Key-Take Aways
• CoStar conducted a ‘return to work’ survey of 2,500 companies of various sizes.
o 8% of employees are back in the office
o 26% of employees think they will be back in the office by years end.
o Only 54% think they will be back in the office by July 2021.
• High-end multi-family is suffering the most with rents down 2% since March 2020. Substantial conversions from renters to owners due to low interest rates. Ironically, workforce housing rents are UP 2%.
• DC’s fiscal year budget was passed. Rainy day fund was used to plug up hotels/shortfalls. Neighborhood prosperity funds are in place to assist retailers and restaurants.
• DC remains in Stage 2 and likely won’t enter Stage 3 until after the election.
• Industrial remains white hot – lack of supply is major constraint and keeping rents and values up.
• Market isn’t seeing distressed assets yet – likely one to two years out. Larger owners are waiting, will hold assets; private investors are selling
• 1031 Exchanges are an economic stimulus – a multiplier. One deals generates downstream work for everyone involved (banking, brokerage, legal, construction, accounting).
• The vast majority of 1031 Exchanges average $500,000 – Middle America does most of these deals, it’s not just the wealthy.