The Bisnow Weekender: No One Wants A Murder Podcast About Real Estate
Thanks for reading The Bisnow Weekender, my personally curated roundup of the most impactful news, notable quotes, binge-worthy show recommendations and other colorful highlights from the Bisnow world of commercial real estate and beyond.
I am going to call it now: WeWork will declare bankruptcy on Tuesday.
Why do I say that? Well, there was a Wall Street Journal report this week that basically said so, citing “people familiar with the matter.” Following that news, a WeWork spokesperson reached by Bisnow declined to comment on the WSJ report, calling it speculation.
However, the WeWork rep did tell Bisnow that the company still has “a clear, long-term vision for the future and over the past few months we have taken a series of decisive actions to improve our business.”
That said, Bisnow also reported this week that WeWork got a one-week extension to make good on its $95M in missed debt payments — and that deadline is, well, 11:59 p.m. ET on Monday.
So, Tuesday is the day.
I could be wrong, but a bombshell report dropping (and WeWork denying it) is a foxtrot that has been tearing up the business media dance floor since the coworking goliath’s stunning $47B failed IPO in 2019.
This week’s tango was par for the ballroom. And while there has been rampant speculation for years that WeWork would eventually go down, this time it feels different, and it now seems we are days (if not hours) away from a major, market-rattling announcement.
I tried to reach Adam Neumann earlier this week using an old phone number from the salad days when he was the shot-guzzling messiah of the business world.
Sadly, he did not reply, but I have a feeling he will be coming back into the real estate “Flow” very soon: Neumann’s WeWork noncompete expires this month.
Have a great weekend — and remember, remember, the fifth of November. Also, don't forget that daylight saving time ends on Sunday at 2 a.m. local time.
— Mark F. Bonner, Bisnow Editor-in-Chief
Voices From The CRE Battlefield
“Tim Dismond has done a great deal to enhance our DE&I programs. Now that he has elected to leave CBRE, we wish Tim continued great success.”
— CBRE press statement to Bisnow DFW Reporter Olivia Lueckmeyer after she learned Tim Dismond, the first chief diversity officer to be hired at CBRE, left the firm. Bisnow hasn't yet learned the reason for Dismond’s departure or what is next for him. CBRE’s DEI efforts will now be headed up by Banke Odunaike, the firm’s chief culture officer.
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“In determining the extent of additional policy firming, it may be appropriate to return inflation to 2%. Over time, the committee will take into account the cumulative tightening monetary policy, the lags with which monetary policy affects economic activity, inflation and economic and financial developments.”
— Federal Reserve Chair Jerome Powell, clearly and succinctly explaining that, for now, the Fed will not raise the federal funds rate, so the base rate will remain between 5.25% and 5.5%. It likely means very little for CRE.
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“I think many [banks] have been kicking the can down the road for several months, but the can is getting heavier to kick.”
— Woodvale Commercial Real Estate Managing Partner Rahim Charania, speaking to Bisnow Atlanta Reporter Jarred Schenke after raising $75M of a targeted $100M fund to buy distressed hotels, warehouses and urban office buildings across the Southeast.
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“In retail, we're beyond worrying about the structural impact of e-commerce. … The impact has happened.”
— Anita Kramer, senior vice president of ULI’s Center for Real Estate Economics and Capital Markets, who spoke to Bisnow National Reporter Dees Stribling regarding some of the top takeaways from the new ULI/PwC Emerging Trends in Real Estate Report.
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“It's certainly not for the faint of heart to be trying to finance and capitalize development projects in the current environment.”
— SJC Ventures principal Fain Hicks, during Bisnow’s recent Atlanta Construction and Development Summit.
Bisnow News Excerpts From The Week: Oct. 30-Nov. 3
Fed Holds Off On Raising Interest Rates For Second Time In A Row — National Reporter Dees Stribling
By itself, the lack of action doesn't mean very much for commercial real estate, BGO Chief Economist and Head of Research in the U.S. Ryan Severino told Bisnow by email Wednesday, since interest rates are already elevated and interest rate volatility remains high. “However, the slowdown in the pace of rate hikes in 2024 suggests that the Fed is much closer to the end of the tightening cycle than the beginning,” Severino said. Read more.
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Top Takeaways From The New ULI/PwC Emerging Trends Report — National Reporter Dees Stribling
The Emerging Trends in Real Estate report from the Urban Land Institute and PwC is one of the most important of the year — and Bisnow got an early copy of the 2024 edition. Read more.
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Fissures Form For Big-Box Industrial As Tenants Delay Big-Money Moves — Southern California Reporter Bianca Barragán
Top-line occupancy rates remain historically high — around 97% or higher — but occupiers are piling on caution as they approach leasing decisions, according to earnings reports from Prologis, First Industrial Realty Trust and other top industrial REITs. Big boxes of 200K SF or more are feeling the slowdown most keenly. Read more.
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DFW-Area State Farm Campus Sale Touted As Largest U.S. Office Deal This Year — Dallas-Fort Worth Reporter Olivia Lueckemeyer
The 2.2M SF mixed-use property sold to a real estate investment firm created by Robert Sarver, an Arizona businessman and former owner of the Phoenix Suns. Read more.
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Cushman & Wakefield Looks To Sell Assets, Reduce Debt As Losses Continue — National Reporter Dees Stribling
“It’s true uncertainties remain, and we saw the transaction markets take another pause in mid-August when rates moved higher. But even as transactional markets were idle during the quarter, we were not. We stayed focused, taking the deliberate actions ... to improve our balance sheet and reduce our cost structure,” CEO Michelle MacKay said on C&W's Q3 earnings call this week. Read more.
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Healthcare REITs Agree To Merge, Form $21B Medical Property Giant — South Florida Reporter Matt Wasielewski
The all-stock merger of the two medical REITs is expected to close in the first half of 2024, with the combined entity having around 52M SF of medical and lab space under management. Read more.
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More News From The Week …
— Scarcity Of Capital Hammers CRE
— REPORT: Regional Banks See Big Jump In Nonperforming CRE Loans, Related Losses
— WeWork Gets One-Week Extension To Make Missed Debt Payments
— Tim Dismond Departs CBRE After Serving As Its First Chief Diversity Officer
— PODCAST: JLL Chief Technology Officer Yao Morin On Why AI Is Coming For Tasks, Not Jobs
— Newmark Expands Cost Cutting Despite Turning Profit, Gaining Market Share
— Six Flags, Cedar Fair Merge To Form $3.5B Theme Park Operator
Slide Into My DMs … NYC Office Power Broker
My Slightly On/Off-Topic Media Diet This Week
A Big Legal Defeat For The Realtors (WSJ): “The National Association of Realtors has objected to our editorials challenging its anti-competitive business model, but what do you know. On Tuesday a federal jury found the Realtors liable under U.S. antitrust laws for conspiring to fix prices in the class-action case Burnett v. NAR.” In fact, it was a $1.5B defeat that is sure to shake up the residential brokerage commissions structure. Will there be CRE impacts down the road? Time will tell.
The Home Office Was A Must-Have During Covid. Now It’s Just Meh. (WSJ): “A recent study by Zillow found that key words like ‘home office’ and ‘cloffice’ were mentioned significantly less during the first six months of 2023 compared to the same period last year.” Wait, WTF is a cloffice?
The World Is Becoming More African (NYT): “The median age on the African continent is 19. In India, the world’s most populous country, it is 28. In China and the United States, it is 38. … More than a third of the world’s young people will live in Africa by 2050.”
40 Companies That Are Beating The West (Rest Of World): “What is the world’s biggest digital bank? No, not HSBC — it’s Brazil’s Nubank, which reported close to $5 billion in revenue last year.”
The Texas Rangers Finally Won Their First World Series Ever (ESPN) … And No One Was Watching (ESPN): It was "the least-watched Fall Classic in recorded TV history."
… The Rangers Also Won The Office World Series (Bisnow): “What the Rangers are doing to draw attention to the DFW Metroplex is awesome.”
The Stratospheric Rise Of Lionel Messi’s Pink Jersey (NYT): “In the span of three months, the soccer superstar has made Inter Miami’s eye-catching jersey the hottest piece of sports merchandise on the planet.” As far as I am concerned, Messi is the GOAT (and he won his record eighth Ballon d’Or award this week), but he isn’t the highest-paid player in the world right now. His nemesis is — and it isn’t even close.
Elephants Are Total Scaredy-Cats Around Bees (Nautilus): “The bee has the power to terrify a mammal that’s 22 million times its size.” Oh, I think we all know how vexing those busy little bees can be.
Want to Achieve Your Goals? Drop The Positive Attitude (The Messenger): Someone call Yoda and tell him to be mindful of his feelings because it looks like anger can lead to a lot more than “sufffffering.”
Why Holiday Candy Hits Shelves So Early (BBC): Hint: We’re all suckers.
Bisnow Weekend Interview Preview
Bisnow National Reporter Dees Stribling sat down with Steinbridge Group founder and CEO Tawan Davis to discuss the ins and outs of impact investing — and how his firm is expanding its investment and redevelopment footprint nationwide. As he told us, providing affordable rental and for-sale housing isn't incompatible with making a solid return.
Bisnow: Are you optimistic that, as a nation, we can deal with the housing crisis?
Davis: Great question. Yes and no. Yes, in that America has the most active and inventive capital markets and economic system in the history of human capital. I’ve traveled a lot the last few years to some wonderful places, but the United States is unique in its ability to allocate capital to resolve economic challenges and to respond to market dislocations like the housing crisis. So there is hope.
Read the full story, which will be leading our site over the weekend, to see his “no” response and the rest of the interview.
Jobs! Jobs! Jobs!
Here are this week’s top jobs over at our job platform, SelectLeaders. Reach out to SelectLeaders Managing Director Ryan Neale to learn more. You can email him at ryan.neale@bisnow.com.
Senior Investment Officer — Play a leading role in shaping the Los Angeles County Employees Retirement Association's $5B-$8B real estate allocation.
Vice President Capital Markets — Join a growing real estate investment management firm seeking a transformative capital markets leader.
Portfolio Management Vice President — Link up with an established real estate investment management firm with over $33B in assets under management seeking a portfolio manager.
VP of Acquisitions and Asset Management — Check out this premier Southeast Class-A office owner/operator seeking an acquisitions leader.
Upcoming Bisnow Events And Webinars
Tuesday, Nov. 7 (Irving, Texas): Dallas Industrial Conference
Tuesday, Nov. 7 (Lone Tree, Colorado): Colorado State Of Aerospace
Tuesday, Nov. 7 (San Francisco): Northern California Women Leading Real Estate
Wednesday, Nov. 8 (Chicago): Chicago Industrial Summit
Thursday, Nov. 9 (Dublin): Ireland’s Residential Conference
Thursday, Nov. 9 (Charlotte): What To Expect For The Queen City In 2024
Thursday, Nov. 9 (Nashville): Greater Nashville Office Market Outlook
Thursday, Nov. 9 (Austin): Austin Architecture & Design
Thursday, Nov. 9 (Columbia, Maryland): Rise Of Downtown Columbia
Hey, Ryan, What Are You Going To Binge This Weekend?
The rest of the third season of Only Murders in the Building — Martin Short is an absolute comedic gem (regardless of what half-baked editorials want you to believe), and pairing him with Steve Martin and Selena Gomez is simply too good. Or maybe I'll rewatch the entire catalog of I Think You Should Leave sketches again. I love them so much that I dressed up as The Driving Crooner for Halloween. — Ryan Wangman, Bisnow Chicago Reporter and fervent Martin Short stan
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How did I do? You can send all love letters and dissents directly to me at mark.bonner@bisnow.com.
