12 Must Reads for the CRE Industry Today (Sept. 20, 2021)

Sears has closed its final stores in the states of Illinois and New York City. A new report from Gensler shows that nearly half of major companies are looking to downsize their office space. These are among today’s must reads from around the commercial real estate industry.

  1. Gavin Newsom signs two laws to ease California’s housing crisis. “Faced with a deepening housing affordability crisis, Mr. Newsom has poured billions of dollars from the state’s budget surplus and federal stimulus packages into investments to ease problems with housing and homelessness. But California remains one of the hardest places in the country to build, resulting in a longstanding housing shortage that is the root of its cost problems.” (The New York Times)
  2. CREW: Pandemic Dealt a Major Setback to Workplace Parity for Women “Although it’s generally acknowledged that the COVID-19 pandemic sent shockwaves through the workforce in 2020, less widely recognized is the disproportionate impact on women. Globally, women lost more jobs than men in 2020, according to a newly issued CREW Network research paper, and while the male workforce has returned to pre-pandemic levels, worldwide there are 13 million fewer women working today compared to 2019.” (Connect Real Estate)
  3. There Are No Easy Answers to Miami’s Condo Collapse “The building’s base is under intense scrutiny, offering what many engineers believe to be the first signs of failure. The tower was built atop a concrete podium, with piles buried deep into the sandy ground to provide stability. A 2018 assessment obtained by the New York Times warned of water damage resulting from storm surge and underground seepage. That same year, an engineering report on the building detailed cracking and crumbling in the building’s support columns, walls, and beams.” (Propmodo)
  4. Nearly Half Of Companies Want To Downsize Their Office Spaces Post-Pandemic: Report “According to a Gensler report released Sept. 7, 39% of top-performing companies said they would plan to downsize after the pandemic. These companies are categorized by the architecture firm as those that have been deemed most innovative, most admired and the best places to work by unspecified ranking lists.” (Bisnow)
  5. More CFOs Add Sustainability Targets to Corporate Loans “Sustainability-linked loans carry interest rates that adjust based on whether a company meets a predetermined environmental, social or governance goal, such as reducing carbon emissions. U.S. companies took out $83.8 billion in such loans through Sep. 16, up from $2.5 billion during the same period in 2020, according to Dealogic, a data provider. U.S. corporate loan volume, including sustainability-linked loans, was $1.7 trillion as of Sep. 16, Dealogic said.” (The Wall Street Journal)
  6. CRE Braces for the Climate Disclosures Regs Coming from the SEC “Few companies provide quantitative metrics on climate risks for investors to consider. That includes real estate companies in two ways: CRE investment firms have obligations to their investors, and it would be next to impossible for any company to report on climate risk without having information about their real estate, whether owned or leased.” (GlobeSt.com)
  7. Realtors Face Federal Scrutiny of Broker Commissions “The Justice Department is investigating home sale commissions, and in a wide-ranging executive order President Biden asked the Federal Trade Commission to adopt rules to address unfair or exclusionary practices in the real-estate industry. Several civil lawsuits challenging industry rules and practices around commissions have survived initial procedural challenges and drawn support from the Justice Department, putting added pressure on traditional broker fees.” (The Wall Street Journal)
  8. Manhattan Businesses Still Struggling To Bounce Back From Coronavirus Pandemic Amid Delta Variant “The real estate firm Cushman & Wakefield reported there are a quarter of ground-floor storefronts in Lower Manhattan that are available for rent amid the pandemic. Meanwhile, around a third of storefronts are available in Herald Square. Although areas across Manhattan have been experiencing a decrease in customers as a result of the pandemic, businesses in Midtown reportedly suffered the most.” (International Business Times)
  9. Credit Suisse Group partners with MARK on $1B-plus rental housing fund “DOMA is targeting single-family homes and small multifamily buildings and wants to eventually acquire a portfolio worth 1 billion euro. The platform was seeded with 700 units across Europe.” (The Real Deal)
  10. Sears is closing its last department store in Illinois, the retailer's home state “The Sears department store in the Woodfield Mall in Schaumburg, a Chicago suburb, will close on November 14. Transformco, which acquired Sears Holdings after the company filed for bankruptcy in 2018, confirmed its plans to redevelop the property.” (CNN)
  11. Sears Closing Brooklyn Store, Its Last Outpost in New York City “But the end of line is near for the chain department store, known for its architecture and 100-foot tower at the corner of Beverley Road and Bedford Avenue. Among the signs: flashy sale posters plastered on the front door. ‘EVERYTHING MUST GO!’ reads one at the entrance. Another reads: ‘FURNITURE, FIXTURES AND EQUIPMENT FOR SALE.’” (The City)
  12. NYC Commercial Rent Control Bill Comes Under Fire During City Council Hearing “The policy would impact retail and office tenants that occupy 10,000 square feet or less, and manufacturing tenants of 25,000 square feet or less. The ten-page legislation, which Levin originally introduced in 2019, seeks to develop a commercial rent regulation framework that resembles residential rent stabilization in New York State. Along those lines, landlords would have to register their commercial rents for new leases with the city after the law takes effect.” (Commercial Observer)
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