What I’m Reading
Headache: Percentage rents are likely to have staying power for retailers even after the pandemic subsides. However, As omnichannel sales strategies grow more popular, the breakdown between online and brick-and-mortar stores is becoming blurry, making it difficult to establish what sales should be included in the percentage rent calculation. Globe Street
Tailwind: Housing has been one of the few economic bright spots in the US in 2020. This could ultimately lead to a broader recovery thanks to the wide range of economic activity that it typically kickstarts, such as purchases of home furnishings and building materials–purchases that have far-reaching secondary and tertiary effects. It is easy to forget that, absent the last cycle, housing typically leads the US out of recessions. The Capital Spectator See Also: Strong demographics, limited supply and suburban migration indicate that today’s housing boom has staying power. Axios
Shocking: Real estate crowdfunding guru Grant Cardone is facing allegations that he’s misled thousands of investors across the country by falsely promising them annual returns of at least 15 percent and other incentives that never materialized. Anyone who saw his flashy Instagram posts flaunting jets, cars, boats, etc – or read any of the absurd return promises – could see this coming from a mile away. I only wish that I could figure out a way to short these clowns before they blow up or go to jail. The Real Deal
Sounding the Alarm: Fitch Ratings expects life insurers to see 50% more losses on mortgage loans than what they saw during the Global Financial Crisis. Fitch Ratings
Flat Footed: We are about 16 months away from the planned phase-out of LIBOR, the benchmark used in trillions of dollars of CRE adjustable-rate and floating-rate loans. Yet concerns about it’s replacement, SOFR, have led to uncertainty about what index will be applied to legacy commercial real estate lending contracts when Libor goes away- and raised the possibility of litigation between borrowers and lenders. Bisnow
Chart of the Day
Active listings continue to fall, a tailwind to upward pricing moves.
Source: @SoberLook
WTF
Bible Thumper: A robbery suspect was arrested for hitting a police officer with a bible because Florida. The Smoking Gun
Cancelation Policy: A barber was arrested for shooting two of his clients when confronted by them for not keeping appointments because Florida. WPTV 5
Basis Points – A candid look at the economy, real estate, and other things sometimes related.
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