Each Wednesday, The Wrap presents a compilation of recent noteworthy commercial real estate stories from a variety of publications. Below are four stories that caught our eyes in recent days.
• “Congress Looks at REIT Tax Exemption” by A.D. Pruitt of The Wall Street Journal.
As part of its comprehensive review of the tax code, the House Ways and Means Committee is reviewing the tax exemption REITs have enjoyed for decades, Pruitt reports.
“Like all other aspects of the code, it is reasonable to expect that REITs would be included in any top-to-bottom review of the code,” said a spokeswoman for the Ways and Means committee. However, because the exemption doesn’t pose a major loss of revenue to the Treasury, industry officials say it is unlikely that REITs will lose their exemption status, Pruitt reports.
Under the current tax code, REITs do not have to pay corporate taxes on their income as long as at least 90 percent of their taxable income is paid in dividends, Pruitt notes.
• “Don’t Look Now But Warehouse Demand Off to Strongest Start Since 2008” by Randyl Drummer of CoStar.
After finishing strong in 2012, this year is proving to be equally strong for the U.S. warehouse market thanks to increases in trade and manufacturing and the recovery of the housing market, Drummer reports.
Forty-three of the 54 largest U.S. markets posted positive net absorption for industrial space, according to Rene Circ of CoStar’s Property and Portfolio Research (PPR). A recent transaction data survey by PPR showed warehouse new supply and demand at their strongest levels in at least five years.
During the first quarter, developers completed almost 13 million square feet of new warehouse space and 38 million square feet is still under construction, Drummer reports.
• “Hot Hotels: Big Boost Ahead for Lodging” by John Salustri of GlobeSt.com.
If the 2,500 hotel transactions that took place last year are any indication, hotel property asset sales will continue to climb through 2013, according to Gregory LaBerge, national director of Marcus & Millichap’s National Hospitality Group.
Supply was down last year, but demand soared; 2012 posted record room sales at nearly 1.1 billion nights, according to LaBerge.
LaBerge says international business travel and tourism, along with low interest rates, are contributing to the growth in property sales.
National occupancy will rise 60 basis points to 62 percent in 2013, with ADR and RevPAR rising 4.8 percent and 5.8 percent, respectively, according to the National Hospitality Group’s latest report.
In this clip, Matt Bechard of REIT.com sits down for an interview with David Farer, chairman of the environmental department at Greenbaum Rowe Smith & Davis LLP, during the recent REITWise 2013 conference.
The two discuss upcoming environmental legislation that will affect REIT development and trends emerging in green building.