production and capacity utilization are also in decline from 2015.
More positively, net real exports have risen for the last several months, and this should be strengthening GDP during the second half. The
auto industry has also been trending upward. Incomes have started to rise, and for the first time in this cycle lower and middle-income households are benefiting materially, according to a Census Bureau study released in September. This is contributing to a small uptick in inflation, with core CPI now up 2.3 percent year over year.
Read more: 2016-central_q3_state_of_market
Economist Hugh F. Kelly PhD, CRE, who leads TCN’s Real Estate Economic Committee, is Clinical Professor at New York University’s Schack Institute of Real Estate where he has taught for 30 years. He is widely cited in the real estate industry and is a frequent speaker around the world.

TCN Worldwide Economic Report – Central Edition (2016-Q2) | by Hugh F. Kelly, PhD, CRE

Regional Conditions in the Central States                               
The Central states, with an employment base of 55.6 million, has the largest number of jobs of the three regions analyzed in our newsletters.  However, with an aggregate job growth of just 31,000 spread over nineteen states, the Central region has the lowest number of additional jobs and the slowest growth rate (1.1%). Texas, with a year-over-year job gain of 171,800 (1.5%) is the regional standout in absolute growth, but Tennessee posted a faster pace of job gains, 2.1% (versus the US average of 1.7%) on the addition of 60,900 positions. On the other side of the coin, Kansas, Louisiana, North Dakota, and Oklahoma saw employment contract in the past twelve months. Unemployment ranged from a low of 2.5% in Tennessee and 3.0% in Nebraska, to highs of 6.3%
in Louisiana and 6.4% in Illinois.
Although far from the oceans, the Central region has an extraordinary role in international trade. Texas has an annual import/export volume of $502 billion, with Michigan ($177 billion) and Illinois ($185 billion) in the top tier trade states as well.  Tennessee and Ohio also engage in more than $100 billion in global trade annually. While lower in volume, four states with agricultural and/or energy concentrations in their economies show surplus trade balances (more exports than imports) in an era where the country as a whole has long been in a deep trade deficit.
Texas, with its enormous total volume, has a very thin trade deficit of just $404 million. Globalization, then, has been a mixed blessing for the region – possibly costing a number of jobs, but generating employment as well in sectors ranging from agriculture and energy to transportation and wholesales, and in manufacturing sectors including precision instruments and transportation
equipment.
  INTERNATIONAL TRADE VOLUMES BY STATE

Healthcare is reported to be a bright spot in the regional economy, as is professional and business services in and around Minneapolis, Kansas City, and Dallas. The energy slump has impacted several parts of the region, and accounts for the bulk ofthe economic contraction in states like Louisiana, Oklahoma, and North Dakota. Residential construction is constrained by rising labor costs
and by tightening underwriting standards at bank lenders. Commercial development lending is also being carefully underwritten, limiting new development. This will have the likely effect of lengthening the real estate cycle, which has not seen the volume of construction that is typical in a late-stage business expansion.  Basel III capital requirements, the regulatory impacts of Dodd-Frank oversight, and the “lessons learned” by banks caught with billions of land and development loans in the Global Financial Crisis all contribute to the constrained credit environment.
READ ENTIRE REPORT–TCN Economic Report – 2016_Q2_Central
 
Economist Hugh F. Kelly, PhD, CRE, who leads TCN’s Real Estate Economic Committee, is a Clinical Professor at New York University’s Schack Institute of Real Estate where he has taught for 30 years. Kelly specializes in development of economic and market forecasts, portfolio strategy, as well as seminars and workshops. He heads his own consulting practice, Hugh F. Kelly Real Estate Economics, which serves national and international real estate investment and services firms, governmental organizations, law firms, and not-for-profit agencies. Kelly is widely cited in the real estate industry and is well known for his research on 24-hour cities and commercial real estate investment performance.

TCN Worldwide’s Economic Report – Central Edition (2016-Q1) | by Hugh F. Kelly, PhD, CRE

Overview of National Economic Trends
The major macro-economic indi­cators. The First Quarter doldrums struck again in 2016. Relatively weak job gains in January (168,000 net new jobs for the month) were a drag on First Quarter totals, with the three-month employment increase at just 628,000. The pattern of the past several years has been economic ac­celeration in the Spring and Summer months. Year-over-year, U.S. employ­ment gains exceeded 2.8 million, or 2.0%. Wages are starting to respond to the low five percent unemployment rate, with average hourly earnings up 2.3% for the year. These are “real” wage gains, as the CPI increase for the 12-months ending March 2016 was just 0.9%.
Although recent in­creases in energy prices suggest some upward inflation to come, the US Energy Information Agency pre­dicts that gasoline prices will aver­age $2.04 per gallon nationally this summer, compared with $2.63 per gallon last year. That could buoy retail spending and vacation travel for con­sumers, which would be a welcome trend for the stores and hotels sector of the economy. The stock market gyrations certainly raised the level of nervousness across the econo­my. The VIX was high and the drop in the equities indexes during the first six weeks of the year was more than 10%. But since that “bottom”, stock prices are up more than 15%. We are entering the Second Quarter with positive momentum.
Read more: TCN Worldwide’s State of the Market | 2016_Q1_Central
Economist Hugh F. Kelly PhD, CRE, who leads TCN’s Real Estate Economic Committee, is Clinical Professor at New York University’s Schack Institute of Real Estate where he has taught for 30 years. He is widely cited in the real estate industry and is a frequent speaker around the world.

TCN Worldwide Commercial Focus (2015 Q3)

Three New Firms Join TCN Worldwide
The past few months have marked some exciting changes at TCN Worldwide—both within our growing member roster and in the tools we provide to our members.
Late this summer, we welcomed Primecorp Commercial Realty/TCN Worldwide—a leading commercial real estate brokerage, management and development company headquartered in Ottawa, Canada. The firm, founded in 1998, has completed over $6 billion dollars (CDN) in transactions in over 55 Cities, coast to coast. Primecorp’s brokerage concentrations are in multi-family, retail and office investment sales and leasing, as well as senior housing and tenant representation.
Sam Firestone LL.B, COO, Co-Founding and Managing Partner, and Broker of Record at Primecorp Commercial Realty, said, “Joining TCN Worldwide is an exciting new chapter in our firm’s history. My partners, Steve Lerner, Aik Aliferis, Nick Pantieras, and I are confident that this new partnership will bring tremendous opportunities to our company.” In addition to Barclay Street Real Estate/TCN Worldwide serving Calgary and Edmonton and Terramont/TCN Worldwide in Montreal, Primecorp expands our organization’s presence in Canada.
This September, Citadel Partners/TCN Worldwide—a commercial real estate advisory, brokerage, and services company headquartered in Dallas, Texas—joined our organization. The firm, founded in 2012 by Managing Partners Scott A. Morse, SIOR, CCIM and Scott M. Jessen, SIOR, CCIM, has been recognized with numerous local and regional awards.
Scott A. Morse, SIOR, CCIM stated: “We are so pleased to be a part of TCN Worldwide. We are joining forces with a group of strategy-based real estate professionals around the globe that will allow us to better serve our clients’ needs with a greater depth and breadth of service.”
The addition of Citadel Partners is another example of TCN Worldwide’s commitment to providing its clients with preeminent independent real estate services firm in each market.
CMI Grupo—a leading full-service commercial real estate advisory, brokerage, and services company headquartered in Mexico City—is the most recent addition to TCN Worldwide.
The firm, founded in 1992 by Enrique A. Carrillo and Pablo Carrillo, is led by 9 partners with four offices in Mexico. CMI Grupo has performed real estate services in all 32 states in Mexico and has successfully completed transactions totaling more than 128 million square feet over 23 years. Some of its recent clients include: Facebook, Investa Bank, Yahoo, Mabe, Herdez, USDOS & Bristol-Myers Squibb, Paramount, and Mattel.
Enrique Carrillo, Chairman of CMI Grupo, stated: “CMI Grupo’s membership in TCN Worldwide represents enormous potential for international business. This organization shares our goal of providing the optimal response to clients’ needs for advisory and consulting services for commercial real estate.”
Please join me in welcoming our newest members to TCN Worldwide!
—H. Ross Ford III
President & CEO, TCN Worldwide
New at TCN Worldwide
We’re excited to share two major improvements and additions to the tools we provide all of our Members: Our redesigned and upgraded website and our new “State of the Market” Quarterly Market Intelligence for the West, Central, and East Regions.
Our website, designed and developed by New Jersey-based Cantilever Co., has been fully modernized and is now mobile-friendly. Cantilever has built a reputation as a dependable source for top-notch design thinking, practical strategy and smart engineering.
Economist Hugh F. Kelly PhD, CRE will lead our new Real Estate Economic Committee. Dr. Kelly will be tasked with evaluating real estate trends in the markets that TCN’s member firms serve, generating quarterly reports for our members to use and share with your clients.
Reports will be available on our website, http://www.tcnworldwide.com.
Top 10 TCN Member Deals

Starboard TCN Worldwide | Richard Gumbinner | Land | 82 Acres | $18,000,000
Landmark Commercial Realty, Inc. | Chuck Heller and Drew Bobincheck | Multi-Family | 200 Units | $12,100,000
Starboard TCN Worldwide | Yoav Ben-ShuShan | Mix-Office/Retail | 17,595 SF | $9,500,000
Landmark Commercial Realty, Inc. | Jason Grace | Industrial | 100,000 SF | $9,300,000
Landmark Commercial Realty, Inc. | Tom Posavec | Office | 66,264 SF | $8,962,212
MHP Real Estate Services | Jesse Rubens | Building | 41,980 SF | $8,400,000
Levrose Real Estate | Jon Rosenberg | Office | 17,700 SF | $7,700,000
MHP Real Estate Services | Jesse Rubens | Building (School) | 35,388 SF | $7,572,347
Berger Commercial Realty | Joseph Byrnes | Office | 50,000 SF | $6,100,000
DP Management, LLC | Fred Scott | Church Campus | 26.5 Acres | $5,800,000

TCN Worldwide and GVA Worldwide Negotiate a Transatlantic Alliance

An alliance has been formed between TCN Worldwide and GVA Worldwide.  David Greene, Chairman of the TCN Worldwide Board of Directors, and I are excited to announce that we have agreed to create an alliance with GVA Worldwide. This alliance extends the scope and capability of our respective organizations into key strategic markets.
GVA Worldwide is an international network of independent commercial real estate companies working with a wide range of clients including occupiers, multi-national corporations, major space users, developers, owners, institutions, lenders and investors. Through its affiliated member firms, partners can harness the expertise of 5,000 professionals in over 120 offices across 25 countries worldwide.
The alliance with TCN Worldwide will facilitate a range of services to both groups’ clients, including: transactions, strategic planning, market and site analysis, financial and fund structuring, lease consultancy, pre-acquisition due-diligence, valuation, asset, property and facilities management.
Patrick Morrissey, Chairman of GVA Worldwide, commented: “This agreement will form a hugely significant step in our plans to expand and strengthen not just our transatlantic ties but our wider cross-border capability throughout the GVA Worldwide community. As the markets continue to strengthen and the flows of capital continue our access to and representation in the US becomes increasingly important for our clients.”
David Greene (of MHP, TCN’s Manhattan, NY member firm) added: “A strategic alliance between TCN Worldwide and GVA Worldwide increases our collective reach, strengthens our client base, and invigorates our individual firms. The new worldwide alliance now provides every individual in both affiliate organizations the chance to better serve their clients and prospects.” He added, “To be able to significantly expand our reach beyond the 200 markets that we currently serve through our independent affiliates is a distinct opportunity. This is an important alliance for TCN and all of our affiliates throughout America, Canada and the World and in particular, for MHP as the NYC affiliate for TCN and as a whole, we will continue to provide ‘best in class’ client services with sincerity and transparency.”
We are excited to make this alliance a reality for our member firms. Expanding our network’s opportunities to better serve our many clients and extend the reach of our global partners across Europe is a significant success. We will look to continue our global growth and work in concert with the GVA Worldwide team to take advantage of the many synergies our organizations share.
Most importantly, we are already seeing several of our member firms and specialty teams working together on new business opportunities. We look forward to building on these early successes in the coming months.
Globe St. wrote about this exciting development this morning. To access the article, please click here.