What I’m Reading
Sweet Spot: Tight market conditions coupled with rising land and construction costs in many markets have led to limited new supply while demand for industrial warehouse space has continued to grow. Even though industrial returns are expected to decline, it should continue to perform well relative to other product types. Globe Street
Looming Threat: The labor contract for 22,000 west coast port dockworkers expires this summer. With port conditions already extremely strained, the prospect of a labor impasse threatens another shock to the global economy. NY Times
Bounce House? Housing inventory usually declines in the winter and increases in the spring. This year appears to be keeping with that trend and inventory is up 5.1% since the beginning of March, from historically low levels. With mortgage rates rising substantially in recent months, it will be interesting to see just how much more inventory will come to market. Calculated Risk My guess is that existing inventory will be suppressed as owners are locked in at much lower fixed rates and therefore reluctant to sell.
Race to Zero: With interest rates rising around the world, the amount of sub-zero yielding bonds is shrinking rapidly. Financial Times
Luxury Belief: Russia’s invasion of Ukraine is exposing ESG as a feel-good measure that is enriching consultants, measurement services and fund managers, while doing close to nothing for the businesses and investors it claims to help, and even less for society. Aswath Damodaran
Chart of the Day
The U.S. housing stock is worth $38 trillion, of which $26 trillion (69%) is equity.
Source: Len Kiefer
WTF
Getting High on Your Own Supply: Demand for psychedelic venom from the Sonoran desert toad has put its population at risk. New York Times
Escape Hatch: A man who was brought in for questioning on a home burglary incident, tried to escape deputies by climbing through the ceiling at the Sheriff’s Office because Florida. Tampa Free Press
Basis Points – A candid look at the economy, real estate, and other things sometimes related.
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