Real estate prices bottom, but remain stagnant

Transcription

1 Real estate prices bottom, but remain stagnant United States Index 2000Q4 = Commercial RE prices House prices Sources: Standard & Poor's and Fiserv, Moody's Investors Service, Moody s Analytics

2 Construction put-in-place United States Percent change, year ago Residential Nonresidential Sources: U.S. Census, Moody s Analytics.

3 Construction put-in-place By non-residential sub-sector Percent change, year ago Commercial Office Lodging Sources: U.S. Census, Moody s Analytics

4 Commercial real estate valuation and delinquency trends Index December 2000= Price Index (L) Percent Delinquency rate (R) Sources: Moody's Investors Service, Moody s Analytics.

5 Moody s Real Commercial Property Price Index By property sector Index Q4 2000= Industrial Retail Apartments Office Sources: Moody's Investors Service, Moody s Analytics.

6 NCREIF Property Index returns Recent returns by property sector Percent Apartments Retail Industrial Office Hotels Sources: National Council of Real Estate Investment Fiduciaries (NCREIF), Moody s Analytics.

7 Office space supply and demand United States Thous., sq. ft. 12,000 10,000 8,000 6,000 4,000 2,000 Net absorption (L) Completions (L) Vacancy rates (R) *Forecast 16.8% 16.6% 16.4% 16.2% 16.0% 15.8% 0 Q Q *Q *Q *Q *Q *Q % Source: National Association of Realtors, CBRE Econometric Advisors.

8 Industrial space supply and demand United States Thous., sq. ft Net absorption (L) Completions (L) Vacancy rates (R) 50,000 *Forecast 40, % 14.0% 30, % 20, % 10, % 0 Q Q *Q *Q *Q *Q *Q % Source: National Association of Realtors, CBRE Econometric Advisors.

9 Retail space supply and demand United States Thous., sq. ft Net absorption (L) Completions (L) Vacancy rates (R) 2,500 *Forecast 2,000 1,500 1, % 13.1% 13.0% 12.9% 0 Q Q *Q *Q *Q *Q *Q % Source: National Association of Realtors, CBRE Econometric Advisors.

10 Multi-family space supply and demand United States Sq. ft. 120, ,000 80,000 60,000 40,000 20, ,000 Net absorption (L) Completions (L) Vacancy rates (R) *Forecast Q Q *Q *Q *Q *Q *Q % 6.0% 4.0% 2.0% -40,000 Source: National Association of Realtors, CBRE Econometric Advisors. 0.0%

11 Vacancy rates By property sector Percent Office Retail Apartment Sources: REIS, Mortgage Bankers Association.

12 Average asking rents By property sector $/sq. ft. 35 $/month 1, Office (L) 1,050 1, Retail (L) Apartment (R) Sources: Mortgage Bankers Association, REIS.

13 Delinquency rates By property type Percent 20 Hotel Multifamily Industrial Retail 5 Office Sources: Moody's Investors Service, Moody's Analytics.

14 Capitalization rates By property type Percent Office Industrial Retail Multifamily Sources: American Council of Life Insurers, Moody's Analytics.

15 Sales of commercial properties over $5 million By property sector US$ billions Office Retail 120 Industrial 100 Apartment Sources: Real Capital Analytics, Mortgage Bankers Association.

16 Mortgage Bankers Origination Index 2001 quarterly avg = 100 US$ millions Source: Mortgage Bankers Association. Avg Loan Size (R) Mortgage Bankers Origination Index (L)

17 New private housing units authorized by permits United States Millions of units 1.8 Thousands of units or more units (R) Single-family units (L) Sources: U.S. Census Bureau, IHS Global Insight.

18 CMBS Issuances US$ billions $80 $70 $60 $50 $40 $30 $20 $10 $0 Sources: Commercial Real Estate Direct, Mortgage Bankers Association.

19 Basis Points CMBS spreads Source: TreppWire.

20 Commercial and industrial loans Loans at all commercial banks Compound annual growth rate Sources: Federal Reserve Bank of St. Louis, Moody s Analytics.

21 Top 10 markets by smallest change in vacancy rates Metro Q (%) YOY Chg (bps) San Jose New Haven-Fairfield County New York City Sacramento Denver Tucson Philadelphia Washington, DC Boston San Diego Average Sources: Marcus & Millichap Research Services, REIS, MBA

22 Top 10 markets by greatest change in vacancy rates Metro Q (%) YOY Chg (bps) Dallas- Fort Worth Las Vegas Houston Charlotte Kansas City Indianapolis Salt Lake City Columbus Oklahoma City Orlando Average Sources: Marcus & Millichap Research Services, REIS, MBA

23 Interest rates Fed funds rate vs. 10-year bond yield Percent year T-note yield Federal funds rate Sources: Federal Reserve Board, IHS Global Insight.

24 Real gross domestic product United States Compound annual growth rate Sources: Bureau of Economic Analysis, IHS Global Insight.

25 Job market showing modest improvement Non-farm employment, United States Percent change, year ago Difference from previous month Absolute change, ths. (R) % change (L) Sources: Bureau of Labor Statistics, IHS Global Insight.

26 Consumer Sentiment Index University of Michigan Index 1966Q1= Sources: Federal Reserve Bank of St. Louis, University of Michigan, Moody s Analytics.

27 Headline CPI inflation gaining momentum Overall vs. core Consumer Price Index Percent change, year ago Overall Less food and energy Sources: Bureau of Labor Statistics, IHS Global Insight.

28 Jan-92 Jan-93 Jan-94 Jan-95 Jan-96 Jan-97 Jan-98 Jan-99 Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Dow Jones Equity REIT Index Total Return Index, Jan-90= Source: Moody s Analytics.

29 Real Estate Investment Trusts Net acquisition of financial assets US$ billions Sources: Federal Reserve, IHS Global Insight.

30 REIT issuance Common equity and unsecured debt Sources: NAREIT, MP3 Capital Partners.

31 REIT IPO Performance Company IPO Price ($) YOY Change IPO Change IPO Date Hyatt % 74.48% Nov-09 Pebblebrook % 8.05% Dec-09 Chesapeake % % Jan-10 Piedmont % 36.07% Feb-10 Terrino % % Feb-10 Chatham % % Apr-10 Excel % % Apr-10 Hudson Pacific % % Jun-10 Whitestone % 19.20% Aug-10 CoreSite % -3.37% Sep-10 Campus Crest % 11.28% Oct-10 American Assets 20.5 n/a 5.76% Jan-11 Summit Hotel 9.74 n/a 5.13% Feb-11 Preferred Apt 9.75 n/a -2.40% Mar-11 STAG Industrial 13 n/a -6.62% Apr-11 Source: NAREIT: IPO Rundown 2011

32 2011 Equity REIT IPO Candidates according to NAREIT Company Industry S-11 Filed Size ($ml) Inland Western Retail (IWST) Retail 14-Feb Schottenstein Realty Trust (SCRT) Retail 13-Apr RLJ Lodging Trust (RLJ) Hotel 13-Apr NAREIT Shadow Candidates: CenterPoint Properties Archstone Hilton Equity Office Malkin Stonehenge Morgan Healthcare Trust of America Moinian Group Industrial Apartments Lodging Office Office Commercial Hotel Medical Commercial Source: National Association of Real Estate Investment Trusts

33 Homebuilder Stock Performance SNL Homebuilders Index Homebuilder TOTAL RETURN (%) Week of April 21 Month Q1 YOY Symbol Beazer Homes BZH Brookfield -5.4 na na na BRP Comstock CHCI DR Horton DHI Hovnanian HOV KB Home KBH Lennar LEN MDC Holdings MDC M/I Homes MHO Meritage MTH NVR NVR Pulte PHM Ryland RYL Standard Pacific SPF Toll Brothers TOL

34 Mortgage REITs Registration Statements on File with SEC TMAC Mortgage Capital Provident Putnam Mortgage Pimco REIT Apollo Residential American Capital AG Mortgage Investment Raise ($Millions) Sources: Wall Street Journal; Securities Exchange Commission

35 United States Home Ownership Rate Source: National Association of Realtors

36 Median Price of an Existing Home Source: National Association of Realtors

37 Total Annual Existing Home Sales Source: National Association of Realtors

38 Existing Home Sales Median Price Change Percentage Change Source: National Association of Realtors

39 Existing Home Sales Percentage Change Source: National Association of Realtors

40 Regional Existing Home Sales Source: National Association of Realtors

41 National Housing Inventory 2011 Number of Months of Supply Source: National Association of Realtors

42 Existing Home Sales 2011 Sales by Price Range Source: National Association of Realtors

43 Existing Home Sales by Price Range Percentage Change Source: National Association of Realtors

44 The Employment Picture Bureau of Labor Statistics latest report The US unemployment rate declined from 8.9 percent in February to 8.8 percent in March. 34 states saw a decline in the unemployment rate in this month with New Mexico, Florida, and Nevada seeing the largest fall. The unemployment rate was unchanged in 9 states and DC. In March, North Dakota, Nebraska, and South Dakota had the lowest unemployment rates all under 5%. Rhode Island, Florida, California, and Nevada had the highest rates among the 50 states and DC.

45 The Employment Picture Bureau of Labor Statistics latest report 38 states had positive job growth in March Average job growth was 0.1%. The greatest job growth in March was in Missouri, while Maine had the largest job decline. Moving forward, increasing labor force participation may keep the unemployment rate high even as jobs are being added.