Random notes from Real Estate Conference at the Dallas Fed on May 8:
• Residential active listings down 35% from 2019. New homes are 30% of the inventory.
• DFW is top market by housing starts (45,000 units annual run-rate).
• Rent-to-income peaked in 2021 and is improving.
• 4 million units short on single family rentals nationwide.
• 5 Ls of builder activity: Land, Labor, Lumber, Laws, Lending• Labor hoarding: companies retain workers due to labor shortage, but cut hours to manage costs.
• Institutional have increased allocations to alternatives (PE, private credit, real estate) from 3% to 10%+.
• US housing market is $48T (S&P500 is $42T by comparison).
• Gen Z (recent graduates) grew up during COVID and don't want to work from home (yet).
• Industrial real estate still strong, especially <100k sqft (96% occupancy in Sunbelt).
• Only 300-500 malls will survive nationwide.
• E-commerce is 16% of total retail (up 3x since pre-COVID). When a new retail store opens, online sales in the area go up. In-store sales don’t always justify the rent, but the total sales do. Retailers are using the space differently: last mile storage, logistics (retail needs more space for loading, warehousing, curbside pickup).
