Submitted by Taps Coogan on the 24th of September 2018 to The Sounding Line.
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Sam Zell, businessman, real-estate mogul, and Chairman of Equity Group Investments, recently spoke with Fox Business News and warned about a growing surge in real-estate supply coming into the market.
Sam Zell:
“I think things are a little frothy and I think they’ve benefited significantly from the fact that there has been a dearth of supply. The dearth of supply is for sure changing (now) and we are seeing very significant new supply in office (real-estate). We’re seeing new supply in multifamily. The flavor of the month is industrial (real-estate) and I do a lot of reading and I always look for idiosyncrasies and one of the peculiar things that I have found is that everybody in the world is building industrial (real-estate). Now I know that Amazon is terrific and I think that they’re a great company but everybody is building industrial? Everywhere? And building it in huge… million, two-million square-foot buildings. I just wonder whether the lack of discipline that marked the real-estate industry in the past is not coming to repeat it… I just have this sense that we have a lot of supply coming on that’s going to effect various parts of real-estate, obviously in different sectors and different time-frames.”
There is much more to the interview so enjoy it above.
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Zell is again spot on. Retail stores closings have become so common they go often go unnoticed. The other day the last Sears store in my city announced it is going to shutter its doors. This is the third anchor store in the mall across from my office to exit in 2018. Last year more than 7,000 stores closed their doors, more than twice the amount of stores that opened in the same time period. The costly bill resulting from online retailers assaulting our brick and mortar retailers will come in many forms including defaults on loans and bonds as… Read more »
Very well said Sam!