The Real Deal New York

National Cheat Sheet: CBRE named most active I-sales brokerage, Feds urge Zillow to settle over deceptive practice allegations … & more

By James Klatell | August 18, 2017 06:24PM

From left: CBRE offices, Zillow’s Spencer Rascoff

CBRE becomes top investment sales brokerage as overall volume drops

For the first time since 2013, CBRE claimed the top spot among the nation’s most active investment sales brokerages. With 23.2 percent market share in commercial property investment sales, CBRE topped Eastdil Secured’s 20.9 percent share, according to Real Estate Alert’s rankings, which were based on data collected from the first half of 2017. Eastdil’s deal volume plummeted by 19 percent, after star brokers Doug Harmon and Adam Spies defected to Cushman & Wakefield. HFF took the third spot, followed by Newmark Knight Frank. Overall investment sales fell 8.8 percent year-over-year. [TRD]

Why the feds could disrupt Zillow’s real estate disruption
In addition to the waves Zillow is making in the real estate industry — with its New York-area subsidiary StreetEasy charging brokers $3 per day per rental listing, among other controversial moves — the national real estate listings giant is feeling the heat from the federal government. The Consumer Financial Protection Bureau [CFPB] has finished a two-year investigation into Zillow’s alleged violations of laws that prohibit kickbacks and deceptive practices. The government agency looked into Zillow’s “co-marketing” arrangements that allow mortgage lenders to pay for portions of realty agents’ monthly advertising costs on Zillow websites. The company denies any wrongdoing but has been urged by the CFPB to agree to a settlement. [TRD]

Real estate leaders remain largely silent on Trump’s Charlottesville response

Business leaders from across the country have slammed President Trump for blaming “many sides” for the violence of white supremacists and neo-Nazis in Charlottesville, Virginia, but the real estate industry has been comparatively silent. While the president of the Real Estate Board of New York blasted Trump, when The Real Deal reached out to over 50 leaders of development firms, commercial and residential brokerages and public real estate investment trusts, they overwhelmingly either declined to comment or did not respond to requests for comment. [TRD]

Chinese government cracks down on “irrational” overseas investments
After years of soaring levels of investment outside the country, China’s top economic planning body laid out formal rules for foreign investment, forbidding investment in gambling, the sex industry and core military technology and restricting overseas real estate investment. China’s National Development and Reform Commission criticized “irrational” capital outflows. “Some companies focused on property rather than the real economy, which, instead of boosting the domestic economy, triggered capital outflows and shook financial security,” a statement from the organization said, according to Bloomberg. [TRD]

Housing construction starts dipped nationwide in July

Led by a slowdown in multifamily building, housing starts across the U.S. fell by almost 5 percent last month, according to the U.S. Commerce Department. Single-family starts were down by 0.5 percent, but starts in multifamily homes were off by more than 15 percent. Permits for new construction, which serve as a barometer for the construction market, also fell by 4 percent. [TRD]

HomeLight, real estate startup that connects home sellers to brokers, raises $40M

HomeLight secured a $40 million in Series B funding this week, bringing total investment in the company to $55 million. The company, which promises to connect home sellers with the right real estate agent, claims that homeowners who use HomeLight sell 29 days faster than average and get prices 3.5 percent higher than average. HomeLight said its revenue, earned via referral fees when agents close a deal through the service, has grown 500 percent since its last funding round in 2016. [Housingwire]

Cushman & Wakefield buys out partners NorthMarq in four states

The 750 employees and 50 million square feet of real estate belonging to two partnerships between Cushman & Wakefield and NorthMarq will soon be the sole property of Cushman & Wakefield. The Chicago-based company will buy out its partners in both Cushman & Wakefield NorthMarq, operating in Minnesota, and Cushman & Wakefield Commerce, in operating in Nevada, Utah and Washington. [Star Tribune]

Applebee’s will leave the neighborhood in more than 100 locations

The parent company of Applebee’s and IHOP announced plans to close more restaurants this year than previously expected. DineEquity Inc. said this week that between 105 and 135 Applebee’s will be shuttered, as well as 20 to 25 IHOPs. Previous plans indicated that DineEquity would close 18 IHOPs and 40 to 60 locations in the Applebee’s Neighborhood Grill & Bar chain this year. The company’s consolidated revenue fell to $155 million from $160 million at the same time last year, it announced in its second quarter financial results. [TRD]

Major Market Highlights

The solution to New York’s retail market struggles may have popped up

Pop-up shops started out as short-term promotional events — Gwyneth and Kanye have used them — but the so-called licensing deals that govern them are creating a whole new industry in New York’s retail market. With stable, long-term retail tenants in short supply in Manhattan, short-term deals are becoming more popular — and can be beneficial for both landlords and tenants. The landlords monetizes the space while maintaining more control of their buildings, and the tenants claim valuable storefronts without long-term risk. [TRD]

Sale prices for LA condos and co-ops on the rise

The median sale price for condos and co-ops in Los Angeles is climbing, a new MLS report finds. The neighborhoods of Mid-Wilshire and Pacific Palisades clocked the biggest price gains among areas with at least 10 or more unit sales in the second quarter. With a median sale price of $1.3 million, condos in Venice were the most expensive on average, but an estimated $2.5 million sale in Malibu Beach was the priciest condo sale of the quarter. [TRD]

Survey: 83 percent of San Francisco metro area renters plan to leave

Eighty-three percent of renters living in the Bay area plan on leaving the area, a survey by rental site ApartmentList found. Nearly two-thirds of that group cited the cost of living in the San Francisco metro area as the reason they wanted out. The second most popular reason among want-aways was the job market, with 13 percent saying they would leave to find better prospects elsewhere. [Curbed SF] 

Looking for a new home? The market is bigger in Texas

One out of every 10 new homes in the U.S. is being built in Dallas, Houston or Austin, a Trulia analysis of building permits found. The three cities will build a total of 130,000 new homes in 2017 — 50,000 in both Dallas and Houston, while Austin will add 30,000, Trulia reported. [Dallas Morning News]