U.S. Mortgage Rates Uptick in Early October

Freddie Mac | October 04, 2019

Freddie Mac's latest Primary Mortgage Market Survey shows that the 30-year fixed-rate mortgage in the U.S. averaged 3.65 percent, a slight increase from last week. While mortgage rates generally held steady this week, overall mortgage demand remained very strong, rising over fifty percent from a year ago thanks to increases in both refinance and purchase mortgage applications, said Sam Khater, Freddie Mac's Chief Economist. As economic growth decelerates, it is clear that low mortgage rates will continue to support the mortgage market and we expect that to persist for the remainder of the year.

Spotlight

This white paper takes a deeper look at the underlying issues in ongoing conversations about the global housing deficit today. It examined the performance and prospects of the real estate industry in the face of a fast-changing global economy, establishing the marked growth the sector has experienced in terms of earnings and impact on human development. Despite such growth, the bigger reality on ground is that challenges such as the inability to access mortgage facilities, low property appraisals, complex government regulatory setups, increased selling costs, low property appraisals, lack of transparency, the complexity of government regulatory setups, and privacy concerns due to disclosure of personal information persist.

Spotlight

This white paper takes a deeper look at the underlying issues in ongoing conversations about the global housing deficit today. It examined the performance and prospects of the real estate industry in the face of a fast-changing global economy, establishing the marked growth the sector has experienced in terms of earnings and impact on human development. Despite such growth, the bigger reality on ground is that challenges such as the inability to access mortgage facilities, low property appraisals, complex government regulatory setups, increased selling costs, low property appraisals, lack of transparency, the complexity of government regulatory setups, and privacy concerns due to disclosure of personal information persist.

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INVESTMENTS

AECOM-Canyon Partners and Tucker Announce Mixed-Use Development in Chicago Metro Area

Tucker Development | November 22, 2021

AECOM-Canyon Partners and Tucker Development ("Tucker") today announce their partnership to develop a mixed-use project in Lincolnwood, Illinois, a premier suburb outside of Chicago. The project ("District 1860") will consist of 299 mid-rise multifamily units, an Amazon Fresh grocery store and over 40,000 leasable square-footage of additional retail and restaurant space. The joint venture simultaneously closed on a senior construction loan from Pacific Western Bank ("PWB") and construction has already begun. In close proximity to downtown Chicago and Evanston, the transit-oriented development is readily accessible to major highways, Oakton-Skokie CTA and Edgebrook Metra train stations. The complex will also have easy access to neighboring employment hubs as well as Chicago O'Hare International Airport. At closing, the retail space is 65% pre-leased and will notably feature an Amazon Fresh grocery store. The development will include additional retail space with multiple dining options, public space for gatherings as well as Class-A multifamily units with high end finishes and amenities. "We are excited to partner with AECOM-Canyon on this dynamic & transformative project. We'd like to thank the Village of Lincolnwood and Mayor Jesal Patel for their strong & unwavering support of District 1860." - Richard H. Tucker at Tucker The project is expected to be completed during 2023. About AECOM-Canyon Partners AECOM-Canyon Partners is a joint venture between AECOM Capital, the real estate investment management arm of global infrastructure firm AECOM, and Canyon Partners, LLC, a global alternative asset management firm with over $27 billion in assets under management. AECOM-Canyon Partners was established to develop large-scale, institutional quality commercial real estate projects in top U.S. markets. In addition to capital, AECOM-Canyon Partners provides best-in-class design, construction management and engineering expertise as well as credit support for its development partners. About Tucker Development Tucker Development, founded in 1996 & based in Chicago, IL, is leading developer & manager of mixed-use properties and shopping centers in key Midwest & East Coast barrier-to-entry markets. The company, led by Richard Tucker (founder & CEO) and Aaron Tucker (CIO), pursues mixed-use and retail-related real estate investments that provide an opportunity to enhance value through development, redevelopment, repositioning & recapitalization. About Pacific Western Bank Pacific Western Bank is a commercial bank with over $35 billion in assets headquartered in Los Angeles, California, with an executive office in Denver, Colorado. The Bank has 69 full-service branches located in California, with one branch located in Durham, North Carolina, and one branch located in Denver, Colorado. We offer national lending products including asset-based, equipment, and real estate loans and treasury management services to established middle-market businesses.

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REAL ESTATE TECHNOLOGY

Ascot Corp., an Associate of Ping An Group, has Started a Real Estate Fund Management Business in Japan

Ascot Corp. | May 09, 2022

Ascot Corp. has formed the first private fund through a joint venture with global institutional investors to invest in MF residential, senior living facilities, and student housing in the Tokyo metropolitan area. Main Investment Properties of the Fund "ASTILE" is MF residential brand winning the Good Design Award twice last year, and "FARE" is the brand winning the Award seven times for the five consecutive years. *The Good Design Award is the only comprehensive design evaluation and recommendation system in Japan that covers a wide range of fields from industrial products to business models and event activities. Overview of the Fund and Strategy The investment targets of the Fund are MF residential, senior living facilities, and student housing, and their locations are limited to the Tokyo metropolitan area where are expected to provide stable cash flows with little impact from the Covid-19 pandemic and high liquidity on exit, and consequently stable investment results. Furthermore, the investment risks can be identified within the limited scope and in a quantitative manner due to the predefined properties. The portfolio of the Fund No. 1 comprises of 9 properties, mainly MF residential developed by Ascot (including ASTILE Harajuku, and ASTILE Nishi-Shinjuku II etc.). In the near future, Ascot plans to expand the scope of its fund in collaboration with global institutional investors by acquiring MF residential, senior living facilities, and student housings from external developers and funds, in addition to properties developed by Ascot. Ascot manages these properties as the asset manager of the Fund. The Growth Strategy of Real Estate Fund Business Department The Real Estate Fund Business Department, established in 2021, is a new business unit of Ascot that leverages the company's design and quality property development capabilities cultivated over the past 20 years since Ascot's founding in 1999, as well as its domestic and international network. As one of the key pillars of our mid-term growth strategy, we aim to further expand our business by forming joint venture funds with domestic and foreign investors and new private funds, as well as by entering the REIT and other businesses. In addition to MF residential and offices, which are our strengths, we will target a wide range of asset classes, including logistics, hotels, senior housing, data centers, etc. Furthermore, we are considering entering some asset classes from the development stage. The Fund Business Department will contribute to the growth of the real estate investment market by continuously providing optimal solutions and quality investment opportunities to a wide range of investors while expanding total assets under management. Background Under the circumstances of limited investment opportunities under the low interest rate policy and globalization trend of investment, there has been a shift in allocations from traditional assets such as listed stocks and bonds to alternative investments, with real estate investment in particular gaining prominence worldwide over the past few years. As the global asset allocation strategy, a certain percentage has been shifted to Asia, and, in comparison to other Asian countries, investment in Japanese real estate has been allocated to a significant degree in terms of core investment. The primary factor is that Japan's low interest rate policy has ensured a relatively large yield gap. Secondly, Japan, centered on Tokyo, has a considerable market size which provides high liquidity on exit. In addition, the infrastructure for investment, such as legal, accounting, and taxation is very stable. Therefore, stable returns are expected to be secured. Consequently, the investment needs and flow of funds from global investors, especially institutional investors, to Japanese real estate have continued even with the COVID-19 pandemic, and the recent depreciation of Japanese yen has also attracted investors' attention to Japanese real estate. The asset classes receiving great attention are logistics and MF residential. Since Ascot has advantage in longstanding residential development business, the first fund focused on residential properties. Comments by Takeshi Nakabayashi, President of Ping An Japan Investment Co, Ltd. Ascot Corp. is the first real estate company in Japan invested by Ping An Group. We are fascinated by Ascot's excellent development track record backed by its ability to plan and deliver high value-added residential and office properties. We have high expectations for the growth of Ascot's new global business, including the real estate fund management business just launched, the development of logistics facilities, and integrated services from real estate brokerage to property management for global investors. About Ascot Corp. Ascot is a global comprehensive real estate service provider targeting Tokyo metropolitan area. The business includes the development of the MF residential and logistics, fund management, real estate brokerage for global investors, and property management leveraged by its design and high-quality property development capabilities as well as its domestic and international network. Its design and development capabilities cultivated over the past 20 years are highly recognized, as the track record of winning the Good Design Award 14 times in total shows. Through Digital Transformation, Ascot aims to provide quality real estate services in line with global standards by enhancing customer contact and creating new revenue models.

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REAL ESTATE TECHNOLOGY

Capital Square 1031 Acquires Newly Constructed, 2.69 Million-Square-Foot, State-of-the-Art Amazon Distribution Facility

Capital Square | February 16, 2022

Capital Square 1031, a leading sponsor of Delaware statutory trust (DST) offerings for Section 1031 exchange and other accredited investors, announced today the acquisition of a 2,690,000-square-foot distribution facility on a long-term absolute net lease to Amazon.com Inc. (NASDAQ: AMZN). The facility was acquired on behalf of CS1031 Zero Coupon Fulfillment Center, DST. This significant offering is designed for Section 1031 exchange investors who need additional debt because their replacement property has lower leverage than their relinquished property, Section 1031 requires equal or greater debt to qualify for 100% tax deferral, but leverage today is much lower than in the past, making high LTV offerings very desirable. In addition to exchangers, other owners of real estate want to invest in real estate like this that generates excess passive losses from a combination of depreciation, cost segregation and bonus depreciation to offset taxable income from other real estate investments. Due to the quality of the Amazon facility and financial strength of the tenant, this offering has both a compelling tax angle and exceptional economics for Capital Square's investors nationwide." Louis Rogers, founder and chief executive officer. Located at 500 32nd St. S.W., the 169.6-acre property is adjacent to U.S. Route 65 and Interstate 80 in Bondurant, Iowa, a premiere industrial submarket in Greater Des Moines. The four-story structure was completed in the fourth quarter of 2020. The building was designed by Amazon with the most recent technological advances and high-grade materials and can process nearly one million packages per day by implementing both robotics and human labor to maximize efficiencies.1,2 The property is leased on an absolute net basis and is guaranteed by Amazon, which enjoys an investment-grade credit rating of AA from by S&P.3 Structured to be highly tax efficient, this acquisition includes a dual loan system that shields investors from phantom income, The lease also enjoys unsurpassed creditworthiness from the full guaranty of Amazon and its investment-grade corporate credit." Whitson Huffman, chief strategy and investment officer. As of February 2022, Amazon ranked as the world's fifth largest company by market capitalization, and the fourth largest in the United States at nearly $1.52 trillion.4 It is the second largest firm in the Fortune 500. Amazon operates its retail sales and distribution activity through its Amazon Services business line, the sole tenant of the Bondurant, Iowa facility. As of December 2021, Amazon's domestic industrial network totaled more than 347.6 million square feet of active facilities, with more than 125.6 million square feet either planned or under development.5 Amazon Robotics sort fulfillment centers are the largest facilities in the Amazon logistical network. CS1031 Zero Coupon Fulfillment Center, DST seeks to raise $52.2 million in equity from accredited investors. Greater Des Moines has experienced a great deal of interest from developers and end users, with more than 630 acres purchased since 2019.6 The MSA is also attractive to technology companies. Des Moines enjoys a high ranking on the 2021 lists "Top Emerging North American Tech Market" by CBRE, "Most Resilient Tech Hub" by LinkedIn, and "Rising Star for Tech Jobs" by CompTIA. As a result, tech companies, such as Apple, Facebook and Microsoft have found the area to be a strategic and cost-effective location for data center operations. Capital Square acquired the property from Mesirow Realty Sale-Leaseback Inc. ("Mesirow"). Mesirow's Sale-Leaseback Capital team structured and financed the development of this property, starting prior to the commencement of construction. Mesirow's breadth of specialized expertise, depth of relationships and balance sheet strength has enabled the firm to execute more than $8 billion in single-tenant transactions while serving the long-term strategic needs of organizations such as Amazon. Since its founding in 2012, Capital Square has acquired 149 real estate assets for over 4,600 individual investors, spanning across 5,800 investments, seeking quality replacement properties that qualify for tax deferral under Section 1031 of the Internal Revenue Code and other investors seeking stable cash flow and capital appreciation. About Capital Square Capital Square is a national real estate firm specializing in tax-advantaged real estate investments, including Delaware statutory trusts for Section 1031 exchanges and qualified opportunity zone funds for tax deferral and exclusion. Since 2012, Capital Square has completed more than $4.9 billion in transaction volume. Capital Square's executive team has decades of experience in real estate investments. Its founder, Louis Rogers, has structured hundreds of investment offerings totaling in excess of $5 billion. Capital Square's related entities provide a range of services, including due diligence, acquisition, loan sourcing, property/asset management, and disposition, for a growing number of high net worth investors, private equity firms, family offices and institutional investors. Since 2017, Capital Square has been recognized by Inc. 5000 as one of the fastest growing companies in the nation for five consecutive years. Additionally, in 2021, the company was ranked 101st on the list of Inc. 5000 Washington D.C. Metro's Fastest-Growing Private Companies. In 2017, 2018 and 2020, the company was also ranked on Richmond BizSense's list of fastest growing companies. Capital Square was listed by Virginia Business on their "Best Places to Work in Virginia" report in 2019 and 2021 as well as on their "Fantastic 50" reports in 2019 and 2020.

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