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11 Must Reads for the CRE Industry Today (Feb. 26, 2021)

Commercial landlords are finding investors interested in providing bridge loans for project revamps, reports The New York Times. The Wall Street Journal looks at what mom-and-pop apartment landlords need to know when their tenants stop paying rent. These are among today’s must reads from around the commercial real estate industry.

  1. Landlords Hungry for COVID-Era Revamps Are Finding Hungry Investors “Roughly $4 billion of collateralized loan obligations were issued through the middle of February, a 46 percent increase over the same period last year, according to JPMorgan research. At the same time, new issues in the market for commercial mortgage-backed securities — another type of debt, where real estate borrowers lock in longer-term financing — were down about 8 percent.” (The New York Times)
  2. Your Tenant Stopped Paying Rent During COVID. Here’s What You Should Know “Real estate has been touted by financial advisers as a stable investment for those seeking a passive source of income in retirement. But instead of boosting their income, some retirees who invested in residential rental properties are now losing money due to eviction moratoria resulting from the coronavirus pandemic. Faced with tenants who can’t pay rent, these mom-and-pop landlords are finding their hands tied under the governmental orders, making them especially vulnerable and, in some cases, at risk of losing the properties securing their retirement.” (Wall Street Journal)
  3. Nursing Homes, Once Hotspots, Far Outpace U.S. in COVID Declines “From late December to early February, new cases among nursing home residents fell by more than 80 percent, nearly double the rate of improvement in the general population. The trendline for deaths was even more striking: Even as fatalities spiked over all this winter, deaths inside the facilities have fallen, decreasing by more than 65 percent.” (The New York Times)
  4. H1 2021 Construction Outlook “Although the economic recovery is underway, the construction industry has not yet reached the bottom. The coming year will look unlike anything we saw during the last recession and recovery cycle. Nonresidential construction is declining, single-family construction is booming, and construction cost growth is picking up steam. JLL’s 2021 H1 Construction Outlook addresses what the intersection of these trends means for the construction industry and construction costs in the coming year.” (JLL)
  5. Some Investors Face ‘Colossal’ Losses on U.S. Treasury Bonds as Yields Surge “The multidecade-long bull market in Treasurys has delivered rich gains to patient investors, but a 2021 bond-market selloff is likely inflicting significant pain on some market participants. Though many were expecting yields to rise this year as the reflation narrative gained ground, few were prepared for the rapid rise in long-term bond yields since the start of this year. Yields move in the opposite direction of bond prices.” (MarketWatch)
  6. There’s a Hidden Financial Drawback to Remote Working “A new working paper from researchers at Harvard University examined how much households with remote workers spent compared with their peers who commuted to work, prior to the COVID-19 pandemic. And while it might be feasible that these remote-working households could move to more distant, potentially cheaper locales, in reality they didn’t necessarily save money. The amount of money households spent on housing, as a share of overall spending, was more than 7% higher for remote households than for non-remote households who lived in the same commuting zone.” (MarketWatch)
  7. CoStar’s Revenue Grew 19% Last Year as CRE Shifted Operations Online “CoStar made three acquisitions last year and experienced revenue growth from its online property listing platforms during the pandemic.” (Bisnow)
  8. Best Buy Workers Powered Through the Pandemic. Then They Lost Their Jobs “Best Buy Co. said sales surged in the holiday season as homebound consumers splurged on televisions and other electronics, but warned that its torrid growth would slow this year as people returned to traveling and dining out. The electronics retailer has been laying off workers and cutting hours for some store workers in recent weeks. The company is accelerating its plan to adapt to what executives think is a longer-term shift to online buying, including shrinking its store workforce and using more store space to fulfill online orders.” (Wall Street Journal)
  9. Target to Roll Out Dedicated Apple Shops Inside 17 Locations “Target is pulling shoppers away from malls as it begins to open dedicated Apple shops in 17 of its locations starting this month, according to a Thursday press release. Target plans to expand the Apple shop-in-shops by the end of the fall. Apple products are already sold in Target stores, but the dedicated shops would double the tech giant's footprint in select stores and expand its offerings. The collaboration also expands the product assortment online.” (Retail Dive)
  10. Iconic Steakhouse Peter Luger Fills its Empty Seats with Celebrity Mannequins from Madame Tussauds “Beginning today, customers can slice into one of the restaurant’s porterhouse steaks under the watchful gaze of two-time Golden Globe recipient Jon Hamm. Wax figures of Audrey Hepburn and Jimmy Fallon are also seated in the restaurant, while journalist Al Roker is stationed at the entryway to direct customers to Peter Luger’s second floor. The mannequins will remain on premises through March 1, at which point they’ll return to the recently reopened Madame Tussauds in Midtown Manhattan.” (Eater New York)
  11. 88% of Restaurants Considering Swapping to Digital Menus, Survey Says “Seventy-six percent of restaurants said they will continue offering contactless tech this year, according to Square's Future of Restaurants 2021 report, which includes findings from a survey of 500 operators. The survey, which was conducted by Wakefield Research from Dec. 9, 2020 to Dec. 21, 2020, found that 61% of restaurants plan to continue offering contactless payment options for dine-in customers, while 88% said they would consider swapping in digital menus for physical menus.” (Restaurant Dive)
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