Shifting Landscapes

Author

Nicholas Burrus
November 20, 2023

Presented by Astra Properties LLC
Shifting Landscapes: Navigating the Downfall of Commercial Real Estate and OpenAI's Leadership Change
By Nicholas Burrus · 11/20/23
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☀️ Good morning and Happy Monday ☀️ 

T-minus 3 days until Thanksgiving 🦃 

Commercial real estate has been in a weird spot ever since covid with vacancy rates rising, topping 19% in Q3 of this year.

Why is that?

The vacancy spike goes hand in hand with the remote job / work from home wave that’s been increasingly popular since the pandemic. With more opportunities to work remote, and less people needing to travel for work, it makes sense that major cities are seeing a fall in people needing somewhere to rent.

So what does this mean for you?

It depends if you’re trying to buy a building or not. If you are, here is a list of the cities currently facing the largest risk of a downturn:

Atlanta, GA: High reliance on CRE (commercial real estate) for property value and government revenue; 23% vacancy rate.

Boston, MA: Significant part of the government budget reliant on CRE; 14% vacancy rate.

New York City, NY: Large portion of property value in CRE; 23% vacancy rate.

Houston, TX: Considerable CRE influence on property value and government revenue; 25% vacancy rate.

San Francisco, CA: High local budget dependence on property taxes from CRE; 27% vacancy rate.

Denver, CO: Significant CRE presence; 22% vacancy rate.

Other cities like Chicago, Washington, DC, and more are also at risk, with varying vacancy rates and CRE sensitivities.

WeWork's bankruptcy doesn’t help the situation, especially considering its substantial office space rentals across the U.S. (even though that didn’t have much impact on the residential side)

This isn’t to say that all commercial real estate is in risk of a downturn. There are some cities that are on the up and booming such as Philly, San Diego, and Phoenix, all with vacancy ratings below 15%.

Bottom line:

If the numbers make sense in the deal

Buy it! 🏢 

OpenAI Fires Sam Altman 🤖 

Sam Altman is leaving OpenAI due to him “not being consistently candid in his communications”.

How does this effect the AI space?

I would say we won’t notice any major changes.

People will still use ChatGPT and all its plugins all the same

Microsoft is still pumping money into OpenAI with no signs of backing down, and they are in full support of the temporary CEO Mira Murati.

So despite Altman‘s departure, everything is seemingly normal across the space

Maybe him and his Co-Founder Greg Brockman will create an alternative platform 🤔 

  • Healthcare

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  • Banking and Finance

🌳 Learn, Adapt, Grow 🌳 

Weekly Mindset Check In 💡 

Life is a constant learning experience.

But often our brains get clouded by everything going on around us rather that be from our phones, work, or issues in our lives.

It’s essential to keep an open mind and continue educating ourselves day to day

I aim to meditate daily to keep my mind as clear as possible

Keeping yourself in a good headspace will improve all aspects of your life (in my opinion) rather that be in business, relationships, etc.

We’re like plants that need constant watering to grow in a way.

Remember to water your pot daily 🙂