Three Economists’ Words of Caution
MIT Center for Real Estate chair (since May) Dennis Yeskey (right, with UBS’s Jonathan Woloshin), told NYCREW last week that ’14 will be almost as great as ’13, and ’15—well, nothing goes up forever. The industry is in a “pre-bubble,” he says. Development is up in all product types, and the good macros like GDP and retail sales outweigh the bad. But six years of expansion is rare. Jonathan recovered from someone telling him he looks like Mayor de Blasio to caution the audience about the housing market. Speaking at UBS’s office at 1285 Ave of the Americas, he said the country lost $7 trillion in the housing bust, and much of that came from Millennials’ pockets, so no one can blame them for being gun-shy about the ownership society.
Studley’s Heidi Learner compared Houston and NYC’s office pipelines. Houston has 11M SF under construction (75% pre-leased) and NYC 11.5M (47% pre-leased). The remaining space is equal to 1.1% of the total office stock in each market, she says, but the big difference is in each city’s ability to absorb. Houston sponged up 1.3% in the past 12 months and NYC only 0.6%. Touche, Texans. Take it easy on us, though. Only you can sympathize with what it's like to be burned by A-Rod.