New legislation, introduced by state Rep. Jim Murphy, R-Houston, is intended to help Texas school districts and protect taxpayers whenever tax revenue from valuable commercial properties is taken from one district and sent to another via a system known as recapture. Houston Independent School District is facing the so-called “Robin Hood” scenario after voters in November decided against sending a separate $162 million recapture payment to the state, triggering a process whereby the Texas Education Agency may "detach" commercial properties and reassign their associated tax revenue.
Commercial property price indices (CPPI) continued to either hold steady or trend upward at the end of 2016, the most recent period for which data is available, signaling the likelihood of an extended market cycle. According to the National Real Estate Investor, the Moody’s/RCA national all-property CPPI rose by 1.4 percent in November compared to October. Over a three-month period, the index went up 3.0 percent. Suburban office buildings experienced the most significant month-over-month increase in prices, at 2.6 percent, followed by office properties in general, at 2.1 percent. Retail assets saw the least movement in prices, at 0.1 percent (prices in the sector also fell 0.4 percent over a three-month period). The Moody’s/RCA CPPI is calculated using repeat sales transactions that take place two months before the figures are released.
Property tax bills for New York City commercial real estate owners have soared under Mayor Bill de Blasio, according to city data. While the tax rate for commercial properties increased slightly, the annual increase is driven largely by rising value assessments. The average tax bill, without abatements, is set to jump to $111,023 in fiscal 2017, which ends June 30, from $85,841 in fiscal 2013, the last full fiscal year former Mayor Michael Bloomberg was in office, the data show. In all, the average commercial property tax bill has jumped 29.3% since Mr. de Blasio’s tenure.
Fueled by the rapid growth of e-commerce, the U.S. industrial market is benefiting from tight supply and rising rents and is expected to enjoy sustained momentum throughout 2017. To track the most in-demand markets, real estate services firm CBRE put together a list of cities and regions with the lowest prime yields on logistics assets. The average prime yield for the U.S. is currently 5.84 percent.
As the number of empty storefronts continues to grow across the U.S., signs are pointing to a slowdown for the national retail-property market. Vacancy rates in community shopping centers increased in 30 of 77 U.S. metro areas last year, compared with 24 in 2015 and 19 in 2014, according to data from real estate researcher Reis Inc. Rents, which usually increase roughly at the rate of inflation in healthy markets, decreased in two metro areas for the full year. In the fourth quarter, rents fell in 15 metro areas from the third quarter.
The hotel industry could be facing an uphill battle in 2017 as new supply may erode pricing power and hinder performance. Hoteliers are already seeing performance dip as supply meets and surpasses demand. In a Hotel News Now roundtable, hotel executives and market analysts provide perspective on supply growth and how it will affect the hotel industry going forward. Jan Freitag, SVP of lodging insights at STR (Hotel News Now’s parent company), says new supply will negatively impact occupancies, now more than ever since demand growth will slow. While it remains to be seen how hoteliers react to the new competition in their markets, Feitag expects continued pressure on pricing and limited (average daily rate) increases going forward. Some markets (such as New York City and Miami), however, are already observing pricing weakness and ADR declines.