A Commercial Real Estate Boom Creates Jobs and Sparks Economic Growth on Many Levels

Real estate, not one region is equal to another, so I want to dive into commercial real estate, this is a topic that I can talk about for hours and hours but I'm not going to do that today but I do want to touch on what’s going on out there. There is a resurgence of development and its not specific to New York City or Miami, its global, there are a number of condo developers looking to build the next luxury tower for the jet setters and billionaires of the world while others are in motion that are solely focused on building rental units while yet another group are looking to build true commercial projects that create jobs.

I think that the later is what I am most passionate about and that’s because it doesn't matter how many condo or rental developments you build if jobs are not created then where is the growth?, its not there.

This is what has impacted the growth of the United States over the years as we moved from being a manufacturing country to a service country, with the service not being that great it has hindered our growth as a whole. So when true commercial developments are slated to be developed anywhere, whether it be New York City, Los Angeles, Miami, Detroit, anywhere in the USA, it’s a plus for our economy.

Especially as tax incentives usually follow in line with these new developments allowing for major companies to take advantage of these incentives thus creating jobs on a larger scale.

If you have the jobs in an area then you have residents, if you have residents then you will need housing and this is what helps the residential developers to flourish. So we need more commercial developments that will create jobs, period the end. They will not only create construction jobs but also be attractive to companies in potentially relocating to a certain area, this relocation does a lot for a town or city as it can spark an attraction for more companies to relocate or develop offices in that town or city. Everything trickles down if done the right way.

I know that there are a multitude of residential agents that are barking right now but unless you can provide concrete facts that show developing more luxury residential buildings add to the economy of a town or city above developing commercial properties to attract major corporations thus creating more jobs then you have to look at the bigger picture. The more jobs Then the more people The more people the more they will need housing, The more local spending and the beat goes on. That is the boom that a residential agent or broker wants not a slow down to a big halt.

Part of what is sparking growth in these residential developments are private equity, yes indeed, we are not going to get into it today but there are a number of private equity firms that are able to offer foreign investors something pretty special, in the USA its called an SB-5 and it actually goes by other codes in other countries but it gives an investor the ability to gain citizenship through such investments. This is a hot topic that we hope to be touching on next week on “Money Never Sleeps” as this is not specific to the real estate industry but it impacts the film and entertainment industries as well. It’s pretty interesting and kinda scary at the same time but it’s alive and well.

When you see these big investments into, even a luxury residential unit, and it’s by a foreign investor chances are it’s not just about the investment but all the perks that come along with it as long as that foreign investor is aligned with a broker worth their salt and knows the path to take.

Anyhow we will be bringing an expert in that arena on the radio show so that we can tackle the facts on SB-5 and its actual impact, good and bad.

On the stock front I really don’t think that homebuilders such as Toll Brothers (TOL), Beazer Homes (BZH) , KB Home (KBH), PulteGroup (PHM) or LGI Homes (LGHI) will be in continued growth mode unless jobs are created to allow the millennials to afford them. With mortgage rates at all time lows, something that will probably not last through 2015, but one would think that more young people would be willing and able to purchase a home.

That is the furthest thing from the truth or reality.

More and more young people either recent grads entering the workforce or even those that have been in the workforce for a while, they are doing one of two things, living at home with their parents or renting.  Some of them are so bogged down in debt from schooling that it’s become increasingly difficult to get their head above water.

So that is part of the problem, a problem that University administrators or U.S. officials need to figure out and fix. The other issue is the lack of jobs with true growth, yes there are jobs out there but these grads are looking for a career not just a job. So creating these opportunities is what comes from making doing business in the United States attractive, but there has to be momentum beyond Google (GOOG), Facebook (FB) or Amazon (AMZN) setting up shop and locking down tech talent.

Manufacturing needs to come back to the forefront in my opinion, make it attractive to build automobiles in the USA again give General Motors (GM) and Fiat Chrysler (FCAU) and Ford (F) the incentives they need to do just that. The US Government did bail out at least one of them very heavily right? Tesla (TSLA) is doing it so why is it a far stretch, it shouldn't be.

Give tax breaks to the likes of Apple (AAPL) to manufacture here, build facilities and grow in the USA, so much more can be done beyond this.

Doing any of this will create viable career geared jobs, get America really working again, increasing the amount of first time home buyers hitting the market and breeding prosperity on a larger scale.

As always never take the opinion or views from one source as the only view, do your due diligence when seeking to invest and consult with your financial advisor.

Remember that anyone that has any questions in regards to commercial real estate they can feel free to contact me on SeekingAlpha.com , CurbStreet.com , Twitter @louisvelazquez or via the ucwmagazine.com website, I will get back to you as soon as I can.

Louis Velazquez

Host- “Money Never Sleeps” Radio Show

www.louisvelazquez.com

www.ucwmagazine.com/moneyneversleeps

Markets Are Jittery , Investors Are Confused And The Guiding Light Is A Flicker In The Night

I mentioned in a previous article that oil prices will have a trading range for a while and right now we are at the bottom of that range. Crude oil falling below $80 for the first time since June of 2012 is important and what’s also important is that this is the fourth straight day, as of this article, of crude oil dropping.

Granted that when green technology advances the drop in crude oil, in my opinion, will bring it much lower over time but we are years away from that even getting any real traction.

As the onlookers and doomsday machines out there spread the gloom and doom of the markets, this drop in crude oil and the markets in general is actually a buying opportunity for investors, well for investors that can see the light beyond all the background noise. Trust me that hedge funds and private equity firms are looking to sop up all the juice that is left on the ground from investors fleeing for safety but what’s confusing is where is the danger?

A correction in any market is healthy, it straightens things out a bit and weeds out the hanger-on’s and creates opportunities for those that can see it. It can be the market as a whole or an individual stock, having a good broad view of an industry helps out a lot because it gives you the tools to connect the dots.

For instance you have many speculators racing for the next big stock that may be a beneficiary as the Ebola crisis heats up. This is not an epidemic in the United States or any other countries other than in West Africa, this is the first point. I lived in West Africa for a time and if people really knew the living conditions in some regions they wouldn’t be surprised of an outbreak of any disease, this is just the one that came back home. As a humanist I do want a quick cure for Ebola to come into play to help those people in West Africa that cannot afford the medical treatment BUT is that going to shake things up enough to give a massive boost to the company that develops it? In my opinion not really, it’s a great idea but I don’t see this as being a truly viable long term investment. Perhaps for a trading pop but it could come back to bite ya potentially if you’re not on top of it.

So the media hype will keep it in front of us but in the end I really don’t see it as being a major investment opportunity as the media paints the picture of an impending global disaster.

Jumping back to the oil arena, there is one company that I do think will benefit as the exploration for oil continues not only in the Middle East but in the United States. The company is called Geospace Technologies and they are in the business of manufacturing equipment that gathers and processes seismic data and monitors producing oil and gas reservoirs.

As I mentioned on the radio show “Money Never Sleeps” there is an oil exploration company in the Midwest that is actually making new discoveries, so with the need at this point to extract more oil out of the ground technology becomes pretty important.

The stock has been trading in the $27 to $30 range over the past five trading days but I don’t see this as a trade but more as a position that could pay off nicely in the next six months or so. With a P/E ratio of about 7.35 for a technology company, its not bad, granted its oil industry related however technology companies always evolve and I think in this case even longer term this could do very well.

A year ago November the stock traded over $100 per share it closed yesterday at $29.70.

It trades on the NASDAQ under the symbol GEOS, its worth a look but as with anything please do your own due diligence and make informed decisions.

Next one that may be a nice play on the dropping oil prices is Stone Energy, the company trades on the NYSE under the symbol SGY and they are an independent oil and natural gas exploration company. They are taking advantage of technology by implementing horizontal drilling techniques to extract natural gas from the Marcellus Shale in the Appalachian Basin.

What’s that mean? In plain English they can drill sideways to hit deposits that traditional drilling methods would not be able to hit, so hit the sweet spot and the spigots open up wide.

The stock has a 52 year high of $50 and its trading near its low which was $21.50, it closed at $24.16 on October 15, 2014. With a P/E of about 17.75 and a market cap of approximately $1.27 Billion I do think that this one may be primed for a rebound on a long term basis. I don’t see it as a short term trade but longer term I see the company making new discoveries and strategic alliances as technology advances.

Let me close out this article on the Ebola topic, I doubt that they will find that miracle cure anytime soon so this will breed fear as the media continues to implant that in the minds of their listeners and viewers. So this could adversely impact airlines as telecommuting to meetings may be a viable replacement for now, it may positively impact medical technology companies that be providing equipment and devices for hospitals preparing for more cases to arise and it will definitely put a spotlight on the quality of life in West Africa which I know all too well.

As always do not solely depend on the opinion of one person, do your own due diligence and become as informed of an investor as you could be. Otherwise consult with your financial advisor for professional guidance.

Feel free to contact me with your input or questions either on here, SeekingAlpha.com , Curbstreet.com or on Twitter @louisvelazquez

Louis Velazquez

Host – “Money Never Sleeps” Radio Show

www.louisvelazquez.com 

www.twitter.com/louisvelazquez

www.ucwmagazine.com/moneyneversleeps

BREAK THE RULES

IF you paint within the lines, live inside the box and Obey ALL the rules then you'll miss all the fun. Life isn't meant to be lived by other peoples rules, you have to live life to the standard that you want to live it and sometimes breaking the rules is part of that deal. We're not talking about breaking the law lol just breaking the rules set in place by others that are not helping you to be the best you that you can be.

So break those chains, kick that box away and become a rebel because its those rebels, those free thinkers, those dreamers that wind up being the ones that change the world. Carpe Diem my friends and never let anyone tell you that you can't because if you can't its because you didn't want it bad enough.

Be someone that paves the way don't be a sheep waiting for the slaughter, we have only one time around this life and if you're not trying different things, experimenting, learning, not afraid of failing and jumping through life then what are you doing really? I want all of you to think about that, what are you doing with your life that will leave a mark behind?

Lets start a conversation about this because its important and one way to pay it forward by sharing our thoughts

- Louis Velazquez
www.louisvelazquez.com
www.ucwmagazine.com/moneyneversleeps

Society of American Business Editors and Writers, CNBCs Squawk Alley and Mark Cuban on Money Never Sleeps

From the pages or actually radio waves of Money Never Sleeps, I wanted to take the opportunity to thank the Society of American Business Editors and Writers for their recent conference in New York City last week, there were some really great speakers such as Bob Sullivan, he gave some great insight that was well received by financial journalist not only stateside but international journalist, I did get a lot from his panel, make sure to check out his latest focus called "The Restless Project" which encompasses economic anxiety and technology disruption that are impacting U.S. Families, you can follow him on twitter at @RedTapeChron. Others that gave some really great insight and had the minds working overtime were Blake Ellis of CNN Money, Amanda Gengler of Money Magazine, Kelli Grant of CNBC, Daniel Marson of the University of Alabama, Tim Mullaney of TheStreet.com, Greg McBride of Bankrate.com, Michele Raneri of Experian, Joe Ryan of Newsday, Charlie Wells of the Wall Street Journal, the awesome Lauren Young of Reuters and Mandi Woodruff of Yahoo Finance. 

They all made some great contributions to the panels and even gave me a thought or too, definitely looking forward to having some of these great minds on "Money Never Sleeps" in the near future. Let me not forget the President and CEO of the National Endowment for Financial Education Ted Beck, great work!

All great journalist that contribute a ton to the next generation of financial journalist that may be coming out of CUNY Graduate School of Journalism, man you have to see that facility, high tech to the max, gotta love it.

I've been tweeting this out over the past few months, first that CNBC, since we are on the topic of financial journalism, but that CNBC should have a dedicated show solely for the technology arena, which they now have, featuring Jon Fortt , Carl Quintanilla and Kayla Tausche, but that was step one my next twitter input is CNBC really have a truly tech driven set, something that will draw the attention of the tech community as well as the financial community as opposed to it just being a financial set with a tech name, so I'm hoping for CNBC viewers that this happens as it will give a new dimension to the show Squawk Alley which airs Monday through Friday 11am sharp. You can follow them all on Twitter to get the latest from Squawk Alley.

Just stating on the CNBC topic for another couple of minutes, with the extreme volatility in motion and tons of confusion as where the market is going and what should you do, the one thing that I will say that you need to do is be well informed. So do yourself a favor and DVR these three CNBC shows, one if "The Halftime Report" with Scott Wapner, Pete Najarian, Mike Murphy, Steve Weiss and the rest of the round table, "Fast Money" with the same lineup and "Mad Money" with Jim Cramer, these three shows will put in layman terms what you should use to keep yourself informed during these turbulent times in the markets, both domestic and internationally.

Ok now its time to touch on the owner of the Dallas Mavericks, cast member of the popular show "Shark Tank" and just one shrewd businessman that has not fear in speaking his mind, that man is Mark Cuban. Recently he brought to light a topic that most Universities see as taboo, and that is the topic of "Student Loans." His view, which I actually agree with, is that if the government caps the amount of money that a student can borrow per year that this may spark the higher end Universities from continuing to raise their tuition fees while not budging on paying their professors more. Its funny but where is that tuition money really going? See Universities get donations from their wealthy alumni and then they build more and more. Prime examples in New York City are NYU and Columbia University, they receive hefty donations, have hefty tuitions, get tons of help from the city and state to acquire land to build more structures and still those tuition rates keep escalating and if a student doesn't have a wealthy family or sugar daddy its time to get a loan. So they get the loan and by the time they finish school they are in heavy debt.

Sure they got the education and hopefully they will land a great job but even if that occurs they are behind the eight ball from day one, so I’m sure there is a better way to go about all this, I'm not the expect and neither is Cuban however just bringing attention to the matter may spark some really smart person to come up with a solution and then a really passionate person to fight for it. When those people come to light I will definitely give them time on "Money Never Sleeps" to lay it on us.

- Louis Velazquez
Host- “Money Never Sleeps” Radio Show
www.louisvelazquez.com
www.ucwmagazine.com/moneyneversleeps

Gold, Oil and 3D Printing Technology

Money Never Sleeps, the show where we touch on anything and everything that impacts the flow of money from around the corner to around the world.

Now I want to talk about 3D technology, I've always been a big advocate of this type of technology as I see this as definitely being the future for fabrication of parts for Cars, Homes, Airplanes, they are even working on using 3D printing in the medical industry to fabricate artificial hearts, and other organs. I'm sure that its not far off that they will be able to actually have functional 3D printing of body parts as they showed in Johnny Depps movie Transcendence, Hey they have already created life like artificial skin and muscle that is 100 times stronger than what we naturally have so why not right? 

I've always said that if they can create something in a movie studio chances are they will be able to create it in the real world, we've seen it before and we will see it again, if you can dream it you can do it.

I want to switch gears to talk about commodities, more specifically gold and oil, there has been a guessing game as it relates to where both are going and let me chime in with my thoughts. Lets start with Gold, there is a ton of skepticism that gold will go to $2,000 or $2,500 per ounce, they are basing this on the weakness of this and lacking of that, in reality unless there is some serious geo-political impact on global currencies there is not going to be a mass run to find shelter in gold, so lets get that out of the way. I was trading gold in the $300 and $500 range where it wasn't cost effective for mining companies to extract it from the ground and now at over $1,220 per troy ounce, and yes a troy ounce is much different than the ounce that you use daily, a troy ounce allows for one universal measurement for metals, anyhow at over $1,220 per troy ounce I still think it has some more room to come in, probably to the tune of $1,000-$1,100 per troy ounce before you see it glide up a bit but I don't think we will see the $2,000 range but over time we may see $1,500.

Yeah I know that a lot of you gold lovers out there are rolling your eyes or blasting me at this point but unless you can bring hardcore facts to the table and not just an hunch or a gut feeling to the table then what I have said is what I am sticking to for the foreseeable future.

I've been to the jungle to extract gold, I've been to major refineries to smelt and stamp gold shoot I'm an Alumni of the GIA, I've been around this so much that I should have a solid gold plaque on my desk so I do have an idea of what I am talking about and again these are my opinions you can come to your own conclusions as its very important to do your due diligence and be well informed.

Now lets touch on oil, there are so many views and opinions on this topic but in the end what will impact the price of oil is technology plain and simple. The less dependent countries become on oil as being their prime energy source and move over to solar, wind and hydro, the less the demand will be for oil and the less the price will be as a result, pretty simple in theory anyway. The major oil companies are not interested in that happening but in reality if there were really smart they would be investing in technology as GE does to buck the trend that will be coming. 

I say that because of human nature, once you see that a person or company can achieve something there is something inside of us that lets us know that we can as well and for those select few that think they can achieve more, well usually they do as they put their minds to the test. So I'm certain that we will see this technology being developed by startups and taken over by one of the big boys in time.

But in the meanwhile oil is still very important and there is significant oil in the United States that can be tapped into still, I know this because a little known company has begun to do it and I plan on speaking more in-depth about this in the coming weeks as the company itself is restructuring in order to take advantage of the assets that lay right beneath their feet. SO just to give my thoughts on the direction of oil and here it is, I see oil having a range in between $80 and $100 for the foreseeable future as the only thing that will impact it over that range is some crisis in the Middle East or technology hitting the market that doesn't involved oil and that technology is coming, trust me on that one.

- Louis Velazquez
Host- “Money Never Sleeps” Radio Show
www.louisvelazquez.com
www.ucwmagazine.com/moneyneversleeps

MONEY NEVER SLEEPS

Money Never Sleeps, the show where we touch on anything and everything that impacts the flow of money from around the corner to around the world. First off Happy Columbus Day for our listeners in the United States and Happy Thanksgiving to our Canadian listeners.

This week I'm going to be touching on a number of topics and companies, over the coming weeks I am planning on bringing on guests that are in the private equity, real estate, commodity, cannabis, yes I said cannabis as its big business now, I'm also going to bring on some traders to get their insight on the state of the market and because I think its very important we want to put a spotlight on startups as well, brining on some startup CEO's on the show to see what the future may be with the products that they are bringing to the table.

Fiat Chrysler merged on October 12, 2014, yes yesterday it was finalized and they began trading today on the New York Stock Exchange. Now the company was rolled into a new Netherlands corporation and there are a lot of reasons for that, especially when it comes to importing materials. The Netherlands is an extremely strategic location in Europe not only for shipping but for creating underlying subsidiaries in other lower taxed countries which allows these companies to avoid getting taxed to death, not to avoid paying taxes but to avoid getting taxed to death.

They have joined the likes of other major corporations who also have main or subsidiaries incorporated in the Netherlands such as Cisco, Mead Johnson, Nike, Google, Starbucks, Tesla Motors, Facebook, Booking.com and a whole host of others.

The reason that I point this out is that it is without a doubt one of the smartest things that they did in order to allow them to transport through out Europe avoid the constant tariffs that come into play. When you ship from the Netherlands you have already paid the lowest tariffs but get a huge tax break when shipping to other European Nations. Anyhow that is only one benefit of a whole host of others that are in place in the Netherlands.

Let me just add that Rotterdam is the major port in Europe and they are adding to this port which will make it an even more integral port in doing business in Europe.

Some of the brands, just in case you didn't know which are wrapped up in the new Fiat Chrysler include of course Fiat and Chrysler but also Ferrari and Maserati, so when you see those fierce monsters on the road you know its a Fiat Chrysler car.

This is a great segway into Tesla Motors.

I really like what Tesla's founder, the Guru of Tech some even call him the real life 'Tony Stark', which he very well may be, but I like what he's doing, Elon Musk is a visionary. He is not looking at the next quarter but he's looking at the future for all mankind. Now that is a wild thought isn't it, but through out history the most impactful people, the ones that become iconic are the ones that tried to change the world for the better and trust me Elon Musk is etching his name in that granite slab along with all the iconic names from Davinci to Newton to Washington on down the line. So doing some good in the world is beyond dollars and Pound Sterling it’s about forging the future which is what he's doing.

Now that I touted Elon Musk just about enough, Tesla unveiled the Tesla D, it showcased an upgraded all-wheel-drive with a dual motor system that gives it the kick that consumers were looking for, its the top sports car of electric sports cars but with a price tag well over $100k it may be out of the reach for the average Joe but still its one step in the right direction. Investors weren't thrilled with the unveiling however Musk doesn't produce products to boost the stock price he produces products that will evolve and I'm very sure that this will evolve over time into a more affordable vehicle. I can't give short term insight on the ups or downs of the stock price itself but long term, as I feel with Amazon, Google and Facebook, long term they are all going to be winners as well as leaders in industry beyond technology.

I just need to add this, which I found to be very interesting, one of the high end sports car companies that are jumping into the electric vehicle game, believe it or not, is Lamborghini, yes Lamborghini, they are looking to launch its first ever plug in hybrid which was unveiled at the 2014 Paris Motor Show, its said that is can travel as far as the Chevy Volt in electric mode. Now if this is true then why are we not embracing this technology more?

Elon Musk made it easy for companies like Exxon, Citgo and other gas companies to implement electric stations at their current gas pump stations, so lets see what 2015 brings.

- Louis Velazquez

Host- “Money Never Sleeps”

www.louisvelazquez.com

www.ucwmagazine.com/moneyneversleeps

Commercial Real Estate: Continued Growth in New York City and Beyond

The One Thing That Will Never Be Reproduced is Land

There is always a constant growth spurt somewhere in the world, where new opportunities arise and a boom in the area begins. Buildings go up, houses get built, shopping malls appear and the people flock to it if the area offers job opportunities. The trick is having the vision to see where that boom may take place, for those who look carefully enough it becomes pretty clear.

There are a few places in the world that real estate never tends to get old and is always in demand, one in particular is New York City, and believe it or not with all the congestion and buildings butted up against each other the growth spurt is continuing. It is not only in Manhattan but its through out the 5 boroughs, again if you look carefully you will see the areas that will be in play.

Manhattan has seen a flock of developers swarm around Harlem but for those that had vision they benefitted from the incentives that the state gave for them to roll the dice, now with the development boom in the area those incentives are all but gone. The Upper East and West side are always in demand but there are a few solid areas that are still in play but at the beginning stages and I’ll just reserve that information to share with my clients. Point is that opportunities are still there.

Brooklyn had the same type of effect and it all started with the waterfront properties and those closest to Manhattan, Williamsburg Brooklyn was targeted by developers early on because it is literally one stop away from Manhattan. The area attracted hipster residents who couldn’t afford the Lower East Side rates and now those original hipsters have been pushed out replaced by those that are more affluent. This is the process, the area gets developed and there is a big shift in the face of the neighborhood. This has spread to Greenpoint, Red Hook and other areas of Brooklyn YET there is so much more to come.

One area of Queens that has had somewhat of that effect is Long Island City or LIC, a name that the community board and city are considering changing to make it stand out and not have an association with Long Island itself, believe it or not. Queens sits on Long Island as does Brooklyn but neither of them are a part of Long Island, if that makes any sense. Anyhow the development of LIC is still taking shape although many high end condo and coop buildings were erected over the years. The trick is to attract more major businesses to come into the area, which brings us back to commercial real estate.

And finally The Bronx and Staten Island are feeling their way around but due to the distance from Manhattan, even a boat ride across the water may not spark the boost to come close to the Brooklyn or Queens boom.

The new Mayor of New York City is trying to put through a standard for developers of multifamily units that would force them to have a 50/30/20 division, meaning 50% of the residences will be at market value, 30% will be for middle income families and 20% will be specifically for low income families. So imagine having a luxury high rise building and you have to adhere to those standards, it wouldn’t be so exclusive anymore would it?

Though I understand the concept of people in the community not being priced out of the market, there should be a better way to handle it, so only time will tell what comes out of it.

Anyhow in short as you can see there is still much opportunity in an area such as New York City, commercial real estate is in play in many other cities but you need to have the vision to see it and getting there first is not always the most popular move but it can pay off in spades if the bet is correct.

I’m always open to connecting with other commercial real estate professionals, buyers and sellers globally so feel free to contact me.

Louis Velazquez

@louisvelazquez