Location Strategy Chartbook 02.01.25

If you’re new to Location Strategy’s Top 10 weekly Chartbook, we endeavor to curate the top macro charts/news and real estate news for our real estate market study clients as you look to make investment, development and product decisions. If there is a topic or area you would like to see us cover more, please drop Julie an email to: [email protected]

You can also read past newsletters here: https://locationstrategytop10.beehiiv.com/

Who wants to see more LS commentary on design? I may launch a website focused on case studies of design, mixed use, mini cities and experiential aspects of real estate. Who would read this?

Our argument is there is an opportunity for a builder/ developer to differentiate and make money not just in design but experience and usability.

On design, which one is the new construction apartment rental and which one is the single family home to purchase? A lot of design is so similar looking, its hard to differentiate higher end vs lower end. The amelioration of design is driven by faux and cheap replicas, but also lack of unique and different.

Bloomberg: In the global economic rankings contest, the US has just tightened its hold on the championship belt, with its 2024 growth rate surpassing that of China, thanks in large part to the irrepressible American consumer.

Data Thursday showed US nominal GDP — that is, before counting inflation — rose 5.3% last year. That’s more than a percentage point faster than China’s 4.2%, released two weeks ago, and marks a third straight year of American outperformance. (It also showcased how Trump inherited a strong US economy.)

WSJ: U.S. banks are no longer living in the shadow of the 2023 crisis sparked by the collapse of regional lenders Silicon Valley Bank, Signature Bank, and later First Republic. But recent reports offer a glimpse of what could haunt them next: a long, slow grind.

In particular, continued slow loan growth is becoming a drag on regional banks, which have less exposure to the booming Wall Street trading and investment-banking business that is benefiting some of the very biggest megabanks.

By all rights, the mood for banks ought to be upbeat. Worries about big deposit outflows are behind them. Based on history, the trifecta of steady-to-falling interest rates, an administration with a deregulatory agenda coming into office and sub-3% inflation ought to be a recipe for fast lending growth.

Yet in their recent round of quarterly updates, many banks continued to give only tepid outlooks for a key part of their business: lending money. PNC Financial Services said, for example, that there was no loan growth in its first-quarter 2025 net interest income projection.

Consumer spending accelerated, driven by households rushing to front-run tariffs

GS: Industries most impacted by undocumented workers. Construction, retail, food, and household services top the list

Marriage, fertility declines and the loneliness epidemic is a major issue globally but here in the US the trends are headed in the wrong directly.

As developers look to build community, the mini cities are ones to study and watch for demand. Does housing, retail, office outperform in these communities?

Axios: There's a growing marriage gap in the U.S.: Marriage rates for women without college degrees are falling, while rates for those with four-year degrees are holding steady.

A fascinating new working paper, titled "Bachelors without Bachelor's," from researchers at Cornell, Harvard and Yale unpacks the trend. Why it matters: The drop-off in marriage rates for women without degrees has everything to do with their male counterparts, the researchers find.

How it works: Men without degrees have seen their economic prospects decline over the past few decades, a trend that's been well-documented.

These financial troubles have led to lower marriage rates for men — and for women without four-year degrees. (Even as these women have seen their incomes rise.) In other (potentially outdated) words: a "good" man has become harder to find, at least for women with less than a four-year degree. So they're getting married less. By the numbers: 71% of women with a bachelor's degree, born in 1980, were married by age 45. That's compared to 52% of women without a degree, per the research.

The paper looked at government data for women born 1930 - 1980, and also projected out these numbers through to women born in 1994, and found that this trend should continue. Zoom out: There's been a lot of worrying in recent years that women with degrees would have trouble finding husbands; fewer men are graduating from college, after all. So who would these ladies marry?

Houston and Dallas combined have seen over 6.7 million square feet of retail space completed in the last twelve months.

For the past decade, these two markets have maintained a spot at the top of the mound, frequently vying for the coveted first-place spot for new construction at a given time. Only New York metro with a population more than double these two Texas cities, will occasionally surpass these leaders, which have held the top spot for 27 of the last 40 quarters of construction activity.

Industrial buildings in Southern California are getting taller by the year.

Developers are accommodating to the modern needs of logistics tenants by constructing buildings with more clear height. The additional space allows for higher racking systems, optimized storage and streamlined operations with automated machinery: improvements that allow for quicker turnaround times in order fulfillment.

Consumer demand for nearly immediate delivery services shifted building requirements among occupiers. High-ceiling industrial buildings provide logistics businesses the ability to fit more goods within the same footprint, reducing overall real estate costs. More vertical space enables tenants to maximize storage efficiency by employing advanced racking and automated retrieval systems

As a result, occupiers are increasingly seeking warehouse spaces that offer greater capacity and flexibility to handle larger inventories and advanced equipment. Clear heights among new industrial buildings in Southern California have risen to over 35 feet on average. Nearly 75% of the buildings larger than 100,000 square feet delivered in 2024 have clear heights of 36 feet or greater, and 15% have ceilings of 40 feet or higher. Older warehouses and smaller warehouses, often designed with lower ceilings and antiquated floor plans, may struggle to accommodate the demands of modern supply chains.

Per the latest growth estimates from the U.S. Census Bureau, three states encompassing the Pacific Northwest turned in solid year-over-year population gains between 2023 and 2024. Based on the most recent release, Washington, Oregon and Idaho also grew faster than the year before.

National active listings are on the rise (+24.6% between January 2024 and January 2025). This indicates that homebuyers have gained some leverage in many parts of the country over the past year, with some markets even feeling like balanced or buyers' markets on the ground. However, nationally, we’re still below pre-pandemic active inventory levels (-25.3% below January 2019), and some resale markets still remain tight—but, that’s not the case anymore in many pockets of the Sun Belt and Mountain West.