Dec 19, 2023
Multifamily rent growth experienced a significant acceleration in 2021 and early 2022, leading to concerns about affordability and calls for rent control. However, since late 2022, the growth has slowed, and in some major markets, rents have even declined. On a national level, the average asking multifamily rent is only $65 higher than it would have been with pre-pandemic growth rates. Markets in Florida, particularly Palm Beach, show the largest positive differences, with rents significantly higher than projected. In contrast, several large coastal California markets, including San Francisco, San Jose, and East Bay, have lower rents than anticipated. The variations are more pronounced between different property types, with four- and five-star properties experiencing the greatest absolute differences. Miami and Orange County have notably higher rents for high-end properties, while San Francisco’s most expensive units are cheaper. Lower-priced one- and two-star properties generally have marginal increases, with some renter households paying slightly less than anticipated in a few markets. Bay Area markets stand out for lower rents in one- and two-star properties compared to pre-pandemic projections, while Palm Beach has higher rents in this category.
Dec 19, 2023
After nearly two years of delays, El Salvador’s Bitcoin Volcano Bond has received regulatory approval from the Digital Assets Commission (CNAD) and is expected to be issued in the first quarter of 2024. The bond, named after a plan to use geothermal energy from a volcano for Bitcoin mining, was initially announced by President Nayib Bukele in 2021 after El Salvador adopted Bitcoin as legal tender. The bond’s debut in early 2022 was postponed and faced multiple delays before El Salvador’s congress passed a law in January, creating a legal framework for the bond. The bond could help the nation avoid defaulting on its debt, although the International Monetary Fund has urged El Salvador to eliminate Bitcoin as a legal currency. The funds raised by the Volcano Bond are intended for the creation of a “Bitcoin city” and investments in Bitcoin itself, aligning with El Salvador’s broader embrace of cryptocurrency.
Dec 13, 2023
In November, the number of distressed office properties backed by commercial mortgage-backed securities loans increased by 1.1%, reaching a total of 762 buildings, with a 30% vacancy rate. The distress level may improve as some properties recently received loan modifications. Notable among these is a portfolio of nearly 150 properties in Pennsylvania, securing a $1.27 billion loan, set to be removed from special servicing after a two-year loan extension by Workspace Property Trust. In downtown Philadelphia, the servicer deemed a $126 million loan on the Wanamaker Building nonrecoverable, with an updated appraised value 71.8% below the 2018 value.
Additionally, final offers are being reviewed for the Countryside Mall in Clearwater, Florida, which faced credit rating downgrades, leading to potential losses in a CMBS deal. The 1.4 million-square-foot mall, managed by special servicer Midland Loan Services, was transferred to special servicing in June 2020. JLL is overseeing leasing and management, and while the mall’s value has risen, a pending transaction is under review for approval.
Dec 2, 2023
StateServ, a national provider of durable medical equipment, has secured a five-year lease for a 14,100 square feet space at the Alico Business Park in Fort Myers, Florida. This expansion is part of the company’s operations in 14 states, with a total of 50 distribution centers. The distribution center at 16311 Domestic Ave., built in 2020 and spanning 13.28 acres, is also home to other tenants such as Clevertech and retailer The Coldest Water. The Alico Business Park, comprising four industrial properties totaling 174,600 square feet, hosts a diverse range of tenants including United Way of Lee County and Matter Brothers Furniture. The lease deal was facilitated by Shawn Stoneburner of Cushman & Wakefield representing the owner, and Jeffrey Bucker of Lee & Associates representing StateServ.
Nov 28, 2023
Financial centers around the world are grappling with uneven recovery in the hotel industry. These centers rely heavily on corporate travel, and the closure of offices in 2020 disrupted hotel occupancy. Even though people are back in offices, downtown hotel occupancy in major financial hubs like New York and Tokyo is still below pre-2019 levels. Factors like new hotels and the slow return to offices are contributing to this. While some cities like Dubai are bouncing back, challenges in corporate travel demand and economic issues in certain countries may slow down the overall hotel recovery.
Nov 18, 2023
In response to the housing needs of the unhoused, refugees, and migrants, over 16,000 hotel rooms in New York City have been repurposed, with 140 hotels no longer available for travelers as of October. Various city and county authorities have secured these accommodations through long-term leases, reducing future hotel room supply. The impact is particularly noticeable in different market segments, with a concentration of projects in major areas like midtown, Queens/Brooklyn, and JFK/Jamaica. The transformation of these hotels, most of which were midscale or economy properties, may have a lasting effect on New York City’s hotel performance, potentially leading to higher average daily rates in the future. Despite ongoing construction, the city’s supply pipeline for new hotels is expected to be limited due to recent zoning and development regulations.
