Actual Property Quotes of the Week for March 12, 2023
The quote of the week is just four words, but they say so much: “The Fed is killing us.”
Berkshire Hathaway HomeServices New York Properties’ CEO Steven James was referring to likely pending interest rate hikes by the Federal Reserve that will take the average 30-year fixed mortgage rate to over 7 percent, further cooling the residential market.
Others were equally sour.
“We’re finally starting to see the light at the end of the tunnel and the Fed is ruining all of that for us,” said Jessica Peters, a Douglas Elliman broker. “We’ve had it really tough for the last six months across the board. …Unless interest rates mean nothing to you, it’s really severely affected the market.”
Banks weren’t thrilled with the possibility of it becoming more expensive to borrow money.
“The issue here is what is the domino effect of problems outside the banking industry on the banks themselves?” Mike Mayo, a bank analyst at Wells Fargo Securities, according to NBC News. “Banks are still the heart of the economy, and if there’s issues, then banks are going to feel it.”
Brokerage firms continued to prepare for tougher times ahead, with @properties confirming it’s adding a 1 percent fee on agents’ gross commission income.
“I don’t know if we’ve seen the worst, or if the worst is coming — you have to be prepared,” firm co-CEO Thad Wong said. “If you’re not talking about your plans when things slow down, you’re making a mistake.”
Winter may be coming, Jon Snow, but New York Gov. Kathy Hochul dismissed doubts on Penn Station’s redevelopment and expansion, by saying, “I’m committed to getting that done.” Hochul made the comment on WNYC’s “All Things Considered,” in response to a state senator who said the deal was dead.
What’s also still very much alive are strip malls. Yes, strip malls. The anonymous Twitter personality StripMallGuy, who has more than 160,000 followers on the platform, has a lot to say about the oft-overlooked sector of commercial real estate.
“A lot of our memories growing up involve a strip mall,” he said in an interview with The Real Deal. “My mom meets her friends at the nail salon, it’s someone’s birthday, we go get pizza. Everyone has their favorite local restaurant. You grow up spending time at the strip mall, whether or not you realize it. It’s part of our human experience.”
He explained what are the right mix of businesses for strip malls, and why a Chick-fil-A or a martial arts center aren’t necessarily ideal tenants.
Still, being the StripMallGuy does have its drawbacks, he said.
“I do get imposter syndrome. I worked hard to build a career and suddenly I’m known as this cartoon character, right? Our three-year-old son, yesterday he was like, ‘Am I strip mall boy?’”