It's a risky game.
Institutions piled into apartment properties with yields <5%, and now with the risk-free rate pushing past 3.9% and rents slowing, the outlook is opaque.
Do you continue to pile into these assets?
Or risk watching property values plummet if you don't?
In the world of CRE, institutions are often content playing a passive game of hot potato with their wealth. They pass off (TRUST) their money to 'professionals,' cross their fingers and hope for the best.
What's going to happen when these institutions learn Bitcoin is a superior scarce asset with
BETTER yield,
ZERO required trust,
24/7 liquidity, and
LOWER risk?
Ah, man. Tough break. As others said, it rarely takes six months for an appointment regardless. Hopefully you get lucky!
This is the shortcut: https://www.cbp.gov/travel/trusted-traveler-programs/global-entry/enrollment-arrival
Look into Enrollment Upon Arrival if it’s not approved beforehand.
According to a report by @WSJ, more and more large office landlords are failing to repay their loans due to the combination of elevated interest rates and the increasing adoption of remote and hybrid work policies.
The office market is competing against secular shifts and cyclical phenomena simultaneously. Leases expiring before 2026, totaling approximately 1.4 billion square feet of space, may lead to the return of nearly 300 million square feet of space to the market.
Owners are expected to hold onto their best product and liquidate their most challenging assets first. Refinancings could prove challenging as values no longer support current terms, meaning an additional equity gap would need to be filled.
Cutting costs is no small feat for companies. Elon Musk knows it. It's why he's closing some offices and reducing one of the biggest expenses after labor: office rent.
WFH may actually increase in a recession for the cost-cutting benefits alone.
Remote work is the e-commerce of the office property market - both have disrupted traditional business models and are forcing real estate/businesses to adapt.
"A recession will allow CEOs to force their employees back to cubicles! They'll be begging for jobs!"
No guarantee.
Charlie Munger's skepticism of Bitcoin makes sense, considering it took him and Warren Buffett 35 years to get on board with Apple.
Unfortunately, I don't think he has another 35 years.
Commercial property markets are freezing, and CMBS sales have dropped 85% YoY. Higher rates are expected to lead to a lot of defaults. Equity investors: check #Bitcoin's price vs. the loans outstanding.
Brace for impact.
Last month, investors filed to withdraw more than $700m from the property fund (SREIT), which represents a significant increase from the norm.
It seems their capital partners are finally questioning the sub 4.5% cap rate multifamily purchases and the REIT's 26% office portfolio.
#[0]
So many office buildings sales heading into 2022 and 2023 have felt like a game of hot potato.
Received a call from a prospect I hadn’t spoken with for over 12 months (largely since I relocated to the other side of the country).
They want to sell their building.
Literally the definition of moving pains. 🫠
In a major recession, breakfast retailers are among the first to fail.
People begin to reconsider their $7 lattes and $8 microwave breakfast sandwiches.
🚩
Interesting time capsule… there’s a clear dichotomy between the Twitter of 2009 vs. 2023.
There are ±255,000,000 homes in the United States. There are only 21,000,000 bitcoin.
Choose accordingly.
WFH is to workers like Bitcoin is to money... The freedom of work-from-home will continue to attract top talent and suck life out of office buildings.
And this is a long-time coming for office owners. Some of the most prominent office properties in prime downtown markets across the U.S. continue to struggle with *real* occupancy. The majority of large office leases are 5-, 10-, or 15-year leases. When those leases begin to end and tenants adjust to their true occupancy, the pain will worsen for these owners.
We are barely 3 years past COVID-19's onset.
