June 2020 – REI INK

American Homes 4 Rent Announces Independent Board Chairman

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The Board of Trustees for American Homes 4 Rent has appointed Kenneth M. Woolley as independent chairman of the board. The appointment was effective May 7. Tamara Hughes Gustavson, former chairman of the board, will continue to serve as a board trustee. Woolley joined the company’s board at its inception in 2012. He is the founder andformer CEO of Extra Space Storage, Inc., a self-storage real estate investment trust, where he currently serves as its chairman. Woolley has developed and constructed more than 18,000 apartment units and 600 single-family homes and acquired and managed an additional 15,000 apartment units. He is also the founder of several companies in the retail, electronics, food manufacturing, airline and natural resources industries.

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PREIT has added Shop Local pages on all of its mall websites, an effort designed to support the ecommerce platforms of the small businesses in its portfolio. The offerings are accessible not only to local audiences but also to the entire PREIT portfolio of consumers. “Our local businesses are among the enterprises hardest hit by this pandemic. Without robust digital marketing budgets, they are at a disadvantage to their national counterparts. The retail ecosystem is critical to economic recovery and we wanted to be sure we took steps to support those most in need, including putting our marketing power behind our tenants,” said Joseph F. Coradino, chairman and CEO of PREIT. “Our goal in pursuing this endeavor is to take another step in putting our communities first and be even better partners with our tenants moving forward.” PREIT Malls reach an audience of more than 1,000,000 people through digital channels.

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Permits.com, a platform for property owners and contractors to apply for construction-related permits nationwide, has launched GovAccess. Contractors in 17,000 U.S. cities and towns can use the free platform to expedite permit requests and inspections online, allowing contractors to access critical information and approvals they need for building in the face of COVID-19 and beyond. Due to the pandemic, building departments have closed or have restrictions on how they support service providers, workers and property owners. These restrictions limit the access, speed and procurement for contractors able and willing to work. Delayed permits and inspections could be long-lasting, ranging from costly project delays to potential public safety issues. “We understand the impact COVID-19 is having on our country, particularly contractors operating in smaller municipalities,” said Permits.com CEO & founder Ray Antonino. “GovAccess strengthens the resilience of local governments, promotes civic engagement and accelerates economic development by moving the permitting process online.” Permits.com was designed in partnership with property owners, contractors and local governments. Local municipalities pay nothing.

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Eastern Union, a commercial real estate finance firm, has arranged $15.5 million in financing toward construction of a ground-up, 1,115-unit self-storage facility in Perth Amboy, New Jersey. The loan, which covers costs associated with both land acquisition and construction of a 130,000-square-foot building, was arranged by managing director David Merkin and underwriting director Barry Dollman. The deal closed on March 30 with lender Orix USA Corporation. The non-recourse loan was provided at 85% leverage. “It’s challenging to secure construction financing even under normal market conditions,” said Merkin. “Eastern Union was pleased to meet our client’s needs by identifying a lender that was ready to offer a non-recourse loan at a high leverage ratio. Moreover, the lender was willing to stand by its original offer, even as economic circumstances were rapidly changing.” The borrower was 112 New Brunswick Properties Urban Renewal LLC, doing business as Woodbridge Self-Storage. The facility will be operated by Extra Space Storage, a Utah-based real estate investment trust. The seller’s identify was not disclosed.

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A&G Real Estate Partners has launched a structured investment sales division. A four-person team, led by industry veteran Jeff Hubbard, brings to the new division more than 80 years of experience in structured turnkey dispositions of portfolios and individual properties across all asset classes. The team expands A&G’s in-house capabilities to include sealed bid and live auctions, portfolio sales, note sales and sale-leaseback transactions. It also broadens the range of asset classes A&G serves to include investment properties (hospitality, industrial, multi-family, shopping centers), luxury home and development projects, as well development land and special use properties. In addition to Hubbard, the team includes senior managing director Jamie Coté and managing directors Katie DeCoste and Christian Koulichkov. All were part of a special situations group that has worked together for nearly 20 years, most recently at Paul J. Massey’s B6 Real Estate Advisors in Manhattan. Hubbard, DeCoste and Koulichov will be based out of A&G’s Melville, Long Island, headquarters. Coté will work from the firm’s Chicago office.

Foreclosure Buyers Moving Online in Wake of COVID-19 Crisis

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COVID-10’s impact on real estate investing Auction.com’s recently released second quarter 2020 Foreclosure Buyer Insights report focuses on buyer outlook, sentiment and acquisition strategies in light of the COVID-19 pandemic and ensuing market turmoil. The data in the report comes from two surveys. One was conducted in February before national emergency declarations, and the second in April after the national emergency declarations. The surveys were sent to buyers who had purchased at least one property on the Auction.com marketplace. Auction.com is the nation’s largest online real estate transaction marketplace focused exclusively on the sale of bank-owned and foreclosure properties. Survey results for the report were analyzed and summarized by Auction.com’s market research and analysis team, which is led by Daren Blomquist. Among thefindings in the report: Online auctions now top acquisition strategy, with rising interest in remote bidding technology for live auctions. Most hold-as-rental buyers, small-volume buyers and online auction buyers plan an increase or no change in property acquisitions in 2020. 14% percent of buyers expect flat or declining home prices in 2020, up from 7% in 2019. 76% of buyers bought five or fewer properties in 2019. A growing majority of buyers ranked rehabbing and reselling to owner-occupants as their preferred investing strategy. One-third of buyers ranked hold-as-rental as their preferred investing strategy. More than 80% of both rehab-and-resell and hold-as-rental buyers budget at least 10% of a property’s purchase price for rehab costs. 46% of buyers acquire a majority of investment properties from Auction.com. “Most foreclosure buyers are small-volume investors purchasing fewer than five properties a year, and more than 90% of them are either selling to owner-occupants or holding the properties as rentals,” said Jason Allnutt, Auction.com CEO. “This broad base of buyers is proving resilient even in the midst of market turmoil, leveraging the power of online auctions even as other sources of inventory are on the decline.”