- Blackstone’s Real Estate Co-Head Reveals How It Will Spend New $30B Fund “Blackstone Global co-Head of Real Estate Kathleen McCarthy told Bisnow where the new fund will be putting its money, and even more interestingly, where it won’t be following the final close of Blackstone Real Estate Partners X — the largest fund ever raised, not only in real estate but in private equity writ large.” (Bisnow)
- Office Building Owners Snubbed by Life Insurance Lenders “Many of these insurers have slowed or stopped making office loans, executives and analysts say, interrupting the sector’s decadelong expansion into commercial property lending. Insurance firms have become skittish about rising vacancy rates and falling rents, reflecting the growing popularity of remote work and return-to-office rates that are still around half the levels workplaces enjoyed prepandemic.” (The Wall Street Journal)
- Bank Pullback Drives More Real Estate Financing to Shadow Lenders “But while regional banks are more exposed to commercial real estate than systemically important banks like J.P. Morgan and Wells Fargo, chatter about their exposure is something of a red herring. Much of the risk lurks instead in alternative lenders such as real estate investment trusts (REITs) run by the asset managers Blackstone and Apollo, which have flourished since Congress passed the 2010 Dodd-Frank Act to regulate Wall Street, driving more activity into non-bank financial institutions.” (American Prospect)
- Commercial Real Estate Is Not As Big of a Threat to Banking As People Think “That fear is the likely reason that everyone, from economists to pundits to that guy at the dinner party who thinks he is an economist, is warning that commercial real estate defaults could be the next big systemic lynchpin. The alarm bells started ringing when two smaller banks went under last month and haven’t stopped since.” (Propmodo)
- Commercial Real Estate Faces Short-Term Challenges But Could Have Long-Term Opportunities “The post-pandemic return to office may have gotten off to a slow start in parts of North America. But Colin Lynch, Head of Global Real Estate Investments at TD Asset Management, says the current climate shouldn’t be seen as the new normal and may provide investment opportunities.” (Seeking Alpha)
- How real estate investors are facing a core-asset shortage “For years, buying some of the largest commercial real estate buildings in Asia Pacific (APAC) was the standard route into the sector for many investors. But as more capital flows into real estate, competition for core assets has intensified. It’s made finding those prized deals much more challenging.” (JLL)
- The Rise of Office-to-Residential Conversions “However, converting an office building into residential units comes with challenges, including location, building configuration and high costs. For these conversions to become more than just a niche opportunity, government incentives will be necessary to make them more viable. California, Baltimore and Chicago are already taking steps toward this end.” (Commercial Property Executive)
- WeWork Fighting to Remain Traded on the New York Stock Exchange “The coworking firm — which has struggled to keep its head above water for the last few years — announced Wednesday morning that it received a noncompliance notice from the NYSE that it could be delisted. WeWork leaders said the company will make an effort to avoid that outcome and will officially respond to the NYSE within 10 days with a plan to avoid becoming a penny stock.” (Commercial Observer)
- Harlan Crow: There’s nothing wrong with my friendship with Clarence Thomas “In an exclusive interview, the Dallas real estate magnate explains his relationship with Supreme Court Justice Clarence Thomas, his love of American history and wanting to stay out of the limelight.” (The Dallas Morning News)
- IKEA Makes Biggest Ever Investment in U.S. With 17 New Stores “Ingka Holding BV, the biggest owner and operator of IKEA stores, said Thursday it would spend 2 billion euros, the equivalent of $2.19 billion, opening 17 new U.S. locations over the next three years. The investment will also be used to bolster its fulfillment network to improve its delivery services, the company said.” (The Wall Street Journal)
- Blackstone's First-Quarter Earnings Plunge on Real Estate Slowdown “Blackstone Inc, the biggest manager of assets such as private equity and real estate, said on Thursday its first-quarter distributable earnings fell 36% year-on-year, as a weak property market stopped it from cashing out on some holdings.” (Reuters)
- Real Estate Spreads Are Out Of Whack: How To Take Advantage “Individual property cap rates are substantially below implied cap rates of the REITs resulting in a favorable ~200 basis point spread in buying certain REITs. As spreads normalize, the mispriced REITs should generate significant outperformance.” (Seeking Alpha)
- NYU Launches First Student-Led REIT Fund To Provide ‘Experiential Learning’ “The fund will invest in U.S.-listed REITs only, as well as real estate operating companies and homebuilders. It won't use derivatives or incur leverage, and any earnings it makes will be reinvested into the fund.” (Bisnow)
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