Wells Fargo Commercial Real Estate Economic Update: "Impact on Cities, Real Estate, Retail & Local Governments. WFH, Technology Advancements & More"

Thank you to Veronica Buenrostro for the invitation to this insightful event. I had a great time listening to all the presenters:

Charles Dougherty - ?Senior Economist, Wells Fargo

"Charlie is a senior economist with Wells?Fargo’s Corporate and Investment Bank. Based in New York, he covers the U.S. economy with a focus on commercial real estate, housing, construction, and regional sectors of the economy. He regularly writes indicator reports, produces special commentary, and contributes to the company’s Weekly Economic & Financial Commentary. His commentary on the U.S. economy has been featured in various regional and national media publications, including?Bloomberg News,?Yahoo Finance,?and?The Washington Post."

Senior Vice President, DCA Partners - Chris Stephenson

"Chris joined DCA Partners as a Senior Vice President in 2022, where he focuses on real estate investments. He previously served as a Partner at a London-based VC firm focused on Proptech and as a Managing Director at AIG Global Real Estate, managing a multi-billion-dollar real estate portfolio."

Cam Williams - Tax Partner, Moss Adams

"Cameron has practiced public accounting since 1999. He provides compliance and consulting services focused primarily on real estate and partnership taxation. Cameron routinely advises on transactions regarding real estate sales and acquisitions, 1031 exchanges, debt modifications, and partnership/LLC formations, sales, and dissolution."

Thank you to 富国银行 and Veronica Buenrostro for the invitation to this event where we heard from experts from 富国银行 Commercial Banking, DCA Partners , and Moss Adams . It was an interesting and relevant conversation about the current state of the economy and the outlook for the commercial real estate industry. The ongoing inflation has resulted in the Fed keeping interest rates high despite economic instability with the risk of a downturn. We heard about the current position in the economic cycle, and its implications for the commercial real estate industry, rents, and local governments. As well as recommendations for navigating through this period of uncertainty.

Everything I heard makes me also think about the impact this will have on retail businesses and small local businesses.

The event was hosted at the beautiful:

LinkedIn: Del Paso Country Club Website: https://www.delpasocc.org/

Del?Paso?Country?Club 3333 Marconi Avenue Sacramento, CA 95821

Please reach out to Veronica for any of your banking needs, this is her contact information:

Veronica Buenrostro - Vice President - Regional Sales Manager

富国银行 - Wells Fargo Commercial Banking

1120 K Street, 2nd?Floor,

Modesto, CA 95354

MAC A0817-021

??Tel 209.549.5732

??Cell 209.765.6002

??Fax 866-503-9155

??[email protected]

??wellsfargo.com/commercialbanking

Some of the things I heard at this event were the following:?

Companies and their employees leaving major cities! What are local governments doing about this?

• Local governments especially in big coastal cities on the West Coast should start thinking about what are they going to do to retain businesses and help retail businesses because so many of these businesses are leaving their spaces in masses.?
• If they are leaving that means fewer local taxes will be paid
• When their employees and these companies leave these cities this will affect retail businesses and small businesses
• These businesses vary in tech and other industries, example Meta , most cities hurting are SF, LA, and NYC
• There are businesses that are returning their complete business, office, and building spaces
• A lot more tech companies will leave SF?
• They are giving back all of their spaces
• People will continue to move to other cities (YAY for movers! Boo for local governments!)
• It will affect retail businesses
• It will affect public policy?
• There will be a drop in rent costs, residential rents will be lower

WFH:

• We have a new generation of people who have only worked from home, that is the only thing they are used to
• Their children have only seen their parents work from home so we will have to see what impact that will have on future generations
• There will always be space for offices but the functioning should not be obsolete
• Companies and businesses should make the commute for their employees worth it, as example, 思科 is making their campus with a focus on “Experience Centers”
• Make the office interesting again?
• Companies in E-Commerce and tech can and will create their own spaces, to their liking, if real estate investors are not offering what they are looking for. Basically, what tech companies need and are not getting from these spaces, they will do themselves?

Residential Real Estate:

• There is a new trend now where you will see more and more residential real estate offerings and showing you home offices, zoom rooms and these sell faster and at a higher price
• The other trend is buying two condos or renting two apartments, one to live in and one to work out of?

Mortgages & lenders:

• There will be 2 Trillion dollars in mortgages and about 1 trillion dollars which will roll over after some period that local and regional banks hold
• There is a huge opportunity in small to mid-size lending, talk to a banker!?
• Keep borrowing $ if you can and if you find good opportunities
• Lenders can be your friends, they can be nice people too, and do not wait too long to talk to them. They are not in the business of owning real estate. Talk to them to find and look for good opportunities

Demographics:?

• We are currently about 2.3 shortfalls on homes?
• The new generation of employees has not been to any offices to work?
• For them, their lifestyles come first, such as where to live, hobbies, etc. They first think of their lifestyles and then they look for work?

Technology:

• Construction methods are changing?
• There are new modular and 3D printing options
• Cities like Dubai are changing to 3D printing?
• Hotels like Marriott Hotels are using these options, they have built hotels in 90 days
• Architects in places like London are designing parking garages that can be? ? turned into condos in 10 years because they are estimating there will be no need for parking garages by that time?
• There will be newer technology for buildings and home sensors and monitors?
• Think about how you can make your business smart
• Use AI as it can help with growth projections?
• Gather your data, track and organize it
• Prepare to use your data in the future and do not let anyone else use it

New business opportunities:

• There will be new business opportunities that will come along
• Find those opportunities
• Be ready when they come so you can help others and help your business grow

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LinkedIn: CG Moving Company, Inc.