Weekly News (June 20, 2018)

1. PP Mayor Rotundo accepts defeat without challenge of the eight-vote victory by Chung

Chung got 1113 votes and Rotundo got 1105 votes in this primary
Rotundo is looking toward to the future: he was reelected to the post of municipal chairman by the Palisades Park Democratic Committee
Online attack by Rotundo’s mother against the town’s large Korean community went viral → Tension between some of older white residents and more recent immigrants from Korea, who make up one of North Jersey’s fastest growing ethnic minorities

2. Bronx, West Farms area dreams Big Renovation

Located in the middle of Bronx ( Between Bronx zoo and Bronx river)
Changing → New residential development, new retail complex, parks
This year: 218 unit rental complex (1903 West Farms Rd) / Next year: 251 unit rental complex (1937 West Farms Rd)
Rare residential listing because most of residents are renters (Last year, 16 residential sold at average $355,000)
In 2017, 1 Bedroom Average rent: $1,400 ($1300 in 2015) / 2 Bedroom Average rent : $1,700 ($1600 in 2015)
More people are thinking West Farms is a ‘Hidden pearl’. Population is mostly Latin Americans (Immigrants)
Public Transportation: Subway #2, #5 (Stations: West Farms Square, East Tremont Ave)

3. Brooklyn “Navy Yard” Redevelopment project launched

Total 300 Acre Development / $2.5 Billion Cost → Will create about 10,000 jobs
Ground breaking for 9 story building as a start
‘Building 77’ built in 1942 → Hi-tech manufacturing facility, warehouse, transportation center, HQ for FreshDirect (On-line food shopping mall). Steiner Studio, etc. (Total 1 Million SF)
Used as Navy Yard from 1801 to 1966 (165 years) → Non-profit organization BNYDC leased for long term and developed continually
About 40 buildings on 4 Million SF lot

4. Subleases flood Manhattan, Wall Street area → Bad sign for landlords

Companies are dumping 600,000 sf of subleases downtown → Competing with their own landlords and threatening to undercut rents → Pressure to lower rent
Conde Nast (Mass Media Company founded in 1909) is giving up 376,000 sf out of 1 Million SF at 1 World Trade
Liberty Mutual Insurance is looking for sublease tenant for 130,000 SF at 55 Water St (3.5 Million SF behemoth by the East River)
Port Authority of NY/NJ is marketing 2 floors at its HQ at 4 World Trade Center
Over all, subleases made up 2.3% of the market’s 105M sf at the end of May
More supply is on the way: Developer, Larry Silverstein cut the ribbon at 3 World Trade Center, 2.5 Million SF skyscraper on Monday (6/18) → He said it constantly ebbs and flows
Currently 14.3 Million SF of office inventory under construction in Manhattan

5. Whole town in California (‘Cerro Gordo Ghost Town’) was listed at $925,000

3 hour distance from Los Angeles
Abandoned mining town for lead and silver from 1867
Total 316 Acre (There were Hotel, Bunker house, School, Hair Salon, etc. → Total 22 buildings)
Currently used for tourism / Sales includes mining right for lead and silver
ghosttownforsale.com

6.Home Equity increased by $1.01T for a year

House earned $16,300 as home equity
As of April 2018, 13.3% equity increased s of April 2018, 13.3% equity increased, compared to a year ago
California, increased Average $51,000 → About 1 year salary
Underwater houses decreased sharply → 84,000 houses become positive in 1st
Underwater house → 5 Million (21% decreased from 3 Million last year) → 4.7 % of total houses (Highest point → 26% houses were underwater)
Home remodeling will become popular / Increased equity will be converted to consumer expenditure → Boosting economy
Average DOM to close → 64 days (Last year July → 71 days)
According to NAR, average DOM to UC → 26 days

7. Z Generation (15~25: Born after 1995) will spend $226,000 rent before buy a home

According to ‘Hotpad’, 11 years as renter before buying a house (M Generation take 12 years)
In San Francisco, Z Generation takes $563,000 (M Generation takes $429,200 / Baby Boom Generation:$282,700)
In LA, Z Generation: $479,200 / M Generation: $359,600 / Baby Boom Generation: $225,200
In New York, Z Generation: $328,400 / M Generation: $318,700 / Baby B Generation: $194,700
Middle age selection: Z Generation → 2002 / M Generation 1987 / Baby Boom Generation →1954

8. US Ref IR raised by 0.25% to 1.75 ~ 2%

FED decided to raise Ref IR at FOMC
IR raised in March → 2nd time (7th raise from zero(0) IR)
Expected one more time in Sep → But possibly two (2) more this year
Consequently, newly developed countries might suffer due to fund moving to US
Next year, anticipated 3 times raise
FED chair Jerome Powell mentioned good economy/ positive sign for inflation due to oil price hike

9. Korean Currency (₩) becomes weaker and Stocks dropped

Reason : Re-igniting Trade war between US and China / US Ref IR raised to 1.75 ~ 2.0% US-North Meeting’s outcome was lower than expected
₩1104.8 → Weakest in 7 months / KOSPI went down to 2340 / Kosdaq went down to 840.23 (3% Down)

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