REAL ESTATE
Foreclosures Surge As Some Investors Call Bottom, Others Say Pain Is Just Starting
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, according to MSCI data first reported by The Wall Street Journal. 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. “Lenders are more dispassionate about values and that’s a sign of a cycle moving [toward a bottom],” Matt Pestronk, co-founder of development firm Post Brothers, told the WSJ. However, loan maturity dates creeping up indicates borrowers, especially with debt tied to office buildings, have more pain in the forecast. More than $94B of commercial real estate debt was in distress at the end of June, with another $201B at risk, according to MSCI data reported by Bloomberg.
https://www.bisnow.com/national/news/capital-markets/foreclosures-surge-as-some-investors-call-bottom-others-say-pain-is-just-starting-125277
Metro Denver Among Cities With Highest Concentration Of CMBS Distress – paywall
Commercial properties in Denver have entered delinquency at a higher rate than the national average, with 10.5% of the metro area’s CMBS-financed buildings owing back payments on their loans, according to Trepp. In the top 25 metro areas in the country, the delinquency rate is less than 6.2%. Office properties make up the biggest percentage of distressed properties in metro Denver, with 29.7% of office buildings in delinquency, according to Vivek Denkanikotte, research associate at Trepp. That is the third most among the top 50 metros. The biggest culprit is remote work, according to Thomas Taylor, a senior researcher for Trepp.
https://www.bisnow.com/denver/news/capital-markets/metro-denver-among-cities-with-highest-concentration-of-cmbs-distress-125045
REAL ESTATE AND MOBILITY
Our Cities Need More People Near Frequent and Rapid Public Transport
One of the highest-ranking metropolitan areas for People Near Frequent Transport in the Atlas is Bogotá, Colombia, which has been widely recognized for its commitment to comprehensive and sustainable transport, particularly with its landmark TransMilenio rapid transit system. A two-time recipient of the Sustainable Transport Award, the Atlas’ 2024 data finds that nearly 85% of people in the Bogotá/Soacha area live within a walkable distance to a transport stop with frequent service. This is all the more impressive given that the region is home to over 11 million people and Bogotá proper has one of the highest population densities globally. In fact, cities like Bogotá that are denser and more compact make a case for the cost-effectiveness of prioritizing quality and rapid public transport services over private vehicles.
https://itdp.org/2024/07/24/our-cities-need-more-people-near-frequent-and-rapid-public-transport/
Navigating High-Density Development Under HB24-1313: The Transit Oriented Development Act
The Denver Metropolitan/Front Range area has been in nonattainment status under the Clean Air Act since 2016. To achieve compliance with national air quality standards, Colorado must reduce household driving by 20 percent by 2030. Consequently, Colorado has invested more than $6 billion in constructing the Regional Transportation District’s (RTD) FasTracks rail and Bus Rapid Transit (BRT) system, with plans to finalize four new BRT corridors by 2030. Yet, despite these investments, transit ridership in Colorado lags behind peer agencies in Minneapolis, Portland, and Seattle, which moves two to four times more people per service mile than RTD. Lawmakers attribute this lag in ridership, at least in part, to a lack of density near these transit lines. According to 2020 census block housing unit data, over 90 percent of rail stations and 84 percent of BRT and frequent bus corridors in Colorado average less than 15 housing units per acre within walking distance. Researchers generally agree that a minimum density of 15 housing units per acre is necessary to support frequent transit services. Additionally, studies show that residents living in TOCs drive 50 percent less than those living in the suburbs.
https://www.ottenjohnson.com/news/navigating-high-density-development-under-hb24-1313-the-transit%e2%80%91oriented-development-act/
Denver’s Historic Train Station Just Got Another Elegant Makeover
Their overarching goal? To freshen up the bustling landmark while paying homage to its 143-year-old history. More than 10,000 people pass through Union Station daily, and over the last decade, the building’s managers have learned a lot about how people actually use the space—whether that’s downtown professionals grabbing a quick latte at Pigtrain Coffee Co., commuters hopping on a regional bus, travelers arriving from the airport, or sightseers passing through on Amtrak’s California Zephyr train. “It was time for an update,” says Ed Blair, the area general manager for Sage Hospitality, which manages the station. The most recent renovation directed much of its efforts toward the Crawford Hotel, which was one of just three Denver hotels to be awarded a prestigious “one key” rating from Michelin in its first-ever hotel guide this spring.
https://www.msn.com/en-us/travel/news/denver-s-historic-train-station-just-got-another-elegant-makeover/ar-BB1qUxo8?ocid=BingNewsVerp
City of San Diego using eminent domain to build bike lanes
The City of San Diego is initiating eminent domain action against landowners in La Jolla so the city can install bike lanes on Gilman Drive. The land seizure will allow the construction of bike lanes separated from vehicle traffic. City staff members have successfully negotiated with four landowners near UCSD to buy their property, which will enable the city to install Class IV bike lanes on both sides of Gilman Drive.
https://www.cbs8.com/article/news/local/city-using-eminent-domain-to-build-bike-lanes/509-b4ccbbab-eedf-44ba-bede-08c8aef789d0
AFFORDABLE HOUSING
How much are rents going up? See how prices have changed in your area.
Though rent prices nationally have climbed about 19 percent since 2019, prices increased only about 1 percent in the past year, according to a Washington Post analysis of rent data from CoStar Group. That pace is down considerably from the steep price growth seen in 2021 and 2022. The long-awaited slowdown comes as more new homes are finishing construction and finally hitting the market. But it also coincides with a presidential election campaign where housing costs dominate many Americans’ budgets and are souring people’s moods on an otherwise strong economy. The Biden administration has proposed a plan to cap some rent increases at 5 percent each year and make housing more affordable overall. But it’s too soon to tell whether that pitch will work — or whether the broader cool-down will stick. Former president Donald Trump, this year’s Republican presidential nominee, has mainly proposed reducing inflation and cutting regulations to address housing issues.
https://www.washingtonpost.com/business/interactive/2024/rent-average-by-county-change-rising-falling/
Zoning reform made way for an explosion of smaller homes in California. Will it work elsewhere?
Unsurprisingly, other states want in on the action and are considering their own zoning reforms to limit local restrictions on ADUs. A multibillion dollar Massachusetts bond bill, for example, is making its way through the state legislature and would, among other initiatives, make accessory dwelling units allowable by right across the state. A few weeks ago, the Rhode Island General Assembly approved legislation allowing property owners to build ADUs while stipulating those units cannot be used as short-term vacation rentals. In May, Colorado approved legislation that requires cities with a population of more than 1,000 to allow ADUs on the properties of single-family homes.
https://www.route-fifty.com/infrastructure/2024/07/zoning-reform-made-way-explosion-smaller-homes-california-will-it-work-elsewhere/397942/
Developer seeks to build affordable Denver apartments with modular construction that costs 25% less
“We hope to do a lot more of these,” Adam Berger with Adam Berger Development told the crowd gathered to see modules put into place on West Holden Place, a 77-unit mixed-income development. Using a modular approach costs 20% to 25% less than traditional methods and shaves at least 40% off of construction times, Berger said. Those savings, when combined with affordable housing funds from Denver, the Colorado Housing and Finance Authority and the Colorado Division of Housing, will be enough to make rents on most of the units affordable to middle-income renters earning between 80% to 120% of Denver’s median income. Although affordable housing has historically focused on building for those earning 60% of area incomes, the problem has reached crisis levels even among people in middle-income ranges, said Cris White, CEO of CHFA.
https://www.denverpost.com/2024/07/11/sun-valley-apartment-construction-denver-affordable-housing/
An affordable housing solution hidden in plain sight: Libraries
The economics of building subsidized housing in America depends on land that costs little or nothing, which almost inevitably means building on public land. But having sold off much of what it owned, New York no longer has a large inventory of big, usable lots for deeply affordable projects, at least not in parts of the city linked to parks, grocery stores and public transportation, where residents want to live. The city does own library branches, however. And they occupy public land in the heart of many neighborhoods. Branches in cities like New York, some of them more than a century old, are often poorly configured for current demands, and ripe for replacement. Library systems have become some of this country’s most venturesome patrons of new architecture as a result.
https://www.nytimes.com/2024/07/17/headway/an-affordable-housing-solution-hidden-in-plain-sight-libraries.html
The Incredible Shrinking U.S. Home—Including One Standard Feature That Is Fading Fast
Most homebuyers today simply don’t need as much space for their stuff, according to Bruce Ailion, a real estate agent and attorney with Re/Max Town and Country in Georgia. “Years ago, we had televisions that were the size of large moving boxes, and we had stereo equipment with a turntable, tape player, and speakers the size of 10-year-olds,” Ailion says. “Today, the TV is flat against the wall, and all our music is in a smartphone in our back pockets.” According to a recent U.S. Residential Architecture and Design survey, new homes will continue to get smaller. Jenni Nichols, vice president of design for John Burns Research and Consulting, who conducted the survey, says that 43% of production residential designers worked on smaller projects last year than the year before. “And 27% of production residential designers reduced the size of projects they designed last year to save on costs,” she says. “Builders are trying to build homes that people can afford to buy since people have less buying power than they used to.” In the survey, architectural residential designers said they were four times more likely this year to plan for smaller homes than larger ones.
https://www.realtor.com/news/trends/americas-homes-are-shrinking-one-standard-feature-is-disappearing/
MOBILITY
Urban Delivery Hubs Present Solutions to Final-Mile Shipping
The basic idea: A hub is established near the outskirts of a specific urban area, and longhaul drivers with goods destined for that area bring them all the way to that hub — bypassing regional distribution centers and cross-dock facilities along the way — then leave their haul, even if it’s the entire trailer, for the local delivery partner to take over for final-mile. The UDH is designed to save shippers money because final-mile delivery only gets involved in the metro area of the final destination, whereas it might cross three or four states coming from a regional distribution center.
https://www.ttnews.com/articles/urban-hubs-final-mile
The Forgotten History of Light Rail
Rather than being a prescriptive recipe for the future of transit service design, the true lesson of light rail’s history has to do with the nature of transit systems. The core insight of San Diego and Edmonton’s rail planning was that bus and rail networks must be planned together and then closely coordinated. Put differently, the two cities’ success should underscore to us that transit is a business that lives and dies on its ability to build networks. No single rail line or frequent bus service can ever unlock broad-based transit ridership gains; the structure of urban travel demand is almost never linear. Connectivity is key, and as American cities confront budget crises, changing travel demand patterns, and the overwhelming pressure to do something in the face of transportation’s contributions to climate change, it is past time for us to fall back in love with network planning.
https://homesignalblog.wordpress.com/2024/07/12/the-forgotten-history-of-light-rail/
