Real Estate Business Newsletter | August 2024

COMMERCIAL

Trimont will acquire Wells Fargo’s commercial mortgage servicing (CMS) business. This acquisition will bring roughly $475B in loans to Trimont, positioning the firm as the largest loan servicer in the U.S. once the deal closes in early 2025, as Trimont’s U.S. portfolio will reach $640B in loans, representing 11% of the country’s CRE lending market.

Listings for condos in Florida are surging as new regulations requiring regular checks on older properties come into force and homeowners association (HOA) expenses continue to rise. Buildings already 30 years or older must have inspections done before the end of the year—meaning that a crucial deadline is looming for many condo owners. Recently, there were 20,293 condo listings in the Palm Beach, Broward and Miami-Dade counties, in the second quarter of 2024, up from 8,353 in the same period last year. Nearly 90% of those units are in buildings over 30 years old.

Homes.com, the residential listing platform, touted 148 million average monthly unique visitors in the second quarter, an annual increase of 73%. The gains followed the company’s launch of their $1 billion advertising campaign earlier this year, which included four commercials during the Super Bowl. Its traffic numbers still trail behind the 230 million that Zillow reported last quarter.

INVESTING

Rent concessions have risen in 40 of the 45 largest U.S. metros, with one in three rentals offering incentives like free rent or parking. The Zillow Observed Renter Demand Index has fallen 23.3% since July 2023, driven by a surge in new apartment supply rather than declining demand. Despite concessions, affordability remains a challenge, with typical rents in July at $2,070, up 3.4% YoY.

LENDING

During the second quarter, $20.5B worth of office, multifamily and other property was seized, up 13% from the first three months of the year and the highest quarterly figure in nearly a decade. In times of distress, such surges of foreclosure activity have historically been followed by market resets. Lenders who don’t want the properties on their books, sell the real estate and set new comparisons for the rest of the market to adjust to.

RETAIL

Ace Hardware plans to invest $1B to launch the Elevated Ace, which includes new showrooms, new product assortments and an outdoor space with plants and grilling demos. This is like Dick’s Sporting Goods, who rolled out its own concept called Dick’s House of Sport, featuring its normal merchandise as well as batting cages, golf simulators and rock walls.

Dallas-Fort Worth is now the second-largest financial services hub in the U.S., following NYC. Major financial firms, including Goldman Sachs and JPMorgan Chase, are attracted to “Y’all Street” by lower taxes, affordable housing, and a welcoming business climate.

Irvine, CA has become the hottest residential market in the nation. Over the past year, the price of a median priced home has jumped 20.8% to $1.56 million, the highest run-up in the U.S., based on Zillow reporting.

For college graduates looking for entry-level jobs, some smaller cities, especially in the South, stand out for their brisk hiring, good salaries and affordability. Raleigh, NC; Austin, TX; Baltimore, MD; Atlanta, GA; and Charlotte, NC, rank as the top five most promising locations to find work for newly minted college graduates.

The rich can’t sell their art, so they’re borrowing against it.

we hope this information helps keep you up to date on the real estate market. Please call or email if you have any thoughts. I would love to hear from you!

Cell: 310-383-6239

Email: Andy@AndyWatkinsJD.com

Best Regards,

Andy