Newly built home sales dip, what constitutes a retail sale comes into question, retailers add distribution capacity, the PRO Act and the real estate industry, and a possible CDC eviction ban extension.
In Today’s News
Sales of newly built, single-family homes in February fell 18.2% to a 775,000 seasonally adjusted annual rate, the U.S. Department of Housing and Urban Development and the U.S. Census Bureau said this week. This represents the lowest level since last May.
The Millionacres takeaway: The National Association of Home Builders (NAHB) cites rising interest rates and construction costs, saying it adds up to taking yet more potential homebuyers out of the market for newly built homes.
Stores are reopening and customers are streaming back in, meaning retailers that withheld rent during COVID-19 shutdowns are now able to pay. But first, they have to agree with their landlords on how to define a sale, The Wall Street Journal reports today [subscription required].
The Millionacres takeaway: The WSJ says landlords are increasingly offering deals in which retailers pay a percentage of their monthly sales in rent, rather than a fixed amount. That has upsides and downsides, and e-commerce just further muddies the waters.
Williams-Sonoma (NYSE: WSM) plans to increase its manufacturing and order fulfillment capacity by 20% to 30% over the next year, the company says, including adding about 2 million square feet to its distribution network, Retail Dive reports.
The Millionacres takeaway: This piece lists similar moves by other, much larger retailers, a reminder that while brick-and-mortar retail may be in the dumps for many, real estate investing prospects in the long run may be shining bright among, say, industrial REITs (real estate investment trusts). Our Maurie Backman adds a look here at what Target (NYSE: TGT) is up to in that regard.
Today on Millionacres
The Protecting the Right to Organize (PRO) Act was recently approved by the U.S. House of Representatives and will move to the Senate for a vote. If passed, it could represent a massive change to labor laws in the United States and could have a major impact on the real estate market.
The Millionacres takeaway: Our Deidre Woollard points out how the fundamental change in relationship from contractor to employee could have repercussions across the industry.
It looks like the Centers for Disease Control (CDC) will extend its residential eviction ban, which is currently set to expire on March 31. Doing so could have serious repercussions for landlords, our Aly Yale writes.
The Millionacres takeaway: Enforcement of the ban has been a mixed bag, and there are court battles over its constitutionality. But if the ban is extended and renters make more use of its protections, the impact will only deepen the pain felt, especially by mom-and-pop landlords, and ramp up the importance of rent relief programs.
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