#  @steelbridgecap Gavin Campbell Gavin Campbell posts on X about rates, debt, inflation, mortgage rate the most. They currently have [------] followers and [---] posts still getting attention that total [---] engagements in the last [--] hours. ### Engagements: [---] [#](/creator/twitter::1549548450953342977/interactions)  - [--] Week [---] +466% - [--] Month [-----] +45% - [--] Months [-----] -56% - [--] Year [------] -62% ### Mentions: [--] [#](/creator/twitter::1549548450953342977/posts_active)  - [--] Month [--] -45% - [--] Months [--] -20% - [--] Year [---] -7.20% ### Followers: [------] [#](/creator/twitter::1549548450953342977/followers)  - [--] Week [---] no change - [--] Month [---] -1.80% - [--] Months [---] -2.20% - [--] Year [---] +33% ### CreatorRank: [---------] [#](/creator/twitter::1549548450953342977/influencer_rank)  ### Social Influence **Social category influence** [finance](/list/finance) [stocks](/list/stocks) [cryptocurrencies](/list/cryptocurrencies) [technology brands](/list/technology-brands) [currencies](/list/currencies) [travel destinations](/list/travel-destinations) [celebrities](/list/celebrities) [agencies](/list/agencies) [us election](/list/us-election) [fashion brands](/list/fashion-brands) **Social topic influence** [rates](/topic/rates), [debt](/topic/debt), [inflation](/topic/inflation), [mortgage rate](/topic/mortgage-rate), [reit](/topic/reit), [ai](/topic/ai), [commercial real estate](/topic/commercial-real-estate), [fed](/topic/fed), [cre](/topic/cre), [investment](/topic/investment) **Top accounts mentioned or mentioned by** [@msciinc](/creator/undefined) [@cbre](/creator/undefined) [@jpmorgan](/creator/undefined) [@treppwire](/creator/undefined) [@jll](/creator/undefined) [@apolloglobal](/creator/undefined) [@realpage](/creator/undefined) [@wsj](/creator/undefined) [@bisnow](/creator/undefined) [@moodys](/creator/undefined) [@jayparsons](/creator/undefined) [@ferrotv](/creator/undefined) [@yardi](/creator/undefined) [@newmark](/creator/undefined) [@business](/creator/undefined) [@mmreis](/creator/undefined) [@lisaabramowicz1](/creator/undefined) [@tomkeene](/creator/undefined) [@sonalibasak](/creator/undefined) [@markets](/creator/undefined) **Top assets mentioned** [Blackstone, Inc. (BX)](/topic/$bx) [Boston Properties, Inc. (BXP)](/topic/$bxp) [SafeCoin (SAFE)](/topic/$safe) [Amazon.com, Inc. (AMZN)](/topic/$amzn) [Cousins Properties Inc. (CUZ)](/topic/$cuz) [Veno Finance (VNO)](/topic/$vno) [Equity Residential (EQR)](/topic/$eqr) [Goldman Sachs (GS)](/topic/goldman-sachs) [Morgan Stanley (MS)](/topic/morgan-stanley) [Arbor Realty Trust, Inc. (ABR)](/topic/$abr) [WP Carey, Inc. (WPC)](/topic/$wpc) [Autonomous Virtual Beings (AVB)](/topic/$avb) [Msci Inc (MSCI)](/topic/msci-inc) [Rexford Industrial Realty, Inc. (REXR)](/topic/$rexr) [Prologis Inc (PLD)](/topic/$pld) [SL Green Realty Corp. (SLG)](/topic/$slg) [FedEx Corporation (FDX)](/topic/$fdx) [Invitation Homes, Inc. (INVH)](/topic/$invh) [Procore Technologies, Inc. (PCOR)](/topic/$pcor) [AppFolio, Inc. Class A (APPF)](/topic/$appf) [CoStar Group, Inc. (CSGP)](/topic/$csgp) [Microsoft Corp. (MSFT)](/topic/$msft) ### Top Social Posts Top posts by engagements in the last [--] hours "3/8 The girls listen to you like you are Zeus on Mount Olympus and the boys dont listen at all. This is why our women have won four World Cups and four Olympic Golds" [X Link](https://x.com/anyuser/status/1739493512477819248) 2023-12-26T03:49Z [--] followers, [--] engagements "Replying to @KobeissiLetter The US office market is indeed in "bear market" territory but the rest of commercial real estate (CRE) like apartments warehouses retail data centers self-storage and hotels are in decent shape with vacancies only slightly above frictional levels The new normal for Commercial Real Estate (CRE): Properties are selling for less than half of what they were worth just [--] years ago. A downtown Los Angeles office building that sold for $92.5 million in [----] just sold for $44.7 million. [--] days ago the Aon Center Los Angeles' https://t.co/7rmoZKJYer The new normal for" [X Link](https://x.com/steelbridgecap/status/1739825291558560053) 2023-12-27T01:47Z [---] followers, [---] engagements "#CRE transactions way down in [----] and cap rates up as balance sheet and operating distress higher interest rates loan maturities and lack of new debt capital either turn ownership over to lenders or create large bid-ask spreads between patient owners and buyers. @MSCI_Inc" [X Link](https://x.com/steelbridgecap/status/1740174048309768670) 2023-12-28T00:53Z [---] followers, [---] engagements "Good piece. Falling rates a tailwind and your point that macro matters is important. Asset type and local/micro factors matter too: office a bloodbath but storage warehouse and apartments although seeing higher vacancy and lower/negative rent growth should stabilize in [----] REITs Are on Fire Lately. What Comes Next InvestorPlace https://t.co/mYTNnJFr2Z REITs Are on Fire Lately. What Comes Next InvestorPlace https://t.co/mYTNnJFr2Z" [X Link](https://x.com/steelbridgecap/status/1740394993528066552) 2023-12-28T15:31Z [---] followers, [--] engagements "What's most interesting about this chart is the large delinquency in apartments which--unlike office--is in good shape from a vacancy perspective. The answer: balance sheet mayhem as fix and flip apartment buyers who borrowed with low floating rate debt in 2001/2 now face resets The amount of delinquent #multifamily #CRE #CLO loans increased by approximately $875 million in November a 117% month-over-month increase. See more via #Trepp: https://t.co/4ntXJPVitn https://t.co/Z1ZlAffueJ The amount of delinquent #multifamily #CRE #CLO loans increased by approximately $875 million in November a" [X Link](https://x.com/steelbridgecap/status/1740400542705438841) 2023-12-28T15:53Z [---] followers, [--] engagements "Replying to @elerianm : Agree completely. WeWork was a low interest rate fueled rebranding of a failed forty year old business model based on long term lease liabilities and short-term lease revenues that as a result was and is viewed by landlords as a tenant of last resort. From the @cnbc article on Startup bubble fueled by Feds cheap money policy finally burst in [----]. https://t.co/hGWbEZG4VU From the @cnbc article on Startup bubble fueled by Feds cheap money policy finally burst in [----]. https://t.co/hGWbEZG4VU" [X Link](https://x.com/anyuser/status/1740481450510831745) 2023-12-28T21:14Z [--] followers, [---] engagements "@SquawkStreet @willywalk @elonmusk @jimcramer @davidfaber @carlquintanilla Everybody's right here. Bottom 50% of office is a falling anvil. The rest of #commercialrealestate like apartments warehouse and self storage is in decent shape. And office loans are a small piece of #banks #CRE books. Non bank lenders have most of the troubled office loans" [X Link](https://x.com/anyuser/status/1741512107341041973) 2023-12-31T17:30Z [--] followers, [--] engagements "Good strategy. Focus appears to be single tenant long tern net leased assets which trade more like long term corporate bonds than real estate: i.e values for this asset class are highly sensitive to moves in 10-year bond interest rates and move inversely to each other. Morgan Stanley Launching Nontraded REIT Targeting Industrial Healthcare And Retail https://t.co/wUlaBGueZd Morgan Stanley Launching Nontraded REIT Targeting Industrial Healthcare And Retail https://t.co/wUlaBGueZd" [X Link](https://x.com/steelbridgecap/status/1743374951330005255) 2024-01-05T20:52Z [---] followers, [--] engagements "Nice chart @GameofTrades_ Tightening bank standards for #CRE have also systematically preceded commercial real estate distress as borrowers are unable to refinance at the same loan to cost ratios and DSCR's they originally borrowed at. Non-bank lenders tightening as well. Banks have been rapidly tightening lending standards Rise in tightening standards have systematically preceded a rise in the unemployment rate This time is not different https://t.co/KxLYerRPpe Banks have been rapidly tightening lending standards Rise in tightening standards have systematically preceded a rise in the" [X Link](https://x.com/steelbridgecap/status/1743750375667052790) 2024-01-06T21:44Z [---] followers, [--] engagements "Good chart @Snapforce showing drop in multifamily lending this year. Started during bank turmoil in the first quarter but accelerated as rising vacancy 30% post-pandemic rise in construction/labor/insurance costs and higher interest rates made DSCR's untenable for refinancings or new construction loans. Sets the stage for multifamily balance sheet distress in [----] but silver lining is that as new construction slows vacancies will start to drop in 2025+. Also interesting is the above trend growth in [----] due to ultra low interest rates and new construction response to COVID migration. Many of" [X Link](https://x.com/anyuser/status/1744112007287132598) 2024-01-07T21:41Z [--] followers, [--] engagements "Terrific article in @WSJ on how private equity investors are getting scale in single family home rental investment by funding large new housing developments. Note per chart @JBREC that mom and pop investors are still the largest investors in the space by far" [X Link](https://x.com/anyuser/status/1744158165443244323) 2024-01-08T00:44Z [--] followers, [--] engagements "1/2 Great chart @cred_iQ on peak office lease expirations nationally for offices with CMBS debt. As these leases expire we will see the clearest picture of how office tenants have decided to rationalize their space needs post-pandemic. #commercialrealestate" [X Link](https://x.com/steelbridgecap/status/1745089711410909386) 2024-01-10T14:26Z [---] followers, [---] engagements "Not an expert on risk of foreign gov debt/FX but would take US 10's at 4% over this deal any day due to liquidity premium. [--] years of real estate has taught me about the illiquid nature of the asset class and ground leases are the most illiquid of all. Add to that low inflation protection of 2% annual bumps over [--] years and the fact that you are overpaying for the land in this location in my view you'll be lucky to get an IRR above the coupon rate. At least with the US [--] you might get some appreciation if you believe the bond bulls or if not you can get out tomorrow" [X Link](https://x.com/steelbridgecap/status/1745489027673854210) 2024-01-11T16:53Z [---] followers, [--] engagements "@TripleNetInvest Also if you want to invest in ground leases with liquidity consider $SAFE . Like long duration bonds sensitive to interest rates and down significantly from peak. Not investment advice" [X Link](https://x.com/steelbridgecap/status/1745501052395294761) 2024-01-11T17:40Z [---] followers, [--] engagements "1/3 Nice chart from @RealPage on #apartment rent growth pre during and post pandemic. But the these averages mask large differences between metro areas" [X Link](https://x.com/anyuser/status/1745823333000564779) 2024-01-12T15:01Z [--] followers, [--] engagements "This story @crainschicago is emblematic of how many office tenants are rationalizing their space needs in a post pandemic world: 60% reduction in space needs due to new hybrid work model although downsizing is often less depending on the industry No desire to live through a renovation of the space that is required to downsize the space so departure is the only option Negotiated rights to expand their new space significantly in the future if growth requires it. Bottom line: tenants still need office space with room to grow just typically less of it with a bias towards moving to a new location." [X Link](https://x.com/steelbridgecap/status/1745898130011230269) 2024-01-12T19:58Z [---] followers, [--] engagements "Nice chart @GameofTrades. Most of this delinquency is NOT due to vacancies in multifamily which remain at reasonable levels. It comes from interest rate resets on floating rate bridge loans taken out in 2021-22 by fix and flip borrowers prior to the Fed's interest rate increases. $ABR a good example of the type of lenders who made these loans. ALERT: Housing defaults are now at the highest levels in a decade Buckle up https://t.co/RF4K8H6URE ALERT: Housing defaults are now at the highest levels in a decade Buckle up https://t.co/RF4K8H6URE" [X Link](https://x.com/steelbridgecap/status/1745998284106170715) 2024-01-13T02:36Z [---] followers, [---] engagements "$NLOP the office owning spin-off of $WPC just announced the sale off four long term leased office assets with various credits and locations at an 8.4% cap. Shows that there is a market for long term leased office at reasonable valuations provided the cap rate is above the interest rate of the new acquisition loan. But assets like these were trading in the 6% cap rate range in 2021-22 when interest rates were much lower" [X Link](https://x.com/steelbridgecap/status/1746259210134868432) 2024-01-13T19:53Z [---] followers, [---] engagements "@realEstateTrent Used to think that way but after [--] years of the time suck and illiquidity of private real estate have found that #reits are a good way to hedge our private business and invest for similar returns with minimal time and high liquidity" [X Link](https://x.com/steelbridgecap/status/1746529004620857609) 2024-01-14T13:45Z [---] followers, [---] engagements "Nice chart @RealPage on [----] relationship between apartment new supply and rent growth. Good proxy for underwriting rent growth in [----] though if we do go into recession it will be lower across the board. #commercialrealestate" [X Link](https://x.com/steelbridgecap/status/1746865229156278708) 2024-01-15T12:01Z [---] followers, [--] engagements "Remember per @realpage that a little over 50% of #apartments tenants renew leases when vacancies are low and that renewals drop as vacancy increases. Given US apartment vacancies are heading up in [----] important to factor into deal underwriting with higher downtime assumptions lower rents or more free rent" [X Link](https://x.com/steelbridgecap/status/1747326775917511120) 2024-01-16T18:35Z [---] followers, [--] engagements "@TheWolfofREI Agree but the irony of it all is that this list describeswith the exception of the capital callthe things you have to do even when the deal is going according to plan. Real estate is always a time suck" [X Link](https://x.com/steelbridgecap/status/1747614814971511271) 2024-01-17T13:40Z [---] followers, [--] engagements "@bencasselman 2/2 Finally I do agree that it makes sense to distinguish between new and renewal leases since landlords find it easier to pass on increases in rent to existing tenants and typically have to offer discounts to new ones. As for weighting the renew/release ratio is about 50/50" [X Link](https://x.com/steelbridgecap/status/1747781311115268319) 2024-01-18T00:41Z [---] followers, [---] engagements "@acquisizioni Great point on #office. And missing core asset classes like #warehouse data centers cold storage and self-storage. Have found that risk is less about product type and more about lease credit markets leverage and capex. Office biggest capex hog of all. Kills free cash flow" [X Link](https://x.com/steelbridgecap/status/1747794346772934858) 2024-01-18T01:33Z [---] followers, [---] engagements "It's all about basis and cycles. Our view is 80% of your return in real estate comes from how cheaply you buy so if you are buying significantly below replacement value and/or recent sales you won't lose a dime and may make a lot. But the only way to buy cheaply is to understand real estate cycles and how to time them" [X Link](https://x.com/anyuser/status/1748094709585584284) 2024-01-18T21:27Z [--] followers, [--] engagements "2/2 But @CBRE apartment IRR and cap rate requirements vary significantly by market and submarket" [X Link](https://x.com/steelbridgecap/status/1748128708529959275) 2024-01-18T23:42Z [---] followers, [--] engagements "1/2 Interesting analysis from @CBRE on increase in initial cap rates and IRR requirements for #apartments as the the Fed tightened from [----]. @CBRE predicting both will drop if and when the Fed starts cutting rates so if you are buying now might be the time" [X Link](https://x.com/steelbridgecap/status/1748128834249994343) 2024-01-18T23:42Z [---] followers, [--] engagements "Interesting article on how weight loss drugs could reduce retail footprints. Counter is that if people live longer they will need more retail. What do you think Ozempic Could Be The Next Big Curveball For Commercial Real Estate https://t.co/FL8KHg5eul Ozempic Could Be The Next Big Curveball For Commercial Real Estate https://t.co/FL8KHg5eul" [X Link](https://x.com/anyuser/status/1748341115915264172) 2024-01-19T13:46Z [--] followers, [--] engagements "@DiMartinoBooth @WSJ Lag effect. Mortgage interest rates for #housing started moving down in earnest after Halloween and buyers started to go under contract in the last quarter of [----]. These sales will show up when they close in the first quarter 2024" [X Link](https://x.com/steelbridgecap/status/1748448205275025889) 2024-01-19T20:51Z [---] followers, [---] engagements "@chernobelskiy @moseskagan Agree. But if LP facing dry gain tax issues due to likely loan restructuring on top of equity loss the pref equity could at least postpone the tax bill for that" [X Link](https://x.com/anyuser/status/1749586260065141067) 2024-01-23T00:14Z [--] followers, [---] engagements "Sure. So often in situations where LP's (and GP's) are getting wiped out the property may be worth less than the debt. If the lender decides to work with a recapped partnership (often involving preferred rescue capital per this thread) they often write part of the loan off so that new partnership has a better debt structure going forward. That amount of debt that is written off is basically loan forgiveness to the LP/GP and as such is taxable under IRS rules as ordinary income. Not an accountant and there are many wrinkles to this including how the LP/GP has depreciated the asset prior to the" [X Link](https://x.com/anyuser/status/1749602096649809944) 2024-01-23T01:17Z [--] followers, [---] engagements "@RE_Deal_Junkie Love it. I once put an R and D facility under contract and learned in due diligence that the tenant selected the location because it was the only property they could find in the city that had the right Feng Shui. I closed and they renewed twice for a total of [--] years" [X Link](https://x.com/steelbridgecap/status/1750192552760733756) 2024-01-24T16:23Z [---] followers, [--] engagements "@ChadGriffiths @TopherNOW When I got my first job in the acquisitions group of a large real estate investment company in [----] they put me in warehouse development because nobody wanted the job and all the cool kids were in office. Roles reversed now" [X Link](https://x.com/steelbridgecap/status/1750237987915362679) 2024-01-24T19:23Z [---] followers, [--] engagements "@chernobelskiy @rhunterh Exactly. Cap rates vary widely by #CRE property type but typically trade off the [--] year. We are in an unusually narrow spread range now---just like corporate bonds interestingly enough.chart courtesy of @MMREIS" [X Link](https://x.com/steelbridgecap/status/1750312780463235243) 2024-01-25T00:21Z [---] followers, [---] engagements "This is worth re-stating: flex workspace #office tenants have been around for [--] years and have a future but it will only be one based on $IWG's and others' management contract model instead of the broken model of signing long term leases and depending on short term subleases. Global flexible workspace giant IWG has snapped up another @WeWork space as the company one of the largest #coworking operators in the world looks to fold in the vacated spaces as part of its aggressive expansion plan. https://t.co/GaREcZfpD7 Global flexible workspace giant IWG has snapped up another @WeWork space as" [X Link](https://x.com/steelbridgecap/status/1750655355372060874) 2024-01-25T23:02Z [---] followers, [----] engagements "Thats right. Underleased older B and C office buildings are trading regularly at [--] and [--] cents on the dollar but bid-ask spread on well leased apartments warehouses self storage and retail is high due to high interest rates and transactions for these assets have fallen off a cliff as a result" [X Link](https://x.com/anyuser/status/1750927094203224070) 2024-01-26T17:02Z [--] followers, [---] engagements "@landlawyerbrian Good point. COC always starts with the risk free rate and after a thirty year bull market in bonds we may be in for a secular reset higher" [X Link](https://x.com/steelbridgecap/status/1750949740089401465) 2024-01-26T18:32Z [---] followers, [--] engagements "@TripleNetInvest Great call. I grew up rural and have been buying ever since although as somebody noted in the thread cash flow is low so it is an IRR play. A complementary strategy though is to also buy stocks like $LAND . Traded in and out of it for years and throwing off [--] %" [X Link](https://x.com/steelbridgecap/status/1751270348962529475) 2024-01-27T15:46Z [---] followers, [----] engagements "There is a lot of gobbledygook in the financial press about the "crisis" in commercial real estate. No. It's a "crisis" in only two places: C B and A- office properties which are running at 20%+ vacancy and will get worse before they get better Anybody who took out a floating rate loan in 2021-2 that did not underwrite for or swap cover for higher interest rates. Every other property type in decent shape overall as of right now" [X Link](https://x.com/steelbridgecap/status/1751632653395058725) 2024-01-28T15:45Z [---] followers, [----] engagements "There is stress for sure esp. in the southeast where most new supply is. And if a borrower has floating rate construction debt they did not cap that is a problem. But the nice thing about new construction multi is that it is the "new car" everyone wants so generally if you click back the asking rates they fill up. My two cents" [X Link](https://x.com/steelbridgecap/status/1751657363528921271) 2024-01-28T17:23Z [---] followers, [---] engagements "$BX one of the OG's of real estate private equity had a good insight on their earnings call last week: they think they #CRE market has already bottomed but it is going to take a while for investor sentiment and capital to catch up making it a great time to buy. It's already flowing back into the office market: see the following firms raising money to invest in distressed #office debt/equity or lend to office owners with refinancing issues. More on the way. $GS $2.6B RXR/Ares: $1B $SLG: $1B Ethan Penner: $1B" [X Link](https://x.com/steelbridgecap/status/1751993438537449538) 2024-01-29T15:39Z [---] followers, [---] engagements "Excellent report just out from @MoodysAnalytics on ignoring the headlines and groupthink psychology of the #CRE "doomloop" and going granular by product type and market to find good risk adjusted returns. Could the CRE 'doom loop' theory be more fiction than fact Our latest report underscores nuanced decision-making and hyperlocal research's role in the recovery phase. Perceived market downturns may mask unexpected opportunities. Read more: https://t.co/nLHkG6ryn5 https://t.co/UUpUnHzUW9 Could the CRE 'doom loop' theory be more fiction than fact Our latest report underscores nuanced" [X Link](https://x.com/steelbridgecap/status/1752060502421708930) 2024-01-29T20:05Z [---] followers, [---] engagements "Our view is that most of this is macro: higher interest rates and 30% run up in labor+materials cost inflation = development proformas no longer pencil particularly given flat to declining rents per below Covid induced migration out of large cities and to sunbelt led to oversupply issues in most of those areas which discouraged further building" [X Link](https://x.com/steelbridgecap/status/1752785756794372252) 2024-01-31T20:07Z [---] followers, [--] engagements "@jessefelder You have to distinguish between #office which is struggling and on average about [--] percent of bank #cre loans and the rest of the commercial real estate asset classes which are doing ok" [X Link](https://x.com/steelbridgecap/status/1753075368431624471) 2024-02-01T15:18Z [---] followers, [---] engagements "Nice discussion this morning with Bruce Van Saun @FerroTV @lisaabramowicz1 on #Banks and #cre. Lower quality #office in tough shape but generally only 5-10% of smaller/regional #Banks real estate loan portfolios; rest of property types in good shape although #RealEstate borrowers who took out floating rate loans in 2021-22 that did not swap out or underwrite for higher short term rates have real issues regardless of property type. Miss @tomkeene and his focus on seminal textbooks and financial esoterica" [X Link](https://x.com/steelbridgecap/status/1753135044292387239) 2024-02-01T19:15Z [---] followers, [---] engagements "Yep. And office loan delinquencies headed to levels not seen since then either. What corporations arent telling you is that WFH showed them they can do a lot more with remote work than they ever thought and the shrinking of their office footprints that will follow are savings that will go right to the bottom line" [X Link](https://x.com/steelbridgecap/status/1753785051668455832) 2024-02-03T14:18Z [---] followers, [---] engagements "Been investing in commercial real estate for [--] years but started posting on here about six weeks ago after my beautiful Gen Z daughters kept accusing me of living in the 19th century. Enjoying the helpful vibe on hereseems like folks following Einsteins advice about not striving to be a success but rather to be of value. So adding to the mix: you never win a competitive bid with your last dollar. Whatever your proforma tells you is the most you can pay for something add 10% to it ignore how ugly your excel now looks( it was a guess anyway) and win it. Lost a few before I realized this never" [X Link](https://x.com/steelbridgecap/status/1753790074024591532) 2024-02-03T14:38Z [---] followers, [--] engagements "Been investing in commercial real estate for [--] years but started posting on here about six weeks ago after my beautiful Gen Z daughters kept accusing me of living in the 19th century. Enjoying the helpful vibe on hereseems like folks following Einsteins advice about not striving to be a success but rather to be of value. So adding to the mix: you never win a competitive bid with your last dollar. Whatever your proforma tells you is the most you can pay for something if you really want it add 10% ignore how ugly your excel now looks( it was a guess anyway) and win it. Lost a few before I" [X Link](https://x.com/steelbridgecap/status/1753791876279181821) 2024-02-03T14:45Z [---] followers, [----] engagements "We invest in both public and private #real estate and arb the two. We attend about [--] earnings calls a month for the #REITS $BXP is the US's largest public #office REIT. Navigating rough waters but going on offense by buying out three partners who wanted to reduce #office exposure: [---] New York Ave DC (below). Extended anchor tenant by [--] years extended loan by [--] years bought at $414/sf and 6.4% cap Santa Monica Business Park LA. Renewed anchor tenant for [--] years $395/sf and 9% cap [---] Park Avenue South NYC. $754/sf and 7.2% cap. Moral of the story: own the top 25% of office and your tenants" [X Link](https://x.com/steelbridgecap/status/1754149438753317248) 2024-02-04T14:26Z [---] followers, [----] engagements "With apologies to Ernest Hemingway the #office market continues to be a story of the haves and the have nots. Yesterday we posted about $BXP recently buying out a partner in a high quality Class A long term leased Washington DC office building at [---] New York Ave at $414/sf and a 6.4% cap During the same time frame five older poorly leased B office buildings in the DC downtown traded at numbers on average about 40% of that: [----] M Street: Sold for $150/sf down from [----] price of $436/sf [----] Connecticut Sold for $122/sf down from [----] price of $425/sf [----] Eye St: Sold for $202/sf down from" [X Link](https://x.com/steelbridgecap/status/1754493883050860561) 2024-02-05T13:15Z [---] followers, [---] engagements "@annmarie @FerroTV Re: Barry Sternlicht's comment that we "don't know" where the $1.1MM in #commercialrealestate losses are. We do know. The vast majority of it is in the non-bank lending system: CMBS CLO's mortgage REITS PE debt funds" [X Link](https://x.com/steelbridgecap/status/1754514350340002183) 2024-02-05T14:36Z [---] followers, [--] engagements "Real time #office leasing data from $IPG earnings call: leased space down 22% from [----] and likely ends at a 35% reduction as vacant space is given back at lease end. To repeat: despite all the talk of return to office #WFH taught employers they can do a lot more with remote work than they ever thought and rent savings will go right to the bottom line" [X Link](https://x.com/steelbridgecap/status/1755972213054828730) 2024-02-09T15:09Z [---] followers, [---] engagements "A lot of news about over-leveraged #realestate hitting debt maturity walls and high interest rates. In contrast look at the debt structure of publicly traded REITS: Average loan maturity: [---] years Average interest rate: 4% Average loan to book: 50% Moral of the story is that debt adds risk not return: [--] year annual returns on private real estate: 8.7% [--] year annual returns on REITS: 12%" [X Link](https://x.com/steelbridgecap/status/1756323935300342079) 2024-02-10T14:27Z [---] followers, [----] engagements "Tough insights from @TreppWire on distressed office in downtown San Francisco which is 30%+ vacant. [--] of them are B or C buildings and poorly leased and are worth collectively a staggering 75% less than their original appraised values. [---] California is Class A but only half leased due to a tenant default and worth about 50% of the original appraised value. Still wouldn't bet against SF office long term though; it is still the world's tech capital. But it will be a long road back. #commercialrealestate" [X Link](https://x.com/steelbridgecap/status/1757158203723259908) 2024-02-12T21:42Z [---] followers, [---] engagements "In our view what has changed in the last few months for #commercialrealestate is that loan maturity walls are finally hitting and interest rate caps set in [----] and [----] are now resetting and leading to loan interest rates [--] and [--] times higher than they were last year. With the exception #office CRE is in good shape from supply and demand perspective; what is driving the crisis is borrower balance sheet issues" [X Link](https://x.com/steelbridgecap/status/1757178792810807802) 2024-02-12T23:04Z [---] followers, [---] engagements "The $AVB earnings call last week was a case study on going on offense in the #apartments space. Announced plans to sell apartments in coastal markets where rents/values are growing again and use the proceeds to buy in over-supplied markets in the sunbelt where rents are dropping enough that they feel they can buy apartments "significantly below replacement cost". That is how you do it" [X Link](https://x.com/steelbridgecap/status/1757413611641741416) 2024-02-13T14:37Z [---] followers, [---] engagements "Yardi Matrix gives good city by city comparison data on macro level but best way to dig into intra-Houston data comes from the following (1) the large storage REITS (EXR PSA CUBE etc) have websites where you can search for what they offer in Houston by specific location and tend to lead the market (2) Rent Cafe does good Houston specific data as does SpareFoot Storage Cafe and . This will give you a broader range of quality and rents. Good luck" [X Link](https://x.com/steelbridgecap/status/1757416029431505318) 2024-02-13T14:46Z [---] followers, [--] engagements "Makes sense. $149B raised from LP's in [----] compared to $270B in [----]. And this does not factor in billions in redemption requests to non-traded REITs. Why 5% risk free cash better than 5-6% cap rates in [----] Locked up transaction market due to [---] bp rise in Fed Funds with poor price discovery and limited acquisition debt. Bottom in distressed asset classes like #office not yet in sight. With Fed easing [----] should be better Private Equity Fundraising Nose-Dives To 11-Year Low https://t.co/FMzixYFBaU Private Equity Fundraising Nose-Dives To 11-Year Low https://t.co/FMzixYFBaU" [X Link](https://x.com/steelbridgecap/status/1757774715102343537) 2024-02-14T14:32Z [---] followers, [----] engagements "1/2 @sonalibasak @lisaabramowicz1 @TheChartress Enjoyed your coverage on #commercialrealestate today. A few small adds: Distress in our business comes in two places: tough operating environments (supply and demand) and balance sheet (debt) issues. Per below the operating fundamentals outside of #office are reasonable: yes there are some idiosyncratic issues in #apartments (oversupply in the sunbelt rent stabilized units in NYC downtown issues in SF) but things are generally ok with the rest. But any borrower who took out a floating rate loan in 2020-2022 has cash flow problems as caps burn" [X Link](https://x.com/steelbridgecap/status/1758203562604069248) 2024-02-15T18:56Z [---] followers, [---] engagements "2/2 @sonalibasak @lisaabramowicz1 @TheChartress Implications: Older poorly located #office has both issues but the bulk of the distress is in the non-bank lender ecosystem: mortgage REITs PE debt funds CMBS. The banks we borrow from tend to have between 5% and 10% of their loans in #office so 50% to 100% of equity which although still high for the most part is being reserved for. Top 25% of office will be fine. The rest of the product types mainly have balance sheet issues due to floating rate resets: although it will lead to idiosyncratic events at #banks ( e.g $NYCB/rent control) or with" [X Link](https://x.com/steelbridgecap/status/1758203809195520082) 2024-02-15T18:57Z [---] followers, [---] engagements "@LiQuidPr0Qu0 @elerianm @sonalibasak @markets Good questions and above our pay grade--we are real estate guys who attend earnings calls of REITS and other financial institutions that affect our ecosystem but not bank experts. They are certainly increasing bank reserves but Basel [--] endgame hovering above all of this" [X Link](https://x.com/steelbridgecap/status/1759327480584769959) 2024-02-18T21:22Z [---] followers, [--] engagements "@unusual_whales But % exposure of loan books at smaller #banks at 30%" [X Link](https://x.com/steelbridgecap/status/1759583783748255917) 2024-02-19T14:20Z [---] followers, [---] engagements "By the way love your feed. It continues to astound me how public pension funds--ostensibly guided and counseled by outside consultants---continue to invest in #realestate with GP's that give them subpar returns. Worst case they should invest in #REITS which although highly correlated with the stock market at least would give them superior real estate returns. Best case they should adapt the @yale endowment model which focuses on GP's that have principled management with extensive track records focus on geographies and product types they know cold don't fall in love with their real estate get" [X Link](https://x.com/steelbridgecap/status/1759665488903479682) 2024-02-19T19:45Z [---] followers, [--] engagements "January [----] #commercialrealestate transactions continue to be muted @MSCI_Inc Cap rates up again as higher for longer continues. Average cap rates: hotel [---] % office 7% retail 7% industrial 6.2% apartments 5.6% Buy 'em if you can find them/finance them" [X Link](https://x.com/steelbridgecap/status/1760706102914646210) 2024-02-22T16:40Z [---] followers, [----] engagements "@LongTermOwner Yep. Going on all over the country and showing up as part of #banks stress as interest rate caps expire. Great opportunity for preferred equity investors . Follow $ABR for how this is playing out in real time" [X Link](https://x.com/steelbridgecap/status/1763214905279143973) 2024-02-29T14:49Z [---] followers, [---] engagements "Definitely a balance sheet issue. Unlike most of the US office market South Florida office is in decent shape from an operating perspective and this is a good A minus assetone of attorneys offices there. Issue is finding lenders who are willing to refinance office assets at all as well as at LTVs high enough to take the original lender out" [X Link](https://x.com/steelbridgecap/status/1763217101198635438) 2024-02-29T14:58Z [---] followers, [---] engagements "@sr_nyc @philbak1 @REITs_Nareit @NYUSchack Amen. And the winning streak is even longer. [---] bp+ to the good REITS vs private over [--] years and with infinitely better liquidity less leverage risk and little management hassle" [X Link](https://x.com/steelbridgecap/status/1763605063732228533) 2024-03-01T16:39Z [---] followers, [--] engagements "Re: the CPI commotion about January OER (Owner's Equivalent Rent) growth exceeding regular apt. growth. Makes sense if you read reports @JBREC . SFR 19% rent premium to regular garden style. Amenitized build-to-rent SFR 25% premium to scattered SFR" [X Link](https://x.com/steelbridgecap/status/1765117977358180812) 2024-03-05T20:51Z [---] followers, [---] engagements "$TGT just announced the opening of [---] new large format stores over the next [--] years This means retail store expansion into suburban and secondary/tertiary city markets. But every one of these stores will also be a last mile warehouse. Two for one" [X Link](https://x.com/steelbridgecap/status/1765732610846708181) 2024-03-07T13:33Z [---] followers, [---] engagements "Coastal infill and Midwestern #apartment markets that did not see overbuilding during the pandemic continue to show flat to positive rent growth. Sunbelt still working through supply issues although the negative growth rates are off artificially high COVID rental rates" [X Link](https://x.com/steelbridgecap/status/1766492009831833954) 2024-03-09T15:51Z [---] followers, [---] engagements "@EpsilonTheory In our view shelter will only cool if we go into a recession and mortgage rates drop" [X Link](https://x.com/steelbridgecap/status/1767890856160219481) 2024-03-13T12:30Z [---] followers, [---] engagements "From @MSCI_Inc on loan loss rates by property type showing the rise across all asset classes in [----] as interest rates rose. #office of course the leader given the added stress of higher vacancy due to secular hybrid work changes. Note the high office loss rates even pre-pandemic and they will spike significantly from here. Warehouse retail and apartments losses will begin to moderate if the Fed cuts since fundamentals in these asset classes are generally good" [X Link](https://x.com/steelbridgecap/status/1771152247549759567) 2024-03-22T12:29Z [---] followers, [---] engagements "Interesting insight from @MSCI_Inc on recent #office transactions. With negative real interest rates the pandemic ongoing and the view that remote work was temporary there was a massive surge in office buying between [----] and [----]. It ended when the Fed started raising rates and investors grasped the reality of a secular decrease in office demand as larger tenants doubled down on the cost savings from many kinds of remote work But as interest rates come down and tenants continue to expand in spite of hybrid work demand for the best assets in the best locations will come back" [X Link](https://x.com/steelbridgecap/status/1772283975328809453) 2024-03-25T15:26Z [---] followers, [---] engagements "Rent vs. own calculus (CBRE chart) continues to weigh on single family home sales and support rental growth inflation particularly for single family homes for rent. Expect CPI readings for OER and rental inflation to remain elevated absent a drop in rates" [X Link](https://x.com/steelbridgecap/status/1772589262938010093) 2024-03-26T11:39Z [---] followers, [---] engagements "From @MSCI_Inc showing that suburban #office buildings taking less of a price/value hit. Two reasons: shorter commute times=higher occupancy and suburban buildings tend to have smaller tenants which have done less downsizing due to hybrid work" [X Link](https://x.com/steelbridgecap/status/1772976810386460776) 2024-03-27T13:19Z [---] followers, [---] engagements "Insight @MSCI_Inc on where distressed #office prices are today versus the GFC albeit on thin transaction volume. Owners of quality well leased office don't have to sell and won't. But distressed office has much farther to fall" [X Link](https://x.com/steelbridgecap/status/1773701506375590390) 2024-03-29T13:19Z [---] followers, [---] engagements "$REXR buys $1 billion of warehouse from $BX at a 4.7% cap stabilizing to a 5.6% That's nicely accretive to $REXR dividend yield of 3%. But stock market pricing their whole portfolio at a 5% cap. Who is right https://www.costar.com/article/2007628353/blackstone-sells-southern-california-industrial-portfolio-for-1-billion https://www.costar.com/article/2007628353/blackstone-sells-southern-california-industrial-portfolio-for-1-billion" [X Link](https://x.com/steelbridgecap/status/1774145664131199006) 2024-03-30T18:44Z [---] followers, [---] engagements "Interesting chart on how rising interest rates have impacted the #hotel market. Like all #cre asset classes transactions down in [----] but post-COVID surge in hotel demand = higher RevPar ADR's and values. On a nominal basis hotel revenues now significantly above [----] levels" [X Link](https://x.com/steelbridgecap/status/1775129165999800631) 2024-04-02T11:52Z [---] followers, [---] engagements "Insight from @MSCI_Inc on drop in LTV by new CMBS issuers starting in late [----] as loan standards got more conservative. Ironically with write downs in #apartments and #office values LTV's of [----] + vintages are back up anyway and headed higher" [X Link](https://x.com/steelbridgecap/status/1775566864942498117) 2024-04-03T16:51Z [---] followers, [---] engagements "#REIT's have deleveraged significantly since 2020---a sea change. This will enable them to take advantage of distressed buying opportunities which they missed out on during the #GFC" [X Link](https://x.com/steelbridgecap/status/1777001307481457076) 2024-04-07T15:51Z [---] followers, [----] engagements "Agree. Our annual apartment and SF home rental growth for the [--] years preceding the pandemic was never below 3%. Renewals which are 70% of our leasing never below 4%. Rents in our portfolio bottomed a year ago and with base effects are only going up from here. Robust job growth and high mortgage rates are driving the increases so don't expect any CPI help from shelter absent a recession or interest rate cuts from the Fed" [X Link](https://x.com/steelbridgecap/status/1778511715811917988) 2024-04-11T19:53Z [---] followers, [---] engagements "@PhysInHistory "Bailey's Beads" C2/C3: 3m 46s Mill Creek MO (Ozarks) Thinking about a new line of work.😃 #Eclipse2024" [X Link](https://x.com/steelbridgecap/status/1779292455403188312) 2024-04-13T23:35Z [---] followers, [--] engagements "Another unique impact of Covid was that it involved massive Fed easing followed by an unprecedented immediate and aggressive Fed tightening. This enabled a generation of homeowners to lock in absurdly low mortgage rates in a way they could not during the GFC or prior downturns right before the Fed went the other way. This has led to more limited homes for sale higher home prices for those that do sell and a high number of renters by necessity which absent a recession or Fed easing sets the stage for continued inflation in shelter costs" [X Link](https://x.com/steelbridgecap/status/1779845701209293057) 2024-04-15T12:14Z [---] followers, [----] engagements "$PLD down due to disappointing earnings. $REXR $STAG and others down in same draft. Buy the dip. Fundamentals fine and will get better into [----] and rates will come down eventually. Not investment advice" [X Link](https://x.com/steelbridgecap/status/1780624343124291823) 2024-04-17T15:48Z [---] followers, [---] engagements "@NickTimiraos @jjj_groen As we have been saying for a while new and renewal rent increase rates only going up from here due to base effects and high mortgage rates. Our rents bottomed a year ago and wil continue to go up absent a recession or lower mortgage rates" [X Link](https://x.com/steelbridgecap/status/1780917576358379817) 2024-04-18T11:13Z [---] followers, [---] engagements "Another reason to be bullish on operating fundamentals of #industrial real estate from @JLL New construction falling to pre-pandemic levels due to high interest rates and moderation of demand. Nice set up for 2025+" [X Link](https://x.com/steelbridgecap/status/1780984719431422410) 2024-04-18T15:40Z [---] followers, [---] engagements "#CMBS issuance in Q1 [----] was 4X what it was in Q1 [----] Liquidity returning to #CRE market after bank pull backs" [X Link](https://x.com/steelbridgecap/status/1781818181360750962) 2024-04-20T22:52Z [---] followers, [---] engagements "Interesting statistics on BTR from RentCafe Sunbelt no surprise but Detroit and Columbus top ten. Strong universities affordability car/EV tech and retail/distribution fueling the growth. Detroit also has strong incentive programs and cheap land as it retools/rebuilds. Never count the Midwest out" [X Link](https://x.com/steelbridgecap/status/1782061867822694905) 2024-04-21T15:00Z [---] followers, [---] engagements "Good insights from @JLL on how the best #office micro-markets almost always outperform the averages. They also have the highest rents: Palo Alto Greenwich Hudson Yards Palm Beach all $100/sf+ Real estate has always been a block by block game. You can't generalize" [X Link](https://x.com/steelbridgecap/status/1783822030707593231) 2024-04-26T11:34Z [---] followers, [---] engagements "Agree. BLS's shelter methodology and weighting in CPI are the ecstasy of obscurity. That said and as we have been saying for a while in our portfolio our new lease rates bottomed a year ago so with base effects and absent a recession the rate of increase is only going to go up. And renewal leases which are typically 70% of our leasing are growing again at 3-4% which is near our pre-pandemic average of 4-5%. So regardless of how the government measures it rent inflation is real" [X Link](https://x.com/steelbridgecap/status/1784001424243794015) 2024-04-26T23:27Z [---] followers, [--] engagements "Given the arcane BLS shelter methodology the governments numbers may indeed show lower shelter inflation as he suggests. But in the real world the fact remains that rents bottomed a year ago and given base effects rent inflation rates are only headed up absent a recession or lower mortgage rates" [X Link](https://x.com/steelbridgecap/status/1785773031555477642) 2024-05-01T20:47Z [---] followers, [----] engagements "You are right. In our view the only way shelter is going to moderate due to high interest rates is if the rates tip us into recession. High interest rates have created a generation of would be home buyers who are renters by necessity and that is keeping apartment/SFR demand healthy" [X Link](https://x.com/steelbridgecap/status/1786023950037729634) 2024-05-02T13:24Z [---] followers, [---] engagements "@ChadGriffiths Nice work" [X Link](https://x.com/steelbridgecap/status/1786078252785631540) 2024-05-02T17:00Z [---] followers, [---] engagements "Self-storage rates per @Yardi still haven't found the bottom with close to 9% inventory additions over last [--] months. Construction still high or increasing in many markets and home sales market still locked up. And yet self-storage REITS like $EXR still way up off their November [----] lows based on hopes for lower interest rates but those are likely to come only if the economy slows considerably. Head scratcher" [X Link](https://x.com/steelbridgecap/status/1786392723722784978) 2024-05-03T13:49Z [---] followers, [---] engagements "REITs with highest likelihood of Q2 dividend increases (33%+) are ag/timber single tenant and mobile home parks according to S&P. All operate with longer term leases showing their value due to consistent income streams with CPI escalators in an inflationary environment" [X Link](https://x.com/steelbridgecap/status/1789731610981446088) 2024-05-12T18:57Z [---] followers, [---] engagements "@davidfrum Indeed. And for Frenchies Id say its Fritos. The domesticated dog is our civilizations greatest achievement although it is often said that they think the same thing about us" [X Link](https://x.com/steelbridgecap/status/1791064032692121764) 2024-05-16T11:11Z [---] followers, [---] engagements "Good insights from @Newmark on the role new and existing home sales play in driving warehouse net absorption. Absorption now below pre-pandemic levels and vacancy is above pre-pandemic as well. Another casualty of higher for longer" [X Link](https://x.com/steelbridgecap/status/1791173271276355774) 2024-05-16T18:26Z [---] followers, [--] engagements "From yesterday's @WSJ on the troubles of Starwood's S REIT. The irony here is that this is great well capitalized real estate. [----] annual report shows that 90% of its holdings are in great asset classes (industrial apartments and almost no office) 95% occupied and 57% leveraged with 99% of the debt fixed or hedged at 3.5% with [--] years of average term. Year over year NOI is up 7% and they just sold $2 B of properties for a 14% IRR and [---] MOIC. This is purely a redemption issue since investors can now find higher yielding more liquid alternatives to the SREIT's dividend elsewhere and--at" [X Link](https://x.com/steelbridgecap/status/1792915987018158303) 2024-05-21T13:50Z [---] followers, [----] engagements "SREIT caps redemptions at 1% a quarter down from 6% . Is a preferred equity deal with a major pension fund the next step $BX did an 11.25% IRR pref deal with the University of California for its BREIT in [----]. via @wealth https://www.bloomberg.com/news/articles/2024-05-23/starwood-reit-sets-drastic-redemption-limits-on-liquidity-crunchutm_source=website&utm_medium=share&utm_campaign=twitter https://www.bloomberg.com/news/articles/2024-05-23/starwood-reit-sets-drastic-redemption-limits-on-liquidity-crunchutm_source=website&utm_medium=share&utm_campaign=twitter" [X Link](https://x.com/steelbridgecap/status/1794077709573956039) 2024-05-24T18:47Z [---] followers, [---] engagements "Nice analysis from @wolfofwolfst and @TreppWire on #office balance sheet stress. Floating rate CMBS deliquency at 20% and climbing while fixed rate at 4% Irony is most of these floaters were taken out AFTER the Fed started raising rates. Most were short term refinancings and were the only deal most borrowers could find and was a bet on a quick fall in rates. Didn't happen and hybrid work did the rest" [X Link](https://x.com/steelbridgecap/status/1794375320918794524) 2024-05-25T14:29Z [---] followers, [---] engagements "Interesting analysis from @Bisnow on the moribund state of real estate crowdfunding which took off in [----] when federal laws changed and gave small investors access to real estate syndications. Exploded to a $17B a year business by [----] with fix and flip sunbelt multifamily and office leading the way. But deteriorating operating fundamentals balance sheet stress from Fed rate hikes and poor operator capitalization has led to losses and capital calls. After some consolidation the business will come back but only after it figures out a better way to vet operator history underwriting and" [X Link](https://x.com/steelbridgecap/status/1794786034372202614) 2024-05-26T17:41Z [---] followers, [---] engagements "Good article from @Bisnow on Invesco's plan to make hard money loans to second tier office #reits High single digit-double/ digit coupons non-callable in first few years but five year minimum terms. Focus on 2025-6 maturity walls originated in depths of COVID. Works only if the "extraction" doesn't kill the patient first. We'll see: dilutive equity may actually be better" [X Link](https://x.com/steelbridgecap/status/1795976429097615707) 2024-05-30T00:32Z [---] followers, [---] engagements "Issue is not that large US banks have ramped up their lending to REITS since the depths of the GFC--true for most lenders. Issue is rather what % of these loans are to REITs with office concentration (20% vacancy and climbing) versus other property types which are generally in the 6-7% range and relatively stable. REPORT: REIT Debt Threatens Large Banks https://t.co/5zspzxQ1HZ REPORT: REIT Debt Threatens Large Banks https://t.co/5zspzxQ1HZ" [X Link](https://x.com/steelbridgecap/status/1796571906629374328) 2024-05-31T15:58Z [---] followers, [---] engagements "New fund flows into non-traded REITs continue to ebb as direct private and public real estate markets offer more liquid and transparent ways to take advantage of #cre distress" [X Link](https://x.com/steelbridgecap/status/1797693431457943571) 2024-06-03T18:14Z [---] followers, [---] engagements "@business Good analysis of what happened when naive crowdfunded apartment investors borrowed from high leverage floating rate Wall Street lenders while the Fed started raising interest rates. History does rhyme" [X Link](https://x.com/steelbridgecap/status/1799143800339611718) 2024-06-07T18:18Z [---] followers, [--] engagements "Lost in the press about the impact of bad #commercialrealestate loans on banks is that the biggest problems are in paper held by the largest banks. Looks like the smaller banks learned their underwriting lessons in the GFC. Big guys not so much" [X Link](https://x.com/steelbridgecap/status/1799530843599212645) 2024-06-08T19:56Z [---] followers, [---] engagements "Interesting sign of the times. Spreads have come in [---] bps since beginning of the year to 6% over SOFR range for BBB but still too rich for $BX. Coupon likely double digit on cash flow that was single digit. via @markets https://www.bloomberg.com/news/articles/2024-06-12/blackstone-shelves-1-3-billion-cmbs-deal-amid-new-issue-frenzyutm_source=website&utm_medium=share&utm_campaign=twitter https://www.bloomberg.com/news/articles/2024-06-12/blackstone-shelves-1-3-billion-cmbs-deal-amid-new-issue-frenzyutm_source=website&utm_medium=share&utm_campaign=twitter" [X Link](https://x.com/steelbridgecap/status/1801589613602955695) 2024-06-14T12:16Z [---] followers, [---] engagements "Good insight from @CoStarUS on what is going on with Phoenix warehouse vacancies. 100K and larger properties have significantly more vacancy than smaller ones primarily because most of the new construction has been 300K in size and above. Microcosm of what is going on across the Sunbelt. Will take a while to correct" [X Link](https://x.com/steelbridgecap/status/1802310640284877174) 2024-06-16T12:01Z [---] followers, [---] engagements "KKR addressing liquidity in its non traded REIT by using its balance sheet to buy back shares. Blackstone and Starwood used a different approach and limited redemptions. Blackstone also brought in preferred equity. But recent redemption requests have exceeded new fundraising for all three and this will not likely change until rates drop" [X Link](https://x.com/steelbridgecap/status/1802389764412477865) 2024-06-16T17:16Z [---] followers, [----] engagements "@3NDeveloper Good analysis with good and unanswered questions. But owning now is an interest rate playwhen Fed starts cutting rates this stock will go up" [X Link](https://x.com/steelbridgecap/status/1803426241451602040) 2024-06-19T13:54Z [---] followers, [--] engagements "Interesting piece from @moodys on how maturing CMBS debt issued after [----] is more at risk than prior vintages: Increased use of subordinate debt (mezz and B piece) increased LTV and therefore risk of debt capital stack. Increased use of B pieces (which also has a claim on the property) more likely to trigger earlier and more lengthy A+B note co-defaults/workouts. Current interest rate environment much higher than at issuance date" [X Link](https://x.com/steelbridgecap/status/1804962773258141873) 2024-06-23T19:40Z [---] followers, [---] engagements "#PropTech funding down considerably 1H [----] reflecting cyclical downturn in VC funding as well as #CRE specific issues in operating and capital markets. But overarching issue is generative AI: how do 2022/2023 startups retool with it and how does every app stay current with it given that underlying models are changing and improving so fast" [X Link](https://x.com/steelbridgecap/status/1807085692339491320) 2024-06-29T16:16Z [---] followers, [---] engagements "Good news on the #CPI front: best stuff @Fireworks down 20%-30% from COVID highs. Deflation baby. Backed up the truck this year. Somehow don't think the BLS cares but it will be a heck of a show. Happy #IndependenceDay2024" [X Link](https://x.com/steelbridgecap/status/1808544215564976389) 2024-07-03T16:51Z [---] followers, [---] engagements "Good insight from @CushWake on 40% run up in warehouse construction costs during COVID. Some outright deflation from peak as warehouse demand normalizes but costs will drop further through [----] as new construction shuts down across most property types due to higher interest rates and increasing vacancy" [X Link](https://x.com/steelbridgecap/status/1810301638055256172) 2024-07-08T13:15Z [---] followers, [---] engagements "@landlawyerbrian Terrific work Brian. Looking at a piece of land and would like to learn more" [X Link](https://x.com/steelbridgecap/status/1811376377834139713) 2024-07-11T12:25Z [---] followers, [---] engagements "#bank distress tied almost completely to multi-family loans. 72% of loans in #CRE and most in fix and flip floating rate CA apartments including many impacted by state rent caps passed in [----]. When you have balance sheet and income statement distress no place to hide" [X Link](https://x.com/steelbridgecap/status/1811772852494041268) 2024-07-12T14:41Z [---] followers, [---] engagements "Analysis from @CBRE on apartment cap rates since COVID. Cap rates bottomed at an outlandish 3% during [----] as real rates went negative rising to 5% as the Fed tightened and then paused. Current spread between going in and out cap rates shows maximum bullishness on the asset class. But anybody who bought at 3% caps and has to refinance or sell now is in serious trouble" [X Link](https://x.com/steelbridgecap/status/1814754520292835361) 2024-07-20T20:09Z [---] followers, 15.1K engagements "Data from USEIA on commercial electricity demand by state. Sunbelt demographic shifts and data center/crypto mining driving demand. Surplus capacity in CA NY Midwest might promote data center migration" [X Link](https://x.com/steelbridgecap/status/1815014650221560308) 2024-07-21T13:23Z [---] followers, [---] engagements "@EllliotttB Love the question. Our answer: infinitely higher since REITs are instantly liquid and BREIT is clearly not. Related question: how low does the Fed Funds rate have to go before BREIT looks like an attractive discount to TBills Again liquidity function rules" [X Link](https://x.com/steelbridgecap/status/1815832193434017873) 2024-07-23T19:31Z [---] followers, [---] engagements "@chasesfish True. Banks wised up about office two cycles ago. Banks issue is fix and flip multi family bought at [--] and [--] caps in [----] and 2022" [X Link](https://x.com/steelbridgecap/status/1817715604918596025) 2024-07-29T00:15Z [---] followers, [--] engagements "Analysis from @cohenandsteers showing anomalous multiple discount of REIT's to broader S and P. Another reason to increase REIT allocations on top of tech slowdown/ sector rotation and possible interest rate tailwinds" [X Link](https://x.com/steelbridgecap/status/1818412458387571080) 2024-07-30T22:24Z [---] followers, [---] engagements "News from $EQR : in contract for a $960MM purchase of [----] units from $BX Atlanta Dallas Denver so some oversupply. 5% cap $270K a door (10-15% below depreciated replacement cost) low 8% unleveraged IRR assuming 5% exit cap. Full price in our view given negative rent growth in some of these markets but drop in new construction = pricing power 2026-7" [X Link](https://x.com/steelbridgecap/status/1821536753527803960) 2024-08-08T13:19Z [---] followers, [---] engagements "@mscottdongh_ good question and not divulged. my gut is that they model 0% rent growth for a few years then spike 5-6% annually as market oversupply goes away then normalizing to probably 3% beginning in year [--] or so. Typically ten year hold analysis" [X Link](https://x.com/steelbridgecap/status/1821542366903243104) 2024-08-08T13:41Z [---] followers, [--] engagements "Don't know but I doubt they used debt. These public REITS can buy all cash now or with a line and put long term financing on later when it makes more sense. A lot of the public REITS are in a great place right now to buy all cash as their stock prices have rebounded and lower interest rates now in sight" [X Link](https://x.com/steelbridgecap/status/1821548786847551535) 2024-08-08T14:07Z [---] followers, [--] engagements "This recent chart from MSCI getting a lot of focus. Two problems with this analysis in our view. Potential distress wildly overstated for warehouse and apartments because operating fundamentals are strong in those sectorsany distress is a function of higher interest rates which will come down. Potential distress for office is understated since operating fundamentals are permanently impaired due to hybrid work for all but the top [--] percent of the asset class" [X Link](https://x.com/steelbridgecap/status/1822414224536072267) 2024-08-10T23:26Z [---] followers, [---] engagements "Article from @Bisnow on opposition to nuclear power plants selling on premise vacant land to data centers. $AMZN just bought [----] acres at Talen Plant in PA. On plant electricity is cheaper to users since avoids transmission costs/grid issues and more profitable for the plant. But raises fairness issues and potential higher electrical prices for consumers. With increasing #AI power needs this is a collision course that will only be solved by large investments in electrical and grid capacity" [X Link](https://x.com/steelbridgecap/status/1823338166369059247) 2024-08-13T12:37Z [---] followers, [---] engagements "Interesting chart from @JLL showing that as the pandemic era recedes tenants are giving back less space . In fact many tenants with growth needs in growth markets are maintaining or expanding their footprints. Green shoots" [X Link](https://x.com/steelbridgecap/status/1845096837394407609) 2024-10-12T13:39Z [---] followers, [---] engagements "Excellent work from @CBRE on [--] year relationship between #cre cap rates and [--] year treasury. For every [---] bp move in 10Y industrial cap rates move about 40bp while office retail and apartments move 70-80bps. Assuming [--] Y has peaked cap rates moving down from here" [X Link](https://x.com/steelbridgecap/status/1845975672285429873) 2024-10-14T23:51Z [---] followers, 24K engagements "@solutionomics @CBRE Well said Chris. In my view probably why industrial so less sensitive--there is strong capital markets demand/lower risk premium for that asset class" [X Link](https://x.com/steelbridgecap/status/1846535776672071958) 2024-10-16T12:56Z [---] followers, [--] engagements "Good insight from Revista of impact of higher interest rates on #medical office cap rates (chart 1). But demand (green) continues to outstrip supply (orange) (chart 2) leading to improved occupancy and rents. Buy opportunity" [X Link](https://x.com/steelbridgecap/status/1853173202945462715) 2024-11-03T20:31Z [---] followers, [---] engagements "Yeah thanks for the clarification-- was speaking on the private side. And $ARE is more of a pure life sciences play and there are longs (believing we are through the worse of the life science VC cycle) and shorts (who think oversupply and hybrid office work will hurt it) on both sides of that stock. We don't play in public MOB space but check out $PEAK $WELL and $VTR" [X Link](https://x.com/steelbridgecap/status/1854253324578566335) 2024-11-06T20:03Z [---] followers, [--] engagements "@CBRE just released a white paper on impacts of Trump presidency on #CommercialRealEstate . Predicts tariffs will have the most immediate effect: spike in warehouse demand as companies stockpile ahead of them and pressure on retailers as they lower consumption of imports" [X Link](https://x.com/steelbridgecap/status/1854358705954865509) 2024-11-07T03:02Z [---] followers, [--] engagements "From @Newmark on how #office vacancy is at [--] year high. Suburban/secondary markets actually doing better than primary given value proposition/shorter commutes. Medical remains safe haven but life sciences heading to 20% as new deliveries kick in later this year and 2025" [X Link](https://x.com/steelbridgecap/status/1855401351410319650) 2024-11-10T00:05Z [---] followers, [---] engagements "Good example of how institutions have used public #reits to hedge against overweighting in office and access harder to reach property types. Norges uses them mainly to expand residential exposure" [X Link](https://x.com/steelbridgecap/status/1858485710233223249) 2024-11-18T12:21Z [---] followers, [--] engagements "#Chicago the only US city to capture a significant amount of warehouse leasing demand in spite of declining population growth per @JLL Centrality is everything in industrial. Can this be a catalyst for population growth here" [X Link](https://x.com/steelbridgecap/status/1858581180486218008) 2024-11-18T18:40Z [---] followers, [---] engagements "@kylematthewsceo Yep and what is interesting is that cap rates have stayed in the same rough range of 6% as well except for COVID era drops due to extreme monetary policy. Cap rates gap and transactions drop only in times of economic uncertainty" [X Link](https://x.com/steelbridgecap/status/1859646984711438781) 2024-11-21T17:16Z [---] followers, [--] engagements "Mori Building Company just bought an 11% interest in $SLG's One Vanderbuilt in NYC for $2900+/sf. Record pricing for this size of building. Top floor rents in nosebleed range of $300/sf Top 25% office buildings like this are thriving. But everyone else is in a dogfight" [X Link](https://x.com/steelbridgecap/status/1859961833647751364) 2024-11-22T14:07Z [---] followers, [---] engagements "Per @SPGMarketIntel 41% of REIT sector raised dividends through 10/1. Retail (shopping centers) residential and industrial increases reflect strong operating fundamentals/national footprints that mitigate micro market weaknesses. Office and self-storage mirror the opposite" [X Link](https://x.com/steelbridgecap/status/1860827718410961086) 2024-11-24T23:27Z [---] followers, [---] engagements "Good insights from @cred_iq on delinquent #cmbs loans by property type. Hotel and apartment distress due to balance sheet issues: floating rate debt kills DSCR. Retail is on the income statement side: mainly older malls which continue their slow decline even as shopping centers outperform. Office has both balance sheet and income statement issues due to hybrid work. industrial and self storage minimal due to very strong operating fundamentals" [X Link](https://x.com/steelbridgecap/status/1861412707964199402) 2024-11-26T14:12Z [---] followers, [---] engagements "New from @redfin showing decline of investor purchases of SFH since COVID. Correlates with interest rates and economy. SFH investors = 16%+ of all purchases (30% in some coastal markets). Majority in lower priced homes. Up from 6% share in [----]. Implications: Higher prices Less supply Higher Rents" [X Link](https://x.com/steelbridgecap/status/1862527950341406960) 2024-11-29T16:04Z [---] followers, [--] engagements "Newest from @TreppWire on CMBS deliquency rates by property type confirms prior trends. Office could easily double from here due to WFH value destruction the rest of the property types will stay below 10%" [X Link](https://x.com/steelbridgecap/status/1862544312929484900) 2024-11-29T17:09Z [---] followers, [---] engagements "New from @propmodo [--] greatest #RealEstate books of all time. What's missing But the best book is the one each one of us is writing every day. https://propmodo.com/the-50-greatest-commercial-real-estate-books-of-all-time/ https://propmodo.com/the-50-greatest-commercial-real-estate-books-of-all-time/" [X Link](https://x.com/steelbridgecap/status/1862993250170093775) 2024-11-30T22:52Z [---] followers, [---] engagements "Case study in creating shareholder value: $SLG just sold a partial interest in One Vanderbilt office tower for a record $2900/sf. Then bought [---] Park Avenue office and retail property for $646/sf" [X Link](https://x.com/steelbridgecap/status/1863007821379350972) 2024-11-30T23:50Z [---] followers, [---] engagements "@StealthQE4 Agree. The good news is that its not the banks that will be taking the hitsits the owners of the securitized debt. The bad news is that office will easily get to [--] percent before its over" [X Link](https://x.com/steelbridgecap/status/1863537767172481054) 2024-12-02T10:56Z [---] followers, [--] engagements "Chart on relationship between FF [--] year bond and [--] yr fixed mortgage rates. [--] takeaways: [--] year with lag tracks movement in Fed Funds. Spread of mortgages over [--] year well above historical of [---] due to bank funding costs. Mortgages can come down even if Fed pauses" [X Link](https://x.com/steelbridgecap/status/1864390370148171824) 2024-12-04T19:24Z [---] followers, [---] engagements "Interesting chart from @SPGlobal on ratio of positive to negative comments in Q3 REIT earnings calls. Not surprisingly data centers and hotels lead while industrial (vacancy issues) and specialty (timber ag infrastructure casinos) lag" [X Link](https://x.com/steelbridgecap/status/1864812509565264196) 2024-12-05T23:22Z [---] followers, [--] engagements "Chart from @EvercoreISI on extended period that REITS have traded at a discount to NAV= COC/spread investing issues and resulting dearth of acquisitions/external growth. Given waning new supply in most sectors if rates come down and demand holds up NAV premiums will return" [X Link](https://x.com/steelbridgecap/status/1864824264869761037) 2024-12-06T00:08Z [---] followers, [---] engagements "But per @SPGlobal some REITs are already trading at a premium to NAV and could gain a head start in the spread investing game once rates normalize" [X Link](https://x.com/steelbridgecap/status/1864826063697658291) 2024-12-06T00:15Z [---] followers, [--] engagements "New from @TreppWire on continuing surge in #CMBS special servicing especially office at 14.63%. Important to remember that office ALREADY exceeds the GFC rate where WFH was not a factor. Could easily exceed 20% before it is over due to continued value destruction @MSCI_Inc" [X Link](https://x.com/steelbridgecap/status/1865472518225563656) 2024-12-07T19:04Z [---] followers, [---] engagements "Here is the simple math on AI power needs: A single Google search requires .3 watt hours of electricity; a single Chat GPT query use 10X that. That means data centers will rapidly max out our power without fundamental upgrades to the grid. Good graph from @McKinsey" [X Link](https://x.com/steelbridgecap/status/1865542757911032194) 2024-12-07T23:43Z [---] followers, [---] engagements "In our view the Fed is cutting because it thinks it has won the war on inflation. @WilliamBlairIM shows why: ex-shelter we are running around 2% now that shelter is decelerating due to high apt construction. But shelter will stay elevated as long as housing affordability an issue" [X Link](https://x.com/steelbridgecap/status/1866583181752742149) 2024-12-10T20:38Z [---] followers, [--] engagements "Lost in the discussion about lack of home affordability is that fact that this situation is an anomaly in the last [--] years @CBRE It depresses the home sales GDP engine and keeps rents elevated and shelter CPI high. Fed cuts will help drop CPI and restart the housing market" [X Link](https://x.com/steelbridgecap/status/1867967424106041548) 2024-12-14T16:18Z [---] followers, [---] engagements "Federal government leased space in private buildings down 7% in [--] years down 11% in DC area alone as remote work grows per @SPGMarketIntel . Another 50% expires or can be terminated in next [--] years. Yet Federal buildings in DC only 12% occupied according to PBRB. @DOGE" [X Link](https://x.com/steelbridgecap/status/1868461318967333345) 2024-12-16T01:01Z [---] followers, [--] engagements "Chair Powell was optimistic today that shelter CPI will improve due to lag effects. We aren't so sure: as long as mortgage rates stay high housing affordability @CBRE will remain at [--] year lows and continue to make would be home buyers price- inelastic renters by necessity" [X Link](https://x.com/steelbridgecap/status/1869502775345951052) 2024-12-18T21:59Z [---] followers, [---] engagements "Since the direction of interest rates is so critical to our real estate community a few things are worth repeating: The Fed made it clear this week that further cuts in Fed funds will only happen if CPI keeps dropping towards 2%. Meanwhile current Fed cuts= higher ten year and mortgage rates due to fears of inflation and/or continued economic growth. Core CPI has dropped mainly because goods and service increases have normalized in response to cooling labor markets and fixes in COVID era supply chains. So further Fed cuts will follow the direction of core shelter inflation per below and given" [X Link](https://x.com/steelbridgecap/status/1870892207231689157) 2024-12-22T18:00Z [---] followers, [---] engagements "Redfin's top [--] [----] projections for the housing market: absent a weakening economy mortgage rates will stay high and housing affordability will remain low. In other words: Shelter CPI will remain high as renters by necessity predominate. Residential brokerage firms will continue to struggle and consolidate. https://www.redfin.com/news/housing-market-predictions-2025/ https://www.redfin.com/news/housing-market-predictions-2025/" [X Link](https://x.com/steelbridgecap/status/1872285570157760584) 2024-12-26T14:17Z [---] followers, [---] engagements "@TicTocTick And mortgage rates will stay high as will shelter CPI as housing affordability remains at multi decade lows" [X Link](https://x.com/steelbridgecap/status/1872383189144187296) 2024-12-26T20:45Z [---] followers, [---] engagements "Nice precis from @eastdilsecured on rebound in CMBS lending this year. Warehouse retail apartments finding a bid as Fed starts cutting and yield curve starts to normalize. Office not so much. But 10Y will need to stay reliably below 4% for lending to rebound in earnest in 2025" [X Link](https://x.com/steelbridgecap/status/1873621939677216791) 2024-12-30T06:47Z [---] followers, [--] engagements "December #cmbs deliquency @TreppWire showing 11% office delinquency highest since series started in [----]. As we have stated before delinquency will be 20% + before it's over due mainly to secondary location B quality office distress from hybrid work value destruction" [X Link](https://x.com/steelbridgecap/status/1874152729767272665) 2024-12-31T17:56Z [---] followers, [---] engagements ".and great real time look at the impact of the Fed cuts on weekly mortgage rates from @mortgagenewsmnd as the bond market pushed back on the Fed's "mission accomplished" pronouncement" [X Link](https://x.com/steelbridgecap/status/1874169183749235126) 2024-12-31T19:02Z [---] followers, [--] engagements "$WPC just announced [----] acquisitions for their single tenant portfolio--higher interest rates are pushing up cap rates and creating buy opportunities. $1.6B 7.5% average cap 9% average yield 10+ years of term positive leverage. Two years ago these same deals were in the [--] and 5% cap range. Buying is getting fun again" [X Link](https://x.com/steelbridgecap/status/1876981322154979740) 2025-01-08T13:16Z [---] followers, [---] engagements "$BXP just bought a 300K vacant DC office building for $34MM=land value. But here is the counter-narrative: they are knocking it down to build another office building and have already pre-leased half of the new building to a law firm. As we have said before there isn't enough office space in DC and most US downtowns that fits the new higher post-COVID tenant standards and developers will keep building more of it" [X Link](https://x.com/steelbridgecap/status/1876984033416294751) 2025-01-08T13:27Z [---] followers, [---] engagements "Interesting analysis for where VC firms are placing gen #AI bets in the real estate tech space from @JLL . JLL says there are a staggering [----] companies providing real estate technology services but only 10% are using gen AI. And of those 10% very few are AI-native: most are getting AI augmented re-works of existing software. Not surprisingly design and construction pm and portfolio data and market analysis the most crowded. Unclear to us whether AI augments are going to do much. But highly likely that some soon to be developed AI native application could be a game changer" [X Link](https://x.com/steelbridgecap/status/1877474254427664662) 2025-01-09T21:55Z [---] followers, [---] engagements "$AMZN spent $2B on acquisitions in [----] up from $930MM in [----]. Most of this was data center land acquisitions and not warehouses: [----] acres in [--] states but just under half in VA. AWS keeping up with AI compute needs. But if AI goes bust they can just build warehouses instead" [X Link](https://x.com/steelbridgecap/status/1877739073927852506) 2025-01-10T15:27Z [---] followers, [--] engagements "Data from PERE on the dismal state of real estate PE fundraising. $131B raised lowest since [----] and 50% below [----] numbers. High interest rates a killer: wider bid ask spreads reluctant sellers target IRR's harder to achieve treasuries hard to beat on a risk adjusted basis" [X Link](https://x.com/steelbridgecap/status/1877833374502416848) 2025-01-10T21:42Z [---] followers, [--] engagements "CMBS special servicing for office has doubled in a year per @TreppWire . House view: It goes to 20%+ before stabilization. Rest of the product types will max out around 10%" [X Link](https://x.com/steelbridgecap/status/1877851298923471002) 2025-01-10T22:53Z [---] followers, [---] engagements "Another Class A office property just traded for land value. [--] W. Madison in Chicago just traded for $85MM nearly 80% less than the $375MM [----] sale price. That's $60/sf for a 65% leased Hines built property in the heart of the Chicago Loop. At that basis they can rent it at C class rents and still make money" [X Link](https://x.com/steelbridgecap/status/1877865791191712067) 2025-01-10T23:51Z [---] followers, [---] engagements "Interesting to see that the e-commerce as % of sales trajectory change that took place during COVID is now permanent. Nominal gross retail sales increases were turbocharged by inflation but the % is permanently higher" [X Link](https://x.com/steelbridgecap/status/1878540318200766551) 2025-01-12T20:31Z [---] followers, [---] engagements "Sidebar on prior post on e-commerce percentage of retail sales. If per @CBRE you exclude gas and automobiles the total % is higher but the trajectory is the same" [X Link](https://x.com/steelbridgecap/status/1878573663789711556) 2025-01-12T22:43Z [---] followers, [--] engagements "New study from @REITs_Nareit showing that REITs are second only to private equity in total return. And with far better liquidity and lower loads. Out performed private real estate too and with lower fees though the two were highly correlated. Real estate PE has work to do" [X Link](https://x.com/steelbridgecap/status/1878773722011807885) 2025-01-13T11:58Z [---] followers, [---] engagements "Top [--] US banks with #CRE exposure as a % of total equity from @FloridaAtlantic. Exposure is to a broad range of real estate collateral types some of whose income statements are doing better (retail warehouse apartments) than others (office). But all collateral with maturing loans face balance sheet risk due to interest rate resets" [X Link](https://x.com/steelbridgecap/status/1878812523266191609) 2025-01-13T14:33Z [---] followers, [---] engagements "Good retrospective on historical CMBS. 2000's driven by acquisitions and poor underwriting followed by GFC reckoning. [----] saw a return of volume but driven by floating rate single borrower refis betting on SOFR drop. Largest was $3.4B Rock Center refi valued at 5.5% cap" [X Link](https://x.com/steelbridgecap/status/1878840779474633069) 2025-01-13T16:25Z [---] followers, [---] engagements "There's alot of news about office distress but distress in life sciences is now far worse. Per @JLL vacancy at 30% and on its way to 40% before it stabilizes and rents dropping. Supply super cycle and anemic VC funding. Good value buy opportunities in public and private markets but recovery is a ways off" [X Link](https://x.com/steelbridgecap/status/1879149300711604600) 2025-01-14T12:51Z [---] followers, [---] engagements "As we have stated before rent and shelter CPI are going to stay between 4-5% as long as high mortgage rates limit housing affordability. Apartment market vacancy has also peaked and rents only going to accelerate from here. CPI relief has to come from goods or other services" [X Link](https://x.com/steelbridgecap/status/1879550095810793604) 2025-01-15T15:23Z [---] followers, [---] engagements "@Jaywramseyky You raise a good point: the beginning and end dates of the survey determine the results. There are shorter periods within that time frame where PE equity outperformed everything" [X Link](https://x.com/steelbridgecap/status/1879593389446053960) 2025-01-15T18:15Z [---] followers, [--] engagements "The highly unusual move in the [--] year since last September has put CRE's hopes for a transaction and value recovery on hold. Per @jpmorgan most of this move has been due to heightened growth expectations and uncertainty about the Fed's reaction to the inflation that could come with this growth and from the incoming administration's policies on trade and immigration. Given that growth is always good for real estate if the uncertainty component goes away the ten year should again be supportive of transactions and values" [X Link](https://x.com/steelbridgecap/status/1880313856834039936) 2025-01-17T17:58Z [---] followers, [--] engagements "Unleveraged IRR's for all private real estate have averaged around 7% and [---] bps over Baa corporates since the 1980s. Current Baa's close to [--] so it's hard to find sellers at the required 8% IRR for core CRE. But plenty of distressed sellers of non core at twice that" [X Link](https://x.com/steelbridgecap/status/1880996317637566936) 2025-01-19T15:10Z [---] followers, [---] engagements "Anybody else think it is quicker and easier to get a cab in Manhattan than an Uber or Lyft You see it you flag it. No wandering around looking either. From @bloomberg on what is happening due to congestion pricing. I think the cabs know that and are flooding the zone" [X Link](https://x.com/steelbridgecap/status/1881010060815655195) 2025-01-19T16:05Z [---] followers, [---] engagements "Interesting per @WSJ and @GreenStreet_CRE $INV trading at discount to NAV due to rise in interest rates. Yet elevated mortgage rates have limited homes on the market and led to higher home prices and SFR rents. Good example of macro incorrectly affecting a stock value" [X Link](https://x.com/steelbridgecap/status/1881039503558894053) 2025-01-19T18:02Z [---] followers, [---] engagements "Interesting to see @CBRE how aggressive apartment IRR rent growth and cap rate assumptions are in spite of high interest rates and overbuilt sunbelt markets. High mortgage rates and lack of home supply/affordability has created a generation of renters by necessity" [X Link](https://x.com/steelbridgecap/status/1883186529838968845) 2025-01-25T16:13Z [---] followers, [---] engagements "Bearish (perhaps) for cold storage REITS predicated on revenue growth through development but new supply reductions are bullish long term for private owners of existing. Not investment advice. The cold storage warehouse industry has been suffering from declining year-over-year inventory levels since mid-2023 and are not showing signs of letting up based on @USDA data. (1/3) https://t.co/aceoQO1l4r The cold storage warehouse industry has been suffering from declining year-over-year inventory levels since mid-2023 and are not showing signs of letting up based on @USDA data. (1/3)" [X Link](https://x.com/steelbridgecap/status/1883924789758480766) 2025-01-27T17:07Z [---] followers, [---] engagements "New from @MSCI_Inc on buyer cap rates on higher risk vs core multifamily. Risk asset unleveraged IRR's [---] bp + higher though" [X Link](https://x.com/steelbridgecap/status/1883938343626629544) 2025-01-27T18:01Z [---] followers, [---] engagements "@conorsen @opinion Agree on dwindling AA space. But including sublease Midtown vacancy increased in [----] to 23% and gave back another 4MM of net office space so bumping along the bottom at best. Most of the vacancy is in older buildings and that is where most of the maturing CMBS debt is @JLL" [X Link](https://x.com/steelbridgecap/status/1886482543735677424) 2025-02-03T18:31Z [---] followers, [--] engagements "Great illustration from @TreppWire about which CMBS apartment loans are now underwater from an LTV perspective. Anything securitized from Q4 [----] to Q4 [----] at sub 5% caps when rates were at COVID lows. Market historically is 5.5-6% and now normalizing. Won't end well" [X Link](https://x.com/steelbridgecap/status/1888802676701581662) 2025-02-10T04:10Z [---] followers, [---] engagements "Candidly I am surprised to see the surge in non agency bank and lifeco lending volume per @CBRE . Taking share from CMBS and alt lenders. Surprising too. Banks appear to be healing post SVB" [X Link](https://x.com/steelbridgecap/status/1889089119718191244) 2025-02-10T23:08Z [---] followers, [--] engagements "For those of you worried about housing affordability and access there is an interesting parking bill in front of the Washington State legislature. Bill [----]. Would prohibit Washington State municipalities from creating minimum parking requirements for new developments. This would dramatically reduce developer costs and increase the amount of FAR available for ADU's not to mention reduce traffic congestion and auto emissions. Also bullish for owners of existing parking structures. This is going on all over the country--cities trying to kill the car. Wave of the future" [X Link](https://x.com/steelbridgecap/status/1889327814844846103) 2025-02-11T14:57Z [---] followers, [--] engagements "Per @business $BX offers $428MM for London office building. Reportedly 6% ish cap. London rents up 8% in [----] off bottom building leases are long term and many were signed during Covid so they already reflect hybrid work space needs. Bond with an equity kicker" [X Link](https://x.com/steelbridgecap/status/1900894445043679329) 2025-03-15T12:58Z [---] followers, [---] engagements "Office rents up 4% cumulatively since COVID due to WFH downsizing from @MSCI_Inc But TI and new construction costs up 40%. So effective rents are still in negative growth. Good news: new construction can't pencil so supply shut down sets the stage for a recovery. Bad news: It will be a decade of pain" [X Link](https://x.com/steelbridgecap/status/1902026452914069527) 2025-03-18T15:56Z [---] followers, [--] engagements "Real estate secondaries had a big year in [----] per @ares_management. Lower mark to market valuations/higher interest rates make for attractive entry points for new investors. GP led transactions still dominate. [----] should be another strong year" [X Link](https://x.com/steelbridgecap/status/1903037741488582731) 2025-03-21T10:55Z [---] followers, [--] engagements "From @jpmorgan hotel Revpar down 4% YOY due mainly to occupancy declines in non luxury segments. Mirrors recent slow down in airline bookings due to decreased consumer confidence and business concerns/uncertainty about macro" [X Link](https://x.com/steelbridgecap/status/1903129951194255582) 2025-03-21T17:01Z [---] followers, [--] engagements "According to @cbre 80% of all firms have "implemented" their RTO but 75% of these firms say attendance is not there yet. Our view: this is less about worker intransigence and more about employer indifference: they have figured out that over time WFH will save money on rent" [X Link](https://x.com/steelbridgecap/status/1903551834444435626) 2025-03-22T20:58Z [---] followers, [---] engagements "Helpful breakdown from @MorganStanley on the core functionalities of AI. (1) Getting organizing processing and interpreting existing data and (2) rearranging it creatively are core competencies today but agentic skills will improve significantly in three years" [X Link](https://x.com/steelbridgecap/status/1908125937658433956) 2025-04-04T11:54Z [---] followers, [--] engagements "From conference presentation @apolloglobal yesterday. Loan activity falling off sharply due to tariffs yet spreads currently ignoring" [X Link](https://x.com/steelbridgecap/status/1908533290455220237) 2025-04-05T14:52Z [---] followers, [--] engagements "@jayparsons not sure that is accurate. either way we are are close to long term averages on both so we don't see a lot of room to move down absent lower rates" [X Link](https://x.com/steelbridgecap/status/1910355782291370190) 2025-04-10T15:34Z [---] followers, [--] engagements "I think this sets a record for the steepest discount we have seen in office. @CrainsChicago . Vacant Chicago suburban office building just sold by $O for $6MM or $8/sf a 96% discount off the [----] sale price of $150MM. New owner is going to lease it up as discount office" [X Link](https://x.com/steelbridgecap/status/1911562189636247774) 2025-04-13T23:28Z [---] followers, [----] engagements "Earnings down 8% in first quarter YOY from $JBHT in an already weak pricing environment due to oversupply of trucks. Seeing slowdown in some of our warehouse properties as well" [X Link](https://x.com/steelbridgecap/status/1912476327275344185) 2025-04-16T12:01Z [---] followers, [---] engagements "Interesting. After buying a 49% interest in [---] Howard St in SF for $900/sf in [----] Divco just recapitalized the now vacant building with $BX for $264/sf. With net rents in the $50 range that's a nearly 20% YOC before lease up TI's and commissions. That's how you do it" [X Link](https://x.com/steelbridgecap/status/1915119381857915335) 2025-04-23T19:03Z [---] followers, [--] engagements "For those of you who want a good tutorial on the history of CMBS @trepp just released their first piece. Tracks CMBS [---] 2000-2007 full of poor underwriting huge investor demand and later carnage during the GFC. Issuance hit in excess of $200B in [----] and we have rarely hit half that level ever since. What is interesting is the chart below which tracks the subsequent losses by property type. Retail the big loser as e-commerce destroyed a generation of inferior malls followed by office the perennial problem child of CRE. What is more interesting is the relatively low loss rates in apartments" [X Link](https://x.com/steelbridgecap/status/1918001198134657109) 2025-05-01T17:54Z [---] followers, [---] engagements "@RecoveryTrade The ones with urban concentrations like $SLG and $VNO (new york) or $$BXP (national CBD's) do since urban leases are generally longer. Suburban reits like $CUZ and $HIW have shorter term" [X Link](https://x.com/steelbridgecap/status/1918379188106531022) 2025-05-02T18:56Z [---] followers, [--] engagements Limited data mode. Full metrics available with subscription: lunarcrush.com/pricing
@steelbridgecap Gavin Campbell
Gavin Campbell posts on X about rates, debt, inflation, mortgage rate the most. They currently have [------] followers and [---] posts still getting attention that total [---] engagements in the last [--] hours.
Engagements: [---] #
- [--] Week [---] +466%
- [--] Month [-----] +45%
- [--] Months [-----] -56%
- [--] Year [------] -62%
Mentions: [--] #
- [--] Month [--] -45%
- [--] Months [--] -20%
- [--] Year [---] -7.20%
Followers: [------] #
- [--] Week [---] no change
- [--] Month [---] -1.80%
- [--] Months [---] -2.20%
- [--] Year [---] +33%
CreatorRank: [---------] #
Social Influence
Social category influence finance stocks cryptocurrencies technology brands currencies travel destinations celebrities agencies us election fashion brands
Social topic influence rates, debt, inflation, mortgage rate, reit, ai, commercial real estate, fed, cre, investment
Top accounts mentioned or mentioned by @msciinc @cbre @jpmorgan @treppwire @jll @apolloglobal @realpage @wsj @bisnow @moodys @jayparsons @ferrotv @yardi @newmark @business @mmreis @lisaabramowicz1 @tomkeene @sonalibasak @markets
Top assets mentioned Blackstone, Inc. (BX) Boston Properties, Inc. (BXP) SafeCoin (SAFE) Amazon.com, Inc. (AMZN) Cousins Properties Inc. (CUZ) Veno Finance (VNO) Equity Residential (EQR) Goldman Sachs (GS) Morgan Stanley (MS) Arbor Realty Trust, Inc. (ABR) WP Carey, Inc. (WPC) Autonomous Virtual Beings (AVB) Msci Inc (MSCI) Rexford Industrial Realty, Inc. (REXR) Prologis Inc (PLD) SL Green Realty Corp. (SLG) FedEx Corporation (FDX) Invitation Homes, Inc. (INVH) Procore Technologies, Inc. (PCOR) AppFolio, Inc. Class A (APPF) CoStar Group, Inc. (CSGP) Microsoft Corp. (MSFT)
Top Social Posts
Top posts by engagements in the last [--] hours
"3/8 The girls listen to you like you are Zeus on Mount Olympus and the boys dont listen at all. This is why our women have won four World Cups and four Olympic Golds"
X Link 2023-12-26T03:49Z [--] followers, [--] engagements
"Replying to @KobeissiLetter The US office market is indeed in "bear market" territory but the rest of commercial real estate (CRE) like apartments warehouses retail data centers self-storage and hotels are in decent shape with vacancies only slightly above frictional levels The new normal for Commercial Real Estate (CRE): Properties are selling for less than half of what they were worth just [--] years ago. A downtown Los Angeles office building that sold for $92.5 million in [----] just sold for $44.7 million. [--] days ago the Aon Center Los Angeles' https://t.co/7rmoZKJYer The new normal for"
X Link 2023-12-27T01:47Z [---] followers, [---] engagements
"#CRE transactions way down in [----] and cap rates up as balance sheet and operating distress higher interest rates loan maturities and lack of new debt capital either turn ownership over to lenders or create large bid-ask spreads between patient owners and buyers. @MSCI_Inc"
X Link 2023-12-28T00:53Z [---] followers, [---] engagements
"Good piece. Falling rates a tailwind and your point that macro matters is important. Asset type and local/micro factors matter too: office a bloodbath but storage warehouse and apartments although seeing higher vacancy and lower/negative rent growth should stabilize in [----] REITs Are on Fire Lately. What Comes Next InvestorPlace https://t.co/mYTNnJFr2Z REITs Are on Fire Lately. What Comes Next InvestorPlace https://t.co/mYTNnJFr2Z"
X Link 2023-12-28T15:31Z [---] followers, [--] engagements
"What's most interesting about this chart is the large delinquency in apartments which--unlike office--is in good shape from a vacancy perspective. The answer: balance sheet mayhem as fix and flip apartment buyers who borrowed with low floating rate debt in 2001/2 now face resets The amount of delinquent #multifamily #CRE #CLO loans increased by approximately $875 million in November a 117% month-over-month increase. See more via #Trepp: https://t.co/4ntXJPVitn https://t.co/Z1ZlAffueJ The amount of delinquent #multifamily #CRE #CLO loans increased by approximately $875 million in November a"
X Link 2023-12-28T15:53Z [---] followers, [--] engagements
"Replying to @elerianm : Agree completely. WeWork was a low interest rate fueled rebranding of a failed forty year old business model based on long term lease liabilities and short-term lease revenues that as a result was and is viewed by landlords as a tenant of last resort. From the @cnbc article on Startup bubble fueled by Feds cheap money policy finally burst in [----]. https://t.co/hGWbEZG4VU From the @cnbc article on Startup bubble fueled by Feds cheap money policy finally burst in [----]. https://t.co/hGWbEZG4VU"
X Link 2023-12-28T21:14Z [--] followers, [---] engagements
"@SquawkStreet @willywalk @elonmusk @jimcramer @davidfaber @carlquintanilla Everybody's right here. Bottom 50% of office is a falling anvil. The rest of #commercialrealestate like apartments warehouse and self storage is in decent shape. And office loans are a small piece of #banks #CRE books. Non bank lenders have most of the troubled office loans"
X Link 2023-12-31T17:30Z [--] followers, [--] engagements
"Good strategy. Focus appears to be single tenant long tern net leased assets which trade more like long term corporate bonds than real estate: i.e values for this asset class are highly sensitive to moves in 10-year bond interest rates and move inversely to each other. Morgan Stanley Launching Nontraded REIT Targeting Industrial Healthcare And Retail https://t.co/wUlaBGueZd Morgan Stanley Launching Nontraded REIT Targeting Industrial Healthcare And Retail https://t.co/wUlaBGueZd"
X Link 2024-01-05T20:52Z [---] followers, [--] engagements
"Nice chart @GameofTrades_ Tightening bank standards for #CRE have also systematically preceded commercial real estate distress as borrowers are unable to refinance at the same loan to cost ratios and DSCR's they originally borrowed at. Non-bank lenders tightening as well. Banks have been rapidly tightening lending standards Rise in tightening standards have systematically preceded a rise in the unemployment rate This time is not different https://t.co/KxLYerRPpe Banks have been rapidly tightening lending standards Rise in tightening standards have systematically preceded a rise in the"
X Link 2024-01-06T21:44Z [---] followers, [--] engagements
"Good chart @Snapforce showing drop in multifamily lending this year. Started during bank turmoil in the first quarter but accelerated as rising vacancy 30% post-pandemic rise in construction/labor/insurance costs and higher interest rates made DSCR's untenable for refinancings or new construction loans. Sets the stage for multifamily balance sheet distress in [----] but silver lining is that as new construction slows vacancies will start to drop in 2025+. Also interesting is the above trend growth in [----] due to ultra low interest rates and new construction response to COVID migration. Many of"
X Link 2024-01-07T21:41Z [--] followers, [--] engagements
"Terrific article in @WSJ on how private equity investors are getting scale in single family home rental investment by funding large new housing developments. Note per chart @JBREC that mom and pop investors are still the largest investors in the space by far"
X Link 2024-01-08T00:44Z [--] followers, [--] engagements
"1/2 Great chart @cred_iQ on peak office lease expirations nationally for offices with CMBS debt. As these leases expire we will see the clearest picture of how office tenants have decided to rationalize their space needs post-pandemic. #commercialrealestate"
X Link 2024-01-10T14:26Z [---] followers, [---] engagements
"Not an expert on risk of foreign gov debt/FX but would take US 10's at 4% over this deal any day due to liquidity premium. [--] years of real estate has taught me about the illiquid nature of the asset class and ground leases are the most illiquid of all. Add to that low inflation protection of 2% annual bumps over [--] years and the fact that you are overpaying for the land in this location in my view you'll be lucky to get an IRR above the coupon rate. At least with the US [--] you might get some appreciation if you believe the bond bulls or if not you can get out tomorrow"
X Link 2024-01-11T16:53Z [---] followers, [--] engagements
"@TripleNetInvest Also if you want to invest in ground leases with liquidity consider $SAFE . Like long duration bonds sensitive to interest rates and down significantly from peak. Not investment advice"
X Link 2024-01-11T17:40Z [---] followers, [--] engagements
"1/3 Nice chart from @RealPage on #apartment rent growth pre during and post pandemic. But the these averages mask large differences between metro areas"
X Link 2024-01-12T15:01Z [--] followers, [--] engagements
"This story @crainschicago is emblematic of how many office tenants are rationalizing their space needs in a post pandemic world: 60% reduction in space needs due to new hybrid work model although downsizing is often less depending on the industry No desire to live through a renovation of the space that is required to downsize the space so departure is the only option Negotiated rights to expand their new space significantly in the future if growth requires it. Bottom line: tenants still need office space with room to grow just typically less of it with a bias towards moving to a new location."
X Link 2024-01-12T19:58Z [---] followers, [--] engagements
"Nice chart @GameofTrades. Most of this delinquency is NOT due to vacancies in multifamily which remain at reasonable levels. It comes from interest rate resets on floating rate bridge loans taken out in 2021-22 by fix and flip borrowers prior to the Fed's interest rate increases. $ABR a good example of the type of lenders who made these loans. ALERT: Housing defaults are now at the highest levels in a decade Buckle up https://t.co/RF4K8H6URE ALERT: Housing defaults are now at the highest levels in a decade Buckle up https://t.co/RF4K8H6URE"
X Link 2024-01-13T02:36Z [---] followers, [---] engagements
"$NLOP the office owning spin-off of $WPC just announced the sale off four long term leased office assets with various credits and locations at an 8.4% cap. Shows that there is a market for long term leased office at reasonable valuations provided the cap rate is above the interest rate of the new acquisition loan. But assets like these were trading in the 6% cap rate range in 2021-22 when interest rates were much lower"
X Link 2024-01-13T19:53Z [---] followers, [---] engagements
"@realEstateTrent Used to think that way but after [--] years of the time suck and illiquidity of private real estate have found that #reits are a good way to hedge our private business and invest for similar returns with minimal time and high liquidity"
X Link 2024-01-14T13:45Z [---] followers, [---] engagements
"Nice chart @RealPage on [----] relationship between apartment new supply and rent growth. Good proxy for underwriting rent growth in [----] though if we do go into recession it will be lower across the board. #commercialrealestate"
X Link 2024-01-15T12:01Z [---] followers, [--] engagements
"Remember per @realpage that a little over 50% of #apartments tenants renew leases when vacancies are low and that renewals drop as vacancy increases. Given US apartment vacancies are heading up in [----] important to factor into deal underwriting with higher downtime assumptions lower rents or more free rent"
X Link 2024-01-16T18:35Z [---] followers, [--] engagements
"@TheWolfofREI Agree but the irony of it all is that this list describeswith the exception of the capital callthe things you have to do even when the deal is going according to plan. Real estate is always a time suck"
X Link 2024-01-17T13:40Z [---] followers, [--] engagements
"@bencasselman 2/2 Finally I do agree that it makes sense to distinguish between new and renewal leases since landlords find it easier to pass on increases in rent to existing tenants and typically have to offer discounts to new ones. As for weighting the renew/release ratio is about 50/50"
X Link 2024-01-18T00:41Z [---] followers, [---] engagements
"@acquisizioni Great point on #office. And missing core asset classes like #warehouse data centers cold storage and self-storage. Have found that risk is less about product type and more about lease credit markets leverage and capex. Office biggest capex hog of all. Kills free cash flow"
X Link 2024-01-18T01:33Z [---] followers, [---] engagements
"It's all about basis and cycles. Our view is 80% of your return in real estate comes from how cheaply you buy so if you are buying significantly below replacement value and/or recent sales you won't lose a dime and may make a lot. But the only way to buy cheaply is to understand real estate cycles and how to time them"
X Link 2024-01-18T21:27Z [--] followers, [--] engagements
"2/2 But @CBRE apartment IRR and cap rate requirements vary significantly by market and submarket"
X Link 2024-01-18T23:42Z [---] followers, [--] engagements
"1/2 Interesting analysis from @CBRE on increase in initial cap rates and IRR requirements for #apartments as the the Fed tightened from [----]. @CBRE predicting both will drop if and when the Fed starts cutting rates so if you are buying now might be the time"
X Link 2024-01-18T23:42Z [---] followers, [--] engagements
"Interesting article on how weight loss drugs could reduce retail footprints. Counter is that if people live longer they will need more retail. What do you think Ozempic Could Be The Next Big Curveball For Commercial Real Estate https://t.co/FL8KHg5eul Ozempic Could Be The Next Big Curveball For Commercial Real Estate https://t.co/FL8KHg5eul"
X Link 2024-01-19T13:46Z [--] followers, [--] engagements
"@DiMartinoBooth @WSJ Lag effect. Mortgage interest rates for #housing started moving down in earnest after Halloween and buyers started to go under contract in the last quarter of [----]. These sales will show up when they close in the first quarter 2024"
X Link 2024-01-19T20:51Z [---] followers, [---] engagements
"@chernobelskiy @moseskagan Agree. But if LP facing dry gain tax issues due to likely loan restructuring on top of equity loss the pref equity could at least postpone the tax bill for that"
X Link 2024-01-23T00:14Z [--] followers, [---] engagements
"Sure. So often in situations where LP's (and GP's) are getting wiped out the property may be worth less than the debt. If the lender decides to work with a recapped partnership (often involving preferred rescue capital per this thread) they often write part of the loan off so that new partnership has a better debt structure going forward. That amount of debt that is written off is basically loan forgiveness to the LP/GP and as such is taxable under IRS rules as ordinary income. Not an accountant and there are many wrinkles to this including how the LP/GP has depreciated the asset prior to the"
X Link 2024-01-23T01:17Z [--] followers, [---] engagements
"@RE_Deal_Junkie Love it. I once put an R and D facility under contract and learned in due diligence that the tenant selected the location because it was the only property they could find in the city that had the right Feng Shui. I closed and they renewed twice for a total of [--] years"
X Link 2024-01-24T16:23Z [---] followers, [--] engagements
"@ChadGriffiths @TopherNOW When I got my first job in the acquisitions group of a large real estate investment company in [----] they put me in warehouse development because nobody wanted the job and all the cool kids were in office. Roles reversed now"
X Link 2024-01-24T19:23Z [---] followers, [--] engagements
"@chernobelskiy @rhunterh Exactly. Cap rates vary widely by #CRE property type but typically trade off the [--] year. We are in an unusually narrow spread range now---just like corporate bonds interestingly enough.chart courtesy of @MMREIS"
X Link 2024-01-25T00:21Z [---] followers, [---] engagements
"This is worth re-stating: flex workspace #office tenants have been around for [--] years and have a future but it will only be one based on $IWG's and others' management contract model instead of the broken model of signing long term leases and depending on short term subleases. Global flexible workspace giant IWG has snapped up another @WeWork space as the company one of the largest #coworking operators in the world looks to fold in the vacated spaces as part of its aggressive expansion plan. https://t.co/GaREcZfpD7 Global flexible workspace giant IWG has snapped up another @WeWork space as"
X Link 2024-01-25T23:02Z [---] followers, [----] engagements
"Thats right. Underleased older B and C office buildings are trading regularly at [--] and [--] cents on the dollar but bid-ask spread on well leased apartments warehouses self storage and retail is high due to high interest rates and transactions for these assets have fallen off a cliff as a result"
X Link 2024-01-26T17:02Z [--] followers, [---] engagements
"@landlawyerbrian Good point. COC always starts with the risk free rate and after a thirty year bull market in bonds we may be in for a secular reset higher"
X Link 2024-01-26T18:32Z [---] followers, [--] engagements
"@TripleNetInvest Great call. I grew up rural and have been buying ever since although as somebody noted in the thread cash flow is low so it is an IRR play. A complementary strategy though is to also buy stocks like $LAND . Traded in and out of it for years and throwing off [--] %"
X Link 2024-01-27T15:46Z [---] followers, [----] engagements
"There is a lot of gobbledygook in the financial press about the "crisis" in commercial real estate. No. It's a "crisis" in only two places: C B and A- office properties which are running at 20%+ vacancy and will get worse before they get better Anybody who took out a floating rate loan in 2021-2 that did not underwrite for or swap cover for higher interest rates. Every other property type in decent shape overall as of right now"
X Link 2024-01-28T15:45Z [---] followers, [----] engagements
"There is stress for sure esp. in the southeast where most new supply is. And if a borrower has floating rate construction debt they did not cap that is a problem. But the nice thing about new construction multi is that it is the "new car" everyone wants so generally if you click back the asking rates they fill up. My two cents"
X Link 2024-01-28T17:23Z [---] followers, [---] engagements
"$BX one of the OG's of real estate private equity had a good insight on their earnings call last week: they think they #CRE market has already bottomed but it is going to take a while for investor sentiment and capital to catch up making it a great time to buy. It's already flowing back into the office market: see the following firms raising money to invest in distressed #office debt/equity or lend to office owners with refinancing issues. More on the way. $GS $2.6B RXR/Ares: $1B $SLG: $1B Ethan Penner: $1B"
X Link 2024-01-29T15:39Z [---] followers, [---] engagements
"Excellent report just out from @MoodysAnalytics on ignoring the headlines and groupthink psychology of the #CRE "doomloop" and going granular by product type and market to find good risk adjusted returns. Could the CRE 'doom loop' theory be more fiction than fact Our latest report underscores nuanced decision-making and hyperlocal research's role in the recovery phase. Perceived market downturns may mask unexpected opportunities. Read more: https://t.co/nLHkG6ryn5 https://t.co/UUpUnHzUW9 Could the CRE 'doom loop' theory be more fiction than fact Our latest report underscores nuanced"
X Link 2024-01-29T20:05Z [---] followers, [---] engagements
"Our view is that most of this is macro: higher interest rates and 30% run up in labor+materials cost inflation = development proformas no longer pencil particularly given flat to declining rents per below Covid induced migration out of large cities and to sunbelt led to oversupply issues in most of those areas which discouraged further building"
X Link 2024-01-31T20:07Z [---] followers, [--] engagements
"@jessefelder You have to distinguish between #office which is struggling and on average about [--] percent of bank #cre loans and the rest of the commercial real estate asset classes which are doing ok"
X Link 2024-02-01T15:18Z [---] followers, [---] engagements
"Nice discussion this morning with Bruce Van Saun @FerroTV @lisaabramowicz1 on #Banks and #cre. Lower quality #office in tough shape but generally only 5-10% of smaller/regional #Banks real estate loan portfolios; rest of property types in good shape although #RealEstate borrowers who took out floating rate loans in 2021-22 that did not swap out or underwrite for higher short term rates have real issues regardless of property type. Miss @tomkeene and his focus on seminal textbooks and financial esoterica"
X Link 2024-02-01T19:15Z [---] followers, [---] engagements
"Yep. And office loan delinquencies headed to levels not seen since then either. What corporations arent telling you is that WFH showed them they can do a lot more with remote work than they ever thought and the shrinking of their office footprints that will follow are savings that will go right to the bottom line"
X Link 2024-02-03T14:18Z [---] followers, [---] engagements
"Been investing in commercial real estate for [--] years but started posting on here about six weeks ago after my beautiful Gen Z daughters kept accusing me of living in the 19th century. Enjoying the helpful vibe on hereseems like folks following Einsteins advice about not striving to be a success but rather to be of value. So adding to the mix: you never win a competitive bid with your last dollar. Whatever your proforma tells you is the most you can pay for something add 10% to it ignore how ugly your excel now looks( it was a guess anyway) and win it. Lost a few before I realized this never"
X Link 2024-02-03T14:38Z [---] followers, [--] engagements
"Been investing in commercial real estate for [--] years but started posting on here about six weeks ago after my beautiful Gen Z daughters kept accusing me of living in the 19th century. Enjoying the helpful vibe on hereseems like folks following Einsteins advice about not striving to be a success but rather to be of value. So adding to the mix: you never win a competitive bid with your last dollar. Whatever your proforma tells you is the most you can pay for something if you really want it add 10% ignore how ugly your excel now looks( it was a guess anyway) and win it. Lost a few before I"
X Link 2024-02-03T14:45Z [---] followers, [----] engagements
"We invest in both public and private #real estate and arb the two. We attend about [--] earnings calls a month for the #REITS $BXP is the US's largest public #office REIT. Navigating rough waters but going on offense by buying out three partners who wanted to reduce #office exposure: [---] New York Ave DC (below). Extended anchor tenant by [--] years extended loan by [--] years bought at $414/sf and 6.4% cap Santa Monica Business Park LA. Renewed anchor tenant for [--] years $395/sf and 9% cap [---] Park Avenue South NYC. $754/sf and 7.2% cap. Moral of the story: own the top 25% of office and your tenants"
X Link 2024-02-04T14:26Z [---] followers, [----] engagements
"With apologies to Ernest Hemingway the #office market continues to be a story of the haves and the have nots. Yesterday we posted about $BXP recently buying out a partner in a high quality Class A long term leased Washington DC office building at [---] New York Ave at $414/sf and a 6.4% cap During the same time frame five older poorly leased B office buildings in the DC downtown traded at numbers on average about 40% of that: [----] M Street: Sold for $150/sf down from [----] price of $436/sf [----] Connecticut Sold for $122/sf down from [----] price of $425/sf [----] Eye St: Sold for $202/sf down from"
X Link 2024-02-05T13:15Z [---] followers, [---] engagements
"@annmarie @FerroTV Re: Barry Sternlicht's comment that we "don't know" where the $1.1MM in #commercialrealestate losses are. We do know. The vast majority of it is in the non-bank lending system: CMBS CLO's mortgage REITS PE debt funds"
X Link 2024-02-05T14:36Z [---] followers, [--] engagements
"Real time #office leasing data from $IPG earnings call: leased space down 22% from [----] and likely ends at a 35% reduction as vacant space is given back at lease end. To repeat: despite all the talk of return to office #WFH taught employers they can do a lot more with remote work than they ever thought and rent savings will go right to the bottom line"
X Link 2024-02-09T15:09Z [---] followers, [---] engagements
"A lot of news about over-leveraged #realestate hitting debt maturity walls and high interest rates. In contrast look at the debt structure of publicly traded REITS: Average loan maturity: [---] years Average interest rate: 4% Average loan to book: 50% Moral of the story is that debt adds risk not return: [--] year annual returns on private real estate: 8.7% [--] year annual returns on REITS: 12%"
X Link 2024-02-10T14:27Z [---] followers, [----] engagements
"Tough insights from @TreppWire on distressed office in downtown San Francisco which is 30%+ vacant. [--] of them are B or C buildings and poorly leased and are worth collectively a staggering 75% less than their original appraised values. [---] California is Class A but only half leased due to a tenant default and worth about 50% of the original appraised value. Still wouldn't bet against SF office long term though; it is still the world's tech capital. But it will be a long road back. #commercialrealestate"
X Link 2024-02-12T21:42Z [---] followers, [---] engagements
"In our view what has changed in the last few months for #commercialrealestate is that loan maturity walls are finally hitting and interest rate caps set in [----] and [----] are now resetting and leading to loan interest rates [--] and [--] times higher than they were last year. With the exception #office CRE is in good shape from supply and demand perspective; what is driving the crisis is borrower balance sheet issues"
X Link 2024-02-12T23:04Z [---] followers, [---] engagements
"The $AVB earnings call last week was a case study on going on offense in the #apartments space. Announced plans to sell apartments in coastal markets where rents/values are growing again and use the proceeds to buy in over-supplied markets in the sunbelt where rents are dropping enough that they feel they can buy apartments "significantly below replacement cost". That is how you do it"
X Link 2024-02-13T14:37Z [---] followers, [---] engagements
"Yardi Matrix gives good city by city comparison data on macro level but best way to dig into intra-Houston data comes from the following (1) the large storage REITS (EXR PSA CUBE etc) have websites where you can search for what they offer in Houston by specific location and tend to lead the market (2) Rent Cafe does good Houston specific data as does SpareFoot Storage Cafe and . This will give you a broader range of quality and rents. Good luck"
X Link 2024-02-13T14:46Z [---] followers, [--] engagements
"Makes sense. $149B raised from LP's in [----] compared to $270B in [----]. And this does not factor in billions in redemption requests to non-traded REITs. Why 5% risk free cash better than 5-6% cap rates in [----] Locked up transaction market due to [---] bp rise in Fed Funds with poor price discovery and limited acquisition debt. Bottom in distressed asset classes like #office not yet in sight. With Fed easing [----] should be better Private Equity Fundraising Nose-Dives To 11-Year Low https://t.co/FMzixYFBaU Private Equity Fundraising Nose-Dives To 11-Year Low https://t.co/FMzixYFBaU"
X Link 2024-02-14T14:32Z [---] followers, [----] engagements
"1/2 @sonalibasak @lisaabramowicz1 @TheChartress Enjoyed your coverage on #commercialrealestate today. A few small adds: Distress in our business comes in two places: tough operating environments (supply and demand) and balance sheet (debt) issues. Per below the operating fundamentals outside of #office are reasonable: yes there are some idiosyncratic issues in #apartments (oversupply in the sunbelt rent stabilized units in NYC downtown issues in SF) but things are generally ok with the rest. But any borrower who took out a floating rate loan in 2020-2022 has cash flow problems as caps burn"
X Link 2024-02-15T18:56Z [---] followers, [---] engagements
"2/2 @sonalibasak @lisaabramowicz1 @TheChartress Implications: Older poorly located #office has both issues but the bulk of the distress is in the non-bank lender ecosystem: mortgage REITs PE debt funds CMBS. The banks we borrow from tend to have between 5% and 10% of their loans in #office so 50% to 100% of equity which although still high for the most part is being reserved for. Top 25% of office will be fine. The rest of the product types mainly have balance sheet issues due to floating rate resets: although it will lead to idiosyncratic events at #banks ( e.g $NYCB/rent control) or with"
X Link 2024-02-15T18:57Z [---] followers, [---] engagements
"@LiQuidPr0Qu0 @elerianm @sonalibasak @markets Good questions and above our pay grade--we are real estate guys who attend earnings calls of REITS and other financial institutions that affect our ecosystem but not bank experts. They are certainly increasing bank reserves but Basel [--] endgame hovering above all of this"
X Link 2024-02-18T21:22Z [---] followers, [--] engagements
"@unusual_whales But % exposure of loan books at smaller #banks at 30%"
X Link 2024-02-19T14:20Z [---] followers, [---] engagements
"By the way love your feed. It continues to astound me how public pension funds--ostensibly guided and counseled by outside consultants---continue to invest in #realestate with GP's that give them subpar returns. Worst case they should invest in #REITS which although highly correlated with the stock market at least would give them superior real estate returns. Best case they should adapt the @yale endowment model which focuses on GP's that have principled management with extensive track records focus on geographies and product types they know cold don't fall in love with their real estate get"
X Link 2024-02-19T19:45Z [---] followers, [--] engagements
"January [----] #commercialrealestate transactions continue to be muted @MSCI_Inc Cap rates up again as higher for longer continues. Average cap rates: hotel [---] % office 7% retail 7% industrial 6.2% apartments 5.6% Buy 'em if you can find them/finance them"
X Link 2024-02-22T16:40Z [---] followers, [----] engagements
"@LongTermOwner Yep. Going on all over the country and showing up as part of #banks stress as interest rate caps expire. Great opportunity for preferred equity investors . Follow $ABR for how this is playing out in real time"
X Link 2024-02-29T14:49Z [---] followers, [---] engagements
"Definitely a balance sheet issue. Unlike most of the US office market South Florida office is in decent shape from an operating perspective and this is a good A minus assetone of attorneys offices there. Issue is finding lenders who are willing to refinance office assets at all as well as at LTVs high enough to take the original lender out"
X Link 2024-02-29T14:58Z [---] followers, [---] engagements
"@sr_nyc @philbak1 @REITs_Nareit @NYUSchack Amen. And the winning streak is even longer. [---] bp+ to the good REITS vs private over [--] years and with infinitely better liquidity less leverage risk and little management hassle"
X Link 2024-03-01T16:39Z [---] followers, [--] engagements
"Re: the CPI commotion about January OER (Owner's Equivalent Rent) growth exceeding regular apt. growth. Makes sense if you read reports @JBREC . SFR 19% rent premium to regular garden style. Amenitized build-to-rent SFR 25% premium to scattered SFR"
X Link 2024-03-05T20:51Z [---] followers, [---] engagements
"$TGT just announced the opening of [---] new large format stores over the next [--] years This means retail store expansion into suburban and secondary/tertiary city markets. But every one of these stores will also be a last mile warehouse. Two for one"
X Link 2024-03-07T13:33Z [---] followers, [---] engagements
"Coastal infill and Midwestern #apartment markets that did not see overbuilding during the pandemic continue to show flat to positive rent growth. Sunbelt still working through supply issues although the negative growth rates are off artificially high COVID rental rates"
X Link 2024-03-09T15:51Z [---] followers, [---] engagements
"@EpsilonTheory In our view shelter will only cool if we go into a recession and mortgage rates drop"
X Link 2024-03-13T12:30Z [---] followers, [---] engagements
"From @MSCI_Inc on loan loss rates by property type showing the rise across all asset classes in [----] as interest rates rose. #office of course the leader given the added stress of higher vacancy due to secular hybrid work changes. Note the high office loss rates even pre-pandemic and they will spike significantly from here. Warehouse retail and apartments losses will begin to moderate if the Fed cuts since fundamentals in these asset classes are generally good"
X Link 2024-03-22T12:29Z [---] followers, [---] engagements
"Interesting insight from @MSCI_Inc on recent #office transactions. With negative real interest rates the pandemic ongoing and the view that remote work was temporary there was a massive surge in office buying between [----] and [----]. It ended when the Fed started raising rates and investors grasped the reality of a secular decrease in office demand as larger tenants doubled down on the cost savings from many kinds of remote work But as interest rates come down and tenants continue to expand in spite of hybrid work demand for the best assets in the best locations will come back"
X Link 2024-03-25T15:26Z [---] followers, [---] engagements
"Rent vs. own calculus (CBRE chart) continues to weigh on single family home sales and support rental growth inflation particularly for single family homes for rent. Expect CPI readings for OER and rental inflation to remain elevated absent a drop in rates"
X Link 2024-03-26T11:39Z [---] followers, [---] engagements
"From @MSCI_Inc showing that suburban #office buildings taking less of a price/value hit. Two reasons: shorter commute times=higher occupancy and suburban buildings tend to have smaller tenants which have done less downsizing due to hybrid work"
X Link 2024-03-27T13:19Z [---] followers, [---] engagements
"Insight @MSCI_Inc on where distressed #office prices are today versus the GFC albeit on thin transaction volume. Owners of quality well leased office don't have to sell and won't. But distressed office has much farther to fall"
X Link 2024-03-29T13:19Z [---] followers, [---] engagements
"$REXR buys $1 billion of warehouse from $BX at a 4.7% cap stabilizing to a 5.6% That's nicely accretive to $REXR dividend yield of 3%. But stock market pricing their whole portfolio at a 5% cap. Who is right https://www.costar.com/article/2007628353/blackstone-sells-southern-california-industrial-portfolio-for-1-billion https://www.costar.com/article/2007628353/blackstone-sells-southern-california-industrial-portfolio-for-1-billion"
X Link 2024-03-30T18:44Z [---] followers, [---] engagements
"Interesting chart on how rising interest rates have impacted the #hotel market. Like all #cre asset classes transactions down in [----] but post-COVID surge in hotel demand = higher RevPar ADR's and values. On a nominal basis hotel revenues now significantly above [----] levels"
X Link 2024-04-02T11:52Z [---] followers, [---] engagements
"Insight from @MSCI_Inc on drop in LTV by new CMBS issuers starting in late [----] as loan standards got more conservative. Ironically with write downs in #apartments and #office values LTV's of [----] + vintages are back up anyway and headed higher"
X Link 2024-04-03T16:51Z [---] followers, [---] engagements
"#REIT's have deleveraged significantly since 2020---a sea change. This will enable them to take advantage of distressed buying opportunities which they missed out on during the #GFC"
X Link 2024-04-07T15:51Z [---] followers, [----] engagements
"Agree. Our annual apartment and SF home rental growth for the [--] years preceding the pandemic was never below 3%. Renewals which are 70% of our leasing never below 4%. Rents in our portfolio bottomed a year ago and with base effects are only going up from here. Robust job growth and high mortgage rates are driving the increases so don't expect any CPI help from shelter absent a recession or interest rate cuts from the Fed"
X Link 2024-04-11T19:53Z [---] followers, [---] engagements
"@PhysInHistory "Bailey's Beads" C2/C3: 3m 46s Mill Creek MO (Ozarks) Thinking about a new line of work.😃 #Eclipse2024"
X Link 2024-04-13T23:35Z [---] followers, [--] engagements
"Another unique impact of Covid was that it involved massive Fed easing followed by an unprecedented immediate and aggressive Fed tightening. This enabled a generation of homeowners to lock in absurdly low mortgage rates in a way they could not during the GFC or prior downturns right before the Fed went the other way. This has led to more limited homes for sale higher home prices for those that do sell and a high number of renters by necessity which absent a recession or Fed easing sets the stage for continued inflation in shelter costs"
X Link 2024-04-15T12:14Z [---] followers, [----] engagements
"$PLD down due to disappointing earnings. $REXR $STAG and others down in same draft. Buy the dip. Fundamentals fine and will get better into [----] and rates will come down eventually. Not investment advice"
X Link 2024-04-17T15:48Z [---] followers, [---] engagements
"@NickTimiraos @jjj_groen As we have been saying for a while new and renewal rent increase rates only going up from here due to base effects and high mortgage rates. Our rents bottomed a year ago and wil continue to go up absent a recession or lower mortgage rates"
X Link 2024-04-18T11:13Z [---] followers, [---] engagements
"Another reason to be bullish on operating fundamentals of #industrial real estate from @JLL New construction falling to pre-pandemic levels due to high interest rates and moderation of demand. Nice set up for 2025+"
X Link 2024-04-18T15:40Z [---] followers, [---] engagements
"#CMBS issuance in Q1 [----] was 4X what it was in Q1 [----] Liquidity returning to #CRE market after bank pull backs"
X Link 2024-04-20T22:52Z [---] followers, [---] engagements
"Interesting statistics on BTR from RentCafe Sunbelt no surprise but Detroit and Columbus top ten. Strong universities affordability car/EV tech and retail/distribution fueling the growth. Detroit also has strong incentive programs and cheap land as it retools/rebuilds. Never count the Midwest out"
X Link 2024-04-21T15:00Z [---] followers, [---] engagements
"Good insights from @JLL on how the best #office micro-markets almost always outperform the averages. They also have the highest rents: Palo Alto Greenwich Hudson Yards Palm Beach all $100/sf+ Real estate has always been a block by block game. You can't generalize"
X Link 2024-04-26T11:34Z [---] followers, [---] engagements
"Agree. BLS's shelter methodology and weighting in CPI are the ecstasy of obscurity. That said and as we have been saying for a while in our portfolio our new lease rates bottomed a year ago so with base effects and absent a recession the rate of increase is only going to go up. And renewal leases which are typically 70% of our leasing are growing again at 3-4% which is near our pre-pandemic average of 4-5%. So regardless of how the government measures it rent inflation is real"
X Link 2024-04-26T23:27Z [---] followers, [--] engagements
"Given the arcane BLS shelter methodology the governments numbers may indeed show lower shelter inflation as he suggests. But in the real world the fact remains that rents bottomed a year ago and given base effects rent inflation rates are only headed up absent a recession or lower mortgage rates"
X Link 2024-05-01T20:47Z [---] followers, [----] engagements
"You are right. In our view the only way shelter is going to moderate due to high interest rates is if the rates tip us into recession. High interest rates have created a generation of would be home buyers who are renters by necessity and that is keeping apartment/SFR demand healthy"
X Link 2024-05-02T13:24Z [---] followers, [---] engagements
"@ChadGriffiths Nice work"
X Link 2024-05-02T17:00Z [---] followers, [---] engagements
"Self-storage rates per @Yardi still haven't found the bottom with close to 9% inventory additions over last [--] months. Construction still high or increasing in many markets and home sales market still locked up. And yet self-storage REITS like $EXR still way up off their November [----] lows based on hopes for lower interest rates but those are likely to come only if the economy slows considerably. Head scratcher"
X Link 2024-05-03T13:49Z [---] followers, [---] engagements
"REITs with highest likelihood of Q2 dividend increases (33%+) are ag/timber single tenant and mobile home parks according to S&P. All operate with longer term leases showing their value due to consistent income streams with CPI escalators in an inflationary environment"
X Link 2024-05-12T18:57Z [---] followers, [---] engagements
"@davidfrum Indeed. And for Frenchies Id say its Fritos. The domesticated dog is our civilizations greatest achievement although it is often said that they think the same thing about us"
X Link 2024-05-16T11:11Z [---] followers, [---] engagements
"Good insights from @Newmark on the role new and existing home sales play in driving warehouse net absorption. Absorption now below pre-pandemic levels and vacancy is above pre-pandemic as well. Another casualty of higher for longer"
X Link 2024-05-16T18:26Z [---] followers, [--] engagements
"From yesterday's @WSJ on the troubles of Starwood's S REIT. The irony here is that this is great well capitalized real estate. [----] annual report shows that 90% of its holdings are in great asset classes (industrial apartments and almost no office) 95% occupied and 57% leveraged with 99% of the debt fixed or hedged at 3.5% with [--] years of average term. Year over year NOI is up 7% and they just sold $2 B of properties for a 14% IRR and [---] MOIC. This is purely a redemption issue since investors can now find higher yielding more liquid alternatives to the SREIT's dividend elsewhere and--at"
X Link 2024-05-21T13:50Z [---] followers, [----] engagements
"SREIT caps redemptions at 1% a quarter down from 6% . Is a preferred equity deal with a major pension fund the next step $BX did an 11.25% IRR pref deal with the University of California for its BREIT in [----]. via @wealth https://www.bloomberg.com/news/articles/2024-05-23/starwood-reit-sets-drastic-redemption-limits-on-liquidity-crunchutm_source=website&utm_medium=share&utm_campaign=twitter https://www.bloomberg.com/news/articles/2024-05-23/starwood-reit-sets-drastic-redemption-limits-on-liquidity-crunchutm_source=website&utm_medium=share&utm_campaign=twitter"
X Link 2024-05-24T18:47Z [---] followers, [---] engagements
"Nice analysis from @wolfofwolfst and @TreppWire on #office balance sheet stress. Floating rate CMBS deliquency at 20% and climbing while fixed rate at 4% Irony is most of these floaters were taken out AFTER the Fed started raising rates. Most were short term refinancings and were the only deal most borrowers could find and was a bet on a quick fall in rates. Didn't happen and hybrid work did the rest"
X Link 2024-05-25T14:29Z [---] followers, [---] engagements
"Interesting analysis from @Bisnow on the moribund state of real estate crowdfunding which took off in [----] when federal laws changed and gave small investors access to real estate syndications. Exploded to a $17B a year business by [----] with fix and flip sunbelt multifamily and office leading the way. But deteriorating operating fundamentals balance sheet stress from Fed rate hikes and poor operator capitalization has led to losses and capital calls. After some consolidation the business will come back but only after it figures out a better way to vet operator history underwriting and"
X Link 2024-05-26T17:41Z [---] followers, [---] engagements
"Good article from @Bisnow on Invesco's plan to make hard money loans to second tier office #reits High single digit-double/ digit coupons non-callable in first few years but five year minimum terms. Focus on 2025-6 maturity walls originated in depths of COVID. Works only if the "extraction" doesn't kill the patient first. We'll see: dilutive equity may actually be better"
X Link 2024-05-30T00:32Z [---] followers, [---] engagements
"Issue is not that large US banks have ramped up their lending to REITS since the depths of the GFC--true for most lenders. Issue is rather what % of these loans are to REITs with office concentration (20% vacancy and climbing) versus other property types which are generally in the 6-7% range and relatively stable. REPORT: REIT Debt Threatens Large Banks https://t.co/5zspzxQ1HZ REPORT: REIT Debt Threatens Large Banks https://t.co/5zspzxQ1HZ"
X Link 2024-05-31T15:58Z [---] followers, [---] engagements
"New fund flows into non-traded REITs continue to ebb as direct private and public real estate markets offer more liquid and transparent ways to take advantage of #cre distress"
X Link 2024-06-03T18:14Z [---] followers, [---] engagements
"@business Good analysis of what happened when naive crowdfunded apartment investors borrowed from high leverage floating rate Wall Street lenders while the Fed started raising interest rates. History does rhyme"
X Link 2024-06-07T18:18Z [---] followers, [--] engagements
"Lost in the press about the impact of bad #commercialrealestate loans on banks is that the biggest problems are in paper held by the largest banks. Looks like the smaller banks learned their underwriting lessons in the GFC. Big guys not so much"
X Link 2024-06-08T19:56Z [---] followers, [---] engagements
"Interesting sign of the times. Spreads have come in [---] bps since beginning of the year to 6% over SOFR range for BBB but still too rich for $BX. Coupon likely double digit on cash flow that was single digit. via @markets https://www.bloomberg.com/news/articles/2024-06-12/blackstone-shelves-1-3-billion-cmbs-deal-amid-new-issue-frenzyutm_source=website&utm_medium=share&utm_campaign=twitter https://www.bloomberg.com/news/articles/2024-06-12/blackstone-shelves-1-3-billion-cmbs-deal-amid-new-issue-frenzyutm_source=website&utm_medium=share&utm_campaign=twitter"
X Link 2024-06-14T12:16Z [---] followers, [---] engagements
"Good insight from @CoStarUS on what is going on with Phoenix warehouse vacancies. 100K and larger properties have significantly more vacancy than smaller ones primarily because most of the new construction has been 300K in size and above. Microcosm of what is going on across the Sunbelt. Will take a while to correct"
X Link 2024-06-16T12:01Z [---] followers, [---] engagements
"KKR addressing liquidity in its non traded REIT by using its balance sheet to buy back shares. Blackstone and Starwood used a different approach and limited redemptions. Blackstone also brought in preferred equity. But recent redemption requests have exceeded new fundraising for all three and this will not likely change until rates drop"
X Link 2024-06-16T17:16Z [---] followers, [----] engagements
"@3NDeveloper Good analysis with good and unanswered questions. But owning now is an interest rate playwhen Fed starts cutting rates this stock will go up"
X Link 2024-06-19T13:54Z [---] followers, [--] engagements
"Interesting piece from @moodys on how maturing CMBS debt issued after [----] is more at risk than prior vintages: Increased use of subordinate debt (mezz and B piece) increased LTV and therefore risk of debt capital stack. Increased use of B pieces (which also has a claim on the property) more likely to trigger earlier and more lengthy A+B note co-defaults/workouts. Current interest rate environment much higher than at issuance date"
X Link 2024-06-23T19:40Z [---] followers, [---] engagements
"#PropTech funding down considerably 1H [----] reflecting cyclical downturn in VC funding as well as #CRE specific issues in operating and capital markets. But overarching issue is generative AI: how do 2022/2023 startups retool with it and how does every app stay current with it given that underlying models are changing and improving so fast"
X Link 2024-06-29T16:16Z [---] followers, [---] engagements
"Good news on the #CPI front: best stuff @Fireworks down 20%-30% from COVID highs. Deflation baby. Backed up the truck this year. Somehow don't think the BLS cares but it will be a heck of a show. Happy #IndependenceDay2024"
X Link 2024-07-03T16:51Z [---] followers, [---] engagements
"Good insight from @CushWake on 40% run up in warehouse construction costs during COVID. Some outright deflation from peak as warehouse demand normalizes but costs will drop further through [----] as new construction shuts down across most property types due to higher interest rates and increasing vacancy"
X Link 2024-07-08T13:15Z [---] followers, [---] engagements
"@landlawyerbrian Terrific work Brian. Looking at a piece of land and would like to learn more"
X Link 2024-07-11T12:25Z [---] followers, [---] engagements
"#bank distress tied almost completely to multi-family loans. 72% of loans in #CRE and most in fix and flip floating rate CA apartments including many impacted by state rent caps passed in [----]. When you have balance sheet and income statement distress no place to hide"
X Link 2024-07-12T14:41Z [---] followers, [---] engagements
"Analysis from @CBRE on apartment cap rates since COVID. Cap rates bottomed at an outlandish 3% during [----] as real rates went negative rising to 5% as the Fed tightened and then paused. Current spread between going in and out cap rates shows maximum bullishness on the asset class. But anybody who bought at 3% caps and has to refinance or sell now is in serious trouble"
X Link 2024-07-20T20:09Z [---] followers, 15.1K engagements
"Data from USEIA on commercial electricity demand by state. Sunbelt demographic shifts and data center/crypto mining driving demand. Surplus capacity in CA NY Midwest might promote data center migration"
X Link 2024-07-21T13:23Z [---] followers, [---] engagements
"@EllliotttB Love the question. Our answer: infinitely higher since REITs are instantly liquid and BREIT is clearly not. Related question: how low does the Fed Funds rate have to go before BREIT looks like an attractive discount to TBills Again liquidity function rules"
X Link 2024-07-23T19:31Z [---] followers, [---] engagements
"@chasesfish True. Banks wised up about office two cycles ago. Banks issue is fix and flip multi family bought at [--] and [--] caps in [----] and 2022"
X Link 2024-07-29T00:15Z [---] followers, [--] engagements
"Analysis from @cohenandsteers showing anomalous multiple discount of REIT's to broader S and P. Another reason to increase REIT allocations on top of tech slowdown/ sector rotation and possible interest rate tailwinds"
X Link 2024-07-30T22:24Z [---] followers, [---] engagements
"News from $EQR : in contract for a $960MM purchase of [----] units from $BX Atlanta Dallas Denver so some oversupply. 5% cap $270K a door (10-15% below depreciated replacement cost) low 8% unleveraged IRR assuming 5% exit cap. Full price in our view given negative rent growth in some of these markets but drop in new construction = pricing power 2026-7"
X Link 2024-08-08T13:19Z [---] followers, [---] engagements
"@mscottdongh_ good question and not divulged. my gut is that they model 0% rent growth for a few years then spike 5-6% annually as market oversupply goes away then normalizing to probably 3% beginning in year [--] or so. Typically ten year hold analysis"
X Link 2024-08-08T13:41Z [---] followers, [--] engagements
"Don't know but I doubt they used debt. These public REITS can buy all cash now or with a line and put long term financing on later when it makes more sense. A lot of the public REITS are in a great place right now to buy all cash as their stock prices have rebounded and lower interest rates now in sight"
X Link 2024-08-08T14:07Z [---] followers, [--] engagements
"This recent chart from MSCI getting a lot of focus. Two problems with this analysis in our view. Potential distress wildly overstated for warehouse and apartments because operating fundamentals are strong in those sectorsany distress is a function of higher interest rates which will come down. Potential distress for office is understated since operating fundamentals are permanently impaired due to hybrid work for all but the top [--] percent of the asset class"
X Link 2024-08-10T23:26Z [---] followers, [---] engagements
"Article from @Bisnow on opposition to nuclear power plants selling on premise vacant land to data centers. $AMZN just bought [----] acres at Talen Plant in PA. On plant electricity is cheaper to users since avoids transmission costs/grid issues and more profitable for the plant. But raises fairness issues and potential higher electrical prices for consumers. With increasing #AI power needs this is a collision course that will only be solved by large investments in electrical and grid capacity"
X Link 2024-08-13T12:37Z [---] followers, [---] engagements
"Interesting chart from @JLL showing that as the pandemic era recedes tenants are giving back less space . In fact many tenants with growth needs in growth markets are maintaining or expanding their footprints. Green shoots"
X Link 2024-10-12T13:39Z [---] followers, [---] engagements
"Excellent work from @CBRE on [--] year relationship between #cre cap rates and [--] year treasury. For every [---] bp move in 10Y industrial cap rates move about 40bp while office retail and apartments move 70-80bps. Assuming [--] Y has peaked cap rates moving down from here"
X Link 2024-10-14T23:51Z [---] followers, 24K engagements
"@solutionomics @CBRE Well said Chris. In my view probably why industrial so less sensitive--there is strong capital markets demand/lower risk premium for that asset class"
X Link 2024-10-16T12:56Z [---] followers, [--] engagements
"Good insight from Revista of impact of higher interest rates on #medical office cap rates (chart 1). But demand (green) continues to outstrip supply (orange) (chart 2) leading to improved occupancy and rents. Buy opportunity"
X Link 2024-11-03T20:31Z [---] followers, [---] engagements
"Yeah thanks for the clarification-- was speaking on the private side. And $ARE is more of a pure life sciences play and there are longs (believing we are through the worse of the life science VC cycle) and shorts (who think oversupply and hybrid office work will hurt it) on both sides of that stock. We don't play in public MOB space but check out $PEAK $WELL and $VTR"
X Link 2024-11-06T20:03Z [---] followers, [--] engagements
"@CBRE just released a white paper on impacts of Trump presidency on #CommercialRealEstate . Predicts tariffs will have the most immediate effect: spike in warehouse demand as companies stockpile ahead of them and pressure on retailers as they lower consumption of imports"
X Link 2024-11-07T03:02Z [---] followers, [--] engagements
"From @Newmark on how #office vacancy is at [--] year high. Suburban/secondary markets actually doing better than primary given value proposition/shorter commutes. Medical remains safe haven but life sciences heading to 20% as new deliveries kick in later this year and 2025"
X Link 2024-11-10T00:05Z [---] followers, [---] engagements
"Good example of how institutions have used public #reits to hedge against overweighting in office and access harder to reach property types. Norges uses them mainly to expand residential exposure"
X Link 2024-11-18T12:21Z [---] followers, [--] engagements
"#Chicago the only US city to capture a significant amount of warehouse leasing demand in spite of declining population growth per @JLL Centrality is everything in industrial. Can this be a catalyst for population growth here"
X Link 2024-11-18T18:40Z [---] followers, [---] engagements
"@kylematthewsceo Yep and what is interesting is that cap rates have stayed in the same rough range of 6% as well except for COVID era drops due to extreme monetary policy. Cap rates gap and transactions drop only in times of economic uncertainty"
X Link 2024-11-21T17:16Z [---] followers, [--] engagements
"Mori Building Company just bought an 11% interest in $SLG's One Vanderbuilt in NYC for $2900+/sf. Record pricing for this size of building. Top floor rents in nosebleed range of $300/sf Top 25% office buildings like this are thriving. But everyone else is in a dogfight"
X Link 2024-11-22T14:07Z [---] followers, [---] engagements
"Per @SPGMarketIntel 41% of REIT sector raised dividends through 10/1. Retail (shopping centers) residential and industrial increases reflect strong operating fundamentals/national footprints that mitigate micro market weaknesses. Office and self-storage mirror the opposite"
X Link 2024-11-24T23:27Z [---] followers, [---] engagements
"Good insights from @cred_iq on delinquent #cmbs loans by property type. Hotel and apartment distress due to balance sheet issues: floating rate debt kills DSCR. Retail is on the income statement side: mainly older malls which continue their slow decline even as shopping centers outperform. Office has both balance sheet and income statement issues due to hybrid work. industrial and self storage minimal due to very strong operating fundamentals"
X Link 2024-11-26T14:12Z [---] followers, [---] engagements
"New from @redfin showing decline of investor purchases of SFH since COVID. Correlates with interest rates and economy. SFH investors = 16%+ of all purchases (30% in some coastal markets). Majority in lower priced homes. Up from 6% share in [----]. Implications: Higher prices Less supply Higher Rents"
X Link 2024-11-29T16:04Z [---] followers, [--] engagements
"Newest from @TreppWire on CMBS deliquency rates by property type confirms prior trends. Office could easily double from here due to WFH value destruction the rest of the property types will stay below 10%"
X Link 2024-11-29T17:09Z [---] followers, [---] engagements
"New from @propmodo [--] greatest #RealEstate books of all time. What's missing But the best book is the one each one of us is writing every day. https://propmodo.com/the-50-greatest-commercial-real-estate-books-of-all-time/ https://propmodo.com/the-50-greatest-commercial-real-estate-books-of-all-time/"
X Link 2024-11-30T22:52Z [---] followers, [---] engagements
"Case study in creating shareholder value: $SLG just sold a partial interest in One Vanderbilt office tower for a record $2900/sf. Then bought [---] Park Avenue office and retail property for $646/sf"
X Link 2024-11-30T23:50Z [---] followers, [---] engagements
"@StealthQE4 Agree. The good news is that its not the banks that will be taking the hitsits the owners of the securitized debt. The bad news is that office will easily get to [--] percent before its over"
X Link 2024-12-02T10:56Z [---] followers, [--] engagements
"Chart on relationship between FF [--] year bond and [--] yr fixed mortgage rates. [--] takeaways: [--] year with lag tracks movement in Fed Funds. Spread of mortgages over [--] year well above historical of [---] due to bank funding costs. Mortgages can come down even if Fed pauses"
X Link 2024-12-04T19:24Z [---] followers, [---] engagements
"Interesting chart from @SPGlobal on ratio of positive to negative comments in Q3 REIT earnings calls. Not surprisingly data centers and hotels lead while industrial (vacancy issues) and specialty (timber ag infrastructure casinos) lag"
X Link 2024-12-05T23:22Z [---] followers, [--] engagements
"Chart from @EvercoreISI on extended period that REITS have traded at a discount to NAV= COC/spread investing issues and resulting dearth of acquisitions/external growth. Given waning new supply in most sectors if rates come down and demand holds up NAV premiums will return"
X Link 2024-12-06T00:08Z [---] followers, [---] engagements
"But per @SPGlobal some REITs are already trading at a premium to NAV and could gain a head start in the spread investing game once rates normalize"
X Link 2024-12-06T00:15Z [---] followers, [--] engagements
"New from @TreppWire on continuing surge in #CMBS special servicing especially office at 14.63%. Important to remember that office ALREADY exceeds the GFC rate where WFH was not a factor. Could easily exceed 20% before it is over due to continued value destruction @MSCI_Inc"
X Link 2024-12-07T19:04Z [---] followers, [---] engagements
"Here is the simple math on AI power needs: A single Google search requires .3 watt hours of electricity; a single Chat GPT query use 10X that. That means data centers will rapidly max out our power without fundamental upgrades to the grid. Good graph from @McKinsey"
X Link 2024-12-07T23:43Z [---] followers, [---] engagements
"In our view the Fed is cutting because it thinks it has won the war on inflation. @WilliamBlairIM shows why: ex-shelter we are running around 2% now that shelter is decelerating due to high apt construction. But shelter will stay elevated as long as housing affordability an issue"
X Link 2024-12-10T20:38Z [---] followers, [--] engagements
"Lost in the discussion about lack of home affordability is that fact that this situation is an anomaly in the last [--] years @CBRE It depresses the home sales GDP engine and keeps rents elevated and shelter CPI high. Fed cuts will help drop CPI and restart the housing market"
X Link 2024-12-14T16:18Z [---] followers, [---] engagements
"Federal government leased space in private buildings down 7% in [--] years down 11% in DC area alone as remote work grows per @SPGMarketIntel . Another 50% expires or can be terminated in next [--] years. Yet Federal buildings in DC only 12% occupied according to PBRB. @DOGE"
X Link 2024-12-16T01:01Z [---] followers, [--] engagements
"Chair Powell was optimistic today that shelter CPI will improve due to lag effects. We aren't so sure: as long as mortgage rates stay high housing affordability @CBRE will remain at [--] year lows and continue to make would be home buyers price- inelastic renters by necessity"
X Link 2024-12-18T21:59Z [---] followers, [---] engagements
"Since the direction of interest rates is so critical to our real estate community a few things are worth repeating: The Fed made it clear this week that further cuts in Fed funds will only happen if CPI keeps dropping towards 2%. Meanwhile current Fed cuts= higher ten year and mortgage rates due to fears of inflation and/or continued economic growth. Core CPI has dropped mainly because goods and service increases have normalized in response to cooling labor markets and fixes in COVID era supply chains. So further Fed cuts will follow the direction of core shelter inflation per below and given"
X Link 2024-12-22T18:00Z [---] followers, [---] engagements
"Redfin's top [--] [----] projections for the housing market: absent a weakening economy mortgage rates will stay high and housing affordability will remain low. In other words: Shelter CPI will remain high as renters by necessity predominate. Residential brokerage firms will continue to struggle and consolidate. https://www.redfin.com/news/housing-market-predictions-2025/ https://www.redfin.com/news/housing-market-predictions-2025/"
X Link 2024-12-26T14:17Z [---] followers, [---] engagements
"@TicTocTick And mortgage rates will stay high as will shelter CPI as housing affordability remains at multi decade lows"
X Link 2024-12-26T20:45Z [---] followers, [---] engagements
"Nice precis from @eastdilsecured on rebound in CMBS lending this year. Warehouse retail apartments finding a bid as Fed starts cutting and yield curve starts to normalize. Office not so much. But 10Y will need to stay reliably below 4% for lending to rebound in earnest in 2025"
X Link 2024-12-30T06:47Z [---] followers, [--] engagements
"December #cmbs deliquency @TreppWire showing 11% office delinquency highest since series started in [----]. As we have stated before delinquency will be 20% + before it's over due mainly to secondary location B quality office distress from hybrid work value destruction"
X Link 2024-12-31T17:56Z [---] followers, [---] engagements
".and great real time look at the impact of the Fed cuts on weekly mortgage rates from @mortgagenewsmnd as the bond market pushed back on the Fed's "mission accomplished" pronouncement"
X Link 2024-12-31T19:02Z [---] followers, [--] engagements
"$WPC just announced [----] acquisitions for their single tenant portfolio--higher interest rates are pushing up cap rates and creating buy opportunities. $1.6B 7.5% average cap 9% average yield 10+ years of term positive leverage. Two years ago these same deals were in the [--] and 5% cap range. Buying is getting fun again"
X Link 2025-01-08T13:16Z [---] followers, [---] engagements
"$BXP just bought a 300K vacant DC office building for $34MM=land value. But here is the counter-narrative: they are knocking it down to build another office building and have already pre-leased half of the new building to a law firm. As we have said before there isn't enough office space in DC and most US downtowns that fits the new higher post-COVID tenant standards and developers will keep building more of it"
X Link 2025-01-08T13:27Z [---] followers, [---] engagements
"Interesting analysis for where VC firms are placing gen #AI bets in the real estate tech space from @JLL . JLL says there are a staggering [----] companies providing real estate technology services but only 10% are using gen AI. And of those 10% very few are AI-native: most are getting AI augmented re-works of existing software. Not surprisingly design and construction pm and portfolio data and market analysis the most crowded. Unclear to us whether AI augments are going to do much. But highly likely that some soon to be developed AI native application could be a game changer"
X Link 2025-01-09T21:55Z [---] followers, [---] engagements
"$AMZN spent $2B on acquisitions in [----] up from $930MM in [----]. Most of this was data center land acquisitions and not warehouses: [----] acres in [--] states but just under half in VA. AWS keeping up with AI compute needs. But if AI goes bust they can just build warehouses instead"
X Link 2025-01-10T15:27Z [---] followers, [--] engagements
"Data from PERE on the dismal state of real estate PE fundraising. $131B raised lowest since [----] and 50% below [----] numbers. High interest rates a killer: wider bid ask spreads reluctant sellers target IRR's harder to achieve treasuries hard to beat on a risk adjusted basis"
X Link 2025-01-10T21:42Z [---] followers, [--] engagements
"CMBS special servicing for office has doubled in a year per @TreppWire . House view: It goes to 20%+ before stabilization. Rest of the product types will max out around 10%"
X Link 2025-01-10T22:53Z [---] followers, [---] engagements
"Another Class A office property just traded for land value. [--] W. Madison in Chicago just traded for $85MM nearly 80% less than the $375MM [----] sale price. That's $60/sf for a 65% leased Hines built property in the heart of the Chicago Loop. At that basis they can rent it at C class rents and still make money"
X Link 2025-01-10T23:51Z [---] followers, [---] engagements
"Interesting to see that the e-commerce as % of sales trajectory change that took place during COVID is now permanent. Nominal gross retail sales increases were turbocharged by inflation but the % is permanently higher"
X Link 2025-01-12T20:31Z [---] followers, [---] engagements
"Sidebar on prior post on e-commerce percentage of retail sales. If per @CBRE you exclude gas and automobiles the total % is higher but the trajectory is the same"
X Link 2025-01-12T22:43Z [---] followers, [--] engagements
"New study from @REITs_Nareit showing that REITs are second only to private equity in total return. And with far better liquidity and lower loads. Out performed private real estate too and with lower fees though the two were highly correlated. Real estate PE has work to do"
X Link 2025-01-13T11:58Z [---] followers, [---] engagements
"Top [--] US banks with #CRE exposure as a % of total equity from @FloridaAtlantic. Exposure is to a broad range of real estate collateral types some of whose income statements are doing better (retail warehouse apartments) than others (office). But all collateral with maturing loans face balance sheet risk due to interest rate resets"
X Link 2025-01-13T14:33Z [---] followers, [---] engagements
"Good retrospective on historical CMBS. 2000's driven by acquisitions and poor underwriting followed by GFC reckoning. [----] saw a return of volume but driven by floating rate single borrower refis betting on SOFR drop. Largest was $3.4B Rock Center refi valued at 5.5% cap"
X Link 2025-01-13T16:25Z [---] followers, [---] engagements
"There's alot of news about office distress but distress in life sciences is now far worse. Per @JLL vacancy at 30% and on its way to 40% before it stabilizes and rents dropping. Supply super cycle and anemic VC funding. Good value buy opportunities in public and private markets but recovery is a ways off"
X Link 2025-01-14T12:51Z [---] followers, [---] engagements
"As we have stated before rent and shelter CPI are going to stay between 4-5% as long as high mortgage rates limit housing affordability. Apartment market vacancy has also peaked and rents only going to accelerate from here. CPI relief has to come from goods or other services"
X Link 2025-01-15T15:23Z [---] followers, [---] engagements
"@Jaywramseyky You raise a good point: the beginning and end dates of the survey determine the results. There are shorter periods within that time frame where PE equity outperformed everything"
X Link 2025-01-15T18:15Z [---] followers, [--] engagements
"The highly unusual move in the [--] year since last September has put CRE's hopes for a transaction and value recovery on hold. Per @jpmorgan most of this move has been due to heightened growth expectations and uncertainty about the Fed's reaction to the inflation that could come with this growth and from the incoming administration's policies on trade and immigration. Given that growth is always good for real estate if the uncertainty component goes away the ten year should again be supportive of transactions and values"
X Link 2025-01-17T17:58Z [---] followers, [--] engagements
"Unleveraged IRR's for all private real estate have averaged around 7% and [---] bps over Baa corporates since the 1980s. Current Baa's close to [--] so it's hard to find sellers at the required 8% IRR for core CRE. But plenty of distressed sellers of non core at twice that"
X Link 2025-01-19T15:10Z [---] followers, [---] engagements
"Anybody else think it is quicker and easier to get a cab in Manhattan than an Uber or Lyft You see it you flag it. No wandering around looking either. From @bloomberg on what is happening due to congestion pricing. I think the cabs know that and are flooding the zone"
X Link 2025-01-19T16:05Z [---] followers, [---] engagements
"Interesting per @WSJ and @GreenStreet_CRE $INV trading at discount to NAV due to rise in interest rates. Yet elevated mortgage rates have limited homes on the market and led to higher home prices and SFR rents. Good example of macro incorrectly affecting a stock value"
X Link 2025-01-19T18:02Z [---] followers, [---] engagements
"Interesting to see @CBRE how aggressive apartment IRR rent growth and cap rate assumptions are in spite of high interest rates and overbuilt sunbelt markets. High mortgage rates and lack of home supply/affordability has created a generation of renters by necessity"
X Link 2025-01-25T16:13Z [---] followers, [---] engagements
"Bearish (perhaps) for cold storage REITS predicated on revenue growth through development but new supply reductions are bullish long term for private owners of existing. Not investment advice. The cold storage warehouse industry has been suffering from declining year-over-year inventory levels since mid-2023 and are not showing signs of letting up based on @USDA data. (1/3) https://t.co/aceoQO1l4r The cold storage warehouse industry has been suffering from declining year-over-year inventory levels since mid-2023 and are not showing signs of letting up based on @USDA data. (1/3)"
X Link 2025-01-27T17:07Z [---] followers, [---] engagements
"New from @MSCI_Inc on buyer cap rates on higher risk vs core multifamily. Risk asset unleveraged IRR's [---] bp + higher though"
X Link 2025-01-27T18:01Z [---] followers, [---] engagements
"@conorsen @opinion Agree on dwindling AA space. But including sublease Midtown vacancy increased in [----] to 23% and gave back another 4MM of net office space so bumping along the bottom at best. Most of the vacancy is in older buildings and that is where most of the maturing CMBS debt is @JLL"
X Link 2025-02-03T18:31Z [---] followers, [--] engagements
"Great illustration from @TreppWire about which CMBS apartment loans are now underwater from an LTV perspective. Anything securitized from Q4 [----] to Q4 [----] at sub 5% caps when rates were at COVID lows. Market historically is 5.5-6% and now normalizing. Won't end well"
X Link 2025-02-10T04:10Z [---] followers, [---] engagements
"Candidly I am surprised to see the surge in non agency bank and lifeco lending volume per @CBRE . Taking share from CMBS and alt lenders. Surprising too. Banks appear to be healing post SVB"
X Link 2025-02-10T23:08Z [---] followers, [--] engagements
"For those of you worried about housing affordability and access there is an interesting parking bill in front of the Washington State legislature. Bill [----]. Would prohibit Washington State municipalities from creating minimum parking requirements for new developments. This would dramatically reduce developer costs and increase the amount of FAR available for ADU's not to mention reduce traffic congestion and auto emissions. Also bullish for owners of existing parking structures. This is going on all over the country--cities trying to kill the car. Wave of the future"
X Link 2025-02-11T14:57Z [---] followers, [--] engagements
"Per @business $BX offers $428MM for London office building. Reportedly 6% ish cap. London rents up 8% in [----] off bottom building leases are long term and many were signed during Covid so they already reflect hybrid work space needs. Bond with an equity kicker"
X Link 2025-03-15T12:58Z [---] followers, [---] engagements
"Office rents up 4% cumulatively since COVID due to WFH downsizing from @MSCI_Inc But TI and new construction costs up 40%. So effective rents are still in negative growth. Good news: new construction can't pencil so supply shut down sets the stage for a recovery. Bad news: It will be a decade of pain"
X Link 2025-03-18T15:56Z [---] followers, [--] engagements
"Real estate secondaries had a big year in [----] per @ares_management. Lower mark to market valuations/higher interest rates make for attractive entry points for new investors. GP led transactions still dominate. [----] should be another strong year"
X Link 2025-03-21T10:55Z [---] followers, [--] engagements
"From @jpmorgan hotel Revpar down 4% YOY due mainly to occupancy declines in non luxury segments. Mirrors recent slow down in airline bookings due to decreased consumer confidence and business concerns/uncertainty about macro"
X Link 2025-03-21T17:01Z [---] followers, [--] engagements
"According to @cbre 80% of all firms have "implemented" their RTO but 75% of these firms say attendance is not there yet. Our view: this is less about worker intransigence and more about employer indifference: they have figured out that over time WFH will save money on rent"
X Link 2025-03-22T20:58Z [---] followers, [---] engagements
"Helpful breakdown from @MorganStanley on the core functionalities of AI. (1) Getting organizing processing and interpreting existing data and (2) rearranging it creatively are core competencies today but agentic skills will improve significantly in three years"
X Link 2025-04-04T11:54Z [---] followers, [--] engagements
"From conference presentation @apolloglobal yesterday. Loan activity falling off sharply due to tariffs yet spreads currently ignoring"
X Link 2025-04-05T14:52Z [---] followers, [--] engagements
"@jayparsons not sure that is accurate. either way we are are close to long term averages on both so we don't see a lot of room to move down absent lower rates"
X Link 2025-04-10T15:34Z [---] followers, [--] engagements
"I think this sets a record for the steepest discount we have seen in office. @CrainsChicago . Vacant Chicago suburban office building just sold by $O for $6MM or $8/sf a 96% discount off the [----] sale price of $150MM. New owner is going to lease it up as discount office"
X Link 2025-04-13T23:28Z [---] followers, [----] engagements
"Earnings down 8% in first quarter YOY from $JBHT in an already weak pricing environment due to oversupply of trucks. Seeing slowdown in some of our warehouse properties as well"
X Link 2025-04-16T12:01Z [---] followers, [---] engagements
"Interesting. After buying a 49% interest in [---] Howard St in SF for $900/sf in [----] Divco just recapitalized the now vacant building with $BX for $264/sf. With net rents in the $50 range that's a nearly 20% YOC before lease up TI's and commissions. That's how you do it"
X Link 2025-04-23T19:03Z [---] followers, [--] engagements
"For those of you who want a good tutorial on the history of CMBS @trepp just released their first piece. Tracks CMBS [---] 2000-2007 full of poor underwriting huge investor demand and later carnage during the GFC. Issuance hit in excess of $200B in [----] and we have rarely hit half that level ever since. What is interesting is the chart below which tracks the subsequent losses by property type. Retail the big loser as e-commerce destroyed a generation of inferior malls followed by office the perennial problem child of CRE. What is more interesting is the relatively low loss rates in apartments"
X Link 2025-05-01T17:54Z [---] followers, [---] engagements
"@RecoveryTrade The ones with urban concentrations like $SLG and $VNO (new york) or $$BXP (national CBD's) do since urban leases are generally longer. Suburban reits like $CUZ and $HIW have shorter term"
X Link 2025-05-02T18:56Z [---] followers, [--] engagements
Limited data mode. Full metrics available with subscription: lunarcrush.com/pricing