Commercial Real Estate Bubble
Another Real Estate Bubble?
Back in November 2016 I wrote an article about red flags that I saw pertaining to the United States commercial real estate market. If you missed that article here is the direct link: Real estate bubble 2017
Well, just this week I saw another red flag pertaining to the commercial real estate market. Yes, take a look at the photo to the left. I purchased an electronic device last Sunday from Amazon. I ordered it online about 8 o’clock in the morning on Sunday. As you can see from the bag, the online order form showed that it would be delivered between 12 and 2 PM (actually arrived at 12:30 PM) the same day. Now, as a prime member, there was no additional cost for this super quick delivery service.
I didn’t realize it at first, but the experience was so easy and so fast, I now believe that this is a definite danger for the large shopping malls. My article about the real estate bubble that I posted in November 2016 was about real estate limited partnerships (REITS) many of which invest in all types of commercial shopping centers and strip malls. So, for me personally, and I would venture to say probably quite a few other people, when ordering online, not only do you have the convenience and a very competitive price, but think of the time saved from having to go to the mall, find a parking space, fight the crowds and finally waiting at the checkout line before heading back home. Therefore, I really believe that this fast shipping service that Amazon has incorporated and I understand some other big online merchants are looking into, is going to spell big trouble for many shopping malls and thereby the REITS that invest in them.
Commercial Real Estate Market Condition
Alexander Goldfarb, an analyst at Sandler O’Neill & Partners LP, talks with Bloomberg’s Lori Rothman about the outlook for the commercial real estate market. Goldfarb also discusses real-estate investment trusts (REIT) and the outlook for Vornado Realty Trust.
httpv://www.youtube.com/watch?v=KZR9TQTPbgk