Real
estate, not one region is equal to another, so I want to dive into commercial
real estate, this is a topic that I can talk about for hours and hours but I'm
not going to do that today but I do want to touch on what’s going on out there.
There is a resurgence of development and its not specific to New York City or
Miami, its global, there are a number of condo developers looking to build the
next luxury tower for the jet setters and billionaires of the world while
others are in motion that are solely focused on building rental units while yet
another group are looking to build true commercial projects that create jobs.
I think
that the later is what I am most passionate about and that’s because it doesn't
matter how many condo or rental developments you build if jobs are not created
then where is the growth?, its not there.
This is
what has impacted the growth of the United States over the years as we moved
from being a manufacturing country to a service country, with the service not
being that great it has hindered our growth as a whole. So when true commercial
developments are slated to be developed anywhere, whether it be New York City , Los Angeles ,
Miami , Detroit ,
anywhere in the USA
Especially
as tax incentives usually follow in line with these new developments allowing
for major companies to take advantage of these incentives thus creating jobs on
a larger scale.
If you
have the jobs in an area then you have residents, if you have residents then
you will need housing and this is what helps the residential developers to
flourish. So we need more commercial developments that will create jobs, period
the end. They will not only create construction jobs but also be attractive to
companies in potentially relocating to a certain area, this relocation does a
lot for a town or city as it can spark an attraction for more companies to relocate
or develop offices in that town or city. Everything trickles down if done the
right way.
I know
that there are a multitude of residential agents that are barking right now but
unless you can provide concrete facts that show developing more luxury
residential buildings add to the economy of a town or city above developing
commercial properties to attract major corporations thus creating more jobs
then you have to look at the bigger picture. The more jobs Then the more people
The more people the more they will need housing, The more local spending and
the beat goes on. That is the boom that a residential agent or broker wants not
a slow down to a big halt.
Part of
what is sparking growth in these residential developments are private equity,
yes indeed, we are not going to get into it today but there are a number of private
equity firms that are able to offer foreign investors something pretty special,
in the USA its called an SB-5 and it actually goes by other codes in other
countries but it gives an investor the ability to gain citizenship through such
investments. This is a hot topic that we hope to be touching on next week on “Money
Never Sleeps” as this is not specific to the real estate industry but it
impacts the film and entertainment industries as well. It’s pretty interesting
and kinda scary at the same time but it’s alive and well.
When you
see these big investments into, even a luxury residential unit, and it’s by a
foreign investor chances are it’s not just about the investment but all the
perks that come along with it as long as that foreign investor is aligned with
a broker worth their salt and knows the path to take.
Anyhow we
will be bringing an expert in that arena on the radio show so that we can
tackle the facts on SB-5 and its actual impact, good and bad.
On the
stock front I really don’t think that homebuilders such as Toll Brothers (TOL),
Beazer Homes (BZH) , KB Home (KBH), PulteGroup (PHM) or LGI Homes (LGHI) will be
in continued growth mode unless jobs are created to allow the millennials to
afford them. With mortgage rates at all time lows, something that will probably
not last through 2015, but one would think that more young people would be
willing and able to purchase a home.
That is
the furthest thing from the truth or reality.
More and
more young people either recent grads entering the workforce or even those that
have been in the workforce for a while, they are doing one of two things, living
at home with their parents or renting. Some
of them are so bogged down in debt from schooling that it’s become increasingly
difficult to get their head above water.
So that
is part of the problem, a problem that University administrators or U.S. United
States
Manufacturing needs to
come back to the forefront in my opinion, make it attractive to build
automobiles in the USA
Give
tax breaks to the likes of Apple (AAPL) to manufacture here, build facilities
and grow in the USA, so much more can be done beyond this.
Doing
any of this will create viable career geared jobs, get America really working
again, increasing the amount of first time home buyers hitting the market and
breeding prosperity on a larger scale.
As always
never take the opinion or views from one source as the only view, do your due
diligence when seeking to invest and consult with your financial advisor.
Remember
that anyone that has any questions in regards to commercial real estate they
can feel free to contact me on SeekingAlpha.com , CurbStreet.com , Twitter @louisvelazquez or via the
ucwmagazine.com website, I will get back to you as soon as I can.
Louis
Velazquez
Host- “Money
Never Sleeps” Radio Show
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