- Office Market Panic Is Easing, But a Critical Period Looms “The office market hysteria appears to be easing — at least if the performance of real estate investment trusts are any gauge. But the office market isn’t out of the woods yet, and risks could loom over the market for years to come if interest rates stay anywhere near current levels. Consider where we’ve come from. The Bloomberg REIT Office Property Index has returned about 25% since its lows in late May, nearly three times the S&P 500 Index. Dividend yield spreads on office property REITs — a rough measure of perceived risk — have plunged back closer to historical norms from their highs after the banking crisis.” (Bloomberg)
- FDIC Starts Marketing $33 Billion of Signature Property Debt “The Federal Deposit Insurance Corp. has begun seeking buyers for $33 billion of commercial property loans from Signature Bank, the latest step in a massive offloading of debt from the bank that collapsed earlier this year. The majority of the loans are backed by multifamily properties, primarily in New York City, the FDIC said Tuesday in a statement. A portion of the loans, about $15 billion, are tied to properties that are rent stabilized or rent controlled.” (Bloomberg)
- Single-Family Rental Firm Taps Former Morgan Stanley Executive as President “Jonathan Pruzan, Morgan Stanley’s former chief operating officer who had been a contender to succeed Chief Executive James Gorman, is the new president of one of the largest investors and managers of single-family rental houses. Pretium, which has a portfolio of about 100,000 houses in more than 30 markets, hired Pruzan to expand the company when high interest rates and tremors in the banking system have created turbulence in the rental-housing market. Pruzan, 55, stepped down from Morgan Stanley in January after working at the investment bank and financial-services company since 1994. He had been one of a handful of contenders to succeed Gorman.” (The Wall Street Journal)
- What’s Worse Than Record High Rent? Record High Rent, Plus Fees “The cost to rent a home or apartment has soared, and it isn’t just because of super high rents. Landlords are hitting tenants with an abundance of fees every month. Many are no more than five or 10 bucks each, but when stacked up they can amount to hundreds of dollars more each year. Some fees, such as those for parking and pets, have been around for years, but many renters now pay up for things they were rarely charged for in the past. That includes fees for trash pickup, pest control, the use of a mailbox, and for making routine maintenance requests.” (The Wall Street Journal)
- One-on-One with Kathleen McCarthy: You Can’t Paint Real Estate with a Broad Brush “Elevated rates, strains on regional banks and dramatic shifts in the ways we work have raised concerns about commercial real estate. Yet today’s market continues to show strong performance in select subsectors. Global Co-Head of Real Estate Kathleen McCarthy explains the unprecedented dispersion we’re seeing and why this market cycle is different from the Global Financial Crisis. She also shares how Blackstone’s experience in prior downturns positions us to capture opportunities today.” (Blackstone.com)
- China’s Biggest Homebuilder Reels as Economy Slows “Country Garden has staved off an immediate crash. It told creditors on Tuesday that it made the interest payments of $22.5 million within the grace period before default. On Friday, the company won a last-minute approval from creditors to postpone repayment of $537 million in yuan-denominated bonds, originally due on Monday, until 2026, according to documents shared by Country Garden. Last week, after reporting a $7.1 billion loss for the first six months of 2023, Country Garden said there were ‘material uncertainties which may cast significant doubt’ on its ability to avoid bankruptcy.” (The New York Times)
- COPT Rebrands to Reflect Dense, Mission Critical Focus “Corporate Office Properties Trust (NYSE: OFC) said it is changing its name to COPT Defense Properties (COPT Defense) to align with its defense and mission critical real estate focus. The REIT said it decided to retain COPT in the new name because its tenants have used the acronym for over 25 years. The ticker symbol for its common shares listed on the New York Stock Exchange will change from OFC to CDP effective Sept.15. Steve Budorick, COPT Defense president and CEO, said the timing of the name change ‘really is to educate current and potential investors, to better inform them of what our strategy is and why it's different from traditional office, and to reaffirm our commitment to only investing in defense assets.’” (Nareit)
- How Remote Work Trends Are Shaping Real Estate Demands “The transformation from traditional office environments to remote work has not only been a response to global events but a marker of a new era in the way we conduct business. This shift is affecting both residential and commercial real estate markets in ways that offer opportunities and challenges for entrepreneurs and business leaders. Let's explore how these trends are unfolding and what they mean for the business-minded. With remote working becoming a more common and accepted practice, the need for dedicated home office spaces has surged.” (Entrepreneur.com)
- Here’s What Real Estate Spent on State Lobbying in New York “Lobbyists arrived in Albany last year ready to talk casinos, zoning and good cause eviction. The state Commission on Ethics and Lobbying in Government’s annual lobbying report detailing 2022’s top spenders included several real estate companies and groups. Homeowners for an Affordable New York was the seventh highest spender overall and No. 2 among property interests.” (The Real Deal)
- Are Proptech Conferences Still Necessary? “Labor Day Weekend signals the unofficial beginning of fall, which means the start of the annual proptech conference season. Ironically, as technology in real estate continues to grow and becomes more intrinsic to the industry, there are questions as to whether proptech-focused conferences are more — or less — relevant than in the past. A number of proptech entrepreneurs and venture capitalists hold vastly different opinions. Meanwhile, a major real estate conference company recently ceased its annual New York City event.” (Commercial Observer)
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