LARGE COMPANIES EXPECT OFFICE PORTFOLIOS TO SHRINK

LOOKING FOR CHEAP LAND ? GO WEST

BACK IN THE BLACK : MALL TRAFFIC TOPS PRE-COVID-19 LEVELS

HOTEL CMBS DELINQUENCIES CONTINUE TO DROP

As workers return to office spaces across the country , companies — large and small — must navigate a new leasing environment with different demands and requirements . More than four out of five large firms ( those with more than 10,000 employees ) are expecting to reduce the amount of leased office space in the coming years , according to a recent survey from CBRE . But when it comes to smaller employers , 40 percent of companies surveyed expect to increase office holdings in the near future , compared to 27 percent that indicated they will decrease .

As for achieving a “ normal state of activity ,” large employers expect to reach this somewhat subjective benchmark in 3Q2021 ( 52 percent ) or 4Q2021 ( 35 percent ). While zero large firms claim to be at such a point now , 39 percent of small companies — and 18 percent of medium-sized employers — have returned to “ normal .”

Migration within the U . S . has trended toward the South and West for years , with the Sun Belt proving especially popular . But considering the booming housing market , Arizona is the most affordable state in the U . S . for those who might be looking for undeveloped land with homesites , according to IMA Research . The median price per acre in Arizona is $ 4,164 , with New Mexico coming in at No . 2 at $ 6,000 . The median price per acre of land designated as a homesite in Arizona is also the lowest in the nation , at $ 3,920 , with Colorado following at $ 5,039 .

In IMA ’ s rankings of the best states for homesites in 2021 , Arizona topped the list , followed by North Carolina , Louisiana , Tennessee , and Florida . On the other side of the ledger , Rhode Island ($ 350,374 median price per acre ) proved to be the most expensive state for such land , followed by Massachusetts ($ 333,250 ) and Connecticut ($ 282,925 ).

The obituary for the American shopping mall has been written and rewritten for at least a decade , but new data from Placer . ai shows foot traffic in these centers finally surpassed pre-COVID-19 levels in July . Collecting data from 100 outdoor shopping centers and 100 indoor malls , researchers found year-over-two-year visits increased by 0.7 percent in July — with many expecting the trend to continue through the end of the year thanks to back-to-school shopping and the holiday season .

Unsurprisingly , outdoor shopping centers have had more success in mitigating the effects of COVID-19 , considering the public health advantages offered by openair settings . After hitting a low in year-over-two-year traffic at -19.9 percent in February , outdoor shopping centers saw that figure get out of the red with growth of 2.1 percent in July 2021 . Indoor malls saw some improvement from February ( -28.7 percent ) to July ( -0.1 percent ).

Thanks to nearly $ 1 billion in loan resolutions , the hospitality sector saw a steep decline in its CMBS delinquency rate from 15.3 percent in June to 13.61 percent in July , according to Fitch Ratings . Hotels accounted for $ 958 million of the total $ 1.7 billion in resolution volume for the month , with retail finishing in a distant second with $ 524 million . That eye-catching total was boosted primarily by the the $ 231 million Hammons Hotel Portfolio loan becoming current .

“ The ongoing vaccine rollout portends a rise in both leisure travel and a widespread return of commercial activity , both of which will have a positive net effect on CMBS ,” says Fitch Ratings Senior Director Karen Trebach .

Hotel CMBS delinquencies have steadily decreased since spiking to 18.38 percent in December 2020 . That COVID-19-related high was still slightly below the 21.31 percent delinquency rate in September 2010 in the wake of the Great Recession .

This page , left to right : Luis Alvarez , King Wu , Victor Huang , Vera Rodsawang