The TreppWire Podcast: A Commercial Real Estate Show

297. Resiliency in 2024, Fed's Holiday Surprise, Portfolio Loans in the Special Servicing Stocking, & 2024 Wrap Up

Dec 20, 2024

Explore the intriguing economic landscape of 2024, where resiliency and uncertainty dance together. Discover mixed signals from recent economic data and what they mean for investors. The podcast also dives into distressed office properties and the fate of major portfolio loans entering special servicing. Hear about Party City's potential second bankruptcy and the significant dynamics in multifamily and retail markets. It's a rollercoaster of insights, trends, and lighthearted holiday cheer that you won’t want to miss!

56:23

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Quick takeaways

The mixed signals from economic indicators reveal a resilient U.S. consumer despite rising interest rates and industrial production declines.

Flagstar Bank's strategy to offload troubled loans highlights a trend among financial institutions seeking stability amid ongoing market challenges.

Declining property valuations in major cities point to deep-rooted issues in the commercial real estate sector, exacerbated by changing work models.

Deep dives

Macroeconomic Overview of 2024

The week ending December 20th saw a mixed macroeconomic landscape characterized by contrasting economic indicators. The services PMI demonstrated strength, while the manufacturing PMI showed declines, reflecting a continued divergence within the economy. Retail sales remained robust despite a fall in industrial production, underscoring the resilience of the U.S. consumer, often described as an unstoppable force. Overall, the expectation for future rate cuts was revised down from six to only two, indicating a cautious optimism about economic stability moving into 2025.

Intro

2min

Navigating Economic Uncertainties in 2024

10min

Economic Indicators and Market Implications in Banking

3min

Commercial Real Estate Challenges

12min

Retail Market Concerns and Cybersecurity Insights

3min

Challenges in Retail and Multifamily Markets

16min

Listener Engagement and Conference Announcements

4min

Connecting Through Resilience and Holiday Cheer

5min

This episode is sponsored by EisnerAmper.

Resiliency is the word of 2024, but uncertainty might be the word of the day. In this week’s episode of The TreppWire Podcast, we are joined by our Chief Economist to discuss mixed signals from the recent economic data, including contrasting PMI figures, retail sales growth, and the latest Fed rate cut. We also discussed the continued chatter around extend & pretend, the unexpected resilience of the U.S. economy in 2024, and what to expect for 2025. We break down Flagstar Bank's sale of troubled NY loans, value reductions across office properties in Philadelphia and San Francisco, and major portfolio loans entering special servicing including the $1.23 billion Workspace Property Trust Portfolio and $379.1 million Selig Office Portfolio. We also discuss Party City mulling a second bankruptcy, significant multifamily sales, and California's rejection of Prop 33. Tune in now.

Episode Notes:

- Economic Update & 2024 Economic Review (0:32)

- Flagstar Bank Looking to Sell Portfolio of Eight Underperforming NY Loans (9:14)

- Office stories: Seattle portfolio special servicing transfer, Federal Center Plaza GSA updates, Philadelphia & SF value reductions (16:01)

- Retail stories: Party City’s second bankruptcy concerns, California mall loan special servicing transfer and a Kentucky shopping center transaction (28:54)

- Mixed-Use: a $23B portfolio loan special servicing transfer and an NYC value reduction (35:40)

- Multifamily stories: NYC $318M loan special servicing transfer, Seattle, South Carolina, Columbus, and DC property transactions (41:21)

- Rent control & California Prop 33 implications (45:24)

- Shoutouts (47:46)

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Questions or comments? Contact us at podcast@trepp.com.

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X: www.x.com/TreppWire

LinkedIn: www.linkedin.com/company/trepp

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