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Commercial property deals in the US are starting to pick up at deep discounts

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Re: Commercial property deals in the US are starting to pick up at deep discounts

#201

Post by AnthonyMouse »

dexterdog wrote: post #199
AnthonyMouse wrote: post #52

Earlier quoted context omitted.

Right, and the solution is to have them written by someone else, e.g. at the state rather than local level.

Do you think those same people don't have the same kind of influence at the state level? If anything they have even more.

In order to have a vote in local elections you have to live there. Then all the people who own property there vote for things that make housing scarce and increase their property value. The people who want to live there but can't because they can't afford it thereby don't get a vote there and can't vote to make it more affordable. But they do get a vote at the state level.

Re: Commercial property deals in the US are starting to pick up at deep discounts

#202

Post by Macha »

AnthonyMouse wrote: post #175
Macha wrote: post #117

Earlier quoted context omitted.

There was plenty of homelessness in the era of tenements too.

If you have 1000 homeless and 2000 in tenements and then you ban the tenements and kick their former residents into the street, you have not done either of them a favor.

However, we're not talking about a situation where tenements are allowed and now disallowing them (which I agree would cause a shock in the market, but probably disagree about how long term it is).

People who's lives are otherwise OK apart from an inability to afford housing tend to have support networks which provide them a better fallback option than living on the street, be that living with family, couch surfing, etc. Consequently, they tend not to get included in official homeless figures. The people who do get included in official homeless figures are going to have issues providing landlord the reassurances they need to rent to them, such as prior references, proof of employment, etc. etc. This is going to be true no matter how substandard the housing on the market is.

Instead, allowing tenement-tier housing is likely to lead to a reduction in supply of what is now the bottom tier, as landlords of that tier of property reorganise existing properties to cram more people in, reducing standards of living.

Re: Commercial property deals in the US are starting to pick up at deep discounts

#203

Post by xionplean »

mguerville wrote: post #164
chollida1 wrote: post #120

Earlier quoted context omitted.

THis is a nice thought but rarely happens regardless of zoning. Office buildings floor plates and residential floor plates aren't really compatable. Office buildings have most of their floor plates not around windows, where are residential needs some light. Also water, and sewer need to be retrofitted. The one building that was a successful conversion that I know of cut out the center of the building to create a ligh…

In Europe a lot of old buildings do this conversion easily, it's really more a problem with modern construction (and hence most American buildings) where the entire design is extremely skewed towards one use case vs the other

In the US, the problem is we have built large offices around the idea of a central elevator shaft then the plumbing and bathrooms are running up and around the shaft. It makes perfect sense for a large multi story office.

You would have to design these weird apartments though that are like a thinly sliced pizza with no central area. Just a long hall of connecting rooms.

Or to retro fit all you have is the foundation and sides, everything else is basically wrong and cost wise you have less than nothing. It is just cheaper to start over and not have to undo all the wrong aspects.

We are mostly in denial in the US that there is going to be a ton of empty, useless buildings along with many regional banks going out of business.

Re: Commercial property deals in the US are starting to pick up at deep discounts

#204

Post by lazyasciiart »

AnthonyMouse wrote: post #50
lazyasciiart wrote: post #7

Earlier quoted context omitted.

Agreed. “Nobody lives in cities any more, they can’t afford the rent there”.

> “Nobody lives in cities any more, they can’t afford the rent there”. This is literally what happened. The population increases but building higher density (i.e. cities) is prohibited or made prohibitively expensive so instead the suburbs get built and people live there instead because the city doesn't have housing for them. Then the city becomes less attractive because the advantage it would otherwise have over the…

If life were that simple, then there wouldn't be anyone living in a housing unit that somebody else would pay a higher rent for. It isn't that simple because housing is a very strongly regulated market with poor liquidity, and there are many many people living outside cities who would be willing to pay more than current occupants inside cities. Cities have not become less attractive.

Re: Commercial property deals in the US are starting to pick up at deep discounts

#205

Post by ByQuyzzy »

addicted wrote: post #5
ByQuyzzy wrote: post #3

[flagged]

Except people continue to move to cities outside the U.S. Even in the U.S. to the extent they aren’t it’s because rents continue to rise dramatically as cities are not keeping up with the demand for housing in their urban cores. Additionally, cities getting more crowded does not imply they should get more dangerous. In fact, during the pandemic crime increased in many cities such as NYC, SF, etc as the numbers of peo…

Should and are, two different things. Cities are getting more dangerous, this is a fact. But "should" they? It's not a real question.

Please though, enjoy, try to attract new residents. I'm sure eventually the commercial real estate people and rental property owners alike will crack down on crime. Or maybe go bankrupt first.

Re: Commercial property deals in the US are starting to pick up at deep discounts

#206

Post by IncreasePosts »

infecto wrote: post #126
xyst wrote: post #91

> The magnitude of the crisis is up for debate. Treasury Secretary Janet Yellen said last week that losses in commercial real estate are a worry, but that the situation is “manageable,” a similar sentiment expressed by Fed Chair Jerome Powell in a 60 Minutes interview on Feb. 4. Others have more dire outlooks, with real estate investor Barry Sternlicht predicting $1 trillion in office losses. Fuck man. Another ‘08 si…

Hard to trust a talking head investor who is just advancing his position/holdings.

Sure, but at least remember that the position came after his beliefs on the market. He wasn't assigned a random position and then needs to sell it - this is what he believes, and he put his money where his mouth is.

Re: Commercial property deals in the US are starting to pick up at deep discounts

#207

Post by AnthonyMouse »

lazyasciiart wrote: post #204
AnthonyMouse wrote: post #50

Earlier quoted context omitted.

> “Nobody lives in cities any more, they can’t afford the rent there”. This is literally what happened. The population increases but building higher density (i.e. cities) is prohibited or made prohibitively expensive so instead the suburbs get built and people live there instead because the city doesn't have housing for them. Then the city becomes less attractive because the advantage it would otherwise have over the…

If life were that simple, then there wouldn't be anyone living in a housing unit that somebody else would pay a higher rent for. It isn't that simple because housing is a very strongly regulated market with poor liquidity, and there are many many people living outside cities who would be willing to pay more than current occupants inside cities. Cities have not become less attractive.

> If life were that simple, then there wouldn't be anyone living in a housing unit that somebody else would pay a higher rent for.

This is essentially what happens in the absence of bad laws. If someone else would pay more then the landlord increases the rent. The occupant might still choose to stay and pay the higher rent, but then they're not paying less than the other person would. This is all fine and good because high rents are the market incentive to build more housing, which is the thing that lowers them again. The problem is reintroduced when you have other bad laws that inhibit housing construction; you have to get rid of both kinds of bad laws to not have a bad time.

> housing is a very strongly regulated market with poor liquidity

This is all the more reason people don't want to move into a city where rents are high. Then they'd be stuck there paying the high rents indefinitely until they suffer the cost to move again.

Re: Commercial property deals in the US are starting to pick up at deep discounts

#208

Post by AnthonyMouse »

Macha wrote: post #202
AnthonyMouse wrote: post #175

Earlier quoted context omitted.

If you have 1000 homeless and 2000 in tenements and then you ban the tenements and kick their former residents into the street, you have not done either of them a favor.

However, we're not talking about a situation where tenements are allowed and now disallowing them (which I agree would cause a shock in the market, but probably disagree about how long term it is). People who's lives are otherwise OK apart from an inability to afford housing tend to have support networks which provide them a better fallback option than living on the street, be that living with family, couch surfing,…

> However, we're not talking about a situation where tenements are allowed and now disallowing them

It's not the shock which is the problem. The set of people who could afford the tenements but can't afford larger units are not going to become able to afford them just because some time has passed.

> People who's lives are otherwise OK apart from an inability to afford housing tend to have support networks which provide them a better fallback option than living on the street, be that living with family, couch surfing, etc.

That just means the problem is bigger than the official numbers suggest. And mooching off your friends and family often creates resentment and friction, which leaves those people at risk of falling into the other group as soon as they have a falling out unless you can get them into their own stable housing.

> The people who do get included in official homeless figures are going to have issues providing landlord the reassurances they need to rent to them, such as prior references, proof of employment, etc. etc. This is going to be true no matter how substandard the housing on the market is.

That's not true. Lower cost units require less in the way of references because the landlord has less at risk when the value of the unit is lower, and has more trouble finding someone who wants to live in it.

You can also reduce the prevalence of these requirements by not making it arduous for landlords to evict non-paying tenants, which is the primary reason they care about any of those things now.

> Instead, allowing tenement-tier housing is likely to lead to a reduction in supply of what is now the bottom tier, as landlords of that tier of property reorganize existing properties to cram more people in, reducing standards of living.

This is not a reduction in standard of living for the people who were previously homeless or the people who choose to live in those new units in exchange for lower rent. Having a smaller apartment in exchange for lower rent is not inherently a reduction in standard of living, and generally wouldn't be what someone chooses unless it isn't.

The people who want to pay the existing rents for the type of units they're in now would be free to do so, if not get those units at a lower rent because the tenements have increased the number of available housing units and relieved some of the demand pressure on existing units.

Re: Commercial property deals in the US are starting to pick up at deep discounts

#209

Post by lazyasciiart »

AnthonyMouse wrote: post #207
lazyasciiart wrote: post #204

Earlier quoted context omitted.

If life were that simple, then there wouldn't be anyone living in a housing unit that somebody else would pay a higher rent for. It isn't that simple because housing is a very strongly regulated market with poor liquidity, and there are many many people living outside cities who would be willing to pay more than current occupants inside cities. Cities have not become less attractive.

> If life were that simple, then there wouldn't be anyone living in a housing unit that somebody else would pay a higher rent for. This is essentially what happens in the absence of bad laws. If someone else would pay more then the landlord increases the rent. The occupant might still choose to stay and pay the higher rent, but then they're not paying less than the other person would. This is all fine and good becaus…

Entertaining to see someone willing to assume an actual free market of spherical housing, but not applicable enough to the real world to be useful outside a 101 class.

Re: Commercial property deals in the US are starting to pick up at deep discounts

#210

Post by reaperman »

Someone wrote: post #177
chollida1 wrote: post #120

Earlier quoted context omitted.

THis is a nice thought but rarely happens regardless of zoning. Office buildings floor plates and residential floor plates aren't really compatable. Office buildings have most of their floor plates not around windows, where are residential needs some light. Also water, and sewer need to be retrofitted. The one building that was a successful conversion that I know of cut out the center of the building to create a ligh…

> Office buildings have most of their floor plates not around windows That’s not the case everywhere. In ‘Europe’ (I don’t know what set of countries this applies to), workers must be able to get sufficient natural daylight. https://www.kingspan.com/ie/en/knowledge-articles/what-is-en... : “To comply with the minimum recommendations for indoor spaces lit with windows or curtain walling, over 50% of the space must ach…

USA has no natural light requirements. Completely windowless offices can easily meet the standards here with no additional considerations.
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