February 15, 2016
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VIDEO RECAP:
Finally Good News: Unemployment Down In January
- The US Labor Department reported the unemployment rate dropped to 4.9% in January, its lowest level since February 2008.
- The US added over 150,000 new jobs and saw a 50 bps climb in hourly wages from the end of 2015.
- In particular, 29,000 new jobs in the manufacturing sector, along with 58,000 new retail jobs, ease worries over the global economy—but bad news could still be coming, expectations of a March Fed rate hike are rising.
Retail Going Strong In January
- Retail activity climbed as well, at a 20 bps gain (double the Commerce Department’s 10 bps expectation).
- Low energy prices, combined with wage and employment growth, mean consumers have more pocket change to spend on extra cars, clothes and hoverboards (of course).
- January marked the largest jump in consumer spending since last May, and economists project that number to rise as the stock market recovers, pulling GDP along with it.
A Ton Of New Rental Units Hitting The Market In 2016
- While affordable housing and luxury development have dominated headlines, the big news last week was the over 8,000 new Manhattan and Brooklyn rental units set to deliver in 2016.
- Increasing vacancy rates makes the new units’ timing less than ideal, but many developers are accounting for the slowdown with solutions like expanded amenities and concessions to new residents.
WeWork’s Valuation Keeps Rising
- Fidelity Investments reported a 53% increase in the value of their WeWork shares through Q4, bringing the co-working giant’s valuation up to $15B.
- Putting that in perspective, Boston Properties has 10 times the SF but only a $17B valuation. Recent economic turmoil has some worried, but WeWork thinks its 40% profit margins will help it weather any storm.
- Proving the global economic tantrum doesn’t phase them, the startup plans to expand to new cities in the US, India and China this year—and even head into the residential world with WeLive at 110 Wall St.
Wait, So Airbnb Doesn’t Impact Hotels?
- Hotel analysts STR released a report last week finding no tangible impact from Airbnb on the NYC hotel industry.
- Airbnb’s occupied nights were up 1.1% in 2015, to 5.5% from 4.4% in 2014—but there’s no evidence that demand at normal hotels was impacted.
- After all, Airbnb only takes in 3.5% of NYC lodging revenue.
Crane Collapse Spurs New Safety Measures
- A deadly crane collapse in Tribeca this month spurred Mayor de Blasio to announce new safety measures, includes ceasing crawler crane operation when winds hit 20 mph along with $10k fines for equipment not safeguarded.
- The administration also ordered inspections of all 376 currently active cranes in NYC, saying “the record boom in construction growth does not come at the expense of safety.”
