Multifamily Sector Faces Mounting Pressure From Prolonged Government Shutdown

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• Dividend disconnect: Blackstone Mortgage Trust is on track to invest $7B in 2025, yet its undervalued stock has prompted $100M in buybacks.

• Debt divide: The $4.8T CRE debt market is seeing diverging lender behavior, with banks growing cautiously while life insurers and securitized lenders ramp up exposure.

• Rule bypass: Trump sidestepped preservation norms by demolishing the White House East Wing without public review. 

• Cautious capital: CRE investors are playing it safe amid tariff, labor, and rate uncertainty, with cautious optimism driven by tax reform and improving liquidity. 

• Policy pushback: Developers say New York’s 485x tax break is stalling housing production, with its $40/hour wage rule driving a surge in 99-unit projects and sidelining large-scale development.

• District rising: Tampa’s historic Ybor City is transforming, as the 50-acre Gasworx project tops off a new office and adds apartments, retail, and revived warehouse space.

• Housing mismatch: Despite talk of a housing shortage, the U.S. housing crisis is more about misalignment than it is about raw unit count.

• Investor map: Multifamily investment is gaining steam in 2025, with Nashville, Indianapolis, and Columbus topping the charts. 

• Data center effect: Rent prices are rising fastest in Midwestern tech hubs where growing data center development is tightening supply and driving up demand. 

• AI landlords: NYC landlords are turning to AI to cut staffing costs and meet rising tenant service expectations.

• Housing wave: NYC greenlit three major neighborhood plans expected to deliver over 27,000 new homes citywide. 

• Growth leader: San Francisco leads the nation in rent growth with a 7.5% annual increase, driven by tight occupancy, low new supply, and revived tech-fueled demand. 

• Foreclosure freeze: A&E Real Estate halted foreclosure on a 1,268-unit Queens portfolio with a $165M loan modification.

• Pipeline pause: Despite easing costs and lower rates, Houston multifamily developers remain cautious, with starts near 15-year lows.

• Logistics landscape: Industrial real estate remains active despite cooling construction and rising vacancies, with Southern rent growth and new tax policies reshaping the sector.

• Adaptive infrastructure: With power access now a top priority, developers are creatively retrofitting older buildings into data centers to meet surging AI-driven demand.

• Tech tenancy: Therma leased a full 213K SF industrial building in San Jose, highlighting strong demand for power-equipped facilities.

• Capacity surge: Equinix boosted its developable capacity by nearly 50% last quarter, as the data center REIT posted higher earnings, with a goal to double total capacity by 2029.

• Amenity magnet: Comstock’s Reston Station, a 10M SF mixed-use, transit-oriented development near D.C., is luring tenants with luxury amenities and new offices. 

• Drive-thru deal: CenterSquare Investment Management acquired a six-property, Starbucks-anchored retail portfolio spanning NC, FL, and IL.

• SNAP lapse: A potential lapse in SNAP benefits could severely impact millions of low-income Americans and disrupt grocery retailers like Walmart, Kroger, and Dollar General.

• SoHo sale: Benenson Capital bought 542 Broadway, a landmarked SoHo retail condo leased to New Balance, for $23M. 

• Bitter brew: Starbucks reported a sales uptick for the first time in two years but saw profits plunge 85% as it closed 627 stores and laid off 900+ workers.

• Brookfield boost: Brookfield completed a $1.3B refinancing of 660 Fifth Avenue, capping $35B in real estate financing year-to-date. 

• Mixed momentum: CoStar now forecasts office growth in 2026, while VTS reports Q3 demand rose 16% YoY but dipped 4% from Q2. 

• Strategic turnaround: AmTrust RE is acquiring 260 Madison Avenue for $217M, with plans to invest up to $70M to boost the office property's NOI.

• Hudson refi: BXP and Moinian refinanced 3 Hudson Boulevard with a $108M loan from JPMorgan after defaulting on prior debt. 

• REIT confidence: Piedmont and Highwoods reported strong office leasing rebounds in Atlanta, but CoStar warns national momentum may falter due to rising white-collar layoffs. 

• Leasing record: BXP hit its strongest Q3 leasing since 2019 and is focusing on East Coast growth while offloading noncore assets.

• Arena showdown: The Dallas Mavericks and Stars are suing each other over control of the American Airlines Center as both teams prepare to leave the arena when their leases end in 2031.

• Costly loyalty: Hotel loyalty program fees rose 3.9% in 2024, outpacing revenue and occupancy growth as loyalty members contributed more to bookings.

• Micro invasion: IHG is bringing its European urban micro hotel brand, Ruby Hotels, to the U.S. as it eyes top city-center markets for new-builds, conversions, and adaptive reuse projects. 

• Vegas rebound: MGM Resorts anticipates a rebound in Las Vegas after a tough summer marked by pricing backlash, softened demand, and a dip in revenue.

📈 CHART OF THE DAY