Weekly News (June 21, 2017)

1. Michael Pollotta (Democrat Chairperson of Palisades Park, NJ) passed away 6/18/2017

2. ‘The Forge’ in Long Island City in Queens, NY begins pre-lease on 6/20/2017

3. Manhattan Supersize complex ‘Essex Crossing’ is under construction

Rental/Condo/Commercial mixed use at Lower East side Manhattan
Total 1.65M SF / 3 Construction companies are involved
1^st phase: apartment will be completed in Oct. 2017 (All phases completed in 2024)
1079 Luxury condo units / Retail / Theater / Bowling lane / Senior center with 150,000 underground market
99 rental units → designated to low income seniors → 60,000 application for lottery

4. New York begins investigation to Landlord who asks tenant’s immigration status.

Rejecting the lease or extension of the lease due to immigration status → illegal act
Exception: LL can ask the status related questions when 1) applying rent control apartment
2) opening bank account for security deposit
www.ny.gov/programs/we-are-all-immigrants

5. Millennial Generation still leading position to buy

6. 1031 Exchange program might be gone?

Tax reform contains a plan to delete 1031 Exchange program or reduced
Reformers’ idea is to re-gain $40.6 Billion tax for future 10 years without 1031 program
RE professionals warns that commercial building trade will reduced significantly → Construction and other related industries will be affected
Compensation plan might be introduce: More depreciation can be reported

7. Still Housing cost is concerned in US

1/3 of households pay over 30% of income as housing cost → 9 Million (39.8 Million last year)
Over 50% as housing cost →18.8 Million (16% of total households)
Big city (like NY) is worse → Over 30% pay as housing cost: 40% of households in NY, 44% of households in LA
Demand is still high compared to supply, especially low cost rentals
New apartment supply → 7 units in 2017: increasing for last 7 years, but lowest increase since 2011
US total vacancy → 6.9%: decreasing for 7 years and lowest for last 30 years
Generally lower than $800 rental decreased (261,000) ←→ Over $2,000 unit increased (1.5 Million)

8. Amazon took over ‘wholefood’ chain

Purchased Wholefood share at $42 per share, total $13.7 Billion (27% higher than normal Wholefood share price)
Existing management will remain → Expand it’s presence to grocery market
AmazonFresh was launched in 2008 and AmazonGo (automated off line store) in 2016
30 Million members in US → will affect $700 Billion ~ $800 Billion Grocery market map
Amazon stock price increased by 3.3% / Walmart, Target, Costco stocks are down

9. Google will build modular home for employees

Big headache for Google due to soaring house price in Silicon Valley, CA
Google’s mother company ‘Alphabet’ will build 300 modular homes
Contract with ‘Factory OS’ →$25 Million ~$30 Million (house made in the factory / assembled on site)
Facebook is also planning to build 1,500 units

10. Depositing cash less than $10,000 repeatedly becomes troublesome

Deli owner deposited $4000 ~ $5000 every month → triggers IRS audit → Fine of about $200,000
Numerous times of check cashing more than $10,000 check to avoid CTR (Currency Transaction Report) → IRS investigation
Bank is required to report cash deposit over $10,000 (Also SAR requirement: Suspicious Activity Report for under $10,000)