UW Bothell student housing redevelopment gets underway

The mixed-use project will be completed in phases, with the first phase slated to finish in spring 2023......»»

Category: topSource: bizjournalsNov 24th, 2021

SmartCentres Real Estate Investment Trust Releases Third Quarter Results For 2021

Maintained $1.85 per unit annualized distribution; Portfolio continues to provide recurring income with an in-place occupancy rate of 97.3% and committed occupancy rate of 97.6%; Continued advancement of non-retail pipeline of 281 projects representing approximately 55 million square feet across the network (32 million square feet at the Trust's share); Average collection levels across the portfolio approximate 97% for the quarter; The remaining 192 presold condominium units at Transit City 3 closed during the quarter generating FFO of $5.9 million ($0.03 per Unit); FFO per Unit with adjustments excluding ECL and condominium profits increased by $0.02 or 4.4% as compared to the same period in 2020; and Strong debt metrics continue, including Debt to Total Assets of 44.5%, Interest Coverage Ratio net of capitalized interest multiple of 3.7X, and Adjusted Debt to Adjusted EBITDA multiple of 8.5X. TORONTO, Nov. 10, 2021 (GLOBE NEWSWIRE) -- SmartCentres Real Estate Investment Trust ("SmartCentres", the "Trust" or the "REIT") (TSX:SRU) is pleased to report its financial and operating results for the quarter ended September 30, 2021. "This is the first release of results since the passing of Peter Forde. Peter was a true gentleman and a wonderful partner in the running of the SmartCentres business. We were not just colleagues, but good friends that spoke many times a day for 22 years. I think of him daily and we all miss him dearly," said Mitchell Goldhar, Executive Chairman and CEO of SmartCentres REIT. "Regarding our third quarter, we ended with solid performances from every aspect of the business. Operational resiliency was demonstrated by improved leasing momentum, occupancy increasing to 97.6%, and cash flow in excess of 97%. This is a reflection of the strength of our tenants. Our accretive mixed-use intensification program continues to be a source of additional growth, demonstrated this quarter by the completion of the remaining 192-unit closings in SmartVMC's 55-storey Transit City 3 condominium tower." "At SmartVMC, the most prolific and comprehensive of all the REIT's masterplan intensification projects, we have thus far closed on 1,741 units in the first three Transit City condominium phases, resulting in $0.37 in FFO per unit. While a healthy contribution indeed, it is merely the tip of the iceberg for our SmartVMC property, where we will have 1,026 additional units closing in our sold-out Transit City 4 and 5 towers, and where our newly minted residential banner, ‘SmartLiving', will imminently launch our next residential phase to the market, called ArtWalk." "ArtWalk, a 12-acre mixed-use neighbourhood in the heart of SmartVMC, located on the former Walmart parcel, will, upon full completion, consist of approximately 5 million square feet, 5,000 residential units, and 100,000 – 150,000 square feet of non-residential, across 12 separate buildings. Phase 1 of ArtWalk is planned to consist of over 370 condo units and 190 rental apartments, 70,000 square feet of large floor-plate tech office space, an innovative multi-use event space building, common and exclusive amenities for all building users, connected by world-class open spaces. The ArtWalk neighbourhood extends the tone set by our Transit City towers, with one very important distinction: SmartCentres REIT will own 50% of ArtWalk condos, double the 25% it owned in Transit City." "We remain committed to our vision to grow our company in the areas of greatest opportunity. While SmartVMC is but one of the REIT's 94 properties slated for intensification, it represents our vision of the future, at its finest." The following table presents the monthly collection experience since the pandemic began: Month(1) % of Gross Monthly Billings Collected Before Application of CECRA-Related Arrangements(2) % of Gross Monthly Billings Collected After Application of CECRA-Related Arrangements(2) Apr 2020 79.8 86.3 May 2020 80.6 97.0 Jun 2020 83.8 90.3 Jul 2020 88.9 95.3 Aug 2020 90.3 96.8 Sep 2020(2) 90.3 96.9 Oct 2020 96.8 96.8 Nov 2020 96.7 96.7 Dec 2020 96.6 96.6 Jan 2021 95.3 95.3 Feb 2021 95.5 95.5 Mar 2021 96.8 96.8 Apr 2021 95.7 95.7 May 2021 95.8 95.8 Jun 2021 95.7 95.7 Jul 2021 97.1 97.1 Aug 2021 97.3 97.3 Sep 2021 97.0 97.0 Oct 2021 94.6 94.6 (1)   Represents the Trust's collection experience up to October 22, 2021.(2)   The Canada Emergency Commercial Rent Assistance ("CECRA") program ended on September 30, 2020. As of October 22, 2021, the Trust has collected 94.6% of gross monthly billings for the month of October 2021. Collection levels have continued to improve to approximately 97% for the three months ended September 30, 2021. However, the challenges associated with the COVID-19 pandemic have continued to impact the remaining 3%. Accordingly, during the nine months of 2021, the Trust recorded additional bad debt expense/expected credit loss ("ECL") provisions totalling $5.3 million. The following table provides some additional details on the Trust's tenant billings, amounts received, abatements and deferral arrangements, and the remaining balance outstanding subject to deferral arrangements under negotiation and before ECL provision: (in thousands of dollars) Nine Months EndedSeptember 30, 2021 As a % Nine Months EndedDecember 31, 2020(1) As a % Total recurring tenant billings 603,745 100.0 601,251 100.0 Less: Amounts received directly from tenants to date 581,071 96.2 535,668 89.1 Balance outstanding 22,674 3.8 65,583 10.9 Less:         Recovery from governments for CECRA — — 15,412 2.6 Amounts forgiven by the Trust for CECRA — — 7,706 1.3 Sales tax on CECRA — — 2,976 0.5 Rent abatements provided to tenants 309 0.1 6,120 1.0 Balance outstanding 22,365 3.7 33,369 5.5 Less: Deferral arrangements negotiated 1,002 0.2 7,395 1.2 Rents to be collected before ECL provision provided 21,363 3.5 25,974 4.3 (1)   The Trust identifies the nine months ended December 31, 2020 as the beginning of the COVID-19 pandemic period. The table below represents a summary of total tenant receivables and ECL balances as at September 30, 2021 and December 31, 2020: (in thousands of dollars) September 30, 2021 December 31, 2020 Tenant receivables 44,110 57,563 Unbilled other tenant amounts 6,379 8,287 Total tenant receivables 50,489 65,850 Less: Allowance for ECL 21,419 19,742 Total tenant receivables net of ECL provisions 29,070 46,108 Highlights Mixed-Use Development and Intensification at SmartVMC Closings of the 55-storey Transit City 3 condo tower representing 631 residential units are complete, with all units closed by August 2021, contributing FFO per Unit of $0.03 (three months ended September 30, 2021) and $0.11 (nine months ended September 30, 2021). Construction continues on the 100% pre-sold Transit City 4 (45 storeys) and 5 (50 storeys) condo towers, representing 1,026 residential units. Construction is complete on the multi-level underground parking garage. Good progress is being made above grade with concrete and formwork up to level 26 for Transit City 4 and level 17 for Transit City 5. Construction of the purpose-built rental project, The Millway (36 storeys), continues at SmartVMC, with concrete and formwork up to level 5. The project includes 92 purpose-built rental units located within a portion of the Transit City 4 and Transit City 5 podiums and 454 units in the 36-storey tower. As part of the Transit City 1 and 2 projects, construction is well underway and delivery is expected in early 2022 of the 22 townhomes, which are 100% pre-sold. Preparation is underway for the launch of the next phase of high-rise condominium development (ArtWalk) in 2021 which is expected to include approximately 627 units. Other Business Development The completed first phase of the two-phase, purpose-built residential rental project in Laval, Quebec, which had initial occupancy by tenants commencing in March 2020 and, to date, approximately 90% of the 171-unit building has been leased. Construction of the next phase commenced in October 2021. The Trust completed the construction of its fourth self-storage facility with the opening of its Oshawa facility in August 2021. All of the four developed and operating self-storage facilities have been very well received by their local communities, with current occupancy levels ahead of expectations. Construction is on schedule for the two purpose-built residential rental towers (238 units) in Mascouche, Quebec with joint venture partner Cogir. Construction commenced for a new retirement residence and a seniors' apartment (402 units) in May 2021 with joint venture partner Selection Group in Ottawa. Three additional self-storage facilities in Brampton (Kingspoint), Aurora and Scarborough are currently under construction, of which one is expected to open in late 2021 and the remaining two are expected to be completed in 2022. Additional self-storage facilities have been approved by the Board of Trustees and the Trust is in the process of obtaining municipal approvals in Whitby, Markham, Stoney Creek and an additional location in Toronto. The Trust has commenced the redevelopment of a portion of its 73-acre Cambridge retail property (which is subject to a leasehold interest with Penguin) which now allows various forms of residential, retail, office, institutional, and commercial uses providing for the creation of a vibrant urban community with the potential for over 12.0 million square feet of development. The initial phase of the redevelopment will include various forms of residential development including townhouses as well as mid-rise and high-rise residential buildings. During the COVID-19 pandemic, the Trust has continued to pursue final municipal approvals for mixed-use density on many of its shopping centres. Financial Net income and comprehensive income(1) was $178.1 million as compared to $111.0 million in the same period in 2020, representing an increase of $67.0 million. This increase was primarily attributed to: i) $82.2 million increase in fair value adjustments on revaluation of investment properties, ii) $2.3 million decrease in interest expenses, and partially offset by i) $14.3 million decrease in NOI, ii) $1.4 million decrease in interest income, iii) $0.8 million increase in general and administrative expenses (net), iv) $0.6 million decrease in fair value adjustment on financial instruments, and v) $0.3 million decrease in gain on sale of investment properties. Debt metrics continue to demonstrate the Trust's commitment to its balance sheet, including Debt to Total Assets(2)(3) of 44.5%, Interest Coverage Ratio multiple(2) of 3.3X, Interest Coverage net of capitalized interest multiple(2) of 3.7X, and Adjusted Debt to Adjusted EBITDA multiple(2)(3) of 8.5X. The Trust improved its unsecured/secured debt ratio(2) to 70%/30% (September 30, 2020 – 67%/33%). The Trust continues to add to its unencumbered pool of high-quality assets. As at September 30, 2021, this unencumbered portfolio consisted of income properties valued at $6.0 billion (September 30, 2020 – $5.8 billion). FFO(2) decreased by $12.2 million or 11.1% to $97.9 million as compared to the same period in 2020, primarily due to $25.3 million of higher net operating income recognized on the Transit City 1 and 2 condo closings in 2020 partially offset by $9.1 million in lower ECL provisions in the current period. FFO per Unit(2) decreased by $0.08 or 12.5% to $0.56 as compared to the same period in 2020, primarily due to higher net operating income recognized on the Transit City 1 and 2 condo closings in 2020 partially offset by lower ECL provisions in the current period. FFO with adjustments excluding ECL and condominium profits(2) increased by $4.4 million or 4.7% to $94.4 million as compared to the same period in 2020. FFO per Unit with adjustments excluding ECL and condominium profits(2) increased by $0.02 or 4.4% to $0.54 as compared to the same period in 2020. ACFO(2) decreased by $11.4 million or 11.2% to $90.3 million as compared to the same period in 2020 primarily due to the impact of the Transit City 1 and 2 condo closings in 2020. ACFO(2) exceeded distributions declared by $10.7 million (2020 – surplus of ACFO over distributions declared of $22.1 million). The Payout Ratio relating to ACFO(2) for the rolling 12 months ended September 30, 2021 decreased by 1.8% to 90.1%, as compared to the same period in 2020. Operational Rentals from investment properties and other(1) was $195.2 million, as compared to $186.3 million in the same period in 2020, representing an increase of $8.9 million or 4.8%. This increase was primarily due to higher straight-line rent, short-term rental revenue and percentage rent revenue, and was partially offset by higher vacancy which principally resulted from the COVID-19 pandemic. In-place and committed occupancy rates were 97.3% and 97.6%, respectively, as at September 30, 2021 (December 31, 2020 – 97.0% and 97.3%, respectively). Same Properties NOI inclusive of ECL provisions increased by $7.8 million or 6.6% as compared to the same period in prior year. Same Properties NOI excluding ECL(2) decreased by $1.3 million or 1.0% as compared to the same period in 2020. Subsequent Events In October 2021, the Trust, together with its 50% partner Penguin, sold a parcel of land totalling 78.4 acres located in Innisfil, Ontario, for gross proceeds of $21.6 million (at the Trust's share), which was satisfied by a vendor take-back mortgage bearing interest at 4% per annum, with a term of two years, in the amount of $15.1 million (at the Trust's share), with the balance paid in cash adjusted for other working capital amounts. In connection with the parcel sale, the Trust received partial repayment in the amount of $6.2 million of its mortgage receivable from Penguin related to the Innisfil property, which had an outstanding balance of $22.9 million as at September 30, 2021. The remainder of the mortgage receivable amount is expected to be settled upon repayment of the previously noted vendor take-back mortgage. (1)  Represents a GAAP measure.(2)  Represents a non-GAAP measure. The Trust's method of calculating non-GAAP measures may differ from other reporting issuers' methods and, accordingly, may not be comparable. For definitions and basis of presentation of the Trust's non-GAAP measures, refer to "Presentation of Certain Terms Including Non-GAAP Measures" in the Trust's MD&A.(3)  Net of cash-on-hand of $50.0 million as at September 30, 2021 for the purposes of calculating the ratios. Selected Consolidated Operational, Mixed-Use Development and Financial Information Key consolidated operational, mixed-use development and financial information shown in the table below includes the Trust's proportionate share of equity accounted investments: (in thousands of dollars, except per Unit and other non-financial data) September 30, 2021 December 31, 2020 September 30, 2020 Portfolio Information       Number of retail and other properties 146 148 150 Number of properties under development 11 10 9 Number of office properties 1 1 1 Number of mixed-use properties 10 8 6 Total number of properties with an ownership interest 168 167 166         Leasing & Operational Information       Gross leasable area including retail and office space (in thousands of sq. ft.) 34,225 34,056 34,051 Occupied area including retail and office space (in thousands of sq. ft.) 33,312 33,039 33,076 Vacant area including retail and office space (in thousands of sq. ft.) 913 1,017 975 In-place occupancy rate (%) 97.3 97.0 97.1 Committed occupancy rate (%) 97.6 97.3 97.4 Average lease term to maturity (in years) 4.5 4.6 4.7 Net retail rental rate (per occupied sq. ft.) ($) 15.40 15.37 15.45 Net retail rental rate excluding Anchors (per occupied sq. ft.) ($) 21.91 21.89 22.15         Mixed-Use Development Information       Future development area (in thousands of sq. ft.) 32,200 32,500 27,900 Trust's share of estimated costs of future projects currently under construction, or for which construction is expected to commence within the next five years 7,700,000 7,900,000 5,400,000 Total number of residential rental projects 97 96 88 Total number of seniors' housing projects 39 40 45 Total number of self-storage projects 46 50 48 Total number of office building projects 7 7 10 Total number of hotel projects 4 4 5 Total number of condominium developments 73.....»»

Category: earningsSource: benzingaNov 10th, 2021

What"s in Cards for Mid-America Apartment"s (MAA) Q3 Earnings?

Mid-America Apartment's (MAA) Q3 results will likely reflect the improving demand for its apartment units on solid rebound in the residential real estate market. Mid-America Apartment Communities, Inc. MAA — commonly known as MAA — is slated to report third-quarter 2021 results on Oct 27, after market close. The company’s quarterly results will likely highlight growth in revenues and funds from operations (FFO) per share.The Germantown, TN-based residential real estate investment trust (REIT) delivered a surprise of 3.05% in terms of FFO per share in the last reported quarter. The quarterly results were driven by an increase in average effective rent per unit for the same-store portfolio.Over the trailing four quarters, the company surpassed the Zacks Consensus Estimate on all occasions, the average beat being 2.03%. This is depicted in the chart below:MidAmerica Apartment Communities, Inc. Price and EPS Surprise MidAmerica Apartment Communities, Inc. price-eps-surprise | MidAmerica Apartment Communities, Inc. QuoteLet’s see how things have shaped up for the announcement.Factors to ConsiderFor the U.S. apartment market, the third quarter appeared to be robust, with renter demand scaling record height. The number of occupied apartments in the nation climbed 255,094 units to 597,354 units, per a report from the real estate technology and analytics firm RealPage, aided by strong leasing in the luxury Class A projects. This marked the biggest quarterly upsurge observed in the RealPage, Inc. database. The rising home prices and limited inventory levels in the for-sale sector, which are making it difficult for the conversion of renters to homebuyers, are other growth drivers.After living with parents during the initial days of the pandemic, young adults are now forming new households. A better job market, particularly for the high-paying employment sectors than in the low-wage positions, is spurring demand for luxury units. In addition, rising home prices and limited inventory levels in the for-sale sector are hindering the conversions to homeownership and stoking rental housing demand. In terms of markets, product absorption continued in the Sun Belt and other non-gateway metros. What’s grabbing attention is the large product absorption in the gateway metros, reflecting healthy rental demand.The current favorable environment is boosting the occupancy levels and in turn, pushing up rents. Rent growth has also been widespread.MAA’s Sun Belt portfolio is likely to have benefited amid these. The pandemic has accelerated employment shifts and population inflow into the company’s markets, thereby enhancing the desirability of its markets. Healthy demand for MAA’s well-positioned Sunbelt properties is anticipated to have positively impacted the company during the third quarter.The residential REIT has been focusing on redevelopment initiatives and smart-home installations. In the to-be-reported quarter, the company is likely to have continued to enjoy higher rents at its redeveloped properties.Per management’s September investor conference presentation, the average blended pricing growth for leases compared with the prior lease at the company’s same-store portfolio improved to 14.3% in August, from the 8.2% reported in the second quarter. As of August 2021, the average physical occupancy for the same-store portfolio was 96.4%, in line with the previous quarter.The Zacks Consensus Estimate for quarterly revenues is pegged at $444.7 million, suggesting a year-over-year rise of 5.1%. The same-store revenues are projected at $429 million, indicating a 2.9% increase from the prior-year quarter.During the third quarter, the company is likely to have enjoyed a robust balance-sheet position, with low leverage and ample liquidity.MAA expects the third-quarter core FFO in the range of $1.62-$1.74 per share.Prior to the third-quarter earnings release, the Zacks Consensus Estimate for the quarterly FFO per share has been revised 1.2% upward to $1.70 over the past month. This calls for year-over year growth of 8.3%.However, elevated supply might have put pressure on the rental rates and affected the revenue growth tempo during the reported quarter.Here is what our quantitative model predicts:MAA does not have the right combination of two key ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or higher — for increasing the odds of a FFO beat.You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.MAA currently carries a Zacks Rank #2 (Buy) and has an Earnings ESP of -0.24%.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Stocks That Warrant a LookHere are some stocks in the REIT sector you may want to consider, as our model shows that these have the right combination of elements to report a surprise for the third quarter:Essex Property Trust, Inc. ESS, set to release quarterly numbers on Oct 26, has an Earnings ESP of +0.27% and carries a Zacks Rank of 2, at present.Equity Residential EQR, scheduled to report third-quarter earnings on Oct 26, currently has an Earnings ESP of +1.19% and carries a Zacks Rank of 3.Camden Property Trust CPT, slated to announce third-quarter 2021 earnings on Oct 28, currently carries a Zacks Rank of #3 and has an Earnings ESP of +0.43%.Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Equity Residential (EQR): Free Stock Analysis Report MidAmerica Apartment Communities, Inc. (MAA): Free Stock Analysis Report Essex Property Trust, Inc. (ESS): Free Stock Analysis Report Camden Property Trust (CPT): Free Stock Analysis Report To read this article on click here. Zacks Investment Research.....»»

Category: topSource: zacksOct 25th, 2021

Work underway on $164 million Sac State student housing project

California State University Sacramento took another step toward a greater village feel around its campus, with groundbreaking Tuesday on the eventual home of more than 1,000 students. Hornet Commons, on what were baseball diamonds south of campus .....»»

Category: topSource: bizjournalsJun 4th, 2019

Residential developers eye former Doraville GM plant site

Talks are underway for at least two large housing projects that may shift the planned $2 billion redevelopment of the site of the Doraville General Motors plant into higher gear......»»

Category: topSource: bizjournalsApr 12th, 2019

PHOTOS: Spring weather brings construction back into full swing

With an atypically long wet winter for Northern California seemingly over, several construction projects underway can shift back into high gear. They include hotels, student housing and apartments, with schedules calling for all to be completed over t.....»»

Category: topSource: bizjournalsMar 31st, 2019

Downtown Sunnyvale site slated for housing, restaurant trades hands, clearing way for redevelopment

The planned project at 311 S. Mathilda Ave. is slated to break ground in the coming months following the land sale this week for a property next door to where a massive overhaul of the city's downtown is underway......»»

Category: topSource: bizjournalsFeb 22nd, 2019

Wedding vs. Homeownership: New Survey Measures Modern Priorities

Americans pressed pause on many milestones in 2020, but in 2021 they reignited plans to buy and sell homes. The real estate market is strong according to the National Association of REALTORS® and homeownership is top of mind for Americans. In fact, 82% of unmarried Americans would rather invest in a home than pay for a big […] The post Wedding vs. Homeownership: New Survey Measures Modern Priorities appeared first on RISMedia. Americans pressed pause on many milestones in 2020, but in 2021 they reignited plans to buy and sell homes. The real estate market is strong according to the National Association of REALTORS® and homeownership is top of mind for Americans. In fact, 82% of unmarried Americans would rather invest in a home than pay for a big expensive wedding, according to the latest survey from Coldwell Banker Real Estate LLC. Conducted online by The Harris Poll among over 2,000 U.S. adults, the survey reveals what’s on homebuyers’ and sellers’ minds as we close out a strong year for real estate in a market marked by tight inventory. A sellers’ market still prevails and competition remains strong across many cities, especially as younger Americans enter the real estate market and various demographics set their sights on homeownership. “The 2021 housing market has been marked by low inventory and competition as Americans continue to keep homeownership top of mind. Our latest survey suggests that, with generations of all ages and backgrounds prioritizing homeownership over other financial goals, this sellers’ market may continue into 2022,” said M. Ryan Gorman, president and CEO, Coldwell Banker Real Estate LLC, in a statement. “Our network of approximately 100,000 agents is ready to help home sellers take the next step.” Who’s Got Real Estate on their Mind? Gen Z and millennials are moving on up: Younger Americans surveyed (age 18-44) are more likely to say owning a home is an important financial goal for them (45%) compared to those 55-plus (30%). Goodbye renting, hello homeownership: Forty-seven percent of respondents who are renters say “owning a home” is an important financial goal for them. Hispanic homeownership desire is high: Forty-two percent of Americans surveyed who self-identified as Hispanic say “owning a home” is an important financial goal, and among Hispanics this is higher than any other financial goal. Overall, Americans are still thinking of homeownership, indicating that they would rather allocate money to achieving those dreams than investing in other personal milestones such as big weddings, vacations or even paying off their student debt. What Would They Be Willing to Trade for a Home? Home is the new engagement ring: Eighty-two percent of unmarried Americans surveyed, including 85% of females who aren’t married, would rather invest in a home than pay for a big expensive wedding. Staycation: Over three quarters of respondents (77%) would rather invest in a home than spend money on an expensive vacation. Save student debt for later: College graduates are more likely to select “owning a home” (41%) as an important financial goal than “paying off student debt” (17%). “Coldwell Banker’s survey found that homeownership is a primary financial goal for 47% of Americans surveyed who identify as Hispanic. The U.S. Hispanic population reached more than 62 million in 2020, growing significantly in the past decade, according to the Pew Research Center,” said Ricardo Rodriguez, Coldwell Banker global luxury ambassador, in a statement. “The affiliated agents at Coldwell Banker recognize this incredible potential for increasing homeownership, and they’re equipped to help this population looking for a home navigate the complexities of a tight housing market.” For more information, please visit The post Wedding vs. Homeownership: New Survey Measures Modern Priorities appeared first on RISMedia......»»

Category: realestateSource: rismediaNov 29th, 2021

A billionaire boomer blames his generation for ruining the economy for millennials

Boomers left future generations with debt and a broken economy, billionaire Howard Marks said. It says a lot about millennials' affordability crisis. Howard Marks is a billionaire boomer with a bone to pick with boomers.K. Y. Cheng/South China Morning Post via Getty Images Boomers have left future generations with debt and a broken economy, billionaire Howard Marks said. With an affordability crisis and two recessions under their belt, millennials took the brunt of it. Boomers need to make room for millennials to wield economic and political influence. One boomer billionaire is going off on his wealthy peers.Howard Marks, investor and cofounder of Oaktree Capital Management, recently wrote a memo to clients full of his usually notable remarks on the economy — and a shot at baby boomers for essentially ruining the economy for younger generations.He pointed out that over 71 million people are boomers — triple the 23 million Silent Gen members and 10% more than the 65 million Gen Xers, the two generations on either side of them."The magnitude of the boomers' votes and financial resources have given them enormous political influence over the last 40 years," he wrote. "The result has been extensive deficit spending on things the boomers want and a failure to modify benefit programs that need fixing, all at the expense of future generations."Marks explained that this exemplifies generational unfairness, with both party administrations historically and currently "spending vast amounts, taxing less than they should relative to their spending (thus incurring deficits), and running up the national debt, largely favoring the baby boomers."He continued: "Baby boomers have been and still are consuming more than their fair share of the pie. This will leave future generations saddled with substantial debt stemming from expenditures they didn't benefit from proportionally."Marks did not immediately respond to a request for comment.Boomers' hand in millennials' affordability crisisMarks isn't the first to question boomers' economic influence. Both generational experts and news outlets ranging from Vox to the Guardian have called out the generation for their role in bankrupting the rich economy they inherited, leaving millennials to pick up the pieces.Millennials, now the largest generation, have faced an affordability crisis ever since they came limping out of the Great Recession into a blighted job market, struggling to build wealth as they faced soaring living costs and shouldered massive student debt. They were still dealing with its lingering effects a dozen years later when the coronavirus recession and a historic housing crisis hit.Boomers, too, have been a force behind their economic plight. Neil Howe, the economist, historian, and demographer who coined the term "millennial," previously told Insider that boomers refuse to pay for institutional upkeep, preferring to spend money on things that change people's lives now. He said this is a result of their coming-of-age experience, in which their parents, the GI generation, cared about building strong institutions and looking into the future. Boomers took that for granted and developed a "live-for-today attitude," he said.They reaped economic benefits from this mindset, a Deutsche Bank Research report found last year. Boomers, it said, saw an increased value in assets thanks to low interest rates and inflated housing prices. They didn't have to pay as much for education as millennials have, nor will they face the cost for environmental damage caused by the carbon emission-releasing companies in which they've invested. Boomers created an economic crisis that will leave millennials the first generation worse off than their parents, author Jill Filipovic explores in her book "OK Boomer, Let's Talk." Millennials, she told Insider, are a generation of optimistic, hard-working people who have been dealt a bad hand. "None of this was an accident," she said. That boomers have held tremendous political, cultural, and economic power for the past several decades has prevented millennials from seeing the economic solutions they need, Filipovic said. She argues that millennials need boomers to impart their wisdom and experience while making room for the younger generation to be part of decision-making processes. "Unless millennials are at the table, we're really not going to see the issues that are most important to us addressed," Filipovic said. "You need people who are actually going to live in the future, who have a stake in the future, at the decision making table."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 24th, 2021

Here"s One Simple Example Of How Absurd Build Back Better" Is

Here's One Simple Example Of How Absurd Build Back Better' Is Authored by Simon Black via, In early January 1964, barely six weeks after the assassination of John F. Kennedy, US President Lyndon Johnson delivered a speech to the American people in which he declared an “unconditional war.” But he didn’t declare war on Vietnam. Or Cuba. Or the Soviet Union. Johnson declared war on poverty. And in his State of the Union address he told his fellow Americans that it would take more than “a single piece of legislation” to eradicate poverty. So they got to work preparing a series of expensive programs to create jobs, build affordable housing, establish new entitlement programs, and invest in vocational training. It goes without saying that this spending bonanza kicked off a steep increase in inflation. But more importantly it turns out that most of these programs were utter failures. One of the best examples is the Job Corps, an initiative established in 1964 to provide free vocational training to young people. The Job Corps was something of a pet project for Lyndon Johnson; he believed that “one thousand dollars invested in salvaging an unemployable youth today can return $40,000 or more in his lifetime.” This is a long-standing argument for increased public investment in education. And yet according to a long-term study of the Job Corps published in 2018 by the agency’s own Inspector General, the program has been a terrible investment for the American taxpayer. The Job Corps spends $1.7 billion of taxpayers’ money each year to train around 66,000 people; this works out to be $25,000 per student per year, which is already more expensive than many public universities. Yet Job Corps’ own Inspector General found that “more than half” of the participants in his study “did not have a beneficial outcome.” A later report by the US Department of Labor determined that a small group of Job Corps graduates could earn, on average, $275 more per year than non-graduates who work in similar jobs. Wonderful. But given that these jobs are at the lowest possible tax bracket, the additional tax revenue per Job Corps graduate is less than $30 per person. That makes the Job Corps’ annual Return on Investment about 0.1%, at best. More likely it loses money and provides no real benefit to graduates. So why would any sane individual continue investing in this program? Even the New York Times called it a complete failure and “a little bit like prison”. And yet the Job Corps is set to be the proud beneficiary of $1.5 billion, courtesy of the Build Back Better Act that passed the US House of Representatives on Friday. This new funding will roughly double the program’s budget. Now, if you’re spending money and you’re getting a fantastic return on investment, then cost shouldn’t be an issue. The problem is spending money and failing to achieve any meaningful outcome. And that tends to be the government’s track record. LBJ believed in 1964 that investing in job training would generate a huge return on investment. But six decades of Job Corps data show that they completely failed to achieve this vision. Instead they created a job training program that is more expensive than most public universities, yet generates no real benefit for its graduates or for taxpayers. But politicians only think about money. If they increase an agency’s budget and throw money at an issue, they feel like they’ve done their job. They never look at performance or execution. And this is the real problem with Build Back Better. Much has been said about the cost of the legislation, including those who say it will “cost nothing”. (The initial cost is actually $1.7 trillion, and the long term costs look like they’ll probably top $4 trillion.) But focusing on cost really misses the point. The real question is– will there be any return on investment? The failure of Job Corps provides a pretty clear answer. Build Back Better is a whopping 2,468 pages. Buried in that text, they’re creating thousands of new programs, just like Job Corps. The politicians keep insisting that these are all “investments”. But they never conduct a honest assessment of investment performance. They just keep writing checks and spending other people’s money with a dangerous fanaticism, and absolutely no consideration of execution and performance. And just like LBJ’s War on Poverty, Build Back Better will likely lead to much higher inflation. After all, it’s not difficult to predict what might happen when they spend money endlessly and generate zero return on investment. LBJ at least got one thing right. In his original State of the Union address in 1964, he acknowledged that the private sector (NOT the government) had the real power to create jobs, enhance prosperity, and alleviate poverty. He argued that cutting taxes, for example, would “create new jobs and new markets in every area of this land”, and he told Congress, “We need a tax cut now to keep this country moving. . . Our taxpayers surely deserve it.” Further, he stated, “the most damaging and devastating thing you can do to any businessman in America is to keep him in doubt and to keep him guessing on what our tax policy is.” Today, however, politicians hold the opposite view. They believe that tax increases are the path to prosperity. They believe jobs are created through more rules, more laws, and more money in the hands of the government. And they’re delighted to keep people guessing about tax policy, including threatening retroactive tax changes. This entire ethos is completely destructive… not to mention highly inflationary. But we’ll tackle that issue another time. *  *  * We think gold could DOUBLE and silver could increase by up to 5 TIMES in the next few years. That's why we published a new, 50-page long Ultimate Guide on Gold & Silver that you can download here. Tyler Durden Tue, 11/23/2021 - 21:00.....»»

Category: blogSource: zerohedgeNov 23rd, 2021

CDOs: Complex securities backed by loans and other fixed-income assets

Collateralized debt obligations are structured-credit securities that derive their value from pools of loans and other income-generating assets. CDOs played a large role in the global financial crisis.Jose Luis Pelaez Inc/Getty A collateralized debt obligation (CDO) is a structured credit product that pools assets and packages them for sale to institutional investors. The assets that back these securities serve as collateral that give CDOs their value. Research found that CDOs were at the heart of the 2007-2008 financial crisis. Visit Insider's Investing Reference library for more stories. A collateralized debt obligation (CDO) is a type of security that derives its value from underlying assets. These assets could include commercial or residential mortgages, bonds, auto loans, student loans, and other types of debt. The assets are pooled and packaged into a product that can be sold to investors as an income-producing asset. The promised repayment of the underlying debt serves as collateral.How do CDOs work?Investment banks, retail banks, commercial banks, and other financial institutions create CDOs to sell in the secondary market. As these are extremely complex instruments, it takes sophisticated computer modeling and a team of quantitative analysts to package the debt and value the bundles of loans that make up a CDO. Then it takes a number of professionals to get the security to market. The CDO manager selects the debt to serve as collateral, which could be anything from mortgages, student loans and auto loans to credit card or corporate debt. Once the CDO manager selects the debt to be pooled, the investment banks can get to work structuring the security. Rating agencies, like Standard & Poors and Moody's, assign credit ratings to the CDO. Finally, the CDO is sold to institutional investors such as pension funds, insurance companies, investment managers, and hedge funds. These investors often buy CDOs in the hope that they'll offer higher returns than their fixed-income portfolios of similar maturity. CDOs aren't available to retail investors and are typically sold to institutional investors in lots valued in the millions of dollars.Note: CDOs aren't available to retail investors and are typically sold to institutional investors in lots valued in the millions of dollars.How CDOs are StructuredThe market for CDOs exists because these securities guarantee cash flows to the owner. However, these cash flows are dependent on the cash flows from the original borrower. The investor receives interest at the stated coupon rate as well as the principal when the CDO reaches maturity. Most CDOs mature at ten years. CDOs are divided into tranches, each of which reflects a different level of risk. Senior tranches are the least risky, with investment-grade credit ratings and a lower chance of default. If the loan should default, the holders of the senior tranche are first in line to be paid from the underlying collateral. Payment continues according to the tranches' credit ratings, with the lowest-rated tranche the last to be paid.The mezzanine tranche comes between the senior and subordinated debt. Mezzanine tranches are rated from B to BBB. In the case of default, mezzanine is paid before the subordinated (junior) tranches. As with any fixed-income security, the safest tranche will bear the lowest coupon rate, while the junior debt will have a higher coupon rate since it carries the greatest risk of default.Note: CDOs are divided into tranches, each of which reflects its level of risk. Senior tranches are the least risky.Were CDOs responsible for the global financial crisis? The first collateralized debt obligations were created by Drexel Burnham Lambert during the 1980s, when Wall Street was booming. The bank was well known for both its junk bond business and employed Michael Milken, who played a significant role in developing the junk bond market and later was jailed for violating securities laws. Interest in CDOs waned in the 1990s but picked up significantly in the early 2000s. CDO sales went from $30 billion in 2003 to $225 billion in 2006. The US was experiencing a boom in the housing market, and financial institutions were originating mortgage-backed CDOs at a fast pace. Homebuyers were encouraged by low interest rates, easy credit, and little regulation. In 2003-2004, banks turned to subprime mortgages as a new source of collateral.In the subprime market, banks offered mortgages to borrowers who never would have qualified under earlier standards. The underwriting process became so lax that in many cases, complete documentation of income wasn't even required. The adjustable-rate mortgage (ARM) was even more dangerous for subprime borrowers. They offered very low interest rates for the first few years of the mortgage, which could then be increased drastically a few years down the line. CDOs issued prior to the global financial crisis consisted mainly of subprime mortgage-backed securities, and those backed by other CDOs were also common. In 2006, nearly 70% new CDO collateral consisted of subprime mortgages, while 15% were collateralized with other CDOs. By 2006, investment banks were turning to short-term collateralized borrowing to support the CDO business. On average, they were rolling over 25% of their balance sheets every night. When the housing bubble burst, uncertainty around asset pricing led lenders to cut off the nightly borrowing, leaving the banks exposed to falling asset prices with little capital. Trading in CDOs came to a halt, and it was only with the intervention of the Federal Reserve buying CDOs that restored the market.As Dr. Robert Johnson, professor of finance at the Creighton University's Heider School of Business, explains: "CDOs are extremely difficult to analyze and value. Issuer models failed to take into account the correlation between mortgages bundled into CDOs. In an event such as an economic downturn, the mortgages will move in sync." Post-crisis analysis found that CDOs lay at the heart of the financial crisis. Issuers and investors ignored warnings about the ticking CDO timebomb and failed to understand and manage risk. Bank balance sheets were often not transparent, and institutions throughout the industry were deeply interconnected. Trillions of dollars in risky mortgage-backed securities were entrenched throughout the financial system.Everything came to a head in March of 2008, when Bear Stearns found itself almost out of cash. Facing bankruptcy, the firm sold itself to JPMorgan. Lehman Brothers was next to fall. It was only government intervention that saved the financial system and economy from collapse. A government  bailout program benefited some institutions that were considered "too big to fail."Note: Analysis after the global financial crisis found that Issuers and investors ignored warnings about CDOs and failed to understand and manage risk.Pros and cons of CDOsLike all assets, CDOs offer advantages and disadvantages. Johnson cites diversification as one advantage. "CDOs are created by bundling debt and spreading it out over many, many mortgages. Thus the investor is exposed to a range of risk levels," he says.Using CDOs, commercial and retail banks can reduce risk on their balance sheets. They can also exchange illiquid assets for CDOs to gain liquidity. Banks can use the additional liquidity to expand lending and generate revenue.CDOs have two principal disadvantages. The first is their complexity, which makes them extremely challenging to analyze and value. CDOs are also vulnerable to repayment risk, as the original borrower can choose to repay the principal, thus depriving the investor of a cash flow stream that would typically last until maturity,Are CDOs popular today?Following the financial crisis, CDOs underwent heavy scrutiny. The result was the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act. The law resulted in widespread regulatory reforms aimed at ensuring the country would never experience another crisis like 2007-2008. Among other measures, the Act was designed to protect investors, increase disclosures, require risk retention, and impose capital requirements. It required originators to retain a specified percentage of a CDO issue, in order to have "skin in the game." Investors in asset-backed securities are now required to hold more capital than if they were investing in other asset classes. Following enactment of Dodd Frank, the market has seen a steady increase in CDO issuance since 2011.Attempts were made to weaken the Act in 2017, and in 2018, President Donald Trump signed into law the Economic Growth, Regulatory Relief and Consumer Protection Act. This new law exempted many financial institutions from Dodd-Frank regulations.Note: The Dodd-Frank Act was designed to protect investors, increase disclosures, require risk retention, and impose capital requirements.The financial takeawayCollateralized debt obligations serve several purposes. They allow financial institutions to move debt off their balance sheets to gain liquidity. Investors value the cash flow from coupon payments, and hope the return on CDOs will exceed the return of standard fixed-income portfolios.Investment  in CDOs is limited to institutional investors —insurance companies, pension funds, hedge funds and the like. However, for the retail investor there are mutual funds and exchange-traded funds that include CDOs in their portfolios.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 23rd, 2021

Millennials Collaborating to Attain the American Dream of Homeownership

The affordability issues in the housing market aren’t going away for younger buyers. The financial challenges hindering millennial homeownership have been well documented between overwhelming student loan debt and record-level home prices. However, some within the cohort are carving their own path to the American dream through teamwork. “Affordability is a key issue for young […] The post Millennials Collaborating to Attain the American Dream of Homeownership appeared first on RISMedia. The affordability issues in the housing market aren’t going away for younger buyers. The financial challenges hindering millennial homeownership have been well documented between overwhelming student loan debt and record-level home prices. However, some within the cohort are carving their own path to the American dream through teamwork. “Affordability is a key issue for young buyers or first-time homebuyers entering into the market with limited housing inventory, so pooling incomes with a roommate becomes a really good solution for many buyers to be able to enter into the housing market,” says Jessica Lautz, vice president of Demographics and Behavioral Insights for National Association of REALTORS® (NAR). Recent data from ATTOM Data Solutions, reported by the Wall Street Journal, suggests that the number of home and condo sales across the country by co-buyers has soared since millennials became the largest share of homebuyers in the U.S. in 2014. The number of co-buyers with different last names increased by 771% between 2014 and 2021, according to ATTOM. Like other market trends, the pandemic accelerated the trend, according to Lautz, who also suggests that declining marriage rates among younger generations have also contributed. Despite the generational lull in nuptials, that hasn’t kept buyers, particularly millennials, from pursuing homeownership. Based on NAR’s recently released 2021 Profile of Home Buyers and Sellers report, for the third consecutive year, the share of unmarried couples that purchased a home accounted for 9% of the buyer pool. According to NAR’s data, the share of first-time buyers who were unmarried couples rose slightly to 17%. Navigating the Trend While co-buying isn’t a novel concept in real estate, experts and agents told RISMedia that it’s a worthwhile trend to keep an eye on, as affordability issues and student loan debt plague millennials—the largest cohort of buyers in the market. Along with working as an agent, Nicholas Ritacco is also a co-buyer. The New York-based Corcoran agent teamed up with his roommate to buy their first home during the pandemic to escape renting. Looking at the numbers, Ritacco says low mortgage rates since 2008—and record lows during the pandemic—presented an opportunity to finally tap into homeownership while living in or near more major metro areas. “The affordability is in our favor, and it is time-sensitive, whether it’s two, three or five years down the line, no one can predict, but I can tell you every point we go up is pricing out somebody,” he says. Compared with traditional buyer scenarios, Lautz suggests that agents work with their co-buying clients to identify long-term intentions for the property they are looking to buy and how they will address any life changes. “If someone gets a job on the other side of the country, are you going to rent the room that the roommate has been living in?” Lautz asks. Discussion over income between the clients is also essential, as Lautz notes that will become an issue when it comes time to divvy up the down payment and closing costs in very similar ways, so they are earning equity in the same way. “Questions like that may get into the nitty-gritty, but I do think it’s important for keeping that relationship and the home-buying transaction on track as well about what is realistic and what may not be realistic.” Having gone through it himself, Ritacco says that he also started working with friends that want to partner up to buy a home. Part of his guidance strategy is helping his clients identify their “exit strategy” before going into a co-buying partnership. This typically involves determining how long they intend to live in the property and how they want to approach selling or renting it out when one or more parties is ready to move. “You have to understand what your options are and what your rights are,” he says, noting that he gets “granular” with his clients when working out the details so that each party is comfortable entering into the deal from the beginning. “It’s really about understanding every step of the process and what is expected of everybody,” Ritacco says. “It’s a joint venture. You’re just changing it from that typical investment-focused agreement to adopting it for a joint venture for a primary.” According to agent Kate Wright at Better Home and Gardens Real Estate Metro Brokers in Atlanta, Georgia, taking a deep dive into buyer goals and expectations during an opening consultation is a helpful tool to mitigate future issues. “That way, I know what they are looking for and what their goals are, and I can direct them toward the best avenue for pursuing the purchase,” Wright says, adding that her market has been popular among millennial buyers because of its affordability. Wright’s pool of millennial co-buyers have already bought their first home and have joined friends to start investing in other properties. While she admits that her pool of first-time buyers co-buying is negligible in her market, broker Shonna Peterson at the Warmack Group with Keller Willams in Seattle says that the trend is popular with the millennial investment group. Peterson notes that investor buyers’ motivation focuses more on the numbers and turning a profit rather than living in the home primarily. Despite the difference in approaches and desired outcomes, Peterson indicates that managing emotions is essential to navigating millennial investors. “While they have a great grasp on the numbers, there does still tend to be an emotional component just because it’s human nature to get somewhat competitive when you know that the competition is stiff,” Peterson says. Legal Protection While the trend of co-buying opens doors to homeownership, it’s not without its challenges, which is why agents told RISMedia that they encourage their clients in co-buying situations to speak with legal experts. Real estate attorney Edwin Farrow recommends hashing things out in writing before closing on a home when it comes to co-buying partnerships. “What they’ve done is create a partnership, and partnerships can go bad,” Farrow says. “You need to know what happens in the event the partnership is dissolved, keeping in mind the fact that the bank doesn’t care that you’re friends and agreed to whatever you agreed to.” Farrow’s co-buying clientele typically consists of unmarried couples and family members teaming up to buy homes together. He indicates that getting a better understanding of the risks and benefits of teaming up to buy a property together is vital for any buyers looking to take this route toward homeownership. Eric Smith, a real estate attorney with Timoney Knox in Fort Washington, Pennsylvania, echoed similar sentiments, adding that the biggest problem that he notices among co-buyers is that many tend to bypass getting a written agreement before closing on their home. If the partnership doesn’t end amicably, Smith says a written agreement could save buyers “tens of thousands of dollars in attorney fees” if their friendship or relationship dissolves and they end up selling the property. “In the end, it will be costly to prove that the person who paid the down money is entitled to get it all back or any of it back,” he says. By default, Smith says tenants in common (TIC) is the route that clients take. The option gives each property owner an “undivided interest of the whole thing in equal shares.” “It essentially means that each owns a slice of the pie,” Smith says, adding that shares can be passed on to an heir in the event of a death. A joint tenancy with the right of survivorship is another route, Smith explains, noting that each partner owns the whole property together, and the last of them to die would keep everything. “You could also imagine a circumstance where you might have a number of people who buy a piece of property as legitimate business partners,” Smith says. He thinks the best option is to buy with an entity—like a limited liability company—so parties can have an operating agreement for the property. “It just makes it easier to manage,” Smith opines. Jordan Grice is RISMedia’s associate online editor. Email him your real estate news ideas to The post Millennials Collaborating to Attain the American Dream of Homeownership appeared first on RISMedia......»»

Category: realestateSource: rismediaNov 23rd, 2021

Transcript: Edwin Conway

   The transcript from this week’s, MiB: Edwin Conway, BlackRock Alternative Investors, is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ BARRY RITHOLTZ, HOST, MASTERS IN BUSINESS:… Read More The post Transcript: Edwin Conway appeared first on The Big Picture.    The transcript from this week’s, MiB: Edwin Conway, BlackRock Alternative Investors, is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ BARRY RITHOLTZ, HOST, MASTERS IN BUSINESS: This week on the podcast, man, I have an extra special guest. Edwin Conway runs all of alternatives for BlackRocks. His title is Global Head of Alternative Investors and he covers everything from structured credit to real estate hedge funds to you name it. The group runs over $300 billion and he has been a driving force into making this a substantial portion of Blackrock’s $9 trillion in total assets. The opportunity set that exists for alternatives even for a firm like Blackrock that specializes in public markets is potentially huge and Blackrock wants a big piece of it. I found this conversation to be absolutely fascinating and I think you will also. So with no further ado, my conversation with Blackrock’s Head of Alternatives, Edwin Conway. MALE VOICEOVER: This is Masters in Business with Barry Ritholtz on Bloomberg Radio. RITHOLTZ: My extra special guest this week is Edwin Conway. He is the Global Head of Blackrock’s Alternative Investors which runs about $300 billion in assets. He is a team of over 1,100 professionals to help him manage those assets. Blackrock’s Global alternatives include businesses that cover real estate infrastructure, hedge funds private equity, and credit. He is a senior managing director for BlackRock. Edwin Conway, welcome to Bloomberg. EDWIN CONWAY, GLOBAL HEAD OF ALTERNATIVE INVESTORS, BLACKROCK: Barry, thank you for having me. RITHOLTZ: So, you’ve been in the financial services industry for a long time. You were at Credit Suisse and Blackstone and now you’re at BlackRock. Tell us what the process was like breaking into the industry? CONWAY: It’s an interesting on, Barry. I grew up in a very small town in the middle of Ireland. And the breakthrough to the industry was one of more coincident as opposed to purpose. I enjoyed the game of rugby for many years and through an introduction while at the University, in University College Dublin in Ireland, had a chance to play rugby at a quite a – quite a decent level and get to know people that were across the industry. It was really through and internship and the suggestion, I’ve given my focus on business and financing things that the financial services sector may be a great place to traverse and get to know. And literally through rugby connections, been part of a good school, I had an opportunity to really understand what the service sector, in many respects, could provide to clients and became absolutely intrigued with it. And what – was it my primary ambition in life to be in the financial services sector? I can definitively say no, but through the circumstance of a game that I love to play and be part of, I was introduced to, through an internship, and actually fell in love with it. RITHOLTZ: Quite interesting. And alternative investments at Blackrock almost seems like a contradiction in terms. Most of us tend to think of Blackrock as the giant $9 trillion public markets firm best known for ETFs and indices. Alternatives seems to be one of the fastest-growing groups within the firm. This was $50 billion just a few years ago, it’s now over 300 billion. How has this become such a fast-growing part of BlackRock? CONWAY: When you look at the various facets which you introduced at the start, Barry, we’ve actually been an alternatives – will be of 30 years now. Now, the scale, as you know, which you can operate on the beta side of business, far surpasses that on the alpha side. For us, throughout the years, this was very much about how can we deliver investment excellence to our clients and performance? Therefore, going an opportunity somewhere else to explore an alpha opportunity in alternatives. And I think being so connected to our clients understanding, that this pivots was absolutely taking place at only 30 years ago but in a very pronounced way today, you know, we continue to invest in this business to support those ambitions. They’re clearly seeing this as the world of going through a tremendous amount of transformation and with some of the challenges, quite frankly, in the traditional asset classes, being able to leverage at BlackRock, the Blackrock muscle to really explore these alpha opportunities across the various alternative asset classes that in our mind wasn’t imperative. And the imperative, really, is from the firm’s perspective and if you look at our purpose, it’s to serve the client. So the need was coming from them. The necessity to have alternatives and their whole portfolio was very – was very much growing in prominence. And it’s taken us 30 years to build this journey and I think, Barry, quite frankly, we’re far from being done. As you look at the industry, the demand is going to continue to grow. So, I think you could expect to see from us a continued investment in the space because we don’t believe you can live without alternatives in today’s world. RITHOLTZ: That’s really – that’s really interesting. So let’s dive a little deeper into the product strategy for alternatives which you are responsible for at BlackRock. Our audiences is filled with potential investors. Tell them a little bit about what that strategy is. CONWAY: So we’re – I think as you mentioned, we’re in excess of 300 billion today and when we started this business, it was less about building a moat around private equity or real estate. I think Larry Fink’s and Rob Kapito’s vision was how do we build a platform to allow us to be relevant to our clients across the various alternative asset classes but also within the – within the confines of what they are permitted to do on a year-by-year basis. So, to always be relevant irrespective of where they are in their journey from respect of liabilities, demand for liquidity, demand for returns, so we took a different approach. I think, Barry, to most, it was around how do we scale into the business across, like you said, real estate equity and debt, infrastructure equity and debt. I mean, we think of that as the real assets platform of our business. Then you take our private equity capabilities both in primary investing, secondary et cetera, and then you have private credits and a very significant hedge fund platforms. So we think all of these have a real role and depending on clients liquidities and risk appetite, our goal was, to over the years, really build in to this to allow ourselves for this challenging needs that our clients have. I think as an industry, right, and over the many years alternatives have been in existence, this is been about return enhancement initially. I think, fundamentally, the changes around the receptivity to the role of alternatives in a client’s portfolio has really changed. So, we’ve watched it, Barry, from this is we’re in the pursuit of a very total return or absolute return type of an objective to now resilience in our portfolio, yield an income. And so things that probably weren’t perceived as valuable in the past because the traditional asset classes were playing a more profound role, alternatives have stepped up in – in many respects in the need to provide more than just total return. So, we’re taking the approach of how do you have a more holistic approach to this? How do we really build a global multi-alternatives capability and try to partner and I think that’s the important work for us. Try to partner with our clients in a way that we can deliver that outperformance but delivered in a way that probably our clients haven’t been used to in this industry before. Because unfortunately, as we know, it has had its challenges with regard to secrecy, transparency, and so many other aspects. We need to help the industry mature. And really that was our ambition. Put our client’s needs first, build around that and really be relevant in all aspects of what we’re doing or trying to accomplish on behalf of the people that they support and represent. RITHOLTZ: So, we’ll talk a little bit about transparency and secrecy and those sorts of things later. But right now, I have to ask what I guess is kind of an obvious question. This growth that you’ve achieved within Blackrock for nonpublic asset allocation within a portfolio, what is this coming at expense of? Are these dollars that are being moved from public assets into private assets or you just competing with other private investors? CONWAY: It’s really both. What – what you are seeing from our clients – if I take a step back, today, the institutional client community and you think about the – the retirement conundrum we’re all facing around the world. It’s such an awful challenge when you think how ill-prepared people are for that eventual stepping back from the workplace and then you know longevity is your friend, but can also be a very, very difficult thing to obviously live with if you’re not prepared for retirement. The typical pension plan today are allocating about 25 percent to 28 percent in alternatives. Predominantly private market. What they’re telling us is that’s increasing quite substantially going forward. But you know, the funding for that alpha pursue for that diversification and that yield is coming from fixed-income assets. It’s coming from equity assets. So there’s a real rebalancing that’s been taking place over the past number of years. And quite frankly, the evolution, and I think the innovation that’s taken place particularly in the past 10 years, alternatives has been really profound. So the days where you just invest in any global funds still exist. But now you can concentrate your efforts on sector exposure, industry exposures, geographic exposures, and I think the – the menu of things our clients can now have access to has just been so greatly enhanced at and the benefit is that but I think in some – in some respects, Barry, the next question is with all of those choices, how do you build the right portfolio for our client’s needs knowing that each one of our client’s needs are different? So, I would say it absolutely coming from the public side. We’re very thankful. Those that had a multiyear journey with us in the public side are now allocating capital to is now the private side to because I do think the – the industry given that change, given that it evolution and given the complexity of these private assets, our clients are looking to, quite frankly, do more with fewer managers because of the complexion of the industry and complexity that comes with it. RITHOLTZ: Quite – quite interesting. (UNKNOWN): And attention RIA’s. Are your clients asking for crypto? At interactive brokers, advisers can now offer crypto to their clients and you could trade stocks, options, futures currencies, bonds and more from the same platform. Commissions on crypto are just 12-18 basis points with no hidden spreads or markups and there are no ticket charges, custody fees, minimums platform or reporting fees. Learn more at crypto. RITHOLTZ: And I – it’s pretty easy to see why large institutions might be rotating away from things like treasuries or tips because there’s just no yield there. Are you seeing inflows coming in from the public equity side also? The markets put together a pretty good string of years. CONWAY: Yes. It absolutely has. And many respects, I think, we’ve had a multiyear where there was big questions around the alpha that can be generated, for example, from active equities? The question was active or passive? I think what we’ve all realized is that at times when volatility introduces itself which is frequent even independent of what’s been done from a fiscal and monetary standpoint, that these Alpha speaking strategies on the traditional side still make a lot of sense. And so, as we think about what – what’s happening here, the transition of assets from both passive and active strategies to alternative, it – it’s really to create better balance. It’s not that there’s – there’s a lack of relevance anymore in the public side. It’s just quite frankly the growth of the private asset base has grown so substantially. I moved, Barry, to the U.S. in 1998. And it’s interesting, when you look back at 1998 to today, you start to recognize the equity markets and what was available to invest in. The number of investable opportunities has shrunk by 40 plus percent which that compression is extraordinarily high. But yet you’ve seen, obviously, the equity markets grow in stature and significance and prominence but you’re having more concentration risk with some of the big public entities. The converse is true, though on the – on the private side. There’s this explosion of enterprise and innovation, employment creation, and then I believe opportunities has been real. So, I look at the public side, the investable universe is measured in the thousands and the private side is measured in the millions. RITHOLTZ: Wow. CONWAY: And I think part of the – part of the part of the thing our clients are not struggling with but what we’re really recognizing with – with enterprises staying private for longer, if not forever, and with his growth of the opportunities that open debt and equity in the private market side, you really can’t forgo this opportunity. It has to be part of your going forward concerns and asset allocation. And I think this is why we’re seeing that transformation. And it’s not because equities on fixed income just aren’t relevant anymore. They’re very relevant but they’re relevant now in a total portfolio or a whole portfolio context beside alternatives. RITHOLTZ: So, let’s discuss this opportunity set of alternatives where you guys at Blackrock scene demand what sectors and from what sorts of clients? Is this demand increasing? CONWAY: We’re very fortunate, Barry. Today, there isn’t a single piece of our business within – within Blackrock alternatives that isn’t growing. And quite frankly too, it’s really up to us to deliver on the investment objectives that are set forth for those clients. I think in the back of strong absolute and relative performance, thankfully, our clients look to us to – to help them as – as they think about what they’re doing and as they’re exploring more in the alternatives areas. So, as you know, certainly, the private equity and real estate allocations are quite mature in many of our client’s portfolios but they’ve been around for many decades. I think that the areas where we’re seeing – that’s called an outside demand and opportunity set, just but virtue of the small allocations on a relative basis that exist today is really around infrastructure, Barry, and its around private credits. So, to caveat that, I think all of the areas are certainly growing, and thankfully, for us that’s true. We’re looking at clients who we believe are underinvested, we believe they’re underinvested in those asset classes infrastructure both debt and equity and in private credit. And as you think about why that is, the attributes that they bring to our client is really important and in a world where your correlation and understanding those correlations is important that these are definitely diversifying assets. In a world where you’re seeing trillions of dollars, quite frankly, you’re providing little to no or even there’s negative yield. Those short falls are real and people need yield than need income. These assets tend to provide that. So the diversification, it comes from these assets. The yield can come from these assets and because of the immaturity of the asset classes, independence of the capital is flowing in, we still consider them relatively white space. You’re not crowded out. There’s much room for development in the market and with our client’s portfolios. And to us, that’s exciting because it presents opportunities. So, at the highest level, they’re the areas where I believe are most underdeveloped in our clients. RITHOLTZ: So let’s talk about both of those areas. We’ll talk about structured credit in a few minutes. I think everybody kind of understands what – what that is. What – when you see infrastructure as a sector, how does that show up as an investment are – and obviously, I have infrastructure on the brink because we’re recording this not too long after the giant infrastructure bill has been passed, tell us a little bit about what alternative investments in infrastructure looks like? CONWAY: Yes. It’s really in its infancy and what the underlying investments look like. I think traditionally, you would consider it as – and part of the bill that has just been announced, roads, bridges, airports. Some of these hard assets, some of the core infrastructure investments that have been around for actually some time. The interesting thing is the industry has evolved so much and put the need for infrastructure. It’s so great across both developed and emerging economies. It’s become something that if done the right way, the attributes we just spoke of can really have a very strong effect on our client’s portfolios. So, beyond the core that we just mentioned, well, we’ve seen a tremendous demand as a result of this energy transition. You’re really seeing a spike in activity and the necessity transition industry to cleaner technologies, a movement, not away completely from fossil fuel but integrating new types of clean energy. And as a result, you’ve seen a lot of demand on a global basis for wind and solar. And quite frankly, that’s why even us at BlackRock, albeit, 10-12 years ago, we really established a capability there to help with that transition to think about how do we use these technologies, solar panels, wind farms, to generate clean forms of energy for utilities where in some cases they’re mandated to procure this type of this type of – this type of power. And when you think about pre-contracting with utilities for long duration, that to me spells, Barry, good risk mitigation and management and ability to get access to clean forms of energy that throw off yield that can be very complementary to your traditional asset classes but for very long periods of time. And so, the benefits for us of these – these assets is that they are long in duration, they are yield enhancing, they’re definitely diversifying. And so, for us, where – we’ve got about, let’s call this 280 assets around the world that we’re managing that literally generate this – this clean electricity. I think to give the relevance of how much, I believe today, it’s enough to power the country of Spain. RITHOLTZ: Wow. CONWAY: And that’s really that’s really changing. So you’re seeing governments – so from a policy standpoint, you’re seeing governments really embracing new forms of energy, transitioning out of bunker fuels, for example, you know, burning diesels which really spew omissions into the – into the into the environment. But it’s really around modernizing for the future. So, developed and emerging economies alike, want to retain capital. They want to attract new capital and by having the proper infrastructure to support industry, it’s a really, really important thing. Now, on the back of that too, one things we’ve learned from COVID is that the necessity to really bring e-commerce into how you conduct your business is so important and I think from the theme of digitalization within infrastructure to is a huge part. So, it’s not just the energy transition that you’re seeing, it’s not just roads and bridges, but by allowing businesses to connect to a global consumer, allowing children be educated from home, allowing experiences that expand geographies and boundaries in a digital form is so important not just for commerce but in so many other aspects. And so, you think about cable, fiber optics, if you think about all the other things even outside of power, that enable us to conduct commerce to educate, there are many examples where, Barry, you can build resilience into your portfolio because that need is not measured in years. Actually, the shortfall of capital is measured in the trillions so which means this is – this is a multi-decade opportunity set from our vantage point and one of which our clients should really avail of. RITHOLTZ: Quite interesting. And I mentioned in passing, structured credit, tell us a little bit about what that opportunity looks like. I think of this as a space that is too big for local banks but too small for Wall Street to finance. Is that an oversimplification? What is going on in that space. CONWAY: I probably couldn’t have set it better, Barry. It’s – if we go back to just the even the investable universe, in the tens of thousands of companies, just if we take North America that are private, that have great leadership that really have strategic vision under – at the – in some cases, at the start of their growth lifecycles are even if they maintain, they have a very credible and viable business for the future they still need capital. And you’re absolutely right. With the retreat of the banks from the space to various regulations that have come after the global financial crisis, you’re seeing the asset managers in many respects working behalf of our clients both wealth and institutional becoming the new lenders of choice. And – and when we – when we think about that opportunity set, that is really understanding the client’s desire for risk or something maybe in a lower risk side from middle-market lending or midmarket enterprises where you can support that organization through its growth cycle all the way to some higher-yielding, obviously, with more risk assets on the opportunistic or even the special situations side. But it – it expands many things. And going back of the commentary around the evolution of the space, private credit today and what you can do has changed so profoundly, it expands the liquidity spectrum, it expands the risk spectrum. And the great news is, with the number of companies both here and abroad, the opportunities that is – it’s being enriched every single day. And were certainly seeing, particularly going back to the question are some of these assets coming from the traditional side, the public side. When we think of private credit, you are seeing private credit now been incorporated in fixed-income allocations. This is a – it’s a yelling asset. This is – these are debt instruments, these are structures that we’re creating. We’re trying to flexible and dynamic with these clients. But it really is an area where we think – it really is still at its – at its infancy relevant to where it can potentially be. RITHOLTZ: That’s really quite – quite interesting. (UNKNOWN): It’s Rob Riggle. I’m hosting Season 2 of the iHeart radio podcast, Veterans You Should Know. You may know me as the comedic actor from my work in the Hangover, Stepbrothers or 21 Jump Street. But before Hollywood, I was a United States Marine Corps officer for 23 years. For this Veterans Day, I’ll be sitting down with those who proudly served in the Armed Forces to hear about the lessons they’ve learned, the obstacles they’ve overcome, and the life-changing impact of their service. Through this four-part series, we’ll hear the inspiring journeys of these veterans and how they took those values during their time of service and apply them to transition out of the military and into civilian life. Listen to Veterans You Should Know on the iHeart radio app, Apple Podcast or wherever you get your podcast. RITHOLTZ: Let’s stick with that concept of money rotating away from fixed income. I have to imagine clients are starved for yields. So what are the popular substitutes for this? Is it primarily structured credit? Is it real estate? How do you respond to an institution that says, hey, I’m not getting any sort of realistic coupon on my bonds, I need a substitute? CONWAY: Yes. It’s all of those in many respects. And I think to the role, even around now a time where people have questions around inflation, how do substitute this yield efficiency or certainly make up for that shortfall, how do you think about a world where increasingly seeing inflation, not of the transitory thing it feels certainly quasi-permanent. These are a lot of questions we’re getting. And certainly, real estate is an is important part of how they think about inflation protection, how client think about yield, but quite frankly too, we’ve – we’ve gone through something none of us really had thought about a global pandemic. And as I think about real estate, just how you allocate to the sector, what was very heavily influenced with retail assets, high street, our shopping behaviors and habits have changed. We all occupied offices for obviously many, many years pre the pandemic. The shape of how we operate and how we do that has changed. So, I think some of the underlying investment – investments have changed where you’ve seen heavily weighted towards office space to leisure, travel in the past. Actually, now using a rotation in some respects out of those, just given some of the uncertainties around what the future holds as we come – come through a really difficult time. But the great thing about this sector is between senior living, between student housing, between logistics and so many other parts, there are ways in real estate to capture where there’s – where there’s demand. So still a robust opportunity set and it – and we do think it can absolutely be yield enhancing. We mentioned infrastructure. Even if you think about – and we mention OECD and non-OECD, emerging and developed, when I think about Asia, in particular, just as a subset of the world in which we’re living in, that is a $2.6 trillion alternative market today growing at a 15 percent CAGR. And quite frankly, the old-growth is driven by the large economic growth in the region. So, even from a regional perspective, if we pivot, it houses 57 percent of the world’s population and yet delivers 47 percent of the world’s economic growth. So, think of that and then with regard to infrastructure and goes back to that, this is truly a global phenomenon. So if we just even take that sector, Barry, you’ll realize that the way to maintain that type of growth, to attract capital, to keep capital, it really requires an investment of significant amount of money to be able to sustain that. And when you have 42 million people in a APAC migrating to cities in the year going back to digitalization, that’s an important thing. So, when I say we’re so much at the infancy in infrastructure, I really mean it. It can be water, it can be sewer systems, it can be digital, it can be roads, there’s so much to this. And then even down to the regional perspective, it’s a – it’s a need that doesn’t just exist in the U.S. So, for these assets, this tend to be long in duration. There’s both equity and debt. And on the debt side, quite frankly, very few outside of our insurance clients and their general account are taking advantage of the debt opportunity. And – and as we both know, to finance these projects that are becoming more plentiful every single day, across the world, including like, I said, in APAC in scale, there’s an opportunity in both sides. And I think that’s where the acid mix change happen. It’s recognizing that the attributes of these assets can have a role, the attributes of these assets can potentially replace some of these traditional assets and I think you’re going to see it grow. So, infrastructure to us, it’s really equity and debt. And then on the credit side, like I mentioned, again, too, it’s a very, very big and growing market. And certainly, the biggest area today from our vantage point is middle-market lending from a scale opportunity standpoint. So, we think much more to come in all of those spaces. RITHOLTZ: Really interesting. And let’s just stay with the concept of public versus private. That line is kind of getting blurred and the secondary markets is liquidity coming to, for lack of a better phrase, pre-public equities, tells little bit about that space. Is that an area that is ripe for growth for BlackRock? CONWAY: Yes. We absolutely think it is and you’re absolutely correct. The secondary market is – has grown quite substantial. If you even look at just the private equity secondary market and what will transact this year, I think it will be potentially in excess of 100 billion. And that’s what were clear, not to mention what will be visible and what will be analyzed. And that speaks to me what’s really happening and the innovation that we mentioned earlier. It’s no longer about just primary exposure. It’s secondary exposure. When we see all sort of interest and co-investment opportunities as well, I think the available sources of alpha and the flexibility you can now have, albeit if directed and advised, I believe the right way, Barry, can be very helpful and in the portfolio. So, your pre-IPO, it is a big part of actually what we do and we think about growth equity. There is – it’s a significant amount of capital following that space. Now, from our vantage point, as one of the largest investors in the public equity market and now obviously one of the largest investors and they in the private side, the bridge between – between private to public – there’s a real need. IPOs are not going away. And I think smart, informed capital to help with this journey, this journey is really – is really a necessity and a need. RITHOLTZ: So let’s talk a little bit about this recent restructuring. You are first named Global Head of Blackrock Alternative Investors in April 2019, the entire alternatives business was restructured, tell us a little bit about how that restructuring is going? CONWAY: Continues to go really well, Barry. When you look at the flow of acid from our clients, I think, hopefully, that’s speaks to the performance we’ve been generating. I joined the firm, as you know, albeit, 11 years ago and being very close to the alternative franchise as a critical thing for me and running the institutional platform. To me, when you watched this migration of asset towards alternatives, it was obviously very evident for decades now that this is a critical leg of the stool as our clients are thinking about their portfolios. We’re continuing to innovate. We’re continuing to invest, and thankfully, we’re continuing to deliver strong performance. We’re growing at about high double digits on an annual basis but we’re trying to purposeful too around where that growth is coming from. I think the reality is when you look at the competitive universe, I think the last number I saw, it was about 38,000 alternative asset managers out there today, obviously, coming from hedge funds all the way to private credits and private equity. So, competition is real and I do think the outcomes for our clients are starting to really grow. Unfortunately, some – in some cases, obviously, very good, and in some cases, actually not great. So our focus, Barry, is really much on how can we deliver performance, how can we be a partner? And I think we been rewarded with a trust and the faith our clients have in us because they’re seeing something different, I think, from us. Now, the scale of the business that you mentioned earlier really gives us tentacles into the market that I believe allows us to access what I think is the new alpha which is in many respects, given the heft of competition sourcing and originating new investments is certainly harder but for us, sitting in or having alternative team, sitting in 50 offices around the world, really investing in the markets because that – the market they grew up with and have relationships within, I think this network value that we have is something that’s quite special. And I think in the world that’s becoming increasingly competitive, we’re going to continue to use and harness that network value to pursue opportunities. And thankfully, as a result of the partnership we’ve been pursuing with her clients, like, we’ve – we’re certainly looking for opportunities and investments in our funds. But because of the brand, I think because of the successes, opportunities seeks us as much as we seek opportunity and that has been something that we look at an ongoing basis and feel very privileged to actually have that inbound flow as well. RITHOLTZ: Really quite interesting. There was a quote of yours I found while doing some prep for this conversation that I have to have you expand on. Quote, “The relationship between Blackrock’s alternative capabilities and wealth firms marked a large opportunity for growth in the coming years.” This was back in 2019. So, the first part of the question is, was your expectations correct? Did you – did you see the sort of growth you were hoping for? And more broadly, how large of an opportunity is alternatives, not just for BlackRock but for the entire investment industry? CONWAY: Yes. It’s been very much an institutional opportunity set up until now. And there’s so much to be done, still, to really democratize alternatives and we certainly joke around making alternatives less alternative. Actually, even the nomenclature we use and how we describe it doesn’t kind of make sense anymore. It’s such a core – an important allocation to our clients, Barry, that just calling it alternative seems wrong. Just about the institutional clients. It ranges, I think, as I mentioned on our – some of our more conservative clients which would be pension plans which really have liquidity needs on a monthly basis because of the liabilities they have to think about. At about 25 plus percent in private markets, to endowments, foundations, family offices, going to 50 percent plus. So, it’s a really important part and has been for now many years the institutional client ph communities outcomes. I think the thing that we, as an industry, have to change is alternatives has to be for the many, not for the few. And quite frankly, it’s been for the few. And as we talked about some of the attributes and the important attributes of these asset classes to think that those who have been less fortunate in their careers can’t access, things they can enrich their future retirement outcomes, to me, is a failing. And we have to address that. That comes from regulation changes, it comes from structuring of new products, it comes from education and it comes from this knowledge transmission where clients in the wealth segment can understand the role of alternatives and the context of what can do as they invest in equities and fixed income too. And we think that’s a big shortfall. So, the journey today, just to give you a sense, as we look at her clients in Europe on the wealth side, on average, as you look from what we would call the credited investors all the way through to more ultra-high-net worth individuals, their allocation to alternatives, we believe, stands at around two to three percent of their total portfolio. In the U.S., we believe it stands at three to five. So, most of those intermediaries, we speak to our partners who were more supporting and serving the wealth channel. They have certainly an ambition to help their clients grow that to 20 percent and potentially beyond that. So, when I look at that gap of let’s call it two to three to 20 percent in a market that just given the explosion in wealth around the world, I think the last numbers I saw, this is a $65 trillion market. RITHOLTZ: Wow. CONWAY: That speaks to the shortfall relative to the ambition. And how’s it been going? We have a number of things and capabilities we’ve set up to allow for this market to experience, hopefully, private equity, hedge funds, credit, and an infrastructure in ways they haven’t in the past. We’ve done this in the U.S., we’re doing it now in Europe, but I will say, Barry, this is still very much at the start of the journey. Wealth is a really important part of our future given our business, quite, frankly is 90 plus percent institutional today, but we’re looking to change that by, hopefully, democratizing these asset classes and making it so much more accessible in that of the past. RITHOLTZ: So, we hinted at this before but I’m going to ask the question outright, how significant is interest rates to client’s risk appetites, how much of the current low rate environment are driving people to move chunks of their assets from fixed income to alternatives? CONWAY: It’s really significant, Barry. I think the transition of these portfolios is quite profound, So you – and I think the unfortunate thing in some respects as this transition happens that you’re introducing new variables and new risks. The reason I say it’s unfortunate and that I think as an industry, this goes back to the education around the assets you own, understanding the role, understanding the various outcomes. I think it’s so incredibly important and that this the time where complete transparency is needed. And quite frankly, we’re investing capital that’s not ours. As an industry, we’re investing our client’s assets and they need to know exactly the underlying investments. And in good and bad times, how would those assets behave? So certainly, interest rates are driving a flow of capital away from these traditional assets, fixed-income, and absolutely in towards real estate, infrastructure, private creditors, et cetera, in the pursuit of this – this yield. But I do – I do think one of the things that’s critically important for the institutional channel, not just the wealth which are newer entrants is this transmission of education, of data because that’s how I think you build a better balanced portfolio and that’s a – that’s a real conundrum, I think, that the industry is facing and certainly your clients too. RITHOLTZ: Quite interesting. So let’s talk a little bit about the differences between investing in the private side versus the public markets, the most obvious one has to be the illiquidity. When you buy stocks or bonds, you get a print every microsecond, every tick, but most of these investments are only marked quarterly or annually, what does this illiquidity do when you’re interacting with clients? How do you – how do you discuss this with them in and how do perceive some of the challenges of illiquid investments? CONWAY: Over the – over the past number of decades, I think our clients have largely held too much liquidity in their portfolios. Like, so what we are finding is the ability to take on illiquidity risk. And obviously, in pursuit of that premium above, the traditional markets, I mean, I think the sentiment they are is it an absolute right one. That transition towards private market exposure, we think is an important one just given the return objectives, the majority of our clients’ need but then also again, most importantly now, with geo policy, with uncertainty, with interest rate uncertainty, inflation uncertainty, I mean, the – going back to the resilience point, the characteristics now by introducing these assets into the mix is important. And I think that’s – that point is maybe what I’ll expand on. As were talking to clients, using the Aladdin systems, and as you know, we bought eFront technologies, albeit a couple of years ago, by allowing, I think, great data and technology to help our clients understand these assets and the context of how they should own them relative to other liquidity needs, their risk tolerances, and the return expectations are really trying to use tech and data to provide a better understanding and comprehension of the outcomes. And as we continue to introduce these concepts and these approaches, by the way, that there is, as you know, so used to in the traditional side, it – it gives them more comfort around what they should and can expect. And that, to me, is a really important part of what we’re doing. So, we’ve released recently new technology to the wealth sector because, quite frankly, we mentioned it before, the 60-40 portfolio is a thing of the past. And that introduction of about 20 percent into alternatives, we applaud our partners who are – who are suggesting that to their clients. We think it’s something they have to do. What we’re doing to support that is really bringing thought leadership, education, but also portfolio construction techniques and data to bear in that conversation. And this goes back to – it’s no longer an alternative, right? This is a core allocation so the comprehension of what it is you own, the behavior of the asset in good and bad times is so necessary. And that’s become a very big thing with regard to our activities, Barry, because your clients are looking to understand better when you’re talking about assets that are very complex in their nature. RITHOLTZ: So, 60-40 is now 50-30-20, something along those lines? CONWAY: Yes. RITHOLTZ: Really, really intriguing. So, what are clients really looking for these days? We talked about yield. Are they also looking for downside protection on the equity side or inflation hedges you hinted at? How broad are the demands of clients in the alternative space? CONWAY: Yes. It ranges the gamut. And even – we didn’t speak to even hedge funds, we’ve had differing levels of interest in the hedge fund world for years and I, quite frankly, think some degree of disappointment too, Barry, with regard to the alpha, the returns that were produced relevant to the cost. RITHOLTZ: It’s a tough space to say the very least exactly. CONWAY: Exactly right. But when you start to see volatility introducing itself, you can really see where skill plays a critical factor. So, we are absolutely seeing, in the hedge fund, a resurgence of interest and demand by virtue of those who really have honed in on their scale, who have demonstrated an up-and-down markets and ability to protect and preserve capital, but importantly, in a low uncorrelated way build attractive risk-adjusted returns. We’re starting to see more activity there again too. I think with an alternatives, you’ve really seen a predominant demand coming from privates. These private markets, like a set of growths so extraordinarily fast and the opportunities that is rich, the reality too on the public side which is where our hedge funds operate, they continue to, in large part, do a really good job. The issue with our industry now with these 38,000 managers is how do you distill all the information? How do you think about your needs as a client and pick a manager who can deliver the outcomes? And just to give you a sense, the difference now between a top-performing private equity manager, a top quartile versus the bottom quartile, the difference can be measured in tens of percent. RITHOLTZ: Wow. CONWAY: Whereas if you look at the public equity side, for example, a large cap manager, top quartile versus bottom quartile is measured in hundreds of basis points. So, there is definitely a world that has started where the outcomes our clients will experience can be great as they pursue yield, as they pursue diversification, inflation protection, et cetera. I think the caveat that I would say is outcomes can vary greatly. So manager underwriting and the importance of it now, I think, really is this something to pay attention to because if you do have that bottom performing at the bottom quartile manager, it will affect your outcomes, obviously. And that’s what we collectively have to face. RITHOLTZ: So, let’s talk a little bit about real estate. There are a couple of different areas of investment on the private side. Rent to own was a very large one and we’ve seen some lesser by the flip algo-driven approaches. Tell us what Blackrock is doing in the real estate space and how many different approaches are you bringing to bear on this? CONWAY: Yes, we think it’s both equity and debt. Again, no different to the infrastructure side, these projects need to be financed. But on the – as you think about the sectors in which you can avail of the opportunity, you’ve no doubt heard a lot and I mentioned earlier this demand for logistics facilities. The explosion of shopping online and having, until we obviously have the supply chain disruption, an ability to have nearly immediate satisfaction because the delivery of the good to your home has become so readily available. It’s a very different consumer experience. So the explosion and the need for logistics facilities to support this type of behavior of the consumer is really an area that will continue to be of great interest too. And then you think about the transformation of business and you think about the aging world. Unfortunately, you can look at various economies where our populations are decreasing. And quite frankly, we’re getting older. And so, were you’re thinking of the context of that senior living facilities, it becomes a really important part, not just as part of the healthcare solution that come with it, but also from living as well. So, single-family, multifamily, opportunities continue to be something that the world looks at because there is really the shortfall of available properties for people to live in. And as the communities evolve to support the growing age of the population, tremendous opportunity there too. But we won’t give up on office space. It really isn’t going away. Now, if you even think about our younger generation here in BlackRock, they love being in New York, they love being in London, they love being in Hong Kong. So, the shape and the footprint may change slightly. But the necessity to be in the major financial centers, it still exists. But how we weighed the risks has definitely changed, certainly, for the – for the short-term and medium-term future. But real estate continues to be, Barry, a critical part of how we express our thought around the investment opportunity set. But clients largely do this themselves too. The direct investing from the clients is quite significant because they too see this as still as a rich investment ground, albeit, one that has changed quite a bit as a result of COVID. RITHOLTZ: Well, I’m fascinated by the real estate issue especially having seen some massive construction take place in cities pre-pandemic, look over in Manhattan at Hudson Yards and look at what’s taking place in London, not just the center of London but all – but all around it and I’m forced to admit the future is going to look somewhat different than the past with some hybrid combination of collaborative work in the office and remote work from home when it’s convenient, that sort of suggests that we now have an excess of capacity in office space. Do you see it that way or is this just something that we’re going to grow into and just the nature of working in offices is changing but offices are not going away? CONWAY: Yes. I do think there’s – it’s a very valid point and that in certain cities, you will see access, in others we just don’t, Barry. And quite frankly, as a firm, too, as you know, we have adopted flexibility with our teams that were very fortunate. The technologies in which we created at BlackRock has just become such an amazing enabler, not just to help us as we mention manage the portfolios, help us a better portfolio construction, understand risks, but also to communicate with our clients. I think we’ve all witnessed and experienced a way to have connectivity that allows them to believe that commerce can exist beyond the boundaries of one building. However, I do look at our property portfolios and even the things that we’re doing. Rent collections still being extraordinarily high, occupancy now getting back up to pre-pandemic levels, not in all cities, but in many of the major ones that have reopened. And certainly, the demand for people to just socialize, that the demand for human connectivity is really high. It’s palpable, right? We see it here too. The smiles on people’s faces, they’re back in the office, conversing together, innovating together. When people were feeling unsafe, unquestionably, I think the question marks around the role of office space was really brought to bear. But as were coming through this, as you’ve seen vaccine rates change, as you’ve seen the infection rates fall, as you’ve seen confidence grow, the return to work is really happening and return to work to office work is really happening, albeit, now with degrees of flexibility. So, going back to the – I do believe in certain areas. You’re seeing a surplus. But in many areas you’re absolutely seeing a deficit and the reason I say that, Barry, is we are seeing occupancy in certain building at such a high level. And frankly, the demand for more space being so high, it’s uneven and this goes back to then where do you invest our client’s capital, making sense of those trends, predicting where you will see resilience versus stress and building that into the portfolio of consequences as you – as you better risk manage and mitigate. RITHOLTZ: Very interesting. And so, we are seeing this transition across a lot of different segments of investing, are you seeing any products that were or – or investing styles that was once thought of as primarily institutional that are sort of working their way towards the retail side of things? Meaning going from institutional to accredited to mom-and-pop investors? CONWAY: Well, certainly, in the past, private equity was really an asset class for institutional investors. And I think that’s – that has changed in a very profound way. I mentioned earlier are the regulation has become a more adaptive, but we also have heard, in many respects, in providing this access. And I think the perception of owning and be part of this illiquid investment opportunity set was hard to stomach because many didn’t understand the attributes and what it could bring and I think we’ve been trying to solve for that and what you’re seeing now with – with regulators, understanding that the difference between if we take it quite simply as DD versus DC, the differences between the options you as a participant in a retirement plan are so vastly different that – and I think there’s a broad recognition now that there needs to be more equity with regard to what happens there. And private equity been a really established part of the alternatives marketplace was once, I think, really believed to be an institutional asset class, but albeit now has become much more accessible to wealth. We’ve seen it by structuring activities in Europe working with the regulators. Now, we’re able to provide private equity exposure to clients across the continent and really getting access to what was historically very much an institutional asset class. And I do think the receptivity is extraordinarily high just throughout people’s careers, they have seen wealth been created as a result of engineering a great outcome with great management teams integrate business. And I do believe the receptivity towards private equity is high as an example. In the U.S., too, working with the various intermediaries and being able to wrap now private equity in a ’40 Act fund, for example, is possible. And by being able to deliver that to the many as opposed to the few, we think has been a very good success story. And I think, obviously, appreciated by our clients as well. So, I would look at that were seeing across private equity as well as private credit and quite frankly infrastructure accuracy. You’re seeing now regulation that’s becoming more appreciative of these asset classes, you’re seeing a more – a greater level of openness and willingness to allow for these assets to be part of many people’s experiences across their investment portfolio. And now, with innovation around structures, as an industry, were able to wrap these investments in a way that our clients can really access them. So, think across the board, it probably speaks the innovation that’s happening but I do think that accessibility has changed in a very significant way. But you’ve really seen it happen in private equity first and now that’s expanding across these various other asset classes. RITHOLTZ: Quite intriguing. I know I only have you for a relatively limited period of time, so let’s jump to our favorite questions that we ask all of our guests. Starting with tell us what you’ve been streaming these days. Give us your favorite Netflix or Amazon Prime shows. CONWAY: That is an interesting question, Barry. I don’t a hell of a lot of TV, I got to tell you. I am – I keep busy with three wonderful children and a beautiful wife and between the sports activities. When I do watch TV, I have to tell you I’m addicted to sports and having – I may have mentioned earlier, growing up playing rugby which is not the most common sport in the U.S., I stream nonstop the Six Nations that happens in Europe where Ireland is one of those six nations that compete against each other on an annual basis. Right now, they’re playing a lot of sites that are touring for the southern hemisphere. And to me, the free times I have is either enjoying golf or really enjoying rugby because I think it’s an extraordinary sport. Obviously, very physical, but very enjoyable to watch. And that, that truly is my passion outside of family. RITHOLTZ: Interesting stuff. Tell us a bit about your mentors, who helped to shape your early career? CONWAY: Well, it even goes back to some of the aspects of sports. Playing on a team and being on a field where you’re working together, there’s a strategy involved with that. Now, I used to really appreciate how we approach playing in the All-Ireland League. How we thought about our opponents, how we thought about the structure, how we thought about each individual with on the rugby field and the team having a role. They’re all different but your role. And actually, even starting from an early age, Barry, thinking about, I don’t know, it’s sports but how to build a great team with those various skills, perspective, that can be a really, really powerful combination when done well. And certainly, from an early age, that allowed me to appreciate that – actually, in the work environment, it’s not too different. You surround yourself with just really great people that have high integrity that are empathetic and have a degree of humility that when working together, good things can happen. And I will say, it really started at sports. But I think of today and even in BlackRock, how Larry Fink thinks about the world and I think Larry, truly, is a visionary. And then Rob Kapito who really helps lead the charge across our various businesses. Speaking and conversing with them on a daily basis, getting their perspectives, trying to get inside your head and thinking about the world from their vantage point. To me, it’s a huge thing about my ongoing personal career and development and I really enjoy those moments because I think what you recognize is independent of how much you think you know, there’s so much more to know. And this journey is an ever evolving one where you have to appreciate that you’ll never know everything and you need to be a student every single day. So, I’d probably cite those, Barry, as certainly the two most important mentors in my life today, professionally and personally quite frankly. RITHOLTZ: Really. Very interesting. Let’s talk about what you’re reading these days. Tell us about some of your favorite books and what you’re reading currently? CONWAY: Barry, what I love to read, I love to read history, believe it or not. From a very small country that seems to have exported many, many people, love to understand the history of Ireland. So, there’s so many books. And having three children that have been born in the U.S. and my wife is a New Yorker, trying to help them understand some of their history and what made them what they are. I love delving into Irish history and how the country had moments of greatness and moments of tremendous struggle. Outside of that, I really don’t enjoy science fiction or any of these books. I love reading, you name any paper and any magazine on a daily basis. Unfortunately, I wake at about 4:30, 5 o’clock every day. I spent my first two hours of the day just consuming as much information as possible. I enjoy it. But it’s all – it’s really investment-related magazines, not books. It’s every paper that you could possibly imagine, Barry, and I just – I have a great appreciation for certainly trying to be a student of the world because that’s what we’re operating in an I find it just a very interesting avenue to get an appreciation to for the, not just the opportunities, but the challenges we’re collectively facing as a society but also as a business. RITHOLTZ: I’m with you on that mass consumption of investing-related news. It sounds like you and I have the same a morning routine. Let’s talk about of what sort of advice you would give to a recent college graduate who was interested in a career of alternative investments? CONWAY: Well, the industry has – it’s just gone through such extraordinary growth and the difference, when I’ve started versus today, the career opportunity set has changed so much. And I think I try to remind anyone of our analysts who come into each one of our annual classes, right, as we bring in the new recruits. I think about how talented they are for us, Barry, and how privileged we all are to be in this industry and work for the clients that we do. It’s just such an honor to do that. But I kind of – I try to remind them of that. At the end of the day, whether you’re supporting an institution, that institution is the face of many people in the background and alternatives has really now become such an important part of their experience and we talked about earlier just this challenge of retirement, if we do a good job, these institutions that support the many, they can have, hopefully, a retirement that involves dignity and they can have an ability to do things they so wanted to do as they work so hard over their lives. Getting that that personal connection and allowing for those newbies to understand that that’s the effect that you can have, an alternatives whether it’s private equity, real estate, infrastructure, private credit, hedge funds, all of these now, with the scale at which they’re operating at can allow for a great career. But my advice to them is always don’t forget your career is supporting other people. And that comes directly to how we intersect with wealth channel, it comes indirectly as a result of the institutions. And it’s such a privilege to do that. I didn’t envision when I grew up, as I mentioned, my first job, milking cows and back in a small town in the middle of Ireland that I would be one day leading an alternatives business within BlackRock. I see that as a great privilege. So, for those who are joining afresh, hopefully, try to remind them that it is for all of us and show up with empathy, dignity, compassion, and do the best you can, and hopefully, these people be sure will serve them well. RITHOLTZ: And our final question, what you know about the world of alternative investing today you wish you knew 25 years or so ago when you were first getting started? CONWAY: I think if we had invested much more heavily as an industry in technology, we would not be in the position we are today. And I say that, Barry, from a number of aspects. I mentioned in this shortfall of information our clients are dealing with today. They’re making choices to divest from one asset class to invest in another. To do that and do that effectively, they need great transparency, they needed real-time in many respects, it can’t be just a quarterly line basis. And if we had been better prepared as an industry to provide the technology and the data to help our clients really appreciate what it is they own, how we’re managing the assets on their behalf, I think they would be so much better served. I think we’re very fortunate at this firm to have built a business on the back of technology for albeit 30 plus years and were investing over $1 billion a year in technology as I’m sure you know. But we need to see more of that in the industry. So, the client experience is so important, stop, let’s demystify alternatives. It’s not that alternative. Let’s provide education and data and it’s become so large relative to other asset classes, the need to support, to educate, and transmit information, not data, information, so our client understand it, is at a paramount now. And I think it certainly as an industry, things have to change there. If I knew how big the growth would have been and how prominent these asset classes were becoming, I would oppose so much harder on that front 30 years ago. RITHOLTZ: Thank you, Edwin, for being so generous with your time. We’ve been speaking with Edwin Conway. He is the head of Blackrock Investor Alternatives Group. If you enjoy this conversation, please check out all of our prior discussions. You can find those at iTunes, Spotify, wherever you get your podcast at. We love your comments, feedback and suggestions. Write to us at MIB You can sign up for my daily reads at Check out my weekly column at Follow me on Twitter, @ritholtz. I would be remiss if I did not thank the crack team that helps put these conversations together each week. Mohammed ph is my audio engineer. Paris Wald is my producer, Michael Batnick is my head of research, Atika Valbrun is our project manager. I’m Barry Ritholtz, you’ve been listening to Masters in Business on Bloomberg Radio.   ~~~   The post Transcript: Edwin Conway appeared first on The Big Picture......»»

Category: blogSource: TheBigPictureNov 22nd, 2021

The era of shortages is unraveling the old American Dream. But that"s not a bad thing.

America is running out of everything in 2021: houses, workers, and all kinds of goods. It could usher in a better economy — and a new American Dream. The postwar American Dream is coming apart at the seams, but a new one is taking its place.Shayanne Gal/Insider America is running out of everything in 2021: houses, workers, and all kinds of goods. It's caused the postwar American Dream, driven by consumerism, to come apart at the seams. It could usher in a better economy with more freedom to live where you want, better working conditions, and less spending on stuff. Insider's Economy team has spent a lot of time waiting for furniture in 2021.All 10 of us moved in the last year, and half of us bought new couches for our new pads. So far, we've spent a total of 45 weeks waiting for them to arrive. After a three-month wait, one editor's couch arrived and it was the wrong size, so she had to return it. The wait is set to get even longer.Just like us, most Americans aren't taking couch shortages sitting down. Headline after headline bemoans the fact that many Americans won't be reclining in the new couches they ordered for their pandemic digs anytime soon. This isn't just a delivery breakdown. It's also a sign of the way the American Dream is breaking down in 2021.When writer and historian James Truslow Adams coined the term in 1931, he defined the American Dream as the opportunity for a better life for all. The postwar boom of the 1950s introduced the house, white picket fence, and other consumerist trappings of the suburban idyll. The global health crisis that ushered in an era of shortages 70 years later is changing everything again.The housing shortage, the labor shortage, and the supply shortage are coalescing in 2021 to challenge every aspect of the 20th-century American Dream: The affordable house in the suburbs with a white picket fence, the job that pays well and provides meaning, and the consumer culture that meets every need and desire. Americans are at a fork in the road, so what will the next dream be?Housing has become a choose your own adventureThe American Dream home became a choose your own adventure quasi-gameshow during the pandemic.Remote work freed knowledge workers from the chains of office life, bringing the postwar dream in sight as workers snapped up nearly every suburban home. But the dream of suburbia was stronger than the market's ability to support it, as the ensuing housing shortage left America short millions of homes. It boxed aspiring first-time homeowners out of a cash-is-king seller's market.As housing prices continued their upward climb to a record highs of $386,888, the American Dream splintered into four different versions of a better life. "While considerable numbers of folks are still convinced that having the proverbial white picket fence will signify they've achieved the American Dream, many others are realizing there are other perfectly valid interpretations of the concept," Larry Samuel, the founder of Age Friendly Consulting and author of "The American Dream: A Cultural History," told Insider. A healthy 59% of Americans still aspire to be homeowners, a sign of the lingering allure of the post-World War II vision. But suburbia is now mostly attainable for the wealthy, less accessible to the 68% of millennials who have their sights set on homeownership. The housing shortage has boxed many out of the housing market.Newsday LLC/Getty ImagesAlyssa Cinami, 32, who has spent 14 months house-hunting and put in five rejected bids, described the market to Insider as "insane, and very discouraging for first-time buyers who can't compete with people with lots of cash."It prompted some 40,000 Americans in May and June alone to turn to more affordable housing in the exurbs, a rural community that is distantly commutable to a big city, or even further out to areas that urbanist Richard Florida has deemed "the rural fringe." Others are finding alternative options in a life on the go, bypassing debt-based homeownership for a more mobile lifestyle in a tiny house or a van, both of which saw a boom in sales since the pandemic began.But that doesn't mean cities are dead. Skyrocketing rents and the 60% of wealthy millennials who plan to buy a home in a big city within the next year indicates that city life still holds an allure. Now, urbanites are living there because they want to, not because they need to for work, and it's reshaping cities as a place centered around personal interaction rather than the office.As Samuel said, "The new white picket fence can be said to be the freedom and peace of mind that comes with not having to do whatever it takes to keep the fence."Power is slowly shifting from employers to workers, and leaving shortages in its wakeFor decades, the American Dream has valued the ideal of wealth through meaningful work: You want to work hard enough that you'll amass enough wealth to buy all the things you want, like a house, a TV, or a car.But the economic reality for many workers hasn't kept pace with these all-important items. Wages have been declining for five decades; the student debt meant to finance the educations that supply the American Dream has skyrocketed, trapping many in untenable cycles of debt. Meanwhile, the opportunities available to workers are increasingly low wage.The pandemic tightened the screws even further, with billionaires notching trillions in gains as low-wage workers found themselves on the frontlines — or just out of a job completely.Workers have taken advantage of the hot post-vaccine labor market. For six months, Americans have been quitting in record numbers, with 4.4 million in September alone. Meanwhile, thousands of workers have gone on strike to demand better conditions. The workers that have joined "the Great Resignation" are effectively on strike, too, many of them expressing a new philosophy of "antiwork," where they document quitting over exploitative conditions and contemplate a future where work is decentralized from life.Spirit Airlines pilots are on strike.Joe Raedle/Shutterstock"I think that it has a lot to do with Gen Z," Kade, a Gen Z antiworker in Kansas, told Insider. After reading antiwork for months, he quit his job when his boss said they would confiscate phones if they caught workers on them. Gen Z doesn't "put up with employers' crap anymore, like the abuse and the low pay," Kade said. "We're getting tired of it."These are still drops in the bucket against decades of stagnant wages and a weakened labor movement. But trends like antiwork seem to be making an impact, as employers have gone from continually bemoaning labor shortages to raising wages and offering better benefits.Businesses shifting from becoming customer-centric to employee-centric could "start a lot of healing," Steve Rowland, the host of Retail Warzone, a podcast chronicling retail workers' "horror stories," told Insider."Customers are important, but your employee base is what keeps you going," Rowland said. "The first company that does that, you'll see a huge change — that'll all of a sudden be the company that people want to work for."Supply chain shortages force a rethink of consumption It's not just couches — there's a shortage for every kind of thing. Factory shutdowns as a result of pandemic safety restrictions and labor shortages, congested shipping ports, the US-China trade war, bad weather, and global traffic jams have led to wait times for many Americans who became used to a "just-in-time economy" in the 2000s.Part of it is a snarled supply chain and part of it is that Americans are just buying more, well, stuff. As the economy reshaped to prioritize remote work and a spread-out populace, Americans had more use for gym equipment and new TVs and less need to go to restaurants and hotels. The demand has outstripped supply at the same time that the supply has broken down.The runaway spending could exacerbate the labor shortage: Rowland said that angry customers demanding their holiday goods could prompt workers to "start throwing their hands up in the air and walking out the door. They're just not going to take it." Container ships at the congested Port of Los Angeles in September 2021.Mike Blake/ReutersCanadian political scientist Krzysztof Pelc argued in the Financial Times that the key to happiness, and the next step in the evolution of our economy, is buying less stuff and more experiences. He explains that a shift toward service spending is a hallmark of developed economies, with effects on growth. Advanced societies may come to view high growth, spurred by goods consumption, not as progress, but a "necessary stage" of it. "The challenge is then to recognise when the moment has come for a shift in social purpose."Gen Z seems to agree with Pelc: Research and advisory firm Gen Z Planet recently found that the generation is saving and investing more than it's spending, and now holds $360 billion in disposable income. Coming of age amidst the greatest economic catastrophe in 100 years could shape their economic behavior for decades to come, and early signs indicate they aren't just "antiwork" — they're anti-spending and pro-thrift, too. That means companies might have to appeal to their thrifty ways and higher standards for work to survive the era of shortages.Gen Z may be saying they're thrifty while shopping just as much as older generations. But maybe, just maybe, the new American Dream is coming into view.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 21st, 2021

Pitt board votes for university to buy Residence Inn hotel property on Bigelow Boulevard

University seeks to make permanent its use of Bigelow Boulevard hotel for student housing with $32 million real estate buy......»»

Category: topSource: bizjournalsNov 19th, 2021

Work starts on turning brewery into senior housing

Work gets underway today on transforming the former Rheingold Brewery Building in Bushwick into am affordable senior housing development. Developed jointly by Southside United HDFC — better known as Los Sures— and Churches United for Fair Housing (CUFFH),  Rheingold Senior Residences will be located at 15 Montieth Street on a... The post Work starts on turning brewery into senior housing appeared first on Real Estate Weekly. Work gets underway today on transforming the former Rheingold Brewery Building in Bushwick into am affordable senior housing development. Developed jointly by Southside United HDFC — better known as Los Sures— and Churches United for Fair Housing (CUFFH),  Rheingold Senior Residences will be located at 15 Montieth Street on a site that was once part of the Rheingold Brewery. Supported by the New York City Department of Housing Preservation and Development’s (HPD) Senior Affordable Rental Apartments (SARA) program, Rheingold Senior Residences aims to set a new standard for deeply affordable housing for seniors and is designed to be age-friendly, both inside and out. The development was the recipient of a NYSERDA Buildings of Excellence Award and its sustainable design reflects the project team’s commitment to improving the safety and environmental quality of the neighborhood’s streets and buildings. The total development cost for the project is approximately $67 million. The eight story, 94-unit building will feature studio and one-bedroom apartments. A day-lit lounge will be built on each floor where residents can gather and connect to the outdoors. Additionally, apartment entrances are recessed from the corridor with a shelf for convenience and to encourage individualization so that seniors can easily identify their own and others’ units. Los Sures will manage the property and offer activities such as gardening, art, poetry and healthy cooking classes, as well as more traditional social services. Outdoor space will include a landscaped rear yard, an accessible rooftop with raised beds for gardening, and a seating area at the building’s entrance. Amenities for the wider public include a separately accessible multipurpose room with a warming kitchen that will be open for use by local community groups, as well as several classrooms and an adjacent office space for programming. Juan Ramos, Executive Director of Los Sures, said: “This development will provide affordability and direct services needed to protect the aging and vulnerable population in our city and its energy saving design will help preserve the planet for their grandchildren.” Rob Solano, Executive Director and Co-Founder of CUFFH, added: “Our hope is that these residences, with their sustainable design, will remain a standard in the continuation of providing affordable supportive housing for our aging communities.” Rockabill Consulting and Development is serving as financial advisor for the project, which has been designed to passive house standards. A 39-kwh solar panel system will occupy the roof of the building with centralized heating and cooling powered entirely by an electric heat pump system. This eliminates the need for residents to buy AC units. Energy recovery ventilation will also be used to provide dedicated, filtered fresh air throughout the building. Overall, the project anticipates a 44 percent energy‐cost savings. The architect for the project is Magnusson Architecture and Planning PC. Financing was secured by Rockabill Consulting and includes a $29.5 million construction loan from Chase, a subsidy loan for $11.2 million through HPD’s SARA program and an allocation of $1.6 million in Low-Income Housing Tax Credits (LIHTC), also awarded by HPD. CREA LLC and Bellwether Real Estate Capital are providing $16.3 million in tax credit equity, which is facilitating the permanent loan to be held by Freddie Mac for $17.4 million. Mayor-Elect Eric Adams and Brooklyn Borough President-Elect Antonio Reynoso also contributed a combined total of $7 million in Reso A funds for the construction of the project. Additional participants in the financing are Local Initiatives Support Corporation (LISC), which provided a predevelopment loan and the New York State Energy Research and Development Authority (NYSERDA), which provided an award through the Buildings of Excellence program and the New York City Housing Authority (NYCHA), which has awarded Rheingold a Project Based Section 8 award for all 93 residential units (exclusive of the superintendent’s unit). Per SARA requirements, 30 percent of the units will be reserved for formerly homeless persons.  The remaining units will be for older adults with incomes up to 60 percent of AMI.  All of the residential units will be covered through a project-based Section 8 Housing Assistance Payments (HAP) contract. The post Work starts on turning brewery into senior housing appeared first on Real Estate Weekly......»»

Category: realestateSource: realestateweeklyNov 19th, 2021

Louisiana-Pacific (LPX) Up 95% in a Year: Housing Holds Key

Louisiana-Pacific's (LPX) strategic investments and business transformation plan are driving growth. Higher costs and expenses are headwinds. Louisiana-Pacific Corporation LPX or LP’s shares have surged 95% in the past year compared with the Zacks Building Products – Wood industry’s 52.7% rally. The company has been banking on solid U.S. residential market and repair and remodeling (R&R) business. Also, strength in Siding business, rising Oriented Strand Board or OSB prices, solid business transformation plan and operational efficiency bode well.The company posted impressive third-quarter 2021 results. Both the top and the bottom line surpassed the Zacks Consensus Estimate and increased on a year-over-year basis. The upside was backed by favorable OSB prices and an improving housing market backdrop.Earnings estimates for the fourth quarter and 2021 have moved up 7.5% and 1.6%, respectively, in the past 30 days. The company has a solid earnings surprise history, having surpassed the Zacks Consensus Estimate in the trailing seven quarters. This trend reflects bullish analyst sentiments. Its impressive VGM Score of A, supported by Value and Growth Score of A, is a testimony to the fact.Image Source: Zacks Investment ResearchYet, increase in raw material prices, freight and labor costs along with higher expenses associated with repair and remodeling activity and product introduction are a concern.Let’s delve deeper into the factors influencing the performance of LP — a Zacks Rank #3 (Hold) company. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Key Strategies to Drive GrowthLP is focused on improving the siding unit to increase the penetration of siding products in R&R activities. In the past several quarters, LP has been experiencing solid demand for its products. In the first nine months of 2021, the Siding unit delivered 27% revenue growth, backed by a 34% year-over-year rise in Siding Solutions business. The upside can be attributed to robust demand for its products. It intends to continue increasing the investment in selling and marketing of the said business in 2021 and beyond.LP is gradually transforming from a commodity producer to a more stable cash-generative business by increasing revenues and EBITDA mix. It has been mainly focusing on three areas — increasing the efficiency of mills by improving productivity, run time and quality through overall equipment effectiveness or OEE initiatives; applying best practices to the supply chain; and optimizing infrastructure costs. Since January 2019 till 2020, LP achieved $178 million in cumulative EBITDA from growth and efficiency. During the first nine months of 2021, adjusted EBITDA increased $1.2 billion to $1.7 billion, primarily due to growth in Siding Solutions revenues and higher OSB prices.LP’s business banks on acquisitions, business combinations and divesture of low-profitable businesses. Recently, the company confirmed capacity expansion projects at Houlton and restarting of the Peace Valley mill. It expects to start SmartSide production at Houlton in late first-quarter 2022. Meanwhile, the company continues to accelerate the Sagola conversion and intends to start SmartSide production therein in first-quarter 2023.Meanwhile, resilient housing markets prospects have been driving the demand for residential construction and thereby wood products.Factors Denting ProfitabilityHigher costs and expenses have been a concern for all wood industry players. The cost of different varieties of wood fiber is subject to volatility owing to governmental, economic or industry conditions. In the last three quarters of 2021, the company witnessed higher freight and transport costs along with rising input costs. In the third quarter, Siding’s adjusted EBITDA fell 4% from the prior-year period’s levels, due to higher costs for raw materials, freight, maintenance and higher investments in sales and marketing.Along with wood fiber and lumber, shortages of resin and adhesives along with supply chain challenges are likely to persist. Also, increased marketing investments associated with accelerating repair and remodel channel penetration along with new product introductions have been putting pressure on its performance over the last few quarters.Some Better-Ranked Stocks in Construction SectorComfort Systems USA, Inc. FIX: This heating, ventilation, and air conditioning installation service provider presently sports a Zacks Rank #1.Comfort Systems has a trailing four-quarter earnings surprise of 17.4%, on average. The Zacks Consensus Estimate for earnings per share for the current year has improved 7.1% in the past 30 days. Shares of FIX have jumped 108.9% in the past year.Meritage Homes Corporation MTH — a leading homebuilder of single-family homes — sports a Zacks Rank #1 at present.Meritage Homes has a trailing four-quarter earnings surprise of 24.4%, on average. The Zacks Consensus Estimate for earnings for the current year indicates a 74.6% year-over-year surge. Shares of MTH have jumped 30.7% in the past year.Beazer Homes USA, Inc. BZH, a national homebuilder, currently sports a Zacks Rank #1.Beazer Homes has a trailing four-quarter earnings surprise of 60.3%, on average. The Zacks Consensus Estimate for its earnings per share for the current year has improved 44% in the past seven days. Shares of BZH have jumped 60.3% in the past year. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report LouisianaPacific Corporation (LPX): Free Stock Analysis Report Meritage Homes Corporation (MTH): Free Stock Analysis Report Beazer Homes USA, Inc. (BZH): Free Stock Analysis Report Comfort Systems USA, Inc. (FIX): Free Stock Analysis Report To read this article on click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 18th, 2021

Deere (DE) to Report Q4 Earnings: What"s in the Offing?

Deere's (DE) Q4 performance is likely to reflect increased farm equipment demand on higher commodity prices and benefits from a margin-improvement plan. Deere & Company DE is scheduled to report fourth-quarter fiscal 2021 results (ended as of Oct 31, 2021) on Nov 24, before the opening bell.Which Way are the Estimates Trending?The Zacks Consensus Estimate for Deere’s earnings per share is pegged at $4.03 for the fiscal fourth quarter, suggesting a 68.6% year-over-year surge. The Zacks Consensus Estimate for total revenues is pinned at $10.5 billion for the period, calling for a year-over-year increase of 21.7%. The company has a trailing four-quarter earnings surprise of 48.1%, on average. Earnings estimates for the fiscal fourth quarter have been stable in the past 30 days.Let’s see how things have shaped up prior to this announcement.Key Factors to ConsiderHigher agricultural commodity prices and pick-up in farm income have prompted farmers to boost spending on new agricultural equipment and replace the age-old ones. Apart from this, preference for Deere’s products for their advanced technologies and features will likely reflect on fiscal fourth-quarter revenues. Robust order activity driven by strong production and elevated grain exports to China are likely to have contributed to Deere’s performance during the quarter.Cost management and benefits from footprint assessment are likely to have boosted the company’s margin in the to-be-reported quarter. However, rising raw material and logistics costs as well as uncertainties regarding the COVID-19 pandemic might have affected quarterly performance.The Construction & Forestry segment sales are expected to have benefited from strength in the housing market, growth in the non-residential sector and strong order activity from independent rental companies during the fiscal fourth quarter. Demand for earthmoving and compact construction equipment remains strong. Robust lumber demand, particularly in North America, is anticipated to have aided forestry sales during the quarter under review.Deere & Company Price and EPS Surprise  Deere & Company price-eps-surprise | Deere & Company Quote Earnings WhispersOur proven model doesn’t conclusively predict an earnings beat for Deere this season. The combination of a positive Earnings ESP, and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the odds of an earnings beat. But that’s not the case here.You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.Earnings ESP: The Earnings ESP for Deere is 0.00%.Zacks Rank: Deere currently carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.Price PerformanceDeere’s shares have gained 39.8% in the past year compared with the industry’s growth of 38.8%.Image Source: Zacks Investment ResearchStocks Worth a LookHere are other stocks worth considering as these have the right combination of elements to post an earnings beat this quarter.Bank of Montreal BMO currently has an Earnings ESP of +0.51% and a Zacks Rank of 2. The Zacks Consensus Estimate for fourth-quarter fiscal 2021 earnings has moved up 0.8% in the past 30 days to $2.47 per share, suggesting year-over-year growth of 36.5%.Bank of Montreal has a trailing four-quarter earnings surprise of 25.1%, on average. It has a long-term earnings growth estimate of 15.8%.HP Inc. HPQ currently has an Earnings ESP of +1.89% and a Zacks Rank of 3. The Zacks Consensus Estimate for fourth-quarter fiscal 2021 earnings has been stable in the past seven days and is currently pegged at 88 cents per share, suggesting a 41.9% surge from the year-ago quarter’s tally.The Zacks Consensus Estimate for fiscal fourth-quarter revenues is pegged at $15.4 billion, which suggests growth of 0.7% from the year-ago quarter’s figures. HP has a trailing four-quarter earnings surprise of 21%, on average.Keysight Technologies, Inc. KEYS currently has an Earnings ESP of +1.66% and a Zacks Rank #3. The Zacks Consensus Estimate for fourth-quarter fiscal 2021 earnings have been stable in the past 30 days and is currently pegged at $1.65 per share, calling for year-over-year growth of 1.8%.The Zacks Consensus Estimate for quarterly revenues is pegged at $1.3 billion, which indicates a year-over-year improvement of 4.6%. Keysight has a trailing four-quarter earnings surprise of 7.3%, on average. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report HP Inc. (HPQ): Free Stock Analysis Report Deere & Company (DE): Free Stock Analysis Report Bank Of Montreal (BMO): Free Stock Analysis Report Keysight Technologies Inc. (KEYS): Free Stock Analysis Report To read this article on click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 18th, 2021

Stock Market News for Nov 18, 2021

U.S. stocks closed lower on Wednesday on growing fears over inflation and supply chain concerns amid a slew of earnings reports from a batch of big-box retailers. U.S. stocks closed lower on Wednesday on growing fears over inflation and supply chain concerns amid a slew of earnings reports from a batch of big-box retailers. However, all the indexes remained within striking distance of their all-time record closing highs, as technology stocks continued to drive the rally. All the three major indexes ended in negative territory.How Did The Benchmarks Perform?The Dow Jones Industrial Average (DJI) shed 0.6% or 211.17 points to close at 35,931.05 points.The S&P 500 declined 0.3% or 12.23 points to finish at 4,688.67 points. Energy and financial stocks were the biggest losers. The Energy Select Sector SPDR (XLE) declined 1.5%, while the Financials Select Sector SPDR (XLF) lost 1.2%. Seven of the 11 sectors of the benchmark index ended in negative territory.The tech-heavy Nasdaq slid 0.3% or 52.28 points to end at 15,921.57 points. Shares of Tesla, Inc. TSLA gained 3.3%. Tesla carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.The fear-gauge CBOE Volatility Index (VIX) was up 2.46% to 15.39. A total of 10.6billion shares were traded on Wednesday, lower than the last 20-session average of 11.09 billion.Inflation Worries Take a Toll on StocksMarkets ended higher on Tuesday and started Wednesday on a high. All the three major indexes moved upward initially following robust quarterly results and some positive economic data released on Tuesday. However, growing concerns over inflation and a slight marginal retreat in Treasury yields on Wednesday weighed on the broader market.That at the same time lifted large-cap tech stocks that rallied. Shares of Netflix, Inc. NFLX gained 0.6%, while Microsoft Corporation MSFT increased 0.1%.Also, a large batch of retailers reported their quarterly results on Wednesday. With most reporting impressive results, investors’ sentiments got a boost. However, many have been also been reporting that rising costs are hurting margins, raising supply chain concerns.However, even after Wednesday’s declined, the three indexes are well within striking distance of the record closing highs.Economic DataNot much economic data was released on Wednesday. The Commerce Department said that U.S. housing starts fell 0.7% to a seasonally adjusted annual rate of 1.520 million units on October. However, building permits jumped 4% to a rate of 1.650 million units in October. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Microsoft Corporation (MSFT): Free Stock Analysis Report Netflix, Inc. (NFLX): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis Report To read this article on click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 18th, 2021

2021 Profile of Home Buyers and Sellers: Pandemic Fuels Desire to Live Closer to Family

After a full year of pandemic-induced activity, buyers and sellers are prioritizing family and friends during their house hunting process, according to the National Association of REALTORS® (NAR). NAR recently released its 2021 Profile of Home Buyers and Sellers report, which highlighted an entire year of research on buyer and seller activity during the COVID-19 […] The post 2021 Profile of Home Buyers and Sellers: Pandemic Fuels Desire to Live Closer to Family appeared first on RISMedia. After a full year of pandemic-induced activity, buyers and sellers are prioritizing family and friends during their house hunting process, according to the National Association of REALTORS® (NAR). NAR recently released its 2021 Profile of Home Buyers and Sellers report, which highlighted an entire year of research on buyer and seller activity during the COVID-19 pandemic. The report found that a critical factor for moving among buyers and sellers was to be near their loved ones. “Realtors® stepped up in a tremendous way during this pandemic—both in helping sellers list and sell properties, as well as in aiding buyers in finding their dream home during a time of such scarce inventory,” said NAR President Charlie Oppler. Behind the quality of the neighborhood, NAR indicated that the second most important factor to buyers when choosing a neighborhood was the convenience to friends and family. Sellers shared a similar sentiment. They also stated a desire to increase their living space as a close second for the top reason they wanted to move. Forty-six percent of sellers traded up to a larger home, and 28% purchased the same size home. Aside from historically low mortgage rates, lagging inventory and overwhelming demand fueling frenzied market activity, NAR indicated that the COVID-19 pandemic likely caused a decrease in how long people were staying in their homes. “Home sellers have historically moved when something in their lives changed – a new baby, a marriage, a divorce or a new job,” said Lautz. “The pandemic has impacted everyone, and for many, this became an impetus to sell and make a housing trade.” The report found that tenure in a home from ten years to eight last year, marking the most significant single-year change in home tenure since NAR began collecting such data. A lull in available homes helped drive frenzied buying activity in 2021, as any homes that hit the market were snagged faster than they were in 2020. The amount of time for a listing on the market dropped from three weeks in 2020 to one week this year. Sellers cited that they sold their homes for a median of $85,000 more than they purchased it, a jump from $66,000 last year. Despite persisting affordability issues, first-time buyers accounted for 34% of all buyers in the market this year – up from 31% the year before. However, according to Jessica Lautz, vice president of demographics and behavioral insights at NAR, surging home prices could be likely to keep straining new buyers. “In the current environment, these buyers also face soaring rent prices and high student debt balances, which makes it extremely difficult to save for a down payment,” Lautz said. Twenty-eight percent of first-time buyers reported that they used a gift or a loan from friends or family to make a down payment on a home, and 29% said saving for a down payment proved to be the most challenging step in the entire buying process. The bump in home equity continued to be a boon for repeat buyers. The report found that 56% cited using equity generated from the sale of a primary residence toward their down payment. Prices of purchased homes increased nationally to a median of $305,000 from $272,500 from 2020, with the most expensive homes found in the West. The most affordable homes were in the northeast. Recent buyers typically purchased their home for a median of 100 percent of the asking price for their home. Twenty-nine percent of buyers paid more than the asking price for their homes. Given the overwhelming buyer demand, only a quarter of all sellers offered incentives to attract buyers—down  from 46% last year. Regarding how buyers are looking for their homes, the report found that almost all buyers (95%) used online tools during their search process. For 41% of recent buyers, that was their first step. Amid the boom of tech and digital tools used to find homes, buyers are still choosing to work with agents and brokers. The report noted that 87% recently used a real estate professional to buy their home, while 73% of buyers only interviewed one agent during their search process. The value of relationships and referrals has been lost as nearly half (47%) of the buyers surveyed said they used an agent referred to them by someone they know. Sixty-eight percent of sellers also found their agent through a referral from a friend, neighbor, or relative or used an agent they had worked with before to buy or sell a home. To read the entire report, click here. For more information, please visit Jordan Grice is RISMedia’s associate online editor. Email him your real estate news to The post 2021 Profile of Home Buyers and Sellers: Pandemic Fuels Desire to Live Closer to Family appeared first on RISMedia......»»

Category: realestateSource: rismediaNov 16th, 2021

MSG Entertainment signs new 428,000 s/f lease at Vornado’s Penn 2

Vornado Realty Trust today announced that Madison Square Garden Entertainment ((MSG Entertainment) has signed a new 20-year lease for 428,000 s/f at Vornado’s PENN 2, which will remain MSG Entertainment’s corporate headquarters. PENN 2 is in the midst of a full redevelopment as part of Vornado’s multibillion-dollar transformation of the... The post MSG Entertainment signs new 428,000 s/f lease at Vornado’s Penn 2 appeared first on Real Estate Weekly. Vornado Realty Trust today announced that Madison Square Garden Entertainment ((MSG Entertainment) has signed a new 20-year lease for 428,000 s/f at Vornado’s PENN 2, which will remain MSG Entertainment’s corporate headquarters. PENN 2 is in the midst of a full redevelopment as part of Vornado’s multibillion-dollar transformation of the PENN DISTRICT. Slated for completion in the second half of 2023, the redevelopment of the 1.8 million square foot PENN 2 will offer creative space and an amenity package. It will feature a modern, triple-pane glass curtain wall with floor-to-ceiling windows and more than 65,000 feet of outdoor space for tenants and guests, including a rooftop park, 16 loggias and three terraces. PENN 2 occupies one of the few double-wide blocks in New York City, directly on top of Penn Station, between Seventh and Eighth Avenues and 31st and 33rd Streets. Steve Roth Steven Roth, Chairman and Chief Executive Officer of Vornado, commented, “We are delighted to continue our long-standing partnership with MSG, the world’s premier sports and entertainment brand. MSG’s commitment to PENN 2 continues the momentum we are generating in the PENN DISTRICT, where we are creating a one of a kind, next generation work environment at the heart of New York City’s thriving West Side.” James Dolan, Executive Chairman and CEO of MSG Entertainment, said, “Vornado has been a great partner and we are pleased to have reached this agreement, which keeps our corporate headquarters at PENN 2 – in the heart of the city next to our Madison Square Garden Arena.” Vornado’s transformation of the PENN DISTRICT, where it owns 10 million square feet, is well underway, anchored by the redevelopments of The Farley Building including Moynihan Train Hall as well as PENN 1 and PENN 2, which together will comprise a unique, two-building 4.4 million square foot, interconnected campus. As part of the PENN 2 redevelopment, Vornado is creating fully remodeled entrances into Madison Square Garden to further enhance the fan experience. PENN 2 rendering Outdoor dining at PENN 2 PENN 2 rendering The post MSG Entertainment signs new 428,000 s/f lease at Vornado’s Penn 2 appeared first on Real Estate Weekly......»»

Category: realestateSource: realestateweeklyNov 15th, 2021