Commercial real estate news from wSJ 9/1/2021

REAL ESTATE – WSJ

Good morning. This is a great time to own a home, whether you are living in it or leasing it to someone. Wall Street has realized this, too, and investment firms are getting more aggressive in their buying and renting out single family homes. Investors purchased $87 billion in homes in the first half of 2021, reports Will Parker, including a record 68,000 houses in the second quarter. Blackstone, Invesco and Goldman Sachs are among the biggest participants.Increasingly, these deep-pocketed investors are competing with families and individual buyers in hot markets. In Atlanta, Phoenix and Miami, one in four home sales went to an investor during the second quarter. “The institutional players are chasing some of the same homes that would be starter homes for owner occupiers,” said U.C. Berkeley professor Desiree Fields, who researches the single-family rental industry.More senior housing facilities are mandating vaccinations for employees, under pressure from prospective tenants and their families. Implementing these mandates promises to be a tough and costly move for the companies that run thousands of U.S. senior communities and face labor shortages that could intensify with vaccine requirements, Peter Grant writes.In the U.K. meanwhile, the pandemic has dented the private-hospital business, a niche real-estate sector targeting wealthy patients and those with private insurance plans. Healthcare industry participants are now watching the expected opening early next year of a 184-bed hospital in a converted office building by the Cleveland Clinic. The U.S. healthcare provider operates in Ohio, Florida, Nevada, Toronto and Abu Dhabi, and established a beachhead in London this year with an outpatient facility, reports Ruth Bloomfield.                                                                                                                                 –– Craig Karmin, Real Estate Bureau
 
House Rents Pop Up as New Investors Pile In
A neighborhood in Chandler, Ariz. In Phoenix, one in four home sales went to an investor in the second quarter of 2021.
PHOTO: MARK LIPCZYNSKI FOR THE WALL STREET JOURNAL
Asking rents for houses rose nearly 13% on the year ending in July. The sharp rise partly reflects increasing demand from people who can’t afford to buy homes as well as city-dwellers who moved to the suburbs to rent during the pandemic.
 
Senior Housing Industry Faces Higher Costs
About 39% of the senior housing organizations surveyed between July 22 and Aug. 8 said they ‘definitely’ or ‘probably’ will impose vaccine mandates.
PHOTO: SETH WENIG/ASSOCIATED PRESS
Within weeks, nursing homes that don’t require workers to be vaccinated against Covid-19 won’t be able to participate in Medicare or Medicaid. About 39% of the senior housing organizations surveyed between July 22 and Aug. 8 said they “definitely” or “probably” will impose vaccine mandates.
 
Cleveland Clinic’s London Move Raises Concerns
Private-hospital revenue in London, which was growing before the pandemic, fell last year.
PHOTO: VUK VALCIC/SOPA IMAGES/ZUMA PRESS
The pandemic dented the U.K. private-hospital business, a niche real-estate development sector targeting wealthy patients. That could present a challenge for an upcoming 184-bed hospital from the Cleveland Clinic in London.
 
U.S. Home-Price Growth Rose to Record in June
Home prices have surged this year, as the inventory of homes for sale remains well below typical levels.
PHOTO: ROGER KISBY FOR THE WALL STREET JOURNAL
The S&P CoreLogic Case-Shiller National Home Price Index, which measures average home prices in major metropolitan areas across the nation, rose 18.6% in the year that ended in June, up from a 16.8% annual rate the prior month. June marked the highest annual rate of price growth since the index began in 1987.
 
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By The Numbers
£1.6 billionPrivate hospital revenue in the United Kingdom during 2020, down 14% from the previous year.
41,000How many new units of American senior housing that are expected to be added annually between years 2020 and 2022.
29.3%Annual home-price growth in Phoenix for the year ending in June, the highest of any city.
 
Beyond WSJ
Some hotels are mandating vaccines. Will others follow? (NYT)Where will the eviction wave hit? Follow the big landlords (Bloomberg)China regulator probes Ping An Insurance’s property investments (Reuters)
 
About Us
Craig Karmin is real-estate news bureau chief. Reach him on Twitter @CraigKarmin or via email at Craig.Karmin@wsj.com. The newsletter is compiled and edited by Will Parker, WSJ housing reporter. Reach him via email at will.parker@wsj.com.
 
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