The Bisnow Weekender: Your Opinions Of Gen Z Probably Need An Update
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.
They are hopeless, constantly depressed and anxious.
And they demand a lot of their employers, from wanting more money and promotions earlier than ever to demanding their companies take serious stands on diversity, equity and inclusion, the planet and their mental health and well-being.
Gen Z doesn’t want to go to an office every day. They don’t like in-person meetings. They have short attention spans. They are too tech-dependent. They want to go on “adventures.” They aren’t loyal, either, especially if your company isn’t “authentic.”
Dealing with Gen Z must be exhausting for the avocado toast-eating, reckless-spending millennials and all of those old, out-of-touch baby boomers who need to hurry up and retire. (As ever, the Gen Xers are too cool or burned out to care.)
Weaker, less serious and less prepared is the way older generations always stereotype the next generation, and Gen Z is having its baptism in that fire right now. At its best, this tactic can furiously inspire a generation to prove itself. At its worst, it can do the opposite.
Time will soon tell. Gen Z will represent 27% of the U.S. workforce in 2025. And it has already made an indelible mark on commercial real estate, from creating massive shifts in retail and restaurant strategies to swelling demands on multifamily and housing design.
The largest, most educated, most racially and ethnically diverse generation in human history, Gen Z’s ranks are 2 billion strong worldwide, and they represent about a quarter of the U.S. population. There is no doubt that they have an enormous impact on economies at every level, and they are starting to enter the real estate industry in force.
The truth about Gen Z is that they want exactly what you do.
They want a secure job that pays well with a defined path to leadership. They want to innovate and create new ways of doing business. And yes, they want to work from home more often to have a life (but also to get work done). They want to be hired, mentored and trusted to solve the big issues that face your business.
And contrary to popular belief, they want to work hard and are ambitious. Nearly a quarter of our newsroom hails from Gen Z, and two are in editor roles. They’re great, all of them.
Millennials and Baby Boomers like to wax about the trials of their lives that led them to where they are now. Boomers were shaped by the aftermath of World War II, the moon landing, the Vietnam War and the Civil Rights Movement. For millennials, it was the birth of the digital revolution, the Sept. 11 terrorist attacks, the Iraq and Afghanistan wars, and the Great Recession.
Gen Z saw their parents and siblings lose their jobs and struggle during the Great Recession. They saw the nation go through massive political and societal upheaval, from the 2020 presidential election to the Black Lives Matter movement to the Jan. 6 attack on the Capitol. They endured the pandemic at home during formative — and now lost — years.
They have been through a lot, and the economy and their future weigh heavily on their minds — just like yours.
P.S. I am off next week, so the Weekender won’t be back until March 29. Good luck with your taxes.
— Mark F. Bonner, Bisnow Editor-in-Chief
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The Best Of Bisnow News: March 11-15
Blackstone’s Real Estate Co-Heads On Their Next Big Investment Bet, The Market Recovery And Career Lessons Learned — UK Editor Mike Phillips
Blackstone upended the real estate world once.
It spotted the opportunity in logistics early, at the bottom of the market, buying hundreds of billions of dollars of industrial assets and reaping huge profits.
Now the company is looking to repeat the trick by capitalizing on the digital revolution.
“The scale of the data center opportunity is immense,” Global co-Head of Blackstone Real Estate Nadeem Meghji told Bisnow in an interview. “It's the single most exciting strategy we have globally today.”
Earlier this year, Meghji stepped up from his role as head of North American real estate at Blackstone to lead the world’s largest real estate manager — $337B of assets under management and counting — alongside co-Head Kathleen McCarthy, as the sector emerges from a trough created by sharply rising interest rates.
With $65B of capital to spend on real estate, McCarthy and Meghji sat down to talk with Bisnow in their first joint interview, a deep dive into the bellwether firm's strategy and processes.
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D.C.'s Historic Crime Wave Is Scaring Away Office Tenants And Retailers — Washington, D.C., Reporter Emily Wishingrad
Many U.S. cities saw crime increase during the first years of the pandemic before receding, but in D.C., violent crime incidents spiked to their highest levels this century. Organized retail theft and vandalism have taken a toll on local businesses, but there have also been high-profile carjackings and homicides in the heart of the city's central business district.
More than a dozen D.C. commercial real estate industry leaders have said in recent weeks that crime in the District has become a top concern among companies considering taking office or retail space.
The same fear is driving developers to reconsider where they build and investors to rethink whether they should bet on the city.
“You have folks who are looking at breaking their leases because of crime or costs associated with crime,” said Eric Jones, vice president of government affairs for D.C.’s Apartment and Office Building Association. “People aren’t coming into the office or everyone leaves at 3 p.m. because you don’t want to be in the city when it gets dark.”
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Dogged By 'Mistakes,' $1.2M Fine, Lawsuits And A Short Seller, Hotel Chain Shakes Up Leadership — New York Reporter Ciara Long and Deputy Managing Editor Ethan Rothstein
A Miami-based hotel operator was fined $1.2M by New York City last week for illegally operating short-term rentals in New York City for more than three years, but its potential troubles are far from over.
LuxUrban Hotels, which bills itself as an "asset-light" hotel chain because it master leases hotel buildings rather than buying them, has been hit with several lawsuits from landlords and vendors alleging it skipped out on bills. It is also the subject of a short-seller report that takes aim at the publicly traded firm's financial statements.
Bisnow also found two instances of the company announcing it has signed deals to take over hotels, reporting the leases in filings with the Securities and Exchange Commission but then later admitting the deals were never finalized.
LuxUrban announced last week, a day after the $1.2M fine was announced, that founder Brian Ferdinand would be stepping back from his role as co-CEO of the firm.
More Big News From The Week …
— American Dream Owner Sees World Cup Final As Chance To Change $5B Mall’s Story
— TikTok Continues Its Real Estate Push Despite House Passing Bill To Ban It In U.S.
— More Construction Projects Are Being Delayed Or Abandoned Entirely
— 'You Can Imagine The Pressure': Commercial Appraisers At The Center Of CRE's Price Reckoning
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My Slightly On/Off-Topic Media Diet
Blank-Cheque Company Aims To Buy Failed U.S. Banks (FT): “As a result, more banks would need to fail for Porticoes to be able to use money it has raised — and the list of potential targets is slim. … Last year, a group of economics professors estimated that the drop in the value of office buildings, in the wake of the pandemic, could cause as many as 300 banks to fail over the next few years.”
What Will The EU’s Proposed Act To Regulate AI Mean For Consumers … And Companies? (The Guardian): “One senior figure at a US company warned that the EU had set a limit for the computing power used to train AI models that is much lower than similar proposals in the US. Models trained with more power than 10 to the power of 25 ‘flops’, a measure of computing power, will be hit with burdensome requirements to prove they don’t create system risks. This could prompt European companies to simply up stakes and move west to avoid EU restrictions.”
New York City Is Covered In Illegal Scaffolding (The Economist): “City records show more than 8,000 current permits for scaffolds, which often include what New Yorkers call ‘sheds’ — dark and claustrophobic street-level tunnels. Many remain in place long after the permit expires because building owners find it more convenient to leave the scaffolding in place between inspections. As part of his ongoing war on sheds, [New York City Mayor Eric] Adams celebrated the removal of 21-year-old scaffolding from a Harlem street that had become a local landmark in its own right.”
The Boomers Who Tried Moving To Florida And Ended Up In Appalachia (WSJ): “The influx of retirees flooding into southern Appalachia is transforming the region from poor, serene and rustic to a bustling retirement haven. Many longtime Floridians are moving up also, as well as northerners moving directly into the area. From April 2020 to July 2022, the population in counties in southern Appalachia designated retirement or recreational areas grew by 3.8% — more than six times the national average.”
Amid Explosive Demand, America Is Running Out Of Power (WaPo): “Communities that had little connection to the computing industry now find themselves in the middle of a land rush, with data center developers flooding their markets with requests for grid hookups. Officials in Columbus, Ohio; Altoona, Iowa; and Fort Wayne, Ind.; are being aggressively courted by data center developers. But power supply in some of these second-choice markets is already running low, pushing developers ever farther out, in some cases into cornfields, according to JLL, a commercial real estate firm that serves the tech industry.”
Thirsty Bots Are Drinking Our Scarce Water (Noema): “According to a new study by University of California Riverside researchers, roughly two weeks of training for GPT-3 consumed about 700,000 liters of freshwater. The global AI demand is projected by 2027 to account for 4.2-6.6 billion cubic meters of water withdrawal, which is more than the total annual water withdrawal of Denmark or half of the United Kingdom.”
Bitcoin Is About To See A Big ‘Halving’ Event. Here's What That Means And Why It Matters (Quartz): “Each of the three halving events so far resulted in price increases in the following months. The last halving took place in May 2020, when bitcoin was priced at around $8,750. Six months after the halving, bitcoin’s price grew 79%, and a year later it was up a whopping 547%.”
The New Office Ritual? Zyn Nicotine Pouches (Business Insider): “If I need to have a challenging conversation with somebody or if I need to work on something that's a little bit more important than other things — like it's just a part of the routine.”
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Bisnow Weekend Interview Preview
The affordable housing crisis is growing across the country, but it is particularly acute in the San Francisco Bay Area. With a potentially historic reform to Low-Income Housing Tax Credits awaiting a vote in the U.S. Senate and calls for more funding and better access to housing coming from President Joe Biden, the problem is garnering a new level of attention.
In the Weekend Interview, Bisnow's Arielle Dreher spoke with Bianca Neumann, director of development at EAH Housing, a nonprofit developer in the Bay Area, about how governments can help fund housing and what the barriers are.
Bisnow: Are there actions that the federal government could take that would be helpful to organizations like yours, whether that be policy or sort of telling local authorities they have to use their federal dollars in certain ways?
Neumann: The first thing that jumps to my mind right now is something that we're all worried about, and that's the availability of vouchers. You know, right now, with what's happening with the federal budget, there is talk of severely limiting voucher availability, and those make a really big difference on the operating side for projects to move forward. So that is certainly something that I think would go a long way to help. Then it's complicated. There's a lot of reform that could happen to the Low-Income Housing Tax Credit program, but I don't know that I want to dive into that.
The Weekend Interview goes live every Friday evening — head to www.bisnow.com over the weekend to check it out!
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Jobs! Jobs! Jobs!
Here are this week’s top jobs over at Bisnow's careers platform, SelectLeaders. Reach out to SelectLeaders Managing Director Ryan Neale to learn more. You can email him at ryan.neale@bisnow.com.
President of Commercial Real Estate — Oversee and manage a geographically diverse commercial real estate portfolio (office, retail, industrial, data centers) for an Alaska Native Corporation.
Managing Director — Oversee the planning and execution of Harvard's project portfolio, project delivery standards, controls and resources.
Director of Asset Management — Oversee a prominent West Coast affordable housing portfolio.
Chief Financial Officer — Lead financial operations for a Beverly Hills-based, family-owned real estate investment company.
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Hey, Patrick, What Are You Going To Binge This Weekend?
I'm a big World Wrestling Entertainment fan, and we’re three weeks away from the biggest show of the year: WrestleMania. I'll be watching Friday Night Smackdown to follow all of the stories in anticipation of the big event. This is the best the product has been in over a decade, and the WWE just got another shot in the arm with the return of Dwayne "The Rock" Johnson. He was my favorite wrestler as a child, along with John Cena, so seeing them both back in the ring gives me a sense of nostalgia that I haven't felt in a long time. The NCAA men’s basketball tournament also starts next Thursday, so I’ll be watching the conference tournaments this weekend to see who makes it to the big dance. I’m predicting that the Kentucky Wildcats win it all, but I’m a bit biased, as my favorite player to watch right now is Rob Dillingham. I live in Southern California, and the weather is starting to pick up, so I’m hoping to get outside this weekend. But if it’s gloomy, I’m more than happy to sit at home and enjoy the action from my living room.
— Patrick Pace, Bisnow Copy Editor
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Upcoming Bisnow Events And Webinars
Tuesday, March 19 (Dublin): Dublin's Property Pulse: State of the Market
Tuesday, March 19 (Chicago): Turning the River Green - CRE Along the Chicago Waterfront
Tuesday, March 19 (San Antonio): San Antonio State of the Market
Tuesday, March 19 (Seattle): Future of Seattle's Waterfront and Downtown
Wednesday, March 20 (Richmond): Greater Richmond Multifamily Summit
Wednesday, March 20 (Boston): Boston Construction & Development
Wednesday, March 20 (Digital): Data Centres & Sustainability
Wednesday, March 20 (LA): Los Angeles ESG & Sustainability Commercial Real Estate Conference
Thursday, March 21 (Miami): South Florida Architecture, Design and Interiors
Thursday, March 21 (Atlanta): Atlanta Multifamily Conference
Thursday, March 21 (NYC): New York Multifamily Development & Investment
Thursday, March 21 (London): UK Office Series: The Renaissance
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How did I do? You can send all love letters and dissents directly to me at mark.bonner@bisnow.com.
