Urbanexus Update - Issue #85
Urbanexus Update - Issue #85
H. Pike Oliver compiles this weekly update of real estate and community development news. Please note that some links may lead to items that are behind a paywall.
Capital markets
What happened on “Repocalypse Day”?
On September 16, 2019, the overnight general collateral rate briefly did something nobody had ever expected it to do. It exploded from 2% to about 10% in minutes, an absolutely unprecedented move, seen as impossible in a world with an ocean of roughly $1.3 trillion in reserves floating around. The Bank of International Settlements believes that the cause was soaring demand for secured (repo) funding from non-financial institutions, such as hedge funds heavily engaged in leveraging up relative value trades. Thanks to Ken Rogers for noting this.
Investment
Blackstone’s diverse assortment of funds include significant real estate investments around the world. The firm also provides investment advice and management services to institutional investors through separately managed accounts. As of Q3-19, total assets under management was $554 billion, up 21% year-over-year.
Exploiting a competitive advantage Net Lease REITs may be expensive, but perhaps that's a good thing. Utilizing cheap equity capital, Net Lease REITs have reasserted themselves as the external gr
Acquisition of single-family rentals in secondary markets Primary markets may be approaching their peak, but there are opportunities to be found in secondary markets.
Hospitality
Consecutive RevPAR dips make it official: Upcycle over
U.S. lodging performance in October is another indicator of the slow-growth environment that operators face in late 2019 and 2020, as revenue per available room declined again.
Industrial
Northrop Grumman opens 633K SF Phoenix area facility
Fast, but fabulous would be a fitting way to describe the development process and the finished product that is Northrop Grumman’s new 633,000-square-foot build-to-suit campus that sits in the Park Place Business Park in Chandler, AZ.
Housing
Homebuilders follow millennials
The latest quarterly National Association of Home Builders (NAHB) Home Building Geography Index (HBGI) shows that the majority of single-family and multifamily housing production in the USA is occurring in counties with the greatest concentration of millennials.
HVAC in new homes — eyeonhousing.org
The U.S. Census Bureau’s Survey of Construction (SOC) provides valuable information on the characteristics of new homes started construction, such as air conditioning and heating system installations. In 2018, 93.7 percent of new single-family homes started had a central AC system, almost the same share as in 2017 (93.5 percent). But there are significant regional variations.
Metropolitan and regional dynamics
Inequality — www.nytimes.com The biggest metropolitan areas are now the most unequal.
How to spread tech innovation across America
A top tier of tech- and innovation-heavy metro areas such as Boston, San Francisco-San Jose, and Seattle began to consistently outperform less-tech-based places on measures of innovation-driven prosperity. The result is a crisis of regional imbalance. A Brookings Institution report report posits that the time has come for the nation to offset the pull-away of the innovation superstars with a concerted intervention to support the emergence of new tech stars in new places.
Top 10 inbound and outbound US states — www.aei.org
There are significant differences between the top ten inbound and top ten outbound states in the USA when they are compared on measures of economic performance, business climate, business and individual taxes, fiscal health, electricity and housing costs, and labor market dynamism.
Environment and resiliency
Barangaroo project — www.barangaroo.com
When completed, the Barangaroo project in Sydney, Australia aims be the first precinct globally to be carbon neutral. Barangaroo includes centralised infrastructure such as Sydney Harbour water cooling, embedded electricity networks, recycled water treatment plants and on-site renewable energy generation.
As seas rise, some places can’t be saved
A project to calculate the cost of raising roads in the Florida Keys shows that some places may not justify the vast expense, casting doubt on the future of those areas.