Restaurants Hit Hard during the Coronavirus Pandemic

Restaurants Hit Hard Amid Coronavirus Pandemic

7 hours ago

7 hours ago 0 0 5

You never see the lightning bolt that hits you. Coronavirus COVID-19 has taken us all by surprise and continues to baffle us with its strength and uncertainty. It’s difficult to write a post about the current climate because it changes daily, hourly even. Every day, we hear of communities requiring residents to shelter-in-place as more orders are announced, clarifying which businesses can operate and which must shutter their doors. Real Estate Recessions: Causes Real estate market recessions are NOT always the result of real-estate activities, such as overbuilding, loose underwriting or easy financing. Sure, there have been real estate recessions caused by these actions, but not always. Often there are non-real estate triggers—think of the mid-70’s oil embargo, the Iraq War, inflation in the 80’s and 9/11. These events usually expose underlying market weaknesses and cause the debt markets to lock up, resulting in sharp declines in real estate fundamentals.

Home Depot's Bernie Marcus Philanthropy in Atlanta, like the GA Aquarium, has multiplier effect

Philanthropy in Atlanta: The Multiplier Effect

By Stan Sonenshine in Atlanta Philanthropy

3 weeks ago

3 weeks ago 0 0 50

We are accustomed to seeing headlines about big philanthropic donations or seeing billionaire’s names on buildings, but do you ever stop to think about the massive multiplier effect these philanthropic donations have? On everything from job growth to real estate worth to quality of life? In Atlanta, we have a multitude of big givers—from Home Depot’s Bernie Marcus and Arthur Blank to the Coca-Cola-affiliated Robert W. Woodruff Foundation to CNN’s Ted Turner. Let’s take a deep dive into how philanthropic giving impacts Atlanta, focusing specifically on Bernie Marcus. Growth of The Home Depot The Home Depot got its start with two entrepreneurs and two Atlanta stores, one in Doraville and one in Decatur, in former Treasure Island locations. Marcus and Blank grew that humble beginning to 2,200+ stores, simultaneously profiting from the DIY craze and revolutionizing the industry. The growth of Home Depot in Atlanta significantly impacted Atlanta. First, think

Job Seekers: Resume, Internship, Job Fair

Job Seekers: Make Yourself Stand Out

By Stan Sonenshine in Mentoring

1 month ago

1 month ago 0 0 70

For many, a new year means a new start in their personal or professional lives—whether it’s hitting the gym, abstaining from alcohol or seeking a new job. Whatever resolution or aspiration you set, you need a commitment and a plan to succeed. This is exactly what I tell my mentees entering the work force: Not only do you need a plan; you need to make yourself stand out. But how do you do that? Create a solid resume, prepare for and attend job fairs, seek relevant internships and market yourself with confidence. Atlanta’s Job Growth in 2020 The forecasts are in, and the good news is you can secure a desirable job in the ATL. Despite positive numbers, this is not easy. According to a recent Bisnow article, “Metro Atlanta’s rocketing job growth has slowed in recent years, from more than 4% in 2014 to 1.5% in August [2019].” But

CRE Bubble? Not If, But When

By Stan Sonenshine in Real Estate Cycle

2 months ago

2 months ago 0 0 161

Recent NREI article “Low U.S. Interest Rates Are Fueling a Bubble in Commercial Real Estate” claims it is not a matter of if the CRE bubble will pop, but when it will pop. I wholeheartedly agree with author Jay Rollins’ assessment and strategy. We’ve already seen investor push back on properties purchased post-2015 that are now back on the market. The current owners paid too much, thinking prices would increase, but in my opinion, the market has flattened—with further appreciation less likely than price deflation. The spreads between real estate yields and other financial instruments are historically low, and like Rollins, I have to believe that interest rates will increase sooner rather than later. I certainly don’t see them decreasing. The best opportunity for upside today is in new development, which has considerably more risk than buying existing assets. Historically, developers get caught by recession and rising interest rates. This time will be

CRE 2020: What to Expect

By Stan Sonenshine in Real Estate Development

3 months ago

3 months ago 0 0 141

A recent NREI slideshow “Breaking Down CBRE’s 2020 Market Outlook” reviewed economic development, tax rate cuts, CRE investment, cap rates and market trends, among other topics, when considering what’s in store for 2020. In general, I agree with CBRE’s assessment that a slowdown in absorption will occur in all sectors as supply continues to grow. We are gradually moving to the confluence of oversupply and slow down. When that becomes problematic and to what extent it creates opportunities or problems is hard to predict. I started thinking about this a few months back in “Development Market Phase: How Long Will It Last?” As expected, the impact on individual sectors will be uneven. In my opinion, retail faces the greatest degree of uncertainty due to online shopping and shifting consumer buying habits. I can’t believe that the multi-family sector doesn’t have significant overhang already, and office will be negatively impacted by the WeWork pullback.

City Centers Create Sense of Community

By Stan Sonenshine in Atlanta's edge cities

3 months ago

3 months ago 0 0 148

Atlanta’s edge cities are developing City Centers to create a sense of community, and it’s working. Since the holiday season is in full swing, it feels appropriate to continue the discussion about community I started in my last blog “The Importance of Community Engagement.” I suggested that leaning into our communities through service and events helps us feel more engaged. But I don’t believe that just happens. It is the addition of City Centers—intentional placemaking at its finest—that elevates the community’s sense of belonging. City Centers Help You Belong In a time when negativity, divisiveness and complaining feel ubiquitous, encouraging a sense of community offers people a positive feeling. While “sense of community” itself is difficult to quantify, it is absolutely a constructive and powerful force for a community’s overall health. Prime Example: Downtown Alpharetta The re-imagining of downtown Alpharetta is just one example of a city determined to craft

The WeWork model looks weak. What is the SoftBank Group to do?

WeWork Weak? Looks That Way

By Stan Sonenshine in WeWork

5 months ago

5 months ago 0 0 190

A recent BisNow article looks at the impending takeover deal between SoftBank Group and The We Company, which values WeWork’s parent company between $7.5B and $8.5B. Here’s what I think: SoftBank is throwing good money away, but the company probably has zero choice if it wants to salvage any of its existing investment. I cannot believe SoftBank paid former CEO Adam Neumann that much money to step down; there must have been a reason. (The article states, “To take control over The We Company, SoftBank will buy $1B in stock from Neumann, pay him a $185M consulting fee and extend him $500M in credit to repay a loan led by JPMorgan.”) As I’ve considered in previous blogs, the WeWork model looks weak. The office market is probably peaked and likely will flatten at a time when WeWork has made its maximum space commitment to date. Also, no barriers exist for

Community Engagement Makes Communities Stronger, like the Food That Rocks event at City Springs in Sandy Springs

The Importance of Community Engagement

By Stan Sonenshine in Atlanta's edge cities

5 months ago

5 months ago 0 1 256

Community Engagement Makes Lives Better Community is defined as a group of people living in the same place or having a particular characteristic in common. But I think it goes beyond that. Whether denoting a physical or religious connection or a bond through common interests, community engagement makes our lives better. Three years ago, in the blog “Atlanta’s Edge Cities Develop New City Centers,” I focused on the development of City Centers and their impacts. In subsequent blogs, I consider how these initiatives impact communities beyond just their physical existence. When you engage in actions or organizations that support the community in which you live, you improve the quality of life in that community. When you connect with people face-to-face in real time, you grow the fabric of your community. Community Engagement = Stronger Community Community Assistance Center As a Sandy Springs resident, I offer the Community Assistance Center (CAC)

Investing in a CRE asset without due diligence or market analysis is just not smart.

Avoid the Sins of CRE Investment

By Stan Sonenshine in Real Estate Investment Strategies

6 months ago

6 months ago 0 0 160

A recent Globe St.com article “The Seven Deadly Sins of CRE Investment” argues, “Buying a CRE asset above its value or at a low cap rate is rarely a route to a successful transaction.” I couldn’t agree more. While situations exist where it is acceptable to pay up, such as the need to acquire a key piece in an assembly, I never advocate buying investment property without proper due diligence or market analysis. Unfortunately, vigorous deal competition coupled with the need to invest idle capital, particularly funds with time limits, inevitably leads investors to commit some of these sins mentioned in the article. After all, what is one or two bad deals in a large portfolio if the other deals are good, right? I disagree. Also, often individual investors invest foolishly because they are driven by the desire to avoid taxes on the gains resulting from a sale. So, they overpay to

The Worth of WeWork?

By Stan Sonenshine in WeWork

7 months ago

7 months ago 0 0 238

Business Insider posted a recent article entitled, “NYU professor calls WeWork ‘WeWTF,’ says any Wall Street analyst who believes it’s worth over $10 billion is ‘lying, stupid, or both’.” Here’s my take on this article: WeWork looks like any other office landlord, just wearing a different suit. Outside of being cool, WeWork owns nothing proprietary, and as I have argued before, there is no barrier to competition from real landlords. If it were such a great concept, office property owners and developers would be providing more flexible space options. But they wouldn’t be able to obtain financing because debt service relies on a steady and reliable income stream—which this concept certainly is not. WeWork might pull off this IPO because of the current market euphoria, but they won’t be getting any of MY money.

Restaurants Hit Hard Amid Coronavirus Pandemic

Philanthropy in Atlanta: The Multiplier Effect

Job Seekers: Make Yourself Stand Out

CRE Bubble? Not If, But When

CRE 2020: What to Expect

City Centers Create Sense of Community

WeWork Weak? Looks That Way

The Importance of Community Engagement

Avoid the Sins of CRE Investment

The Worth of WeWork?

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