CRE Trends per Moody’s, Blackstone sells Motel 6 for $525M

In partnership with

-

Simplify your fundraising process

Close more deals, faster

• Raise more equity

• Track soft commitments

• Accelerate your fundraising processes

Learn more

New here? Join the newsletter (it's free).

New-home sales dip in August despite easing mortgage rates and listing prices link

• New-home sales dropped by 4.7% in August 2024, despite falling mortgage rates and prices. Sales in the South grew 2.7%, while the Northeast saw a 27.3% decline month over month.

  

• The median sales price of new homes in August 2024 decreased to $420,600, down 2% from July. Builders have been prioritizing more affordable homes, with 18% of new homes selling for under $300,000.

• Inventory of new homes increased to 7.8 months of supply as construction outpaced sales. The share of completed, move-in-ready homes also rose, with 372,000 sold in August.

The times they are a-changin’ as more markets clear their hurdle rate link

• Industrial markets were the only sector to exceed the '1' hurdle rate, thanks to yield expansion between 2022-2024. Value loss in other sectors is stabilizing, making more markets investable today.

• The office sector still struggles, with high vacancy rates and delinquencies keeping projected returns below the hurdle rate. Investors must take a precise, market-specific approach to offices.

• More markets are now entering territory where projected 10-year returns meet or exceed their required hurdle rates. This shift indicates improving conditions for investment across multiple sectors.

Luxury brands flock to prime corridors and Class A malls link

• U.S. luxury retail sales are projected to reach $77.3 billion in 2024, even though the U.S. share of the global luxury market declined by 4% in 2023. Growth is expected to normalize at a 1.9% annual rate through 2028, when sales could surpass $82 billion.

• From July 2023 to July 2024, luxury brands leased over 360,000 square feet of retail space, with 48.5% of openings in malls and 41% on select prime streets. Prime retail corridors attracted 68% of street store leases, showing strong demand for high-visibility locations.

• New York and Los Angeles led U.S. luxury openings, accounting for 37% of new stores. Madison Avenue and SoHo in NYC and Rodeo Drive in Beverly Hills were key hot spots for these brands.

Blackstone sells Motel 6 for $525M link

• Blackstone sold Motel 6 and Studio 6 to Oyo's parent company, Oravel Stays, for $525 million in an all-cash deal. The transaction is expected to close by the end of 2024.

• Blackstone had purchased Motel 6 in 2012 for $1.9 billion and converted it into a franchise model, generating over $1 billion in profit during its ownership. The sale is considered a major win for investors, more than tripling their initial capital.

• Oyo operates 320 hotels across 35 U.S. states and plans to add 250 more by the end of the year. This acquisition helps strengthen Oyo’s growing U.S. presence, with Studio 6 catering specifically to extended-stay customers.

CRE Trends per Moody’s

Homes sales are climbing with lower mortgage rates

Top 10 States with Underwater Mortgages

Buying beats renting in 22 major U.S. cities: Zillow

Uncertainty for Self Storage Sector in the Second Half of 2024: Yardi Matrix

Life sciences construction benchmarks & trends 2024

New CRE data per Moody’s

Ranked: Average GDP Growth Rates for the Next 10 Years, by Country

Two giant redwood wine barrels.

(I’ll leave it at that)

Link to the listing

That's all folks. Let me know what you think of the email. Quite a lot went into it. If these emails aren't for you anymore, you can unsubscribe here.

Cheers,

Vidit

 Instagram

P.S - Read past newsletters here