Good Morning!

No rate cuts in the U.S. but the Swiss will see a 25bps drop, occupancy continues to hurt office despite rising asking rents, multifamily loan losses rise in 2023, Baltimore is selling houses for a $1, home-flipping falls by 29% in 2023, and expect Congress to eye money going to China more closely

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Capital Markets

Headlines

• The Swiss Cut The Rates

  The Swiss National Bank announced a decision to lower their main policy rate by 25bps to 1.5%, believing their inflation is likely to stay below 2%

• Fed Holds Rates, Three Rate Cuts Still Expected This Year

  On Wednesday the Fed indicated it still expects to have three rate cuts this year despite inflation remaining above 2%, the market rallied on the news

• Congress Likely To Place More Scrutiny On Money Going to China

  Congress is likely to be placing more scrutiny on U.S. investments headed to China. Particularly those which might help develop its military

• Baltimore Planning To Sell Homes For $1

  Roughly 200 boarded up homes will be sold to residents who commit to renovations under a program aimed at revitalizing neighborhoods

• Home-Flipping Declines By 29% in 2023

  A report 308,922 single-family homes and condos in the U.S. were flipped in 2023, down from 436,807 in 2022, the largest drop since 2008

• Multifamily Loan Losses Spike As 2021 Debt Matures

  According to MSCI, the loss rate for apartment loans reached 16% in 2023, up from ~5% in the prior two years

• Low Occupancy Offsetting Higher Office Rents

  Despite asking rents for the top office assets rising above pandemic and pre-pandemic levels, occupancy remains the limiting factor

Deals Deals Deals

Sales

• Office: Fracht Group acquired Intercontinental Park III, a 90K sf office asset in Houston, TX from Greenspoint Property Management

• Self-Storage: Prime Group Holdings acquired Prime Storage, a 98K sf storage facility in Rocklin, CA for $20M from Banner Real Estate Group

Debt

• Multifamily: Affiliated Development secures $456M construction loan form Bank United for a 223-unit multifamily development in downtown Hollywood, FL

• Multifamily: Lotis Group secures a $95M loan from MF1 Capital to refi Tamarac Village, a 401-unit apartment community in Miami, FL

• Office/Hospitality: Panorama Holdings secures a $72M loan from Deutsche Bank to refinance an office and hotel property in Charlotte, NC 

• Retail: United Hampshire U.S. REIT secures a $22M, 5-year, fixed-rate loan for the refinancing of Arundel Plaza, a 282K sf shopping center in Glen Burnie, MD

Developments

• Multifamily: TM Associates and United Planning Organization, opened MDXL Flats, a 101-unit affordable housing asset in Washington, D.C.

• Multifamily: Affiliated Development breaks ground on The Tropic, a 223-unit workforce housing project in Hollywood, FL

• Industrial: Stonemont Financial Group completes construction of Sunridge Industrial Park, a 565K sf logistics facility south of Dallas, TX

• Multifamily: Cityview has completed Portico, a 378-unit multifamily asset in Oakland, CA

Capital Raising

• Multifamily: Redwood Trust and the Canada Pension Plan Investment Board have formed a $750M joint venture to invest in multifamily investor bridge loans and term loans. It will initially target more than $4B in total acquisitions

• Industrial: ElmTree Funds announced today the launch of ElmTree Industrial Trust, Inc. and ElmTree Industrial Access Trust, Inc.. Two industrial REITs expected to primarily invest in single-tenant, stabilized, income-producing industrial properties with long-term net leases, along with similar build-to-suit industrial properties

Leasing

• Office: LibreMax Capital signs a 10-year 21K sf lease at BXP’s 601 Lexington Ave in New York, NY

Meme Summary

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