Urbanexus Update - Issue #120
Urbanexus Update - Issue #120
H. Pike Oliver assembles and distributes selected economic, real estate and community development news and perspective every few weeks. Some items are behind a paywall.
The passing of a preeminent real estate leader
Gerald D. Hines — www.hines.com
Gerald D. Hines, born in 1925, was the founder and chairman of the eponymous real estate firm died peacefully at home on August 23, 2020. Among many accomplishments, Mr. Hines established the Urban Land Institute Hines Student Competition that is entering its 19th year in January 2021. Teams of five students pursuing degrees in at least three different disciplines have two weeks to devise a development program for a real, large-scale site in a North American city.
The economy and real estate finance
USA added 1.4 million jobs in August In August, total payroll employment rose by 1.4 million and the unemployment rate fell to 8.4%. The U.S. labor market continues to recover from the COVID-19
Mortgage forbearance remains flat in the USA
The Mortgage Bankers Association's latest Forbearance and Call Volume Survey revealed that the total number of loans now in forbearance remained unchanged relative to the prior week at 7.20% as of August 23, 2020. According to MBA's estimate, 3.6 million homeowners are in forbearance plans.
Mixed-use development
A mixed-use project in Las Vegas
San Diego-based developer Matter Real Estate Group has started construction of UnCommons, a $400 million mixed-use project in Las Vegas.
An office where people will want to be — pamplinmedia.com
On a recent weekday visit to Mahlum Architects' new office in the renovated Custom Blocks in Portland, OR, the silence was inescapable. What should have been a hive of activity was instead an empty vessel, awaiting the staff's post-pandemic return. Yet amidst the concrete floors and exposed old-growth timber trusses of this 90-year-old cluster of former warehouses, you could see not just the mark of generations past but a way forward for workplace designs.
Retail
Retail's rush to file bankruptcy
In May, J. Crew, Neiman Marcus, and J.C. Penny filed for bankruptcy protection. In July, seven retailers filed including The Paper Store, Brooks Brothers, and Lucky Brand. This month, Lord & Taylor and Stein Mart filed as well. According to tracking by S&P Global Market Intelligence, 44 retailers have been in bankruptcy court this year. S&P Global predicts that Blue Apron, Wayfair, J. Jill, Christopher & Banks, and Destination XL Group, are all at risk of defaulting on their debt and filing for bankruptcy. Andy Graiser, co-CEO of restructuring firm A&G Real Estate Partners said “I think you are going to start seeing mid- and small-size companies filing in the fall. In some cases, they have gotten government money and have been able to buy time. But if their sales aren’t there, you are going to see more bankruptcies.”
Residential
From golf course to residential community in Las Vegas
Lennar has announced its acquisition of 130 acres of land in Henderson, Nev., as well as the construction of a new master-planned community of up to 900 homes on the site. Formerly the site of the Black Mountain Golf and Country Club, the upcoming Black Mountain Ranch master plan will be divided into five neighborhoods, offering buyers a choice of single-family detached homes, single-family attached homes, or an active adult community for buyers 55 and older. The homes will range from 1,600 to 3,300 square feet in size, and feature a choice of mid-century modern, western contemporary, or modern prairie exteriors.
Silicon Valley apartment market death exaggerated
Short-term rent and occupancy growth are temporarily stalled, but modeling indicates a high likelihood that the effects of the COVID-19 slowdown will end mid-year 2021. How weak is the multifamily market? By historical standards, not very. Employing the Reis average unit rent history, Santa Clara County rents declined peak-to-trough by about 1 percent in 1993-1994; 37 percent in 2001-2004; and 8 percent in 2008-2010. The same series recorded a 0.02 percent peak-to-trough decrease between April and June, while year-on-year comparisons remain solidly in the black.
San Francisco Bay Area cities reluctantly approve housing “From San Bruno to Castro Valley to Lafayette, a slew of major Bay Area housing approvals are the result of changing politics and new state legislation that forces cities to accept development despite residents’ protests. This includes Senate Bill 35, which streamlined housing construction in counties and cities that fail to build enough housing to meet state housing goals. Also, Senate Bill 330 cuts the time it takes to obtain building permits, limits fees, and prevents local governments from shrinking projects that abide by all city codes.
The threat of eviction meets the threat of the pandemic
Threatening to turn families out of their homes during the coronavirus fight isn’t just morally suspect; it’s dangerous. During a pandemic that forcefully links our health to our homes, eviction will help spread the virus, as displaced families crowd into shelters, double up with relatives and friends, or risk their health in unsafe jobs to make rent or pay for moving expenses.
Eviction solves nothing. Landlords don’t need to resort to the threat of eviction to get paid. If they did, we would expect to see higher rent collection rates in states where eviction moratoriums have expired and lower rates where landlords are still barred from evicting families. But that’s not what industry data show. There is no discernible difference in rent collection rates between states with eviction moratoriums still in place and those whose moratoriums have expired. Eviction is not a solution to landlords’ fundamental problem of maintaining rental income. Rent relief is.
The U.S. housing market heated up even more, with home prices and measures of competition charging ahead, unfazed by seasonality. Pending sakes are up 20% and prices have increased 11% overall.
Office
Morgan Stanley sells its NYC office tower for $350M
The buyer of the office space at 522 Fifth Avenue in Midtown Manhattan is seeking a single tenant to occupy 21-floors when Morgan Stanley departs. The two-floor retail condominium was sold separately.
Cross laminated timber office building
The planet needs us to create more buildings like the Catalyst Building in Spokane, WA, USA.
Regional and metropolitan dynamics
3D mapping the largest population density centers What does population density look like on a global scale? These detailed 3D renders illustrate our biggest urban areas and highlight population trends.
Diversity in the USA's suburbs In ‘The Sprawl,’ author Jason Diamond argues that America’s much-maligned suburbs are more diverse, culturally rich, and strange than you thought.
Rental ads reinforce neighborhood segregation A new University of Washington study of Seattle-area rental ads shows how certain words and phrases are common to different neighborhoods, helping to reinforce residential segregation.
Will the USA ban apartment bans?
Federal policy could take on apartment bans. Overly restrictive zoning laws across the USA lock in high prices, segregated communities, and mega commutes.
Community development
We must plan racial justice in cities
Dorothy Walker, a retired planner and former assistant vice chancellor for property development at University of California, Berkeley, was the founding president of the American Planning Association when it was formed in 1978. She denounces the racially unjust visions, policies and consequences associated with the foundations of the planning profession and calls on planners across the country to envision the kinds of communities that will bring true racial justice to oppressed neighbors of color, and to engage as allies in the fight to achieve those communities.
Ms. Walker notes that local control over land-use decisions has obstructed efforts for racial justice and social equity in housing since the beginning of our profession: As long as the people who own land and are already housed have total control over growth and change in their communities, we will never achieve true racial justice and social equity. And, as long as local control enforces prohibitions on urban growth, we will sprawl ever-outward into green fields and agricultural lands, exacerbating climate change and land degradation.
In debating the shape of our cities, the zoning ordinance gets a lot of the headlines. It gives us the bulk and height of buildings, the dimensions of our streetscapes, and the mix of uses in our neighborhoods. But this emphasis on buildings overlooks the underlying land. Every zoning ordinance is prefaced with the unloved and often unread rules for cutting land into smaller pieces. These rules for “subdivision” are technical and legalistic, causing most folks to glaze over and head to the sexy parts. Such obscurity is a shame because the ignored little sibling etches our planning decisions–good and bad–onto the land.
How parking ate an American metropolis Parking is so ubiquitous that it’s hard to see just how much we have of it. But the data shows us. The data also reveals what a waste of precious resources all that parking is.
All about roundabouts — www.nytimes.com
Rotaries, traffic circles or however you know them, they’re often frustrating for American motorists. They are designed to lessen collisions, but that’s not always the effect.