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10 Must Reads for the CRE Industry Today (July 12, 2017)

Janet Yellen promises a few gradual interest rate increases, according to Fortune. The Wall Street Journal looks at the slowdown in the self-storage sector. These are among today’s must reads from around the commercial real estate industry.

  1.  Fed Chair Janet Yellen: Expect Gradual Rate Increases “The United States is healthy enough to absorb further gradual rate increases and the slow wind down of the massive bond portfolio accumulated by the Federal Reserve during the financial crisis, Fed Chair Janet Yellen said in prepared testimony to be delivered to Congress Wednesday morning. The Fed ‘continues to expect that the evolution of the economy will warrant gradual increases in the federal funds rate over time,’ Yellen said, while reductions in the Fed's more than $4 trillion in securities are likely to begin ‘this year.’” (Fortune)
  2. Office Sharing Start-Up WeWork Gets $760 Million in New Cash “Start-up WeWork has raised about $760 million of new funding, according to filings with the Delaware Department of State. The company's valuation now stands at $20 billion, unnamed sources told Forbes, which previously reported the funding round. That would be higher than the $16.9 billion valuation last estimated by CB Insights. WeWork declined to comment on the filing.” (CNBC)
  3. City Fines Landlords Who Report Airbnb Violations “In its running battle to stem the tide of illegal Airbnb listings, City Hall has been alienating a powerful ally: landlords. Building owners often have detailed knowledge of what is happening at their properties, information they might be happy to share with the de Blasio administration as it seeks to oust problematic tenants who operate de facto hotels out of their apartments. But several landlords who have reported illegal home sharing to the Mayor’s Office of Special Enforcement have themselves been slapped with violations.” (Crain’s New York Business)
  4. Building Boom in Boston Casts Shadows on History and Public Space “Boston is riding the crest of what city officials say is the biggest building boom in its history, with cranes lifting glassy towers into place and raising the city’s unassuming profile. The surge of construction is also plunging some of its most cherished sites into deepening shadow, testing state laws that have long balanced economic development with protection of sunlight and open space.” (The New York Times)
  5. The 10 Best Cities for Millennials in 2017 “If you’re a millennial thinking about moving to a new city, you’re likely mulling over its job market, cost of living and tendency for sunny days. But perhaps you’re also considering whether a city has a vibrant, diverse community. Niche, a website that ranks schools and neighborhoods, released its annual list of the best cities for millennials. The list puts an emphasis on how many bars, coffee shops and restaurants are accessible to a city’s residents — these factors make up nearly 40% of the ranking.” (Forbes)
  6. Self-Storage Boom Shows Signs of a Slowdown “After decades of growth, the self-storage industry is poised for a slowdown, according to real-estate research firm Green Street Advisors. The category has enjoyed massive expansion as more Americans seek out places to keep their stuff. In all, 8% of the U.S. population now uses a facility, up from 3% in the 1980s.” (Wall Street Journal, subscription required)
  7. Real Estate Venture Firm Fifth Wall Launches an Early Stage Accelerator “For the firm’s co-founder and co-managing partner Brendan Wallace, the accelerator is an opportunity to reach out to companies when the firm’s input can make more of a difference. Because the company’s backers include some of the nation’s largest real-estate and construction firms, Fifth Wall has deep insights into which types of technologies will be most interesting to the industry and can play the role of kingmaker, according to Wallace.” (TechCrunch)
  8. Gymboree’s Bankruptcy Means Closing 350 Stores “The San Francisco-based company said Tuesday that it's mostly closing Gymboree and Crazy 8 stores. It also operates Janie and Jack stores. The company will have more than 900 locations after the stores are shut down. Gymboree filed for bankruptcy protection in June. Traditional retailers have been struggling to deal with strong competition from online companies and slowing mall traffic.” (CBS News)
  9. U.S. Office Vacancy Rates Remain Unchanged in Mid-2017 “According to CBRE, vacant office space in the U.S. remained unchanged during the second quarter of 2017 at 13 percent. The steady performance was attributable to a balance of supply and demand. The vacancy rate in suburban markets increased by 10 bps, to 14.3 percent, while downtown vacancy remained steady at 10.7 percent. Vacancy continued to fall in an about half of the U.S. office markets, and the national office vacancy rate remains near its post-recession low.” (World Property Journal)
  10. Kushner (the Musical) on Ice “It’s not just intelligence investigators who want to know more about Kushner’s involvement in his family’s company and its latest dealings. Last month, members of the House and Senate Judiciary Committees penned a nine-page letter to Kushner Companies President Laurent Morali, asking for detailed information on how the company raises money for projects through the controversial EB-5 visa program and how it touts its connections to the White House to potential investors.” (The Real Deal)
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