Power Reads: 5 Interesting Articles That Will Help You This Week
/Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.
1. The Great American Reunion
After a year-and-a-half of isolating Covid lockdowns, Americans are emerging from seclusion into the joy and comfort of others.
For many, that means family. Adults are heading back to childhood homes to the arms of Mom and Dad. Families are hosting reunions and making up for missed Sunday dinners. The kids are taller, the moments sweeter.
For others, it’s the routine pleasures of lunch with the gang from the office or the coffee shop or the corner bar. The guy from the next cubicle over is grayer, but his stories somehow seem funnier now.
Celebration, secular and religious, is the order of the day. To sway in a sweaty crowd to the rhythm of music at a festival. To raise hands in prayer in the communal spirit of worship, and to hold them out to neighbors and friends.
2. Americans Boosted Spending, Adding Fuel to Economic Growth
Americans continue to venture back out into public to buy services they went without for more than a year—a shift that is adding fuel to the economic recovery and stirring higher inflation.
Consumer spending, the biggest source of economic demand in the U.S., rose 0.5% last month after surging in March, the Commerce Department said Friday.
The report offered mostly positive signs about the direction of the economy’s path out of the pandemic-induced downturn. After months of buying goods from the safety of their homes, Americans are increasingly comfortable enough to go out in public and buy things in person, a shift that economists say is crucial to getting the economy running at full speed again. Spending on services, which account for the bulk of all consumer purchases, rose 1.1% last month; spending on goods fell 0.6%.
3. Consumer Shopping Behavior Changing As Pandemic Recedes
Discretionary retail sales revenue in the US increased by 17% over the first half of the year and rose 18% over 2019 levels, suggesting that the uptick in consumer spending predicted by many experts post-pandemic is beginning to materialize.
The figures—outlined by The NPD Group—demonstrates that consumer behavior is beginning to change following the COVID-19 crisis. Sports equipment, home products, consumer tech, and toys all posted strong sales numbers in 2020. And spending in the categories relating to home-based work, education, fitness, entertaining, and healthy home—sectors NPD dubbed “lifestyle pillars”—will continue to drive growth.
“Some experiential spending is already coming back strong, as consumers do more, dress up more, place more emphasis on appearance and health, and start to spend more on tangible products related to travel and other experiences,” said Marshal Cohen, chief retail industry advisor for NPD. “However, as this pent-up demand works itself out in the coming months, we can also expect those rising sales to throttle back a bit in apparel, footwear, and other categories.”
4. WeWork’s Demand Surpasses Pre-Pandemic Levels, Chairman Says
Demand for coworking space at WeWork locations has recovered, according to WeWork Executive Chairman Marcelo Claure, with inquiries from potential customers exceeding pre-pandemic levels. Claure, who is also SoftBank Group chief operating officer, made the comment during an interview at the Bloomberg Businessweek virtual summit.
“Sales are back to pre-pandemic levels, and our sales pipeline is strong," a spokeswoman told Bloomberg by email afterward.
The comments came in the wake of WeWork CEO Sandeep Mathrani's assertion during a May 11 Wall Street Journal podcast interview that "those who are least engaged are very comfortable working from home,” a comment that Mathrani has since apologized for.
5. House Hunters Are Leaving the City, and Builders Can’t Keep Up
Tired of being cooped up, eager to take advantage of low interest rates and increasingly willing to move two or more hours from the urban core, buyers have propelled new home construction to its highest level since 2006. That was the year when the mid-2000s housing bubble started deflating on its way to what would become the financial crisis and Great Recession.
After a prolonged period of anemic sales since the housing bust, home builders now risk losing business because they can’t supply enough inventory. Home prices have shot up 11.3 percent over the past year, according to CoreLogic, keeping many people out of the market. At the same time, the cost of labor and raw materials — in particular the cost of lumber, which has more than doubled over the past year — is spiraling upward, pushing prices higher still.
Just as notable as the level of new construction is where it is taking place. From the mountains of central Pennsylvania to the one-stoplight towns beyond Houston’s endless expanse to California’s San Joaquin Valley, developers are racing to build homes in areas that buyers used to judge beyond the outer limits of an acceptable commute.
Your success blesses others. I wish you a great a hugely impactful week!
