What I’m Reading
Evolution: A new breed of flexible work landlords is converting unused suburban retail locations to office space, potentially transforming downtowns in the process. Wall Street Journal
Bottleneck: The Biden administration is racing to end a bottleneck that has prevented state and local governments from distributing nearly $50 billion in rental assistance, putting both landlords and tenants in peril. Politico
Delayed Response: Office performance metrics typically have a substantial lag due to the long term nature of leases. The negative impact of COVID is just starting to show up in performance metrics.
Vacancies spiked in the first quarter of the year, with the national rate rising by 40 basis points to end the period at 18.2% and 15.8 million square feet of occupied stock being removed from the market. Asking rents fell by 0.3% while effective rents dropped by 0.8%.
However, there is still little evidence of sellers capitulating with fire sale prices. As predicted, the debate over the impact of COVID on office space will be with us for a while. Moody’s Analytics REIS
Ahead of the Curve: In Q1 2021, the US multifamily market stabilized a quarter earlier than expected, according to a new report from CBRE. Globe Street
Priced Out: The breakneck pace of home price growth is going to continue until there’s enough supply to meet demand, meaning that affordability will continue to strain. The result will be a continued increased demand for apartment and single family rentals. Vox
Chart of the Day
Ugly.
Source: REIS
WTF
Holy Smokes: A woman found a cigarette wrapped up in her soft shell taco from Taco Bell because Florida. After initial testing, the cigarette was found to be the most healthy thing in the taco. NY Post
Have Fun Staying Poor: The guy who invented Dogecoin sold off his entire position in 2015 for roughly the price of a used Honda Civic and used the proceeds to pay rent. Today the cryptocurrency, which was created as a joke, has a market cap larger than that of Honda Motor Company. (h/t Mike Deermount) Benzinga
Basis Points – A candid look at the economy, real estate, and other things sometimes related.
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