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The Daily Ten – Gary Keller steps down, Danny Meyer says restaurants need stimulus, Manhattan Rents cheapest since 2013…

October 8, 2020by Steve NsonNews

The Daily Ten – Gary Keller steps down, Danny Meyer says restaurants need stimulus, Manhattan Rents cheapest since 2013…

October 8, 2020 by Steve Nson
Thursday, October 8th, 2020

The Daily Ten

1. Almost One-Quarter of Homeowners in Forbearance Are Still Paying| Bloomberg

The forbearance issue that hangs over the mortgage bond market may actually be better than it seems at first glance.

Almost one quarter of all homeowners who have demanded forbearance are still current on their mortgages as of Sept. 6, according to the latest Mortgage Bankers Association data. Of the 3.4 million households currently in forbearance, roughly 820,000 have not missed a payment.

“That has been one of the most surprising aspects of this entire episode,” Mike Fratantoni, MBA’s senior vice president and chief economist, said in an interview with Bloomberg. “We’ve seen that share come down over time because some of those borrowers have exited forbearance.”

Call it “strategic forbearance,” with many homeowners taking on the option, just in case. Of the Ginnie Mae borrowers in forbearance, 23.7% are current. For conventional borrowers it’s 20.6%, and for those sitting on banks’ balance sheets it’s 28.6%.

This is important, as mortgages which continue to pay are not going to be bought out by servicers, and for mortgage investors buyouts are just prepayments by another name. With loans bought out from pools at par, this can weigh on portfolio performance, especially when much of the mortgage universe is trading at a premium.

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2. Restaurateur Danny Meyer on stimulus need: ‘We cannot reemploy people if we go out of business’ | CNBC

Famed restaurateur Danny Meyer told CNBC on Wednesday that the dining industry desperately needs government aid due to the coronavirus pandemic, warning of significant economic damage without it.

“We cannot reemploy people if we go out of business,” Meyer said “Closing Bell,” one day after President Donald Trump put an end to broader Covid-19 stimulus negotiations “until after the election.” Trump later expressed support for smaller bills targeting the airline industry, small business and stimulus checks for individual Americans.

Meyer, who is CEO of Union Square Hospitality Group and founder of burger chain Shake Shack, called the halt to relief talks a “crushing blow” for those in the restaurant business. He said that is especially true as restaurants grapple with the uncertainty around colder weather, complicating the pandemic-era lifeline of outdoor dining.

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3. Gary Keller steps back from Keller Williams amid major corporate restructuring | HousingWire

Keller Williams Realty will no longer have a CEO

Keller Williams co-founder Gary Keller has stepped down as CEO amid a broader corporate restructuring that will see the creation of a new holding company, KWx, and a new CEO.

In an email to Keller Williams’ leaders and agents Wednesday morning, Keller said the announcement is “one I have been working toward for many months and am confident will mark the next chapter in the history of Keller Williams.”

KWx will house all of Keller Williams’ affiliates and subsidiaries, including Keller Williams Realty, Keller Williams Worldwide, Keller Mortgage, Keller Covered and Keller Offers, and will “create alignment, scale and efficiencies across the Keller Williams ecosystem,” the company said in a news release.

“This move will allow me the opportunity to get back to my passion – placing my focus on the vision for our industry, consulting our amazing agents and leaders, and building the models and systems for tomorrow’s real estate environment,” Keller said in the email.

In January 2019, Keller, a charismatic Texan who co-founded the company in 1983, took back control of the brokerage from longtime employee John Davis, who had been CEO for just two years. At the time, the residential brokerage industry was grappling with a wave of consolidation, disruptions in technology, poaching wars and slowing growth.

Keller, who has pivoted multiple times during his decades at Keller Williams, re-emerged that winter to win back market share for the franchise brokerage. The list of challenges was long: some of its best agents had been picked from upstart rivals like virtual brokerage eXp Realty (which also has a profit-sharing model), Berkshire Hathaway HomeServices, and Compass. And Keller Williams had also been slow to adapt to shifts in technology.

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4. Boom Supersonic Unveils the Jet Concept That Will Fly From NYC to London in 3.5 Hours | Robb Report

The future plane could cut long-haul flights in half.

What if you could travel from New York City to London in just 3.5 hours? It may sound like pure fantasy when considering that the trip is normally a seven-hour slog, but a newly unveiled prototype could change that for good.

Engineered and designed by aviation startup Boom Supersonic, the XB-1 could revolutionize commercial air travel, introducing Mach speeds not seen since the days of the Concorde, which was retired in 2003. The full-scale demonstrator––showcased to a team of executives on Wednesday in Denver––won’t take to the skies until next year, but its mere existence is an important step to becoming a reality.

Though the model is a downsized version of what the company plans to build in the future at just 71 feet long (it currently only has room for the pilot), the jet is still anticipated to reach speeds of Mach 1.3 or 997mph via three J85-15 engines.

If all goes well with the initial testing phase, Boom Supersonic hopes a full-sized aircraft with room for 44 passengers can be in regular use by as early as 2029. The end goal is the development of its 199-foot-long Overture, its first commercial plane, which would have enough room to ferry between 68 and 88 passengers at any one time while flying at speeds literally double that of standard jets today. Aside from a speedy trip across the Atlantic, it would also mean traveling from Los Angeles to Sydney in 6 hours and 45 minutes compared to the normal 15 hour trek. But that convenience, as you would expect, doesn’t come cheap.  Tickets are expected to cost $5,000 each once the jet takes flight.

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5. Manhattan Apartments Haven’t Been This Cheap to Rent Since 2013 | Bloomberg News

Manhattan renters have never had this many apartments to choose from. And it’s been seven years since rents were this low.

September proved to be another winning month for bargain-hunters committed to finding a place in New York City’s costliest borough — and another month of worry for landlords trying to fill mounting vacancies.

Apartment listings tripled from a year earlier to 15,923, the largest monthly inventory in records dating back to 2006, according to a report Thursday by appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate. The vacancy rate set a new high for the fifth straight month, rising to 5.75%.

Renters are finding few reasons to sign leases in Manhattan, and even fewer to pay a premium to live there in the Covid-19 era. Offices are still mostly empty, public schools are largely remote and restaurants and cultural attractions like museums are operating at limited capacity.

“I’m not sure how this changes in the short term or over the next six months,” said Jonathan Miller, president of Miller Samuel. “The direction of the rental market is determined by when there is a vaccine.”

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6. Fancy Cars, Fine Dining, Creator Mansions, Cash: Triller Is Shelling Out for Talent | New York Times

TikTok’s top creators are taking “Triller money” to bring their content over to the app.

When talk of a possible TikTok ban began in July, the leaders of a small social video app called Triller saw a growth opportunity.

To attract users, the company set its sights on TikTok’s biggest names. Some of the Sway Boys, a group of TikTok influencers, had been toying with the idea of building their own app to compete with TikTok, but after a discussion with Ryan Kavanaugh, the majority owner of Triller and a veteran entertainment executive, they decided the platform could be good for them.

Triller offered the creators a deal: Tell your audience on TikTok that you’re moving to Triller, and we’ll give you equity and roles within the company. You can still post on TikTok, they were told, but only if you post on Triller more frequently. In turn, of the Sway Boys, Josh Richards, 18, was named Triller’s chief strategy officer, and Griffin Johnson, 21, and Noah Beck, 19, joined as advisers with equity.

Soon, CNBC, Fox News and The Los Angeles Times were writing about TikTok defectors bound for Triller, an app they described as a viable replacement for TikTok should a ban be put in place. In August, Triller announced it was seeking a new funding round of $250 million, hiking its valuation to over $1 billion.

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7. Pandemic Exposes Holes in Sweden’s Generous Social Welfare State | New York Times

Decades of budget-cutting and market reforms laid the ground for a wave of death in Swedish nursing homes.

In the popular imagination, Sweden does not seem like the sort of country prone to accepting the mass death of grandparents to conserve resources in a pandemic.

Swedes pay some of the highest taxes on earth in exchange for extensive government services, including state-furnished health care and education, plus generous cash assistance for those who lose jobs. When a child is born, the parents receive 480 days of parental leave to use between them.

Yet among the nearly 6,000 people whose deaths have been linked to the coronavirus in Sweden, 2,694, or more than 45 percent, had been among the country’s most vulnerable citizens — those living in nursing homes.

That tragedy is in part the story of how Sweden has, over decades, gradually yet relentlessly downgraded its famously generous social safety net.

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8. Inside the $1 Billion Bid to Rescue Affordable Housing | Bloomberg CityLab

A new partnership between housing groups aims to give nonprofit developers the resources they need to preserve affordable apartments.

In normal times, the deal to rehab Coggins Square Apartments might have been a very minor victory for advocates of preserving affordable housing. But these are not normal times.

The nearly 20-year-old building — a modest transit-adjacent apartment building in Walnut Creek, California, just northeast of Oakland — is getting a $16 million facelift, and its developers will preserve its existing 86 units as affordable housing for residents making under 60% of area median household income, with some units set aside for tenants earning much less.

In the Covid-19 era, with construction of new affordable housing in the U.S. slowing to a crawl as a massive wave of housing instability looms, the scheme represents a potentially life-saving win. The Coggins Square deal is an example of a project financed through the Low Income Housing Tax Credit (LIHTC), an investment incentive program that has subsidized more than 3 million low-income housing units since its inception in 1986. Two nonprofits were involved in the project — the National Affordable Housing Trust (NAHT) and BRIDGE Housing Corporation, with an investment from JP Morgan Chase.  It was the first deal during the pandemic to close for NAHT, a LIHTC syndicator that partners with developers and investors to build and preserve affordable housing.

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9. Envisics raises $50 million to bring AR holographic displays to car windshields | Venture Beat

Envisics, a U.K.-based startup developing augmented reality (AR) holographic head-up display (HUD) technology for cars, has raised $50 million in a series B round of funding from a host of automotive giants, including Hyundai Mobis, General Motors’ VC arm GM Ventures, and China’s SAIC Motors’ investment offshoot SAIC Capital.

HUD technology originally gained traction in the aviation and military realm — where it allows pilots and operators to view data directly in their field of vision. But it has increasingly made its way into the automotive sphere, with the likes of BMW embracing HUDs to display things like speed and directions in the windshield. However, most modern HUD systems offer fairly basic graphical functionality with a limited field of view (FOV) that places images near the front of the car — basically as a secondary display for information already visible elsewhere in the vehicle.

With AR-enabled HUDs, cars can overlay graphics that interact with real-world objects and leverage vehicle sensor data. In real terms, this means a car’s driver assistance system can move beyond audible alerts and flashing symbols to highlight a potential hazard on the road via the windshield, for example.

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10. Former College Basketball Walk-On Is Worth $11.3 Billion, More Than LeBron And Jordan Combined | Forbes

Former Michigan State basketball walk-on, Mat Ishbia, is now worth more than Lebron James, Shaquille O’Neal, Dwanye Wade, and Michael Jorden combined. Ishbia, who was a member of the 2000 NCAA championship time, is now CEO of United Shore, also known as United Wholesale Mortgage. The company is preparing to go public on the Nasdaq stock exchange in a deal involving another basketball connection, the older brother of Detroit Pistons owner Tom Gores.

The deal values United Shore at $16 billion and would leave its owners, mainly Ishbia and his father, Jeffrey, who founded the company, with a 94 percent stake. Mat Ishbia’s stake would amount to roughly 70 percent of the newly public company, which would translate to $11.3 billion, assuming a $10 share price, according to Bloomberg.

United Shore is the second largest mortgage lender behind Quicken Loans. It has a roughly 20 percent share of the overall mortgage market and a 33 percent share in the wholesale mortgage market. United’s wholesale lending business underwrites loans made by independent mortgage brokers. This contrasts with companies like Quicken Loans who also provide direct-to-consumer loans.

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