ULI Fall Meeting Takeaways

Thursday, September 19, 2019
Washington, DC


Emerging Trends

  • Wage growth is one of the top major factor you need to look at by geography to identify
    market opportunities at this stage of the market cycle.
  • Occupations driving wage growth are an additional factor you need look at when
    targeting markets during this stage of the market cycle.
  • Example City – Austin’s pop growth is 3 times higher than the national average.
  • Knowledge towns are a market opportunity because of the talent hubs being supported
    by corporations and educational institutes, these maybe more resilient in the event of a
    downturn in the future.
  • The broader trends are important but you really have to look more at deals on a case by
    case basis than just population sizes of cities when comparing the two at that level. The
    tier 1,2,3 cities have become less of a factor.
  • Hipsturbia – a trend of the younger generation bring their more urban interests into the
    suburban community for things like breweries, vegetarian food, coffee shop, walkability,
    village squares etc there a real opportunity to create urban environments in the
    suburbs.


Fastest growing neighborhood in Washington DC – The Yards and Capital Riverfront.

  • Quality of life and urbanization are the primary reasons why it has grown and expecting
    continued growth.
  • It’s mainly millennials, remote workers and government contractors. These
    communities are highly amentized. Lots of rooftop garden terraces, pools and gyms.
    Several with conference rooms and one with a basketball court shared among several
    buildings.
  • Instagram local influencer campaign was successful in getting more tenant leases

 

Residential Neighborhood Development Council Meeting

  • Washington’s DC Market – National factors are impacting the market similarly to the rest
    of the country
  • Government shutdowns impact DC local real estate economy substantially.
  • Buyers have become more decerning. They are waiting on the right property.
  • Lower price points increasing at a higher rate
  • Luxury market starting to soften in DC $1M+
  • Correlation between pop growth and home prices are not very correlated
  • In DC, Boomers are living in their homes longer.
  • 30% additional cost due to DC’s regulatory environment
  • I-Buyer Platform – Lenner taking the lead on buying homes online
  • Zillow Offers – Amazon is an ethos at Zillow. Ondemand services needed. 38% think
    about new construction when they consider a buying a home but only 12% do
    afterwards.
  • Lennar – trade in trade up program, rolled out open door across 20 markets
  • Zestimate turning into instant offer
  • Where are the risks?
    • Low offers is an issue for builder referrals
    • Realtors relationships is a struggle
  • Zillow would like to purchase 5,000 units per month.
  • Brokers are having to lower their commissions to compete with the Zillow Offers and
    OpenDoor.
Posted in Blog.