I am surprised by the narrow range of industrial capacity (79 - 82%) and the steady year long ascent from June 05 - 06.
Does this mean that industrial capacity is being offshored to meet increasing population (2%?) needs? Given the global nature of today's industry, how does the industrial capacity manage to stay as high as 81.5%? In plant downsizing, (GM) does this register as a loss of capacity?
Calmo,
A steady capacity usage rate implies that capacity is growing right along with demand, rather than having any implication for off-shoring. You'd want to look at the ratio of industrial output vs imports or industrial imports to GDP to get a hanle on the question you've raised.
Kash,
All else equal, you'd expect a pick-up in core inflation given the rise in energy prices, but is all else equal? In prior episodes of rising petroleum prices in this cycle, the rise was often to a new high. The recent rise is within the range of outcomes firms have faced over the past couple of years. Shouldn't them be better prepared now? Don't we also expect the passage of time from the final Fed rate hike to mean forces to limit inflation are becoming stronger? At least till the June data are released. Bernanke's estimate of the lag involved between monetary policy and inflation is 2 years, isn't it?
K Harris: Good point; all else is not equal. If the economy slows, as you suggest, we may not see that uptick in core inflation that I mentioned as a possibility. In fact, that's exactly why I like the core CPI inflation rate as one indicator of the strength of the economy in general.
Louis & Joel Kestenbaum/Fortis Property Group to purchase State Street Financial Center.
Fortis Property Group is leading the “Northeast-based private real estate investment group” that has agreed to acquire the 1 million-square-foot State Street Financial Center at 1 Lincoln Street in Boston for more than $880 million, or $880 per square foot, according to sources familiar with the sale.
The Brooklyn, NY-based Fortis, which includes Louis and son Joel Kestenbaum, and a group of other New York investors are expected to close on the 36-story office tower from a joint venture led by American Financial Realty Trust (NYSE:AFR) and an affiliate of IPC US Income REIT by the end of this year or early 2007.
Fortis apparently set its sights on Boston following several high-profile Dallas deals where it agreed to pay about $280 million for the three-building, 1.4 million-square-foot office complex known as Galleria Office Towers in Dallas. Earlier in the year, Fortis teamed with Trimarchi Management, also from New York, on the nearly $100 million acquisition of two other Dallas office properties, Harwood Center and Saint Paul Place. It also invested in the $282.5 million purchase of JPMorgan International Plaza in Dallas.
The addition of State Street Financial Center will build out Fortis’ portfolio considerably. The privately held firm headed by CEO Jonathan Landau is controlled by the Louis Kestenbaum family. Fortis manages some 3 million square feet in commercial properties and about 454 residential units.
American Financial, a Jenkintown, PA, REIT decided to formally shop the 36-story tower in the last couple of months. The company is pruning its portfolio and repositioning itself. The REIT paid $705.4 million or $688.84 per square foot in February 2004 to acquire the property. Later that year, it sold a 30% stake to an affiliate of Canadian REIT IPC US Real Estate Investment Trust, for $60.3 million.
The building is fully leased with triple A credit tenant State Street Corp. occupying most of the building under a lease that runs until 2023. State Street also leases the property’s 900-space garage on a 20-year triple-net lease.
Commenting by HaloScan
