- Rents Are Falling in 27 of the U.S.’ Biggest Cities and Still Rising in 8 “As Americans become increasingly priced out of homeownership, more have returned to renting, which has caused rental affordability to plummet. But with the slowdown in the housing market, there is finally some good news for renters. Rents fell 0.1% through August across the US's biggest metropolitan areas, according to new data published by Apartments.com. The drop snapped a 20-month streak of price hikes and offered the first sign of relief for renters stuck with few alternatives.” (Insider)
- Property Faces Slow Reckoning as Interest Rates Rise “For property owners, rising interest rates bring back uncomfortable memories of the years leading up to the 2008 financial crisis. Commercial landlords who learned useful lessons about debt since then—except to carry less of it—face a slow reckoning. While interest rates have been rising faster in the U.S., Europe’s real estate owners look more vulnerable to pricier debt. Listed property stocks in the euro area carry net borrowings of 14 times their projected earnings before interest, taxes, depreciation and amortization on average, according to Bank of America, compared with six times in the U.S.” (The Wall Street Journal)
- CoreNet Global Poll: Inflation and Recession Fears Affecting CRE “A survey conducted by CoreNet Global from June to September 2022 has found a strong link between the high rate of inflation, recession fears and a number of corporate real estate decisions. The survey received 175 responses from all regions of the world. While nearly 60 percent of the survey’s respondents say that their companies are growing, three quarters expect the U.S. economy to enter a recession before the end of 2023, and 72 percent said that they see a global recession happening at about the same time.” (Commercial Property Executive)
- The Boom Times in Industrial Real Estate Are Far from Over “Looking at current supply and demand data for the industrial market, there are no signs of any impending slowdown. Vacancies are historically low, rents continue to set records across most markets, and developers are starting to slow the pace of delivery, which drives demand even further. Despite a slower pace of warehousing product coming online due to higher development costs, longer lead times for materials, and more grassroots organizations opposing commercial development in certain markets, demand remains significantly higher than the delivery pipeline for new industrial space in the Northeast.” (Commercial Observer)
- Amazon’s Logistics Pullback Grows to Affect 66 Warehouses “The list of operating and planned distribution facilities from which Amazon is pulling back continues to grow. Since announcing it was pivoting from all-out growth mode to a period of re-evaluation, refocusing and potential contraction, Amazon has closed several operating facilities and canceled or postponed plans for dozens of future facilities.” (Bisnow)
- All Major Categories Point Toward Home-Market Slowdown “Housing inventory in 35 key markets overall was down 35% year-over-year in January, down 8% YoY in March, and is now up 79% YoY, according to market-watcher Bill McBride of the CalculatedRisk blog. August is much of the same, he said. According to McBride’s first, early look at local markets in August, ‘We are seeing a sharp decline in closed sales, and inventory is up significantly year-over-year.’ He said new listings are down as the ‘sellers’ strike’ continues.” (GlobeSt.com)
- Can Real Estate Investors Count on Student Housing to Protect Them from a Recession? “Now that COVID-19 restrictions have eased, students restless from online classes are eager to jump back into the classroom full-time, and college.” (Propmodo)
- ‘The Future of Hospitals’: Flexible Space for the Next Pandemic “To prepare for that shift, designers are thinking about how traditional rooms can quickly morph into isolation wards by upgrading or overhauling their heating, ventilation and air-conditioning systems. Fabrics and finishes, too, are being reconsidered, with an eye toward durable materials that can withstand industrial-level scrubbing. Finally, the pathways that lead to these wards need to be rethought, Mr. King said, ‘so the transportation for patients and staff allows these spaces to be isolated and operated independently from the rest of the hospital.’” (The New York Times)
- ‘Capitalists with a Chip on Their Shoulder’: LGBTQIA+ Community in CRE Still Facing Hurdles “More people than ever before identify as LGBTQIA+ in the U.S., and in spite of some societal progress and stated goals by major corporations to be more inclusive in hiring, promoting and acknowledging members of diverse groups, many real estate professionals in the LGBTQIA+ community feel that these efforts have left them behind. A Gallup poll this year found that 7.1% of adults identify as members of the LGBTQIA+ community, double the figure the organization found when it first conducted the survey a decade ago.” (Bisnow)
- Starbucks Set to Detail Store Investments, New Café Equipment “Starbucks Corp. is expected to brief investors Tuesday on a strategic revamp ranging from store operations to employee benefits, with shareholders monitoring the plan’s potential cost and workers anticipating improvements at stores. Interim Chief Executive Howard Schultz and other company executives are slated to discuss Starbucks’s U.S. and international business throughout the day at the company’s Seattle headquarters. They are expected to unveil some of the updates to store operations that executives have plotted since last year at the company’s Tryer Center technology lab.” (The Wall Street Journal)
- New York Times Is Giving Out Branded Lunch Boxes to Get People Back to the Office—But Over 1,300 Staff Are Refusing to Budge “NYT union staff have tweeted out their distaste as they were given the little lunch boxes as a free perk after the company asked employees to start coming back into the office three times per week post-pandemic. Amid growing inflation, many on staff have said that a simple perk won’t pay their gas prices, transport fares and lunch expenses—and what they really should be getting is a raise to cope with the cost-of-living crisis. More than 1,300 have opted to stay home in protest, including members of the News Guild, Times Tech Guild and Wirecutter.” (Fortune)
- Illegal Weed Shops Are Booming in Plain Sight. Police Raids Do Little to Stop Them. “The success of illegal cannabis shops and the struggles of legal ones in the heart of L.A.’s Eastside offer a stark illustration of how California's legalization of marijuana has gone wrong.” (Los Angeles Times)
- Office Aromas Are Now a Hot New Amenity to Draw Office Workers Back “With workers having discovered that they have the option to do their jobs remotely and don’t have to be umbilically tethered to their workplace, office landlords are leaving nothing to chance. Not even how their buildings smell.” (Commercial Observer)
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