Landmark Links March 8th – Reformed Hoarders

Must Read: The self storage industry is fighting two headwinds: right now.  Marie Kondo-inspired de-cluttering mania and a potential glut of units in some markets thanks to new construction.  See Also: A global ‘Tidying Up’ frenzy sparked by Marie Kondo is burying donation centers with goods that truly nobody wants.  But See: While absorption still needs to catch up with new supply, self storage demand fundamentals remain strong.


Sticky: High tax states are making it harder than ever for rich people to leave, especially when they keep a second home there.  If only there were something that they could do to keep the wealthy taxpayers that they depend upon from fleeing to Florida…..

Credibility Gap: Anecdotal indicators suggest that the labor market is incredibly tight.  However, wages are still rising slowly while payrolls are on the rise, suggesting that the job market has more slack than it appears to.  A better answer may be found in the prime-age employment rate (25-54 year olds) which has recovered to 2008 levels but is still well below its all-time high.

It May Not Be Over: The Federal Reserve has signaled that they are likely to hold off for the next few months but after that, their next move is anyone’s guess.


Turncoat: Amazon has long been viewed as a threat to retail landlords.  However, with its move into brick and mortar, it is now increasingly being viewed as a potential savior that has the expertise to draw the right crowd of shoppers, given its trove of consumer data.  See Also: Amazon and Whole Foods are reportedly eyeing shuttered Sears and Kmart locations as potential sites for expansion.

Don’t Call It A Comeback: Downtown LA has been booming for years now and don’t expect it to stop with the Olympics coming in 2028.


The Long Wait: State law requires that municipalities zone enough land to meet local demand for housing but a new report from public policy group Next 10 found that, given the current building pace, some municipalities won’t hit their goals for nearly 1,000 years.

Bounceback: Framing lumber prices appear to have found a bottom after falling for much of 2018.

Thawing: Home price growth slowed last year but falling mortgage rates and continued economic stability point to prices heating up again in the spring.

Mobility Premium: The number of rental households earning six-figures or more in Los Angeles has increased 33% in the last decade, showing that a large amount of high-income earners are choosing to rent rather than buy (or possibly that even high earners can’t afford to buy a home there).  See Also: The median rent for a one bedroom apartment in San Francisco has reached an absurd new peak of $3,690, according to survey data from Zumper.  That’s nearly 30 percent higher than New York City and more than double the prices in Miami.


Unsustainable: Uber and Lyft are using venture capital to subsidize their massive losses.  Unlike some tech companies that can spend upfront for customer acquisition and then grow profitable thanks to massive economies of scale, the rideshare giants are selling a physical service that is expensive to deliver and not scale-able (fuel, for example does not get less expensive with scale).  This will eventually result in ride share companies needing to raise their rates substantially in order to remain viable, possibly leading to sticker shock when customers discover the true cost of the service.

This Would Be Awesome: A new urban farming company in Germany has plans for grocery stores where you are able to pick your own vegetables in-store.

Chart of the Day

Source: AEI


Money Can’t Buy Everything: A 65 year old billionaire diamond trader died while undergoing penis enlargement surgery, becoming the front rummer for a Darwin Award in 2019.

Normal Saturday Night: A Virginia woman was arrested for DUI after allegedly getting wasted on boxed wine in a Target and the mug shot is just as awesome as you’d imagine.

All in One: Heinz is releasing mayo/mustard and mayo/bbq sauce hybrids that absolutely no one asked for.

Landmark Links – A candid look at the economy, real estate, and other things sometimes related.

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