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Wyndham hotel Jonathan Weiss/Shutterstock

12 Midweek Must Reads for Real Estate Investors (Oct. 18, 2023)

Choice Hotels International offered $9.8 billion in stock and debt assumption to buy out Wyndham Hotels & Resorts, reports CoStar News. Cohen & Steers looked at what the September selloff in publicly-traded REITs said about the market. These are among today’s must reads from around the commercial real estate industry.

  1. Choice Hotels Offers $7.2 Billion in Cash and Stock, $2 Billion in Debt Assumption to Buy Wyndham “Choice Hotels International executives are publicly offering a combined $9.8 billion to purchase Wyndham Hotels & Resorts after claiming the latter company walked away from the negotiating table ‘a few weeks ago.’ Wyndham officials have responded to the offer calling it risky and ‘not in the best interest of shareholders.’ Choice's offer includes $7.8 billion in combined cash and stock and another $2 billion in assumed debt.” (CoStar News)
  2. Why the Federal Government Can’t Shake its Empty Office Space “Late this past summer, Paul Walden, executive director of the federal Public Buildings Reform Board (PBRB), briefed the Federal Real Property Council on what its 24 agencies could do to streamline their respective office space. The PBRB itself was preparing a report to Congress about disposing of unneeded federal offices in cities such as Washington, D.C., and Atlanta, areas with large amounts of federal workspace. The idea was not just to reduce space in the remote work era but also to save some tax dollars in the process.” (Commercial Observer)
  3. Putting the September Selloff in U.S. Listed REITs into Perspective “U.S. listed REITs sold off 7.0% in September; as of the end of the third quarter, they were down 11.7% from their July peak (Exhibit 1). Last month was the worst month of the year and represents the third-worst September monthly performance since 1995. The sector faced continued headwinds at the start of October, with returns down an additional 1.9% over the first week of the month, but it rallied back and is down only .3% month-to-date as of October 10. As of October 10, the FTSE Nareit All Equity REITs index now stands 4.2% below its prior August 21 low, 12.0% below its July peak, and almost 30% below its peak in 2021.” (Cohen & Steers)
  4. Goldman Sachs Profit Plunges on Impact from Fintech Sales, Real Estate Bets “Real estate investments were another drag on earnings as the bank booked an impairment charge of $358 million. That weighed on revenue from its asset and wealth management unit, which slipped 20% to $3.23 billion. But investment banking offered some hope as fees at $1.55 billion was largely unchanged from last year as debt underwriting activity resumed and the market for initial public offerings picked up.” (Reuters)
  5. Has Proptech Funding Turned the Corner? “The news surrounding investment in proptech, and much of technology in general, has been consistently bad through much of 2023. Now, however, some investors and entrepreneurs are beginning to see some green shoots amid the autumnal browns. Over the first half of 2023 in particular, the funding news ran the gamut from bad to horrible. But, like a Major League team making a playoff wildcard run after a bad first half of the season, even tepid performance seemed to tease some hope.” (Commercial Observer)
  6. WeWork Names David Tolley as CEO to Boost Turnaround Efforts “WeWork on Monday named interim Chief Executive David Tolley as its CEO, tasking the former Blackstone executive with turning around the flexible workspace provider's ailing business. WeWork's shares were up 2% at $2.41 in premarket trading. Tolley, who was CFO of satellite operator Intelsat from 2019 to 2022, has been a WeWork board member since February 2023 and was interim CEO since May 2023.” (Reuters)
  7. Rite Aid Files for Bankruptcy Protection, Plans Store Closings “Pharmacy chain Rite Aid, facing significant debt and plagued by litigation related to filling prescriptions for opioids, filed for Chapter 11 bankruptcy protection in a move that's expected to lead to the closing of hundreds of its stores. The Philadelphia-based company in a statement Sunday said it had received a commitment of $3.45 billion from some creditors and lenders to support its business operations and to financially restructure. The retailer, which had already been shutting stores, has more than 2,100 retail pharmacy locations across 17 states. Its voluntary Chapter 11 petition was filed in New Jersey, and The Wall Street Journal reported the chain is looking to reject 168 leases in connection with the filing.” (CoStar News)
  8. ‘Enormous’ Amount of Capital on Sidelines Means Now Is Time to Buy Multifamily “With strong fundamentals, new construction starts and a sizeable amount of capital on the sidelines, ‘now is the right time to buy’ in multifamily, according to John Sebree, senior vice president and national director, Multi Housing Division, at Marcus & Millichap. Speaking in a recent news video by his firm, Sebree said, ‘Occupancy remains very high, rent growth continues to be very strong, and we’re dealing with a housing shortage in this country and there has been an unprecedented amount of new deliveries.’” (
  9. American Work-from-Home Rates Drop to Lowest Since the Pandemic “The push by employers to get American workers back into the office appears to be working. Fewer than 26% of US households still have someone working remotely at least one day a week, a sharp decline from the early-2021 peak of 37%, according to the two latest Census Bureau Household Pulse Surveys. Only seven states plus Washington, DC, have a remote-work rate above 33%, the data shows, down from 31 states and DC mid-pandemic.” (Bloomberg)
  10. The Real Estate Tycoon Whose Fingerprints Are on the Menendez Indictment “Mr. Daibes, 66, was accused of giving the Menendezes bribes in exchange for the Democratic senator’s efforts to help him in the bank fraud case by installing a U.S. attorney inclined to ease up on the prosecution. Envelopes stuffed with cash bearing Mr. Daibes’s fingerprints and nine bars of gold bullion with serial numbers tracked to him were seized during a search of Mr. Menendez’s home, according to federal prosecutors in Manhattan.” (The New York Times)
  11. What Happened to San Francisco, Really? “The change has been unsettling because the city’s broad project is widely shared. Since the end of the industrial period, the main path of the U.S. metropolis has been what’s often called urban renewal: transforming old frameworks into beautiful, dynamic settings for prosperous middle-class life. No city excelled at the assignment more than San Francisco. It invested in lush, landscaped parks, tree-lined boulevards, and world-class museums where there had been none. It grew rich, and seemed to climb out of the Great Recession with both influence and a mandate.” (The New Yorker)
  12. China Bet It All on Real Estate. Now its Economy Is Paying the Price. “When China’s housing boom seemed like a one-way bet, Gary Meng’s parents bought an apartment from China Evergrande, the country’s biggest developer. Soon the company called with another pitch: to manage their wealth. It was a good deal with little risk, the family thought. Evergrande had global recognition and was a politically important company at the heart of China’s growing economy. They invested all their savings. Then the unthinkable happened.” (The New York Times)
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