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11 Must Reads for Real Estate Investors (Oct. 23, 2023)

Non-traded alternative investment fundraising has reached more than $50 billion for the year, through the end of September, according to Robert A. Stanger & Co. More concerns have arisen about the potential broader fallout of WeWork’s struggles. These are among the must reads from the real estate investment world to start the new week.

  1. Non-Traded Alts Raised $51 Billion Through Third Quarter, Interval Funds Lead the Way with Nearly $14 Billion “Non-traded alternative investment fundraising totaled $50.9 billion year-to-date through September, led by interval funds at $13.7 billion, private placements at $13.5 billion, non-traded business development companies at nearly $13.2 billion and non-traded real estate investment trusts at nearly $9.0 billion, according to the latest data provided by investment bank Robert A. Stanger & Co.” (The DI Wire)
  2. More office fallout from WeWork cratering “Landlords that count WeWork as a top five tenant owe about $2.6 billion in CMBS debt, an analysis of Trepp data shows. About half of those loans come due within 12 months and nearly 80 percent are either watchlisted, delinquent or in default.” (The Real Deal)
  3. How WeWork’s Bankruptcy Would Ripple Through Commercial Real Estate “The drama surrounding the coworking pioneer and New York City’s onetime largest private office tenant has already played out in business journals, mainstream newspapers, books, a documentary and even an Apple TV series. Tales abound of damage to investors (such as SoftBank), revolving leadership (CEO Sandeep Mathrani left in May), and more.” (Commercial Observer)
  4. WeWork President, COO Heads For The Exit “Anthony Yazbeck, the company's president and chief operating officer, is departing the company Friday after reaching an exit agreement last week, the company disclosed in a Securities and Exchange Commission filing.” (Bisnow)
  5. Global Real Estate Pressured by Rising Bond Yields in September “The FTSE EPRA Nareit Developed Extended Index (PDF) faced headwinds in September as investors grappled with rising bond yields in the United States and other developed markets.” (Nareit)
  6. Persistent inflation, CRE register as top financial stability concerns “The report also details elevated concerns about CRE related to higher interest rates, falling property values and a long-term weakening in the demand for office space resulting from the widespread adoption of remote and hybrid work. The report points to small and regional banks as being the biggest point of vulnerability on this front, given their outsized holdings of CRE loans.” (American Banker)
  7. Amazon Introducing Warehouse Overhaul With Robotics to Speed Deliveries “Amazon says its new robotics system, named Sequoia after the giant trees native to California’s Sierra Nevada region, is designed for both speed and safety. Humans are meant to work alongside new machines in a way that should reduce injuries, the company says.” (The Wall Street Journal)
  8. Getting Deals Done in a Low-Transaction Climate “Pricing expectations between buyers and sellers are often too far apart and many owners are now choosing a wait-and-see approach if they don’t have to sell their asset in the immediate future.” (Multi-Housing News)
  9. Private-Equity Firms Forced to Kick In More Cash to Shore Up Portfolio Companies “With credit costs at the highest level in years, companies that provide debt for private-equity deals are asking firms to chip in additional equity when they look to refinance, say people who research the leveraged-finance markets and advise private-equity firms on transactions.” (The Wall Street Journal)
  10. Rite Aid’s Empty Storefronts: What Will Fill Them? “Rite Aid needs more than a Band-Aid — as does the retail space left behind by the bankrupt drugstore. Still, the imminent closure of dozens, maybe hundreds, of stores offers opportunities to landlords and tenants alike.” (Commercial Observer)
  11. Cities Foster Serendipity. But Can They Do It When Workers Are at Home? “The clustering itself is a thing that matters, economists have argued, because it helps people trade ideas, land better jobs and find others doing highly specialized things. And those benefits of what economists call ‘agglomeration’ have theoretically grown more important as America has shifted over decades to an economy built on ideas.” (The New York Times)
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