🛍️ Why investors are flocking to open-air shopping centers
👑 Manhattan’s luxury office spaces hit record-breaking leases in 2024
🇳🇴 Goodman Group + Norway’s SWF to conquer U.S. industrial market
📈 Spiking office CMBS celinquencies
📚 Learn to develop a local real estate project, sell into owners, and raise capital
🇦🇪 The UAE behemoth entering the US data center market

Data Viz of the Week: Spiking Office CMBS Delinquencies

The office market crossed a depressing threshold in Q4: CMBS delinquencies crossed above the high water mark set in the aftermath of the 2008-9 global financial crisis.

While post-GFC delinquencies peaked at around 10.5%, the current wave of distress is unlikely to subside any time soon. But perhaps there is a light at the end of the tunnel with a new wave of companies asking workers back to the office five days per week.

Upcoming Thesis Driven Courses & Classes

Sharpen your real estate IQ on capital raising, selling into real estate owners, developing local real estate projects, and more.

Upcoming Courses

• January 13: Selling Into Real Estate Owners (💻 Online): A bootcamp for people selling technology and products into the real estate industry - Sign up

• January 14-15: Fundamentals of Capital Raising (🗽Live in NYC): Insider’s guide to raising capital for real estate projects & platforms–from individuals, family offices and institutional investors - Sign up

• January 28-29: Introduction to Development (🗽Live in NYC): A first-person POV simulation for aspiring developers to learn to source, underwrite and finance a local real estate project - Sign up

• February 10: Fundamentals of CRE (💻Online): A bootcamp providing an insider’s view of “a day in the life” of key industry stakeholders, with real-world insights and applications - Sign up

Thesis Driven Classes—1-hour micro courses on specific topics—are now available on Eventbrite here!

Three Articles We Loved from Last Week

It’s not easy keeping up with everything. Here are three articles we loved from the past week that you may have missed:

1. (WSJ) Retail Is Fashionable With Property Investors Again, but Only the Unflashy Kind

   Institutional investors are increasingly favoring open-air neighborhood shopping centers over traditional enclosed malls. These centers, often anchored by grocery stores, boast high occupancy rates and stability, making them attractive investments. Despite rising rents, new construction remains limited due to high building costs.

2. (New York Post) NYC’s high-end office market scores record year for new leases that top $200 per square foot

   In 2024, Manhattan’s premium office market achieved a record with 28 new leases priced above $200 per square foot, indicating a strong demand for top-tier office spaces. The city recorded a total of 30.2 million square feet leased, marking a 19.4% increase from 2023 and the highest since 2018. Financial services dominated the market, occupying nearly 40% of leased spaces.

3. (The Australian) Goodman brings in Norwegians for US assault

   Goodman Group has secured the Norwegian sovereign wealth fund as a partner in the U.S. market, following the exit of the Canadian Pension Plan Investment Board from their $6 billion joint venture. This move underscores the strong demand for industrial real estate, particularly last-mile delivery facilities, and highlights Goodman’s strategic expansion into data centers globally.

Developer of the Week

Each week, we feature a different real estate GP doing something special.

This week, our featured developer is DAMAC Properties, the UAE-based behemoth responsible for some of Dubai’s swankiest luxury towers.

Notably, DAMAC built and owns the only Trump-branded golf course and resort in the Middle East. Last week, DAMAC founder Hussein Sajwani announced a $20 billion investment in data center development in the United States. Check out the NYT’s deep dive into DAMAC.

Check them out here on the Thesis Driven database!

—Brad and Paul