Airbnbs in the red, Top 10 Zips with flips and more

A commercial real-estate crisis may be brewing with troubled assets hitting $64 billion, and another $155 billion in the cards link

• Distress Rising: The amount of distressed assets in the US commercial real estate sector has surged to $64 billion, marking a 10% increase in the first quarter of 2023.

• More Trouble Ahead: An additional $155 billion of commercial real estate assets are at risk of becoming distressed due to factors such as higher borrowing costs and the shift towards remote work.

• Retail Properties Under Pressure: US retail properties are feeling the most strain, with nearly $23 billion worth of assets classified as distressed.

Top 10 ZIPS Flipped in Q1 2023 link

• In Q1 2023, there were 72,960 U.S. single-family homes and condos flipped, representing 9 percent of all sales. This is a slight decrease from 9.4 percent in Q1 2022, but an increase from 8 percent in Q4 2022.

• The gross profit on typical transactions increased to $56,000 in Q1 2023, up 4.7 percent from $53,500 in Q4 2022. However, this figure is still down 20 percent from $70,000 in Q1 2022.

• The highest home flipping rates in Q1 2023 were found in Macon, GA (16.8 percent of all home sales), Atlanta, GA (15.3 percent), and Jacksonville, FL (15.2 percent).

Office Landlords Losing 24 Percent of Rent to Concessions for Class A Space link

• Concession Increase: Landlords are losing up to 24% of rent on average to concessions in Class A buildings in Manhattan, a significant increase from the 16.7% during the pandemic.

• Higher Concessions for Class A: While all asset classes are losing an average of 21.3% of rent to concessions, Class A buildings are experiencing a higher loss.

• Tepid Demand: Despite the increase in concessions, the demand for office space remains tepid, indicating that the trend of high concessions is likely to continue in the near future.

Global PropTech: Cross-Border Trends and Technologies link

• North America: PropTech advancements are primarily driven by data analytics and artificial intelligence (AI) applications. These technologies are being used to streamline property searches, predict market trends, and facilitate investment decisions.

• Europe: PropTech is being used to track, monitor, and predict buildings’ and homes’ carbon footprint, supporting Europe’s leading regulations around sustainability and data privacy.

• Latin America: PropTech is addressing the region's affordable housing challenges and improving the mortgage process through digital platforms, AI, and alternative credit scoring models.

Why Airbnb owners are about to Sell link

• The "Airbnb bust" has begun, with some cities seeing a 50% decline in revenue for Airbnb operators due to a slowdown in post-pandemic travel demand and a surge in Airbnb supply.

• The number of Airbnb rentals in America has skyrocketed from less than 200,000 seven years ago to nearly 1 million in 2023, while the number of homes listed for sale has dropped from roughly 1.2 million prior to the pandemic to less than 600,000 today.

• The Airbnb bust is expected to hit urban areas and vacation destinations the hardest, with cities like Phoenix, Austin, and Denver being particularly vulnerable.