New multifamily construction is coming back. Earlier this month [we reported] that Barrons expects multifamily revenue to remain stagnant due to a lowering level of supply. Last week we pointed to an article from The Commercial Observer (and Trepp that shows lenders are very willing to refinance mutlifamily loans due to their high low LTV ratios. This week The News Tribune reports that the construction of new developments is on the rise due to a decline in vacancy coupled with rising rental prices means.
Read the full article here.
8 (residential) real estate tech startups to watch. Real estate technologists are continuing to provide innovation in the real estate tech game, with the top tech companies including:
- Floored – Offers a 3D technology to walk through a space (a house, for example) and make changes to that space to see how it would look.
- ShortSave, Inc. – A typical short sale takes 165 days to complete, ShortSave is able to do it in 36 days.
- Porch.com – A home improvement network that allows members to get word of mouth referrals from neighbors.
- Relocality Inc. – A matchmaker connecting people to neighborhoods and services through their social network. Relocality looks at people’s Facebook likes, pictures, etc. and gives neighborhood recommendations based on lifestyle interests.
- Keyzio – iPhone app helps to create a profile for your home before you intend to list it. Buyers and sellers can connect directly and send messages and favorite which homes they like before the home enters the market.
- KeyMe – KeyMe Makes copying keys easy. Take a picture of your key and KeyMe will cut and ship a copy in the mail. Users can also digitally backup their keys.
- RealScout – Platform improves collaboration between realtors and clients. Users can also do a visual feature search for ammenties like a gourmet kitchen and find houses with that match.
- RealDirect – Builds tools and software for agents to generate and close leads more effectively. RealDirect is funding HomeBuilder, which is a floorplan generator where the user can build new or modify existing floorplans for houses.
Once “skittish” lenders are now eager to deal. Crain’s Detroit Business website posted an article that includes statements, feedback and anecdotal stories from more than two-dozen lenders. Highlights from bankers include:
- Commercial lending originations at Clarkston State Bank jumped in 2013 from about $15 million in 2012 to $25 million, a figure that the Grant Smith, the bank’s president and CEO, expects to hold steady this year.
- Flagstar Bancorp, the largest bank headquartered in Michigan, saw commercial lending increase by $150 million, to $386 million, in the first nine months of 2013. The increase in lending was driven by a restructuring (e.g. selling out-of-state branches) and diversifying into commercial lending to lessen its reliance on mortgage originations.
- The Michigan Credit Union League reports a growth rate in lending of 17.3% amongst its members, a huge increase considering the national average was 8.5%.
Read the highly recommended, full article here.
Transformations in commercial real estate finance. Deloitte’s real estate research points to the need for transformation within commercial real estate. “The finance function at CRE companies typically spends the bulk of its time consolidating and reporting key pieces of financial information both across the organization and externally. And why? It’s because many organizations tend to have a multi-entity structure, with properties spread across various geographies. Adding to that, each one typically has a unique finance operating model using different legacy systems - all of which can create integration challenges.” Discover more about the need for changes in technology within commercial real estate finance here.
See you next week.