What I’m Reading
Behind the Scenes: Unless you live under a rock, you have probably heard about the massive short squeezes (and crashes) in troubled retailer GameStop and struggling theater operator AMC over the past couple of weeks. Both companies’ stocks have soared but, despite the increases in valuation, both face major fundamental challenges with their retail real estate portfolios. Bisnow
Under Pressure: With U.S. lumber prices at fresh record highs, construction companies and wood wholesalers are buying just enough to get by, threatening to make price swings even bigger. This is absolutely a headwind for new construction. Bloomberg
Turning the Corner? Apartment vacancy increased significantly in gateway markets like New York and San Francisco in 2020, but these beleaguered markets should begin to see some relief this year – or at least a slowdown in their declines – according to Freddie Mac. Freddie Mac
Rush for the Exit: Regulatory challenges, deteriorating market conditions and rental affordability challenges are driving California investors to Phoenix. This trend was well underway before COVID but the pandemic has accelerated it substantially. Globe Street
Larger Trend: The trend towards eCommerce adoption accelerated rapidly this past year and even vaccination may not be enough to save traditional brick and mortar. In a new survey from First Insight, forty percent of consumers said that they will shop for apparel in-store either less or the same amount after being vaccinated. First Insight
Chart of the Day
The high yield bond market is off to a record start in 2021 when it comes to new supply.
Source: Goldman Sachs
WTF
Using Her Head: A woman performed a sex act on an armed robber holding up a gas station until police arrived to arrest him because Slovakia. The Sun
Imagine That: the city of Philadelphia relied on college kids to distribute vaccines. It was a disaster where appointments weren’t honored and unsupervised 18- and 19-year-olds vaccinated one another and posed for photos. (h/t Steve Sims) The Washington Post
Basis Points – A candid look at the economy, real estate, and other things sometimes related.
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