Emerald Bay Investments Newsletter

Commercial Property Vendor List

Commercial Strength Buffers Slowdown

Commercial Real Estate Hot in Europe

Commercial Leasing and Sale Activity Projected to Rise Slightly

Commercial Real Estate Pro Offers Insights on Sales Leads

Housing Slump to Continue?

The Wall Street Journal (WSJ) reported in the June 9^th edition, that not only will the housing slump continue, but that it will have a ripple effect on the economy as a whole. This will include retail sales.

The 10 year Treasury bond broke the 5% mark. This turn has influence over interest rates and falling stock prices. The increase in interest rates with a tightening in the no money down sub prime mortgage market will make it more difficult for the home buyer to purchase a home. Builders as builders do, they build to much in a hot market causing a glut of homes in a down market. Single Family housing starts have declined 33% since early 2006 and will remain low through the first quarter of 2008 according to the U.S. Census Bureau.

Consumer spending is also decreasing and will continue to decrease as less cash-out mortgages are opened. In 2005 over $700B was borrowed against homes and has declined to around $179B this year, according to Michael Feroli, an economist at J.P. Morgan Chase & Co. With less borrowing there is less spending.

This could affect commercial properties in the retail sector. If retail spending decreases, it would obviously hurt retailers.

Another issue to add to this mix is the weak dollar and foreign investors. This is a buyers market for homes and there are less American buyers due to our lagging economy. RISMedia reports the following: “According to Pete Pietz, an agent with Badger Realty in North Conway, New Hampshire, who specializes in working with international clients: "My phone has been very busy with buyers from the UK, Bermuda and Scotland interested in purchasing investment properties and holiday homes here. A lot of this interest is being driven by the soft market and weak dollar, but there are other factors, too. Like their American counterparts, foreign baby boomers are looking for ways to maximize their return on investments as they approach retirement, and so are purchasing second homes."

A National Association of Realtors survey of home purchases in Florida has shown that 15% of all home sales in that state were to international clients. While such a level of foreign-purchasing activity is not as high in New Hampshire, the White Mountains has seen a sharp increase in real estate purchases by international buyers in the past several years. “

For the whole story: www.rismedia.com/wp/2006-10-17/soft-us-real-estate-market-and-weak-dollar-means-great-potential-for-foreign-investors/

The National Association of Realtors Commercial Division publishes this research. A very interesting read. http://www.realtor.org/Research.nsf/files/CREOJune2007Sum.pdf/$File/CREOJune2007Sum.pdf

Commercial Property Vendor List

PROPERTY MANAGEMENT SOFTWARE
American Computer Software	Property Automation Software Corp.
AMSI	PropertyBoss Solutions
Black Dog Software	Property Solutions International Inc.
Cam Systems Inc./TCG Technologies	Property View Solutions (Remanage, SLA Technologies - PEAK)
Classic Real Estate Systems	RealInsight Inc.
Corrigo Inc.	Realm Business Solutions Inc.
Domin-8 Enterprise Solutions	Remanage Inc.
1477.com	RentRight Inc.
Integrated Business Systems	ResidentSource
Intuit Real Estate Solutions	Sage Office
iRealty Manager.com	Skyline II Software
Jenark Business Systems Inc.	Timberline Software Corp.
LandlordMax Software Inc.	TrackPro Services
LivingNexus	Turtle Creek Software
Logicbuilt Inc.	Winning Edge Software Inc.
OneSite by RealPage Inc.	Yardi Systems

RESIDENT SCREENING SYSTEMS

Accurint	RentBureau
Adrem Profiles Inc.	RentGrow Inc.
AmRent	RentPort Inc.
ClearStar.net	Rent Quest
CreditRetriever/TransUnion Screening Solutions	Resident Check/Allied Cos.
Equifax	Resident Data Inc.
First Advantage SafeRent	Resident Source
Gall & Gall Co.	Tenant PI
Kroll Factual Data	Tenant Tracker
On-site Manager, Inc.	Trak-1 Technology
OneSite Screening by RealPage Inc.	The U.D. Registry
Reliable Tenant Screening	ZipReports LLC

RESIDENT PAYMENT SYSTEMS
AllianceData Systems	Realm Business Solutions Inc.
Apt Connect	RentPayment
CheckFree	ResidentPay by Property Solutions
ClearNow Inc.	Resident Source
Ocius LLC	Resite Information Technology
OneSite Payments by Real Page	Safepak Corp.
On-Site.com	Sure Deposit
Payment Service Network Inc.	TranZero Inc.
Property Bridge

INTERNET LISTING SERVICES
ApartmentFinder.com	Apartments24-7.com
ApartmentGuide.com	ForRent.com
ApartmentHomeLiving.com	Move.com
Apartments.com	MyNewPlace.com
ApartmentSearch.com	Rent.Com
ApartmentSource.com	Rentals.com
ApartmenTime.com

TELECOMMUNICATIONS PROVIDERS
AT&T Smart Moves	Pavlov Media
Bell South Community Technologies	Pin Oak Group
Bright House Networks	Platinum Consulting
CoaXmedia	Qwest
Comcast Cable	RCN
Copper River Technology Solutions	Riser Management Systems
Cox Communications	The Siemon Co.
DirecTV	Spot On Networks
DMISI	Starta Development Inc.
Echostar Communications Corp.	StratComm Inc.
Focal Communications	SysRoute Inc.
Foxcom/OnePath Networks	Telkonet
Hotwire Communications	Time Warner Cable
InfiniSys Inc.	TradeWinds Television LLC
Invisimax	Tut Systems
MDU Communications	UStec
Noment Networks	Verizon Enhanced Communities
NTC Communications	Ygnition Networks
Ortronics

SECURITY
Access Control Technologies	Kwikset
Brinks Multifamily Security	Morse Watchmans Inc.
Gate Packages Unlimited	Network Multifamily Security
Handytrac Key Control	Persona/VingCard
Intelock/BridgePoint Systems	Saflok
Kaba Ilco	Schlage/Ingersoll-Rand Security & Safety Americas
KeyTrak Inc.

PRODUCT PROCUREMENT
AvidXchange	Lowe's
Buyers Access	Maintenance USA
EZ-Cross Inc.	OpsTechology
FacilityPro	Wilmar
HD Supply

CALL CENTERS
Answernet Network	MessagePro
CallmaX	Voicecom
CallSource	Who's Calling Inc.
CrossFire Call Center	Xact Telesolutions

UTILITY MANAGEMENT
Energy Billing Systems	National Exemption Service
Guardian Water and Power	NWP Services Corp
ista North America	SpeedRead Technologies
Inovonics	Studebaker Submetering Inc.
Minol USA	Velocity

Study: Commercial Strength Buffers Slowdown

Daily Real Estate News | June 1, 2007

What’s kept the economy perking during the housing slowdown? Look to the commercial real estate market says the National Association of Industrial and Office Properties.

A recent study conducted by Dr. Stephen S. Fuller, director of the Center for Regional Analysis at George Mason University, for NAIOP Research Foundation credits “the thriving commercial development sector” with buffering the slowdown in the residential sector.

The study found that spending related to commercial real estate added $498.4 billion to the GDP in 2005. By comparison, the federal government’s contribution that year was $498.8 billion.

Spending on commercial real estate included:

$228.93 billion on soft costs (architects, engineering, marketing, legal, management), site development, and tenant improvements
$265.9 billion on the hard costs, or actual construction outlays
$3.6 billion on maintenance

"By 2005, all sub-sectors of nonresidential construction were accelerating, helping to offset slowing residential building construction outlays in 2006 and 2007," Fuller said. "This counterbalance kept the national economy from experiencing a sharper slowdown in the face of rising energy costs and lost output due to Hurricanes Katrina and Rita.”

Most recently, in March 2007, spending costs rose 2.4 percent, which according to Thomas Bisacquino, president of NAIOP, “more than makes up for the 1 percent drop in residential construction.”

Leading States for Commercial Construction Spending

The top 10 states for construction spending are:

California
Texas
Florida
Georgia
Illinois
Indiana
New York
Ohio
Virginia
Arizona

In terms of individual sectors, Texas ranked first for industrial spending, while California led the states in spending for office, industrial, warehouse, and retail categories.

— By Camilla McLaughlin for REALTOR® Magazine Online

Commercial Real Estate Hot in Europe

Daily Real Estate News | June 5, 2007
While residential real estate is cooling in Europe, as it is in the United States, commercial real estate appears to be in hot demand.

The value of investment property in Western Europe, including office and retail space as well as big residential developments, rose 7.8 percent in 2006, says IPD, a London-based research group.

Growth topped 20 percent in Ireland last year and was greater than 10 percent in Britain, France, Spain, and Scandinavia.

The economy is the primary driver. Economic growth was 2.8 percent in Europe in 2006 and is expected to be about 2.7 percent this year, compared with a projected 2.1 percent in the United States. Also interest rates continue to be at 3 percent to 5 percent historic lows, says Sabina Kalyan, chief economist for IPD.

However, Kalyan says the boom may be about over because of the number of mega-deals in the works. The super deals "may signal a turning point in the market, as people seek to cash in," she says.

Source: BusinessWeek Online (05/30/07)

Commercial Leasing and Sale Activity Projected to Rise Slightly

Commercial real estate practitioners can anticipate leasing and sales activity in the third quarter of this year to be approximately 0.8 percent higher than the third quarter of 2006, according to the Commercial Leading Indicator, NAR's forward-looking index for the commercial real estate market. Read more...
http://www.realtor.org/press_room/news_releases/2007/comrcl_2007q1_commercial_index_rises.html?&WT.mc_t=LS060607&WT.mc_n=Comm

Commercial Real Estate Pro Offers Insights on Sales Leads

Listen to a Podcast featuring Andy Florance, president and CEO of CoStar Group, a leading commercial property listing site, on his company's new tools for generating commercial leads via the Internet. Subscribe to the RCA Technology & Intelligence Briefing podcasts from iTunes or REALTOR.org or contact rca@realtors.org to order a free audio CD. Read more...
http://www.realtor.org/ncommsrc.nsf/pages/TechnologyAndIntelligenceV7Florance?OpenDocument&WT.mc_t=LS060607&WT.mc_n=Comm

Study: Who Are Your Future Tenants?

The commercial real estate industry should be encouraged that office-based employment will increase by 6.5 percent between 2004 and 2009 and grow nearly the same percentage in the five years after, according to the results of new research from the National Association of REALTORS® National Center for Real Estate Research. The report is expected to serve as a beacon to help guide where and what types of office space will be needed in the next decade and beyond. Read more...
http://www.realtor.org/ncrer.nsf/pages/commercial?OpenDocument&WT.mc_t=LS060607&WT.mc_n=Comm

Source: National Association of Realtors

Apartment Market in Aspen Sizzles

The Aspen, CO apartment market posted a vacancy rate of less than 1%, according to a Q1 2007 report by the Colorado Division of Housing. Aspen's overall vacancy rate is 0.7%, while Summit County, CO posted a healthy 2.8% vacancy rate in the same quarter. In addition, Grand Junction, CO reported its lowest apartment vacancy rate in more than a decade at 1.5%.

Source: LoopNews June 7^th, 2007

Time for a Makeover: Retail Investors/Developers Pursue Redevelopment Over New Construction

Obsolescence of Older Shopping Centers Seen as Big Factor in Decrease of Retail Property Deliveries Forecast for 2008

One of the biggest industry trends identified at this year's International Council of Shopping Centers (ICSC) Spring Conference in Las Vegas is the increasing prevalence of "re-do's" among retail developers. More and more developers and shopping center owners are choosing to redevelop existing properties as opposed to buying sites and building new. CoStar interviewed retail industry leaders and queried its data-rich CoStar COMPS and CoStar Property Professional modules to uncover some of the factors driving this trend. To read more…. http://www.costar.com/News/Article.aspx?id=E6C4AF80834F214021A9F13FD356205E&ref=100

I hope you enjoy the information I provide. If not please give me some suggestions. I will also love to add your commentary or information to this letter.

The Mastermind in Los Angeles is coming together quickly. Let me know if you have interest in helping or attending. We are working with Harv Eker team to build one of the best Mastermind organizations we can. The working title right now is “Building Wealth through Commercial Real Estate” I will have the website up soon. This is a first come, first served Mastermind opportunity and membership will be limited.

If you have projects you are working on and would like my help. Please contact me to discuss.

“The saddest failures in life are not those that come from pursuing success, but from those which come from not putting forth the power and will to succeed” – JW Najarian

Kind Regards

JW Najarian

818-353-9100