The remaining 51.1% stake in the acquired properties is retained by TIAA-CREF who will also manage these assets. The property portfolio totals a rentable space of 1.9 million square feet and is comprised of two New York assets, two located in Washington DC and another one in Boston. The joint venture between NBIM and TIAA-CREF plans on buying more office properties in these three US cities.

“This is the fund’s first real estate investment outside of Europe and is in line with our strategy to build a high-quality, global property portfolio. We are very pleased to team up with a partner that has TIAA-CREF’s knowledge and capabilities, and look forward to jointly developing the venture,” said Karsten Kallevig (upper left), chief investment officer for real estate at NBIM. ”As the world’s largest real estate market, the US will be an important part of the fund’s long-term property portfolio. We will initially seek to invest in key East Coast cities.”

Norway’s sovereign wealth fund, or Pension Fund Global, which NBIM manages, uses government revenues from the country’s oil and gas industry to make its investments and has made its first property investments in 2011, when it targeted office and retail properties in London and Paris. The fund is mandated to hold up to 5% in property assets, while the majority of its investments are focused on equities (60%) fixed income (over 35%).

PDIC stated 84 commercial and residential properties with a combined minimum disposal value of P44.41 million will be auctioned on February 5th. The foreclosed properties are located in various areas: Negros Occidental, Aklan, Antique, Bohol, Camiguin, Cabu, Iloilo and Negros Occidental.

PDIC will only receive “sealed bids only from direct buyers on Feb. 5 from 9:00 a.m. to 2:00 p.m.” Extensions on the deadline won’t be made for any reasons. All interested buyers are advised to inspect, asses and verify land titles for the properties they are interested in buying to determine possible unpaid taxes, fees or expenses.

“All bids must be accompanied by a bond or deposit equivalent to at least 10% of the submitted bid either in cash or manager’s check or cashier’s check. The winning bidder is required to pay the balance of the bid price not later than Feb. 14,” PDIC said.

Image © freshidea – Fotolia.com

Investor number one: Gene

A down home country boy from north Georgia who is about as smart as they come. I selected Gene out of literally dozens of investors I could have chosen because Gene is one of the most successful investors that I’ve ever met, and has one of the more unusual investing strategies that you seldom hear about.

Gene told me this story himself during a casual visit to his office a few years back. Gene’s main strategy is keeping up with what state and local governments are planning to do, especially as it pertains to development of new projects.

Back in 1975 Gene was at a Department Of Transportation meeting when they decided to put an extension of an expressway system right through his small town. Through this public process, which anyone can attend, Gene discovered exactly where the new exits would be located for this expressway. Though the area was totally undeveloped, and at that time had virtually no value for immediate commercial use, Gene raised $86,000 and bought 100 acres surrounding the area where one of the planned exit ramps would be located.

During the ensuing years, Gene kept that land and paid very low property taxes, and waited for the expressway and the exit ramps to be built. It would be about 15 more years before the area became highly desirable for commercial use. But it eventually did. Today Gene prefers to offer 100 year leases to commercial clients, and has gas stations at this exit, restaurants, hotels and several other businesses, with land left over for new clients. If someone wants to buy an acre of this land, Gene’s asking price is $1,000,000 per acre. Not bad for an original investment of $860 per acre.

The main keys to his success are the ability to be very foresighted about what would happen in the future, and the patience to take advantage of it. In the years since that original purchase, Gene has duplicated this model many times over and owns a wide variety of commercial properties with tenants that include every one from mom and pop businesses to oil companies to fortune 500 retailers. He is a buy and hold guy all the way, and prefers to hold and lease rather than sell outright.

Investor number two: Mary

I had to get at least one of the ladies in here. I chose Mary because she too has a very unique storys as well as a creative approach to real estate investing.

Mary’s parents emigrated to the U.S. after barely surviving World War II in eastern Europe. After losing everything they had during the war, they arrived in the U.S. with nothing, to start a new life in America. Mary was born some years after their arrival in the U.S.

Today she is a highly successful real estate broker, who has her own realty company in addition to her investing activities. Mary owns apartments, buys and sells single family houses and has a typical investing business. But she did a deal once on a mobile home park that was very clever and something that you don’t hear about every day.

The mobile home park was one that had a reputation for drugs and trouble. The previous owners had allowed the park to run down, and because several of the tenants were involved with using and selling drugs, most of the better tenants had moved out, leaving the park half empty as well. But Mary is a bold investor who knows the real estate business inside and out. She saw something in that park that no other investor saw.

After closing on the park she promptly informed all of the current residents that there would be a crackdown on drugs and drug dealers. Using the legal tools at her disposal, she quickly rid the park of all those who had been identified as problem tenants or involved in drugs. Then she cleaned up the park to make it more desirable for future occupants.

Mary also had a creative idea up her sleeve that was truly a stroke of brilliance. While doing her due diligence on this park, she discovered that each of the individual mobile homes also had their own septic tank. Many communities of this type have several units sharing one tank, but in this case, they all had their own.

Because of this fact, Mary was able to get each of the units in the park rezoned as individual residences, with each lot partitioned into an individual parcel. As a result, Mary was able to offer the units for sale with owner financing. People could come in and buy their own unit instead of renting.

It worked like a charm and Mary sold the units off to owners instead of renting to tenants. The result was a higher cash flow per unit, while avoiding headaches and costs of maintaining the units. A run down, drug infested park was transformed into a major cash cow. Mary never stops learning, and considers all of the strategies that may be employed when looking at a potential investment.

In my next article, I’ll feature two more professional investors who have been wildly successful.

Donna S. Robinson is a real estate investor located in Atlanta, GA. Follow her on twitter at donnaconsults. Her facebook page is facebook.com/realtybizconsulting Her latest book, Basics Of Real Estate Investing” is now available on Amazon.com

The 12 assets contributed by Prologis have been appraised at approximately JPY 173 billion ($2 billion). Mainly comprising properties located in Tokyo and Osaka, the newly establish portfolio totals 9.6 million square feet (890,000 square meters), the weighted average age being of 3.4 years.

NPR has already been approved for listing on the Tokyo Stock Exchange. The real estate investment trusts will serve as a long-term investment vehicle for modern logistics facilities.

As part of NPR’s efforts to expand its portfolio, the trust already has exclusive negotiation rights for another eight properties owned by Prologis. Through the sponsor support agreement, Prologis will also provide pipeline, operational and personnel assistance. Moreover, Prologis’ wholly owned subsidiaries will act as NPR’s property and asset managers.

Although the sponsorship is a great opportunity for the US-based Prologis, it not intended as a securities sales offer in the United States, as securities may not be offered or sold in the United States unless they are registered or exempt from registration. Yet the high-profile player in the industrial real estate market comes with valuable expertise which will benefit NPR. Focusing on global and regional markets across the Americas, Europe and Asia, Prologis currently owns or has invested in properties and development projects from 21 countries which will amount, upon completion,  to about 565 million square feet (52.5 million square meters).

The report shows a great contrast between prime assets in key locations and the rest of CEE countries, the difference only getting bigger. Quality asset in Warsaw, Moscow and Prague are quite attractive, while the rest of the CEE region shows extremely feeble interest when it comes to commercial real estate investments.

Offices are the most liquid segment, amounting for 44% of the volume, according to the report, but that is due to a low supply in quality retail assets. The industrial segment is also showing some increase in investment interest, a trend to watch in 2013.

“Due to high levels of vacancy and relatively low net absorption in recent years, investment in the office segment in Prague has remained low. Prime assets are in demand, however, and are proving difficult to obtain,” said Jos Tromp, Head of CEE Research & Consultancy, CBRE. “The purchase of City Green Court by Deka from Skanska for around €54 million confirmed the prime yield levels quoted for Prague. In Warsaw more offices were traded during 2012; however, investors have also started to price in the risk of vacancy increasing over the next 12-18 months.”

Mike Atwell, Head of CEE Capital Markets, CBRE, added:

“With the pricing of prime office assets relatively stable in most segments and markets, thus far pricing for secondary offices – even in the most liquid cities – has moved by at least 75-100 basis points to date. Some investors have started to show interest for value-add opportunities in prime office locations in order to pro-actively prepare for the anticipated increasing vacancy. The yield gap between prime offices in the capital and regional cities amounts to around 150 bps. Generally the gap between prime and secondary is expected to increase through to the end of 2013.”

This commercial property is located in the St James’ district of the British capital city and has previously belonged to RREEF Real Estate, the property branch of Deutsche Bank. The building is currently let to banking group HSBC, the lease being valid until 2023, giving an investment yield of approximately 5.4%.

The oil-producing nation of Azerbaijan is also working on finalizing another acquisition in Europe, the Actor Gallery shopping complex from Moscow, a transaction valued at $102.5 million, according to data from research company Real Capital Analytics (RCA).

Azerbaijan is not the only country whose state funds who has recently invested in London. Sovereign wealth from Qatar, Malaysia and Norway have also completed billion dollar investments in offices and shops in the city, as Britain is viewed as a safe market due to its relatively stable political and legal climate.

Having a growing number of countries interested in buying European real estate was a predictable trend according to Joseph Kelly, RCA’s director of market analysis:

“There’s a lot of emerging market investors like Brazil and Malaysia that are looking at Europe to put their money after making it in their home countries.”

St James is one of the very hot commercial areas right now – the rents, over 100 pounds per square foot, make it the most expensive in the world. The district is popular with hedge funds and private wealth managers.

Before switching to buying real estate in London, the recently wealthy nation of Azerbaijan has invested millions of dollars in skyscrapers in the country’s capital city, Baku. The country is focusing on modernizing Baku, a goal they have been working towards since 1991, when Azerbaijan became independent.

Photo source

© Sergej Khackimullin – Fotolia.com

However with commercial property you have much more control over creating real value in the property.  Here are some basic things you can do to increase the value of your commercial real estate investment.

1. Raise the Rents.  If your rents are below market average then you are essentially giving away part of your earnings to your tenants.  Do a rent comparable with other similar buildings in your area to see what the average rent per square foot is.  Then as your tenants leases expire raise your rents so you are in line with this value and your NOI will go up accordingly.
2. Lower your Expenses.  This produces the same results as raising rents except you can normally do it immediately and not have to wait for tenant leases to expire.  Again, look at your expenses and compare them to the norm for your type of property.  You may be paying too much in property insurance or maintenance services or cleaning supplies, etc.  Any place you can lower your costs without significantly lowering the quality of the services provided will increase your NOI.
3. Upgrade the Property.  This may not seem to make much sense as property upgrades cost you money but in the long term upgrades will make you money.  They do so by making your property more attractive to future tenants and therefore allowing you to charge these tenants a higher rent.  It also can justify rent hikes to current tenants when their leases expire.  A tenant who is asked to pay more for the same space may decide to shop around but if the building has been upgrading and the tenant is reaping the benefits of these upgrades then they are more likely to agree to the rent increase without shopping around for a new building and incurring the expenses of moving.
4. Change the Use of the Property.  In some instances a property can become obsolete for what it was originally built for.  If a property was originally build as an apartment complex it may be possible to convert it to office space and be able to collect much higher rents.
5. Add more Services.  This is different then upgrading the physical structure.  If you add services like a cleaning company, conference rooms, fitness center, etc, then you can in turn charge higher rents for the building since it is now more attractive to potential tenants.
6. Lower your Property Taxes.  Many times the tax assessor’s office uses incorrect data when updating or calculating a properties tax liability.  By asking for a reassessment of your tax bill and providing the tax collector documentation as to why you feel the tax bill is to high you may be able to lower your taxes, especially if your building is in an area with declining property values and has not been reassessed for several years.  Lowering your property taxes in turn lowers your costs and increases your NOI.
7. Make Tenants Pay for Additional Services.  If your building currently offers garbage pickup, electricity, water, cable or any other service as part of the tenants rent, you can increase your NOI by making the tenants pay all or part of the cost of these services.  This is in essence the same as a rent increase except you are justifying it by making the tenants pay for additional services they are receiving instead of an increase just for the actual space they occupy.  This is especially effective when bringing in new tenants who are not used to having these services “for free”.
8. Renegotiate Leases.  Every time a tenant leaves and a new tenant comes in you incur expenses.  Whether it be advertising costs, painting, carpeting, customization of the space, etc.  It is in your best interest to keep the same tenant in a space as long as possible, even if it means making slightly less on the rent.  See if you can get tenants to sign longer term leases.  This gives the tenant rent security to budget their expenses and gives you the security of knowing you do not need to pay to re-lease the space every two years.
9. Hire new Management.  People tend to get in a rut.  A management team that has worked the same building for years may become complacent and not act aggressively to bring in new tenants at higher rents.  New management can bring in fresh ideas on increasing income and reducing expenses without lowering the operation efficiency of your property.
10. Divide your Vacant Land.  If you own a large parcel of vacant land that is zoned for residential use you can add value to that land by having is sub-divided into individual parcel lots suited for single family homes.  This is attractive to a developer who wished to buy your land since it saves them the time and expense of getting this done and allows you to charge more for the land, per parcel, then you would have received as a whole.

Daniel Doran is a 20+ year veteran in the real estate industry. He is a previous owner of a law firm, mortgage and title company. Daniel has also written several books on mortgage modification, short sales and real estate investing. He currently specializes in Commercial Finance and Real Estate Development and is a graduate of Manhattanville College and Brooklyn Law School. You can contact Dan at Buildings By Owner.

© Junial Enterprises - Fotolia.com

With the real estate market is still in a state of flux, and with foreclosures still accounting for a large percentage of the market, real estate auctions have become a more popular sales method amongst both homeowners and professionals. The advantages of real estate auctions include a time specific liquidation of properties that is beneficial for both buyers and sellers. The numbers of auctions taking place nationwide is steadily increasing, and every type of property is being sold. The PropertyAuction.com survey allows clients to assess industry activity last year, and to see their predictions for this year. The topics of survey included frequency of auctions by region, auction type, online bidding, mobile accessibility, the use of social networking, advertising allocation, and the rate of success.

The survey found that the South West, Central, and Southeast regions of the United States had the highest number of real estate auctions last year, with states on the West Coast seeing the lowest numbers of auctions. This data is in agreement with media reports, as states such as Nevada and Florida are still struggling with high levels of foreclosures. Participants in the survey revealed that signage was the most effective method of promoting real estate auctions last year, with the Internet being the second most effective advertising tool. This was In spite of spending an average of 44% of their overall budget on print advertising.

The survey also asked respondents about their predictions for this year, and found most thought homes, condos, and co-ops would be the most popular assets brought to auction. They forecast commercial land as the least likely to be brought to auction. Auctioneers and real estate professionals are predicting the Southeast will have the highest number of auctions, and that lender REO is likely to be the most frequently auctioned property type this year.

Almost 50% of the UK's commercial property lets are up for renewal in the next three years. Image by Not forgotten

Apparently these disputes are likely to arise over the question of dilapidation claims and might result in costly legal battles as tenants could be faced with huge bills at the end of their lease with landlords looking to claim as much money as possible. Dilapidation costs arise because of a tenant’s legal duty to repair any deterioration or damage to the property at the end of their lease. The trouble is that many of the valuations carried out are highly subjective and open to dispute, and according to a report in Citywire the number of disputes is rising and legal battles can cost millions of pounds.

Jones Lang LaSalle has estimated that 50% of all shopping center and high street leases in Great Britain will come to an end by 2015, with around 50% of these expiring within the next couple of years. Around 6.2 million ft.² of office space in London will be affected by lease expirations or breaks this year with another 8 million ft.² due for we negotiation in the cities of Birmingham, Manchester and Leeds, as well as the South East. Some of these leases are 25 years old and were written during the 80s when the high streets and shopping centers underwent something of a boom. Such properties are likely to be pretty outdated, and there are likely to be disputes over who is liable for the cost. Some landlords are being less than honest as they are trying to claim for refurbishments they have no intention of making, while others are using the potential cost of refurbishments to keep tenants who may want to break their lease early.

According to the Jones Lang LaSalle survey, just 18% of tenants in London negotiating lease renewals between this year and 2016 have reached new agreements on leases.

Asia Pacific real estate declines on back of weak market sentiment © Rodrigo Roy Boncato - Fotolia.com

The decline of 39% from Q1 to Q2 follows the earthquake and tsunami in Japan, and the recent economic troubles in the Eurozone and the US. The Pacific region is recovering from a slow start to the year, and increased by a massive 228% quarter on quarter, while transactions in Asia dropped by 52% quarter on quarter.

Australia currently accounts for 24% of total investment in the Asia Pacific region, and proved particularly attractive to investors looking for core quality buildings in established markets. Investors included Asian buyers who were keen to capitalize on the Sydney office market, especially as demand for premium office space is expected to increase over the next few years.

Income producing properties are also proving particularly popular as the Sofitel Silom Hotel in Thailand was recently sold to an owned associate of The Pioneer Global Group. However market interest is also focused on strategically located sites, and REITs and other listed property companies continued to purchase properties both within their own borders and in other countries. They accounted for 27% of all commercial real estate transactions.

Real estate experts have commented that even though activity has fallen, there is still a significant volume of investment capital and a real shortage of better quality assets for sale. The market is also affected by the limitations imposed on lending in China and Hong Kong which has led to buyers expecting discounts to offset their increased borrowing costs.

Most analysts think the Asian real estate market is still well positioned to deal with the current global uncertainty, remaining an attractive medium-term investment. In general, the Pacific region expects an improvement in economic growth over the next year, depending on the global economy, and investors are expected to continue focusing attention on quality Australian commercial property.