Landmark Links September 20th – Tectonic Shift


Must Read: Fifteen years ago, industrial real estate was an asset class largely held by small to medium sized local operators.  Today, thanks to innovation and changes in supply chain management, it has been overtaken by large institutional investors.


Cross-hairs: A decade of freewheeling growth has put gig economy companies in the spotlight and regulatory actions are popping up around the globe amid complaints about congestion and worker pay, among other issues.  But See: Uber says its not subject to California’s new gig worker law.

Another Cut: The Federal Reserve cut rates another 25 basis points this week but didn’t provide a whole lot of clarity as to what their next move will be.

Inflection Point? The massive growth in negative-yielding debt appears to have hit a pause and has actually reversed course a bit – at least for the time being.


Whipsaw: Last week, WeWork insisted that it was pushing forward with its IPO road show despite being urged to put it off by its largest investor, Soft Bank.  This week WeWork scrapped the road show amidst growing scrutiny that its worth anything close to even its drastically reduced valuation.  See Also: Dilutive triggers built into WeWork’s capital structure to provide VC’s with down-round protection will pose problems when the company again attempts to tap public markets.  And: WeWork’s eccentric (that’s what we call rich people when they are crazy) CEO has said to others – according to the Wall Street Journal – that:

  • He was interested in becoming Israel’s PM
  • He was interested in becoming president of the world
  • He wants to be the world’s first trillionaire
  • He thinks that his company will solve the problem of children without parents
  • He hopes to live forever

In other words, he’s the stereotypical douche bag tech CEO but runs a real estate company instead (and no, I don’t care that he thinks its a tech company and neither do public market investors, apparently).

Saving Grace? A new survey by A.T. Kearney indicated that consumers between the ages of 14 – 24 have a strong preference for brick and mortar shopping that could lead to a retail resurgence.

Cold Water: eCommerce made warehouses hot.  However, slowing business investment, weaker growth, and uncertainty created by the trade dispute are said to be weighing on the sector.


Rebound? Total housing starts for August were substantially above expectations – the highest in 12 years – and starts for June and July were revised up as well.  This puts starts on a trajectory where they could actually be up year over year by the end of 2019 after starting out in a big hole after the first quarter.

Don’t Call it a Comeback: Citigroup, Goldman Sachs and Wells Fargo are getting back into the private mortgage bond business that burned them in 2008 as the feds continue to indicate that they want less government involvement in the mortgage business.  This trend is still in its infancy.  Last year around $70 billion of mortgages ended up in private label bonds, far below the peak of  more than $1 trillion just before the crisis.  However, it had dried up to $0 by 2009 so its something that bears watching.

Large Appetite: Life insurance companies may hold up to $120 billion in multifamily loans by 2024 as they ramp up to attempt to compete with the GSEs.


Death Stars: From NYU Professor Scott Galloway: the world’s biggest tech companies can use bundling and economic power to add services and features that can destroy a promising business before it has a chance to grow.  This is stifling innovation and hurting economic growth.  See Also: Why anti-trust can’t catch big tech.

Too Good to Be True: MoviePass, the subscription service that sold unlimited movie passes to theaters at prices that ensured that it would never be a viable business, has officially shut down.

We Don’t Deserve Dogs: Twelve years ago, 47 dogs were rescued from Michael Vick’s dogfighting operation and allowed to live. They’ve enriched the lives of countless humans and altered the course of animal welfare.

Chart of the Day


Source: Statista via The Daily Shot


E For Effort:  Priests sprayed holy water from airplanes to stop ‘alcohol use’ and ‘fornication’ because Russia.

Finger Lickin’ Good: KFC is testing a fried chicken sandwich with a glazed donut as the bun because apparently the Double Down was too healthy.  Looks like fair food is going mainstream.

Seminal Event: Check out this headline from Newsweek to which I have nothing to add:

Massive Semen Explosion After Blaze Hits Bull Artificial Insemination Facility Firefighters Forced to Dodge ‘Projectiles’

Landmark Links – A candid look at the economy, real estate, and other things sometimes related.

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Landmark Links September 20th – Tectonic Shift

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