TREG Newsletter January 26, 2024

Hi Everyone,

This is Forrest Jacobs. I am coming to you with the second installment of the Tulane Real Estate Group newsletter. We are excited to share with you what events we have coming up!

TREG Event Updates

We thank everyone who attended our virtual speaker event with Mike Strug! We hope you gained valuable insights from him and enjoyed the free Canes!

1. Ryan Patterson, Global Head of Real Estate for Meta Platforms, Virtual Event: On January 29th, we will virtually host Ryan Patterson, Meta's global director of real estate. He has previous experience in investment banking and private equity and now advises Meta on their industrial, office, and data center acquisitions. He will discuss Meta’s real estate operations and how tech companies are redefining the workplace environment of the future.

→ Jan 29, 6 pm, GWBC 300 Wavesync Link to RSVP

2. Steve DeRose, Senior Vice President at Starwood Mortgage Capital, Virtual EventAt Starwood, Steve DeRose is a loan originator responsible for originating, structuring, and closing loans on all property types for securitization. Mr. DeRose holds a Bachelor’s Degree in Economics and Business Management and a Master of Science in Finance from the University of Florida.

→ February 5, 4 pm, Virtual Event Zoom Link

3. ICSC+OAC Conference Opportunity! Once again, the ICSC conference will be held in New Orleans, and you have the opportunity to shadow a mentor for the day on February 28th.?

→ Apply Here! …. Applications are due by Feb 1.?

Market Overview

A New Era of Trends in 2024 pwc 2024 report:

• Many economists believe we are headed towards a soft landing, posing moderate job growth but high-interest rates.?
• We have all been waiting for a recession to hit, but the US economy has been resilient in the wake of rising rates.?
• It has been a year and some change since the yield curve between the 3-month and 10-year treasuries inverted, and we are still waiting for a downturn.?
• In the next five years, 78% of respondents believe inflation will decrease, and 82% believe commercial mortgage rates will decrease.?
• Peering into the future, we are moving towards a period characterized by higher interest rates and sluggish economic growth, posing a difficult scenario for real estate investors.

Record Levels of Commercial Real Estate Debt in 2023

By: Peter Grant, Jan 2024

• According to Trepp, in 2023, $541 billion dollars of commercial real estate debt, backed by hotels, apartments, and industrial spaces, came due.?
• At the end of 2027, $2.2 trillion dollars of commercially backed debt is projected to be due.
• Higher vacancies and weakened cash flows are lowering property values.?
• Most commercial mortgages are interest only, meaning that when the debt matures, the borrower has to refinance or pay off the principal.?
• By 2025, US commercial mortgage-backed securities loan delinquency rates are projected to reach 10%.?
• Borrowers and lenders are finding it hard to come to terms with one another. Borrowers tend to be more optimistic than lenders looking for top-tier credit and additional capital put down.??

Job Board/Other Opportunities

• Development Intern, NJ (1) Development Intern (Construction/Commercial Real Estate) | Prologis | LinkedIn
• CRE Investment Sales Intern, Seattle https://www.dhirubhai.net/jobs/view/3732648500/
• CRE Investment Sales Intern, Fort Lauderdale https://www.dhirubhai.net/jobs/view/3732648405/

Thank you all for reading! We hope to see you at our upcoming events!

Best,

Forrest Jacobs