Single-Family Rent Growth Continues Gradual Recovery

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Good morning. The single-family rental (SFR) market shows signs of gradual recovery, with rent growth climbing in March. Plus, from 2019 to 2023, rents in ten U.S. cities increased by 20% more than wages.

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• Lending kingdom: Andover Properties launched its lending arm with $300M in funding, offering $600M in self-storage loans as the fledgling sector takes flight.

• Rolling into recession: RealPage warns of a potential ‘rolling recession’ with slowing employment growth in interest rate-sensitive sectors, which may point to deeper economic instability.

• Broken compass: The now-notorious SoftBank Vision Fund reduced its Compass (COMP) stake to 15% after selling $74.5M in shares as part of a larger divestment plan.

• Inflation forecast: JP Morgan’s (JPM) Jamie Dimon warns of persistent inflation amid rising deficits, and seriously doubts that we’re in for a soft landing.

• Real estate Renaissance: Commercial Observer just released its 2024 Power 100 list, honoring top real estate leaders who drove record transactions.

• Capitalizing on growth: Northmarq expands into investment management by acquiring Morrison Street Capital, boosting its assets to $5.4B across diverse real estate sectors.

• Too damn high: Slightly more than 1 in 3 NYC apartments is currently considered affordable for tech workers, while entry-level professionals can afford just 2.1%.

• Senior success: South Florida developer Terry Salzman secured site plan approval for a 6-story, 245-unit senior living facility in Weston designed by Synalovski Romanik Saye LLC.

• Houses all day: Multifamily rents cooled by 0.8% in April, with the national median rent at $1,396. Meanwhile, single-family rents went up by 3.4%.

• Rate hike headache: Crystal Asset Management is behind on a $49M loan for a Riverside County property, as rising rates squeeze profits.

• New wind, old deal: Four Winds Real Estate bought The Knox and its 110 units in Murray Hill for $68M. The property had been used since the pandemic as a temporary housing provider.

• Storage loan: Self-storage developer 1784 Holdings, led by Shane Albers, secured $36M in bridge financing for a Life Storage (LSI) facility in LA.

• Futuristic facility: A new JV between Hines (ZHGIIX) and Oaktree broke ground on a 267KSF advanced manufacturing facility in Fremont, CA.

• Garden State glow-up: Matrix Development Group secured $93M in financing for a nearly 782KSF industrial project in Budd Lake, NJ.

• Institutional confidence: ERS of Texas plans to invest $200M in industrial real estate funds in fiscal 2024 to balance its CRE portfolio.

• Balancing the scales: Two Amazon-anchored (AMZN) warehouses totaling nearly 3MSF have hit the market for $225M, with a 10.2-year lease term.

• Happier hours: Downtown restaurant and bar traffic during happy hours now exceeds pre-pandemic levels, despite ongoing remote work preferences.

• Retail rebound: TZ Capital paid $180M for a Madison Avenue property from Thor Equities, or 35% less than the property’s 2013 sale price.

• Welcome wisdom: Weston developer Terry Salzman secured approval for a 6-story, 245-unit senior living facility on Racquet Club Road.

• Thanks, Joe: Trader Joe's plans to open a full-service grocery store in DC’s Monroe Street Market development, filling a neighborhood gap.

• Location navigation: WeWork nears the end of its bankruptcy period, sorting leases across 170 locations nationwide and keeping most spots in major markets.

• Delinquent deluge: The Trepp CMBS Delinquency rate rose 40 bps to 5.07% in April, driven by large newly delinquent loans, particularly in the office, retail, and lodging sectors.

• Rent standoff: Santa Monica's Third Street Promenade is staring down a 25% vacancy rate, with just 73 of 97 storefronts occupied, as landlords resist lowering rents.

📈 CHART OF THE DAY