Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
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Speaker 3: Thank you everyone, there's cool press confidence. Thank you for
Speaker 3: a right.
Speaker 4: That was a press briefing from one police Applaza in
Speaker 4: Lower Manhattan. Poice Commissioner Jessica Tish, Chief of Department at
Speaker 4: Jeffrey Madra, and Chief of Detective Joseph Kenny providing an
Speaker 4: update regarding the hom side often Manhattan, the United Health executive.
Speaker 4: Let's get some more reporting on this with Miles Miller.
Speaker 4: He's managing editor for Bloomberg News. Miles, anything in that
Speaker 4: press conference strike you as of note here still obviously
Speaker 4: very very early in the investigation.
Speaker 5: Yeah, you know, this is a really interesting investigation. They
Speaker 5: have a suspect who is able to flee on a
Speaker 5: city bike after shooting an executive in Midtown Manhattan in
Speaker 5: full view of plenty of people. Midtown Manhattan, of course,
Speaker 5: flooded with people around the time this happened, just before
Speaker 5: seven o'clock in the morning. It's very striking that Brian Thompson,
Speaker 5: a CEO of a company that is currently trading at
Speaker 5: about six hundred and thirteen dollars a share, with no
Speaker 5: executive protection, walking from his hotel into investor with no
Speaker 5: executive protection, and he's able to be shot by a
Speaker 5: person who was able to flee into New York City
Speaker 5: traffic at the height of rush hour.
Speaker 6: So, Miles, you have extensive work having worked with the
Speaker 6: NYPD when you worked in local news, you also led
Speaker 6: communications strategy.
Speaker 7: For the FDN.
Speaker 6: Y tell me about the process inside the NYPD when
Speaker 6: something like this happens.
Speaker 5: Yeah, So the first thing that the nypds did was
Speaker 5: search Arcis cameras, so that is the NYPD's network of
Speaker 5: cameras throughout Manhattan, and from those cameras they were able
Speaker 5: to pull that photo of the suspects standing in a
Speaker 5: shooter stamps and aiming at the executive at Brian Thompson.
Speaker 4: So that's the first step.
Speaker 5: The second step is going to be working with those
Speaker 5: partners like City Bike to figure out where we wound
Speaker 5: up going number one, number two, to figure out where
Speaker 5: that suspect is, and then also trying to trace every step.
Speaker 5: They put all of these videos that they take the
Speaker 5: suspect from the moment it happened to him getting a
Speaker 5: Central Park. They put it together on an app called Patentizer,
Speaker 5: and they're able to figure out just exactly where that
Speaker 5: person wound up and how to continue doing the investigation.
Speaker 5: So the investigation will focus on where he is. And
Speaker 5: then also they're doing that search worn in Brian Thompson's
Speaker 5: hotel room. They'll try to figure out if there was
Speaker 5: anything there that can lead them to what may have
Speaker 5: happened here.
Speaker 4: All right, Myles, thank you so much for that. We
Speaker 4: appreciate your reporting. Miles Miller, Managing editor, Bloomberg News in
Speaker 4: this unfolding story, extraordinary fluid, very early stages. But we
Speaker 4: did get some comments from leadership of the NYPD that
Speaker 4: again they are working all angles as you can imagine, right.
Speaker 6: And United Health Group obviously has many different subsidiaries, and
Speaker 6: Brian Thompson is the CEO of one of them, so
Speaker 6: he was the CEO of United Health.
Speaker 7: They also have financial services.
Speaker 6: They have a Medicare division, community division, and employer division,
Speaker 6: so he headed one of those divisions for the overall
Speaker 6: United Health Group and Bloomberg News will be keeping you
Speaker 6: updated on any headlines as they cross. And we heard
Speaker 6: also that the tree lighting ceremony today, the whole event
Speaker 6: starts at seven pm, and that will go on as
Speaker 6: expected with a much heavier police presence as well as
Speaker 6: ununiformed detectives.
Speaker 2: Yeah.
Speaker 4: I mean, I think one thing New York has shown
Speaker 4: over and over again is the resilience of the city
Speaker 4: and its people. And we move on, you know, as
Speaker 4: most folks tried to do as well.
Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live
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Speaker 4: Eleven thirty, Let's check in with Steve Miller, who he's
Speaker 4: the chair of the ISM Services PMI, Steve, thanks so
Speaker 4: much for joining us here. I'm looking at the ISM
Speaker 4: Services Index came in at fifty two point one. The
Speaker 4: consensus was fifty five point seven.
Speaker 8: Here.
Speaker 4: What are we seeing on the services side of the
Speaker 4: US economy here?
Speaker 3: Now, I think this month's number is a solid number.
Speaker 9: It's on trend. If you look past the last two months.
Speaker 9: I had a couple of interviews that I was in
Speaker 9: over the last two months. I mentioned just as likely
Speaker 9: those blips in new orders and business activity as well
Speaker 9: as supplier deliveries could have been the result of the
Speaker 9: port strike, people getting ready risk management around port strike
Speaker 9: and hurricanes, and those seem to be off trend. This
Speaker 9: one seems to be right on trend and continues to
Speaker 9: reinforce slow to moderate growth in the services sector.
Speaker 7: So the market is taking a little bit of different view.
Speaker 6: If I just look at the front end of the
Speaker 6: yield curve, you're seeing a bin to the BUN market
Speaker 6: yields a little lower, the dollar is dropping, and the
Speaker 6: S and P.
Speaker 7: Is off its highs.
Speaker 6: And I say that because it seems like the market
Speaker 6: is taking it as more weakness. Is that how you're
Speaker 6: describing it, like continued weaker services grinding.
Speaker 7: Lower or some sort of like, yeah, it's fine.
Speaker 3: I think for the next six months. To me, it
Speaker 3: looks fine.
Speaker 9: It's a trend of about fifty two percent, which is
Speaker 9: which is a solid number, although lower than it's been.
Speaker 3: In previous years.
Speaker 9: I think more of the concern is when you look
Speaker 9: at the summertime, which in non COVID years has been
Speaker 9: anywhere from half a percentage point up to six percentage
Speaker 9: points down from where it is in the September to
Speaker 9: November timeframe.
Speaker 3: So I think in the near term it looks solid.
Speaker 9: I'd be you know, there there's so many variables out
Speaker 9: there on tariffs and interest rate changes and that type
Speaker 9: of thing, fedrarate changes. I think, you know, I think
Speaker 9: the summertime is more of the question mark.
Speaker 4: All right, Steve, thank you so much with that. Steve Miller,
Speaker 4: he's the chairman of IM. That's the Institute for Supply
Speaker 4: and Management on Zoom from Aledo, Texas. How about that.
Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live
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Speaker 4: Salesforce dot com big tech company reporting big earnings last night,
Speaker 4: stock up nine and a half percent at a hitting
Speaker 4: an all time high market cap just below three hundred
Speaker 4: and fifty billion dollars. One of the real winners here
Speaker 4: stocks up thirty eight percent year today. Let's break down
Speaker 4: some of those numbers on rog Rana joins us the
Speaker 4: freshly shaved on a rock rana, Thank goodness, shave that
Speaker 4: thing off. Technolog Jannel's Bloomberg intelligence from.
Speaker 7: The technial them, I don't recoonize them.
Speaker 4: He looks like a professional now makes some years younger
Speaker 4: from that tech hub of Chicago, Illinois. Ana Rod talk
Speaker 4: to us about Salesforce dot com. They seem to really
Speaker 4: put up some good numbers. What is this street like
Speaker 4: about it?
Speaker 8: I think when you really peel the numbers on sales
Speaker 8: and backlog, they were pretty much in line. But I
Speaker 8: think what is really happening and something that we highlighted
Speaker 8: during a preview w some notes that we wrote earlier
Speaker 8: in October, they released a new product, Collegent Force, which
Speaker 8: is truly their AI product. Now that's not going to
Speaker 8: drive revenue over the next twelve months, but it really
Speaker 8: changes the shape of the company and with the direction
Speaker 8: it's going in, and I think that's what investors are
Speaker 8: buying in right now, along with their steady margin expansion.
Speaker 8: Margins were so good yesterday. That has been a big
Speaker 8: story for them as well. So I think on all
Speaker 8: fronts they're doing well and as I said, the sales
Speaker 8: growth is not going to show up near time, near term,
Speaker 8: but I think they have a clear strategy how they're
Speaker 8: going to play this game.
Speaker 6: So to this point, if Salesforce are doing this well
Speaker 6: without agent Force materially contributing to its bottom line, like
Speaker 6: I mean, what kind of upside do we really have
Speaker 6: and when do they read sort of full tilt on that.
Speaker 8: Yeah, I think I would agree with you on that
Speaker 8: because you know, people are buying into that without seeing
Speaker 8: the results.
Speaker 4: And I think this is.
Speaker 8: Truly what we have seen a lot in the software
Speaker 8: space is people really figured out which are the companies
Speaker 8: that will benefit in the long run, and a lot
Speaker 8: of that, you could say, value realization happens sooner, you know,
Speaker 8: when the revenue realization is so perhaps down the road
Speaker 8: there will be a time when the software space may
Speaker 8: not see evaluation uptake, but the sales growth will go up.
Speaker 8: But you know, one of the things you have to
Speaker 8: think about it when former Salesforce point of view, they
Speaker 8: have two really critical products. One is sales automation for
Speaker 8: salespeople and the other is customer service products for customer
Speaker 8: service people and in enterprises AI and is the biggest
Speaker 8: beneficiary to those customer service people chat pots AI agents.
Speaker 8: We recently did a conference and when we ask the
Speaker 8: question as to how many people use chat pots, it's
Speaker 8: still less than twenty percent at this point. So that
Speaker 8: is the direction where the world is going in terms
Speaker 8: of working with retailers, working with you know, airlines, and
Speaker 8: these guys are right in the middle of it.
Speaker 4: All right, So what is what's getting the market all excited?
Speaker 3: Here?
Speaker 4: This this this AI product? What is their AI product
Speaker 4: and what is it supposed to do? Because I actually
Speaker 4: moderated a panel with the Salesforce executive and I forgot
Speaker 4: everything he told me, So think about it.
Speaker 8: I actually have a very interesting demonstration if you go
Speaker 8: to YouTube and look at their Dreamforce and demo, it
Speaker 8: was actually pretty interesting because they did Sacks Fifth Avenue.
Speaker 8: So think about it this way, Paul, you you buy.
Speaker 8: You know, the presenter bought a jacket from saxs Fifth Avenue,
Speaker 8: didn't like the size or something, just went to the
Speaker 8: chatpot and say can you find me a different size?
Speaker 8: And can you the chatbot basically took care of everything,
Speaker 8: basically knew what size this person was, was able to
Speaker 8: return the jacket, you know, send another one to this
Speaker 8: person's address, or that matter, if it wasn't available, you
Speaker 8: could go to the store and pick it up without
Speaker 8: the intervention of a human. That level of sophistication coming
Speaker 8: into a chat pot so quick in the game, I
Speaker 8: think it's really what people are getting excited about and put.
Speaker 6: Some numbers on that, like how much is that going
Speaker 6: to do for them in terms of revenue? And how
Speaker 6: much do they charge for like that chatbot? So say
Speaker 6: like that chatbot works for me for two minutes, what's
Speaker 6: the translation of money?
Speaker 8: So the pricing starts at two dollars per conversation. Now
Speaker 8: the question is what does that mean. So when you
Speaker 8: look at you know, a person calling AD and D
Speaker 8: or Hoverizon, that call could cost as much as ten
Speaker 8: to fifteen dollars. If it's a quasi mix of an
Speaker 8: automated chat pot and a customer service person, you know,
Speaker 8: that call could be seven dollars eight dollars per conversation.
Speaker 8: Salesforce pricing at two dollars or so, so it will
Speaker 8: force companies to pix their customer service because think about it,
Speaker 8: if you're an insurance company, if you are a phone company,
Speaker 8: that's really a very large portion of your cost. Amazon's
Speaker 8: already doing so much of that in the chat pot.
Speaker 8: If you are used to returning things on Amazon through
Speaker 8: their chat pot, it's actually pretty impressive right now. But
Speaker 8: it is still rule based, which is, if it can
Speaker 8: only do so much based on the data that's available,
Speaker 8: it doesn't take you to the next level. And this
Speaker 8: is what Salesforce is saying is the direction of that
Speaker 8: is that the agent or the chat pot is able
Speaker 8: to execute a transaction for you without getting a human
Speaker 8: involved in it, which is refund the money for you
Speaker 8: return your things, give you an alternative of whatever you
Speaker 8: were doing before without any person getting in, and that
Speaker 8: really saves costs.
Speaker 4: All right, So this company's got like thirty nine to
Speaker 4: forty percent EBITDA margin. Pretty much all of that goes
Speaker 4: down to the free cash flow line. What do they
Speaker 4: do with their cash right now?
Speaker 8: They're buying back years. I'm sorry, Paul, but that's exactly
Speaker 8: what most software companies do when they have it.
Speaker 2: Now.
Speaker 8: Think about it this way. Just one and a half
Speaker 8: two years ago, this was almost ten percentage points lower
Speaker 8: because they were spending even more on sales and marketing.
Speaker 8: The big story for Salesforce in the last one and
Speaker 8: a half years has been a real improvement in margins
Speaker 8: and as of today, compared to let's say March of
Speaker 8: twenty twenty three, it's up ten percentage points. That's big
Speaker 8: if you look at from any you know, financial metric.
Speaker 6: All right, An, I really appreciate it, really good stuff.
Speaker 6: I'm if you give me a chatbot that can actually
Speaker 6: do something that when I call City Bank doesn't take
Speaker 6: me an hour.
Speaker 7: I'm gay. I'm down for that.
Speaker 6: All right, enter a ground on Bloomberg Intelligence Technology and
Speaker 6: I was joining us.
Speaker 7: It has not worked for me yet. It hasn't worked
Speaker 7: for me.
Speaker 4: Call for customer service. It freaks me out when I
Speaker 4: don't get a live.
Speaker 7: Yeah, and I keep saying my name and they're like,
Speaker 7: I don't understand you. Please talk to a real good boy.
Speaker 3: That's unders. Yeah.
Speaker 2: You're listening to the Bloomberg and Intelligence Podcast. Catch us
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Speaker 2: Just Say Alexa, playing Bloomberg eleven thirty.
Speaker 4: We love talking about commercial real estate all around this country.
Speaker 4: Because it's such a dynamic business and it's undergone a
Speaker 4: tremendous amount of change, particularly resulting from the pandemic, as
Speaker 4: this industry tries to continue its recovery and reinvention. And
Speaker 4: we love talking to some good, smart people about that.
Speaker 4: We got that today. Liz Hart, she's at over at Newmark.
Speaker 4: She's the president of Leasing for North America, and that's
Speaker 4: US and Canada. Abigail Deulttle Joints is too. She's our
Speaker 4: market correspondent in our Bloomberg and Directive broker studio. So Liz,
Speaker 4: let's step back and as we think about the last
Speaker 4: few year has been very difficult for certain parts of
Speaker 4: commercial real estate, not all, but certainly like office for example.
Speaker 4: I knows you as an industry always looking forward. What's
Speaker 4: the view forward for commercial real estate.
Speaker 1: In this country? We really see twenty four five is
Speaker 1: the year the real estate gets redefined. We're five years
Speaker 1: post of the pandemic. We're putting that all behind us.
Speaker 4: Now.
Speaker 1: People have experimented with different ways to view commercial real
Speaker 1: estate and now it's really about setting the value and
Speaker 1: creating the value going forward.
Speaker 7: So across key.
Speaker 1: Urban markets, particularly in New York and San Francisco. We're
Speaker 1: seeing demand that we haven't seen in five years, which
Speaker 1: is a really good thing to see because that demand
Speaker 1: will start to create future value in those assets.
Speaker 7: What kind of demand? What are you hearing in terms
Speaker 7: of demand?
Speaker 1: I think the most active segments of the market are
Speaker 1: still financial services across the country. Also, technology has a
Speaker 1: very strong and growing portion of demand, so we're seeing
Speaker 1: both of that.
Speaker 10: So relative to Newmark, let's back up for a moment,
Speaker 10: publicly traded company, one of the top real estate advisory
Speaker 10: firms in the country. Lots of different businesses. What's the
Speaker 10: main business and in terms of this thesis about twenty
Speaker 10: twenty five being the reset, what are the data points
Speaker 10: that you're seeing.
Speaker 1: Well, we've certainly created a purposeful kit of different parts
Speaker 1: that will come together to drive our business forward. So
Speaker 1: we're number one in capital markets across the country. As
Speaker 1: you're looking at what's going to happen in the debt
Speaker 1: markets and what's happening with the debt that will be
Speaker 1: maturing in the next year, there will be an onslaught
Speaker 1: of capital markets activity that will happen across the country
Speaker 1: and that will really.
Speaker 7: Reset the value.
Speaker 1: And that mixed with tenant demand is what's going to
Speaker 1: drive the business forward. So we think the services business
Speaker 1: is going to have really spectacular years in twenty five
Speaker 1: and twenty six.
Speaker 10: So in terms of being the top capital markets, that
Speaker 10: means you're actually doing these financings because we keep hearing
Speaker 10: and talking about this let's call it one trillion to
Speaker 10: one point five trillion dollar wall of maturity is coming,
Speaker 10: but there's been some extent and pretend.
Speaker 7: So you'll be very much involved in that activity.
Speaker 1: Yes, we have an incredibly active debt market team right
Speaker 1: now and they've traded a billion dollars just in REZI
Speaker 1: to or C the office to RESI conversions alone in
Speaker 1: the last couple of months. So we're seeing that turn on.
Speaker 1: So we're last year it was a lot of hey,
Speaker 1: what are we going to do next? It's starting to
Speaker 1: hit trades and then actually move forward, and we think
Speaker 1: that's really optimistic for.
Speaker 7: The year ahead.
Speaker 4: Where the part within commercial real estate, where's the growth,
Speaker 4: where's the opportunity? Because I still feel like in office
Speaker 4: we I'm not sure maybe we're starting to form a bottom,
Speaker 4: but we haven't seen a ton of activity, but I
Speaker 4: know there are other parts that are working.
Speaker 1: Yeah, I mean, I think the opportunity is trophy has
Speaker 1: been talked about a lot, so we know there's opportunity
Speaker 1: in trophy. But right below that, there's a category that's
Speaker 1: being repositioned right now towards having more amenities and being
Speaker 1: better space. That definitely is a segment of the market
Speaker 1: that we think there's a lot of opportunity, particularly in
Speaker 1: places like Seattle, San Francisco, Boston where you do see
Speaker 1: the demand picking up at such a large level. So
Speaker 1: that would be one category. We also see a lot
Speaker 1: of opportunity in office to RESI conversion that can happen.
Speaker 1: We're tracking probably about two percent of the market could
Speaker 1: be converted, and two percent sounds like a lot. And
Speaker 1: I'm a leasing broker, so you're probably wondering, why is
Speaker 1: the leasing broker advocating for an office to RESI conversion.
Speaker 1: But when you have twenty percent of availability across the
Speaker 1: entire market, there's still a lot of space that companies
Speaker 1: can transact on from an office perspective. But we have,
Speaker 1: you know, four to seven million homes that are missing
Speaker 1: in America, and so if we can take that real
Speaker 1: estate and reposition it, I think that's really an exciting
Speaker 1: part of what we'd see in twenty five, but it's
Speaker 1: unlikely to happen without the assistance of tax abatements, government
Speaker 1: interference and really pushing this forward, like we're going to
Speaker 1: have to do this together.
Speaker 6: Well, I was going to say, I've heard that the
Speaker 6: convergence there isn't as easy as it may sound. That
Speaker 6: it's a lot more complicated, particularly like windows and like
Speaker 6: central air and like moving walls and stuff.
Speaker 1: It's physically very complicated, which is why you don't see
Speaker 1: it happening on even a larger part. But what's interesting
Speaker 1: is we started tinkering this more and more post pandemic,
Speaker 1: and there's some very notable projects that will set the
Speaker 1: blueprint going forward that are delivering this year, including twenty
Speaker 1: five water in New York City. So we really see
Speaker 1: this as being something that will pick up.
Speaker 10: As our markets correspondent. Also with this real estate beat,
Speaker 10: I of course took a look at Newmark Stark because
Speaker 10: we don't talk to a lot of real estate folks
Speaker 10: who are around publicly trading companies, or at least that's
Speaker 10: not something that I've been in my coverage so much
Speaker 10: so far over the last year year and a half.
Speaker 7: But it's really interesting.
Speaker 10: So you went public in twenty seven and then up
Speaker 10: and then down, and then up and then down about
Speaker 10: sixty five percent on the real estate downturn, but then
Speaker 10: up almost two hundred percent off of that bottom into today,
Speaker 10: still a little bit below your record high, but it
Speaker 10: tells me that some of those smart investors out there
Speaker 10: are seeing something similar to what you're talking about in
Speaker 10: twenty twenty five being redefined. You have a sense for
Speaker 10: why people are gobbling up your stock like this.
Speaker 1: Yeah, I mean, I think that there's certainly a sentiment
Speaker 1: in the market that the markets are improving. But also
Speaker 1: Newmark has a very big strategy focused on top talent,
Speaker 1: and that's something that's very differentiated from a lot of
Speaker 1: our peers. So with AI and all the changes that
Speaker 1: are happening, we're still doubling down and investing in the
Speaker 1: downturn and top talent, and I think that's incredibly important
Speaker 1: as we recover, because fundamentally, those people are the ones
Speaker 1: that are making the decisions about how to reprice and
Speaker 1: how to think about what the value creation is going forward.
Speaker 1: We really know how to create alpha for our clients,
Speaker 1: and I think that's what we're seeing people be attracted
Speaker 1: to in our stock.
Speaker 4: Say I'm out in Middle America, I'm a developer. I
Speaker 4: want to put up a multifamily. Whatever is my bank
Speaker 4: and lend me the money. Where am I going to
Speaker 4: get the capital for that?
Speaker 1: These days? It depends on the situation. So it's obviously
Speaker 1: very unique on every single asset. But we are seeing
Speaker 1: debt and equity enter the market again because now that
Speaker 1: we have enough data points to know where the market is,
Speaker 1: people know how to price things right. I think the
Speaker 1: uncertainty of yesterday is now behind us and it's really
Speaker 1: about moving forward. That doesn't mean every project will pencil.
Speaker 1: It doesn't mean that every project will be at the
Speaker 1: same value that it was before. It just means there's
Speaker 1: an opportunity to move forward and create the next chapter.
Speaker 7: Where are the problem points still?
Speaker 1: I mean the debt that's maturing is still the problem point,
Speaker 1: because that's when the value is changing. And so there's
Speaker 1: this really interesting mix. And I can give a specific,
Speaker 1: you know, example from a building actually in San Francisco
Speaker 1: where the debt was just too high, that it was
Speaker 1: too high for anyone to do a transaction, but there
Speaker 1: there was a willing tenant willing to take one hundred
Speaker 1: thousand square feet in a building that they loved, right,
Speaker 1: everything else worth, but the capital structure below just didn't
Speaker 1: support it. I think, you know, there's a little bit
Speaker 1: of a standoff, and you can see that standoff being
Speaker 1: something that was really present in twenty three and twenty
Speaker 1: four because there's no way to move forward. But now
Speaker 1: I think people have realized, like, we are where we are,
Speaker 1: so we've got to move and I think we'll start
Speaker 1: seeing some of those become more liquid in the market
Speaker 1: and people just realizing, like, yesterday's value is gone, and
Speaker 1: I've got to move forward because I'm not able to
Speaker 1: meet the demand in the market today.
Speaker 7: So with that standoff, like we use that example, who caved,
Speaker 7: was that was the situation.
Speaker 1: Actually, interestingly enough, neither caved and the tenant went somewhere
Speaker 1: else and created the value for someone else, right, And
Speaker 1: then I guess that's there's this saying and commercial real
Speaker 1: estate that the best amenity is a well capitalized landlord,
Speaker 1: and you know that's probably going to continue to be
Speaker 1: true in twenty five, twenty six and for the next
Speaker 1: several years as this readjustment happens. But the fact that
Speaker 1: the demand is in the market does mean there's a
Speaker 1: lot of opportunity.
Speaker 4: Are we seeing equity people come in and say, at
Speaker 4: this value, I'm ready to put in equity into this
Speaker 4: building and lender, you're just going to have to work
Speaker 4: something out, and the lenders are willing to work something
Speaker 4: out certainly. I mean, because the lender at the end
Speaker 4: of the day will have to take a haircut the
Speaker 4: original equity. We're going to get a take take acrecut.
Speaker 4: But if fresh equity is ready to come in, because
Speaker 4: I would guess there's a lot of smart money out
Speaker 4: there that says, boy, fifty percent marked down, I'm in.
Speaker 1: There's a lot of smart money out there, and a
Speaker 1: lot of it is coming in places like San Francisco'd
Speaker 1: be a great example of that right where you can
Speaker 1: trade down and get something that will go for the
Speaker 1: next generation to create value.
Speaker 10: So this is certainly a news heavy cycle and year
Speaker 10: President elect Trump going to be taking office in January.
Speaker 10: What's the effect I've been dying to know what's the effect.
Speaker 7: Going to be on real estate?
Speaker 10: You know, if rates go higher but less regulation, what
Speaker 10: is the buzz out there?
Speaker 1: Yeah, I think commercial real estate largely sees. You know,
Speaker 1: Trump is being pro growth, as many people do, and
Speaker 1: so that's a positive for our industry. But I think
Speaker 1: for commercial real estate, what also matters, in addition to
Speaker 1: the national election is what's happening at the local level.
Speaker 1: So seeing half of the urban mayors switch in the
Speaker 1: last election cycle, seeing people like Daniel Lorie who are
Speaker 1: pro business, pro safety, pro transportation coming into office, that's
Speaker 1: really what starts to turn our cities on.
Speaker 10: You know. Regulation wise, there are some that said that
Speaker 10: in this election year that the regulation on regional banks
Speaker 10: was relatively laxed because of the presidential cycle, but that
Speaker 10: it could come on. Do you see any problems with
Speaker 10: the regional banks in the coming year, any kind of
Speaker 10: a crisis of sorts similar to the Silicon Valley situation
Speaker 10: last year.
Speaker 1: I think that the large crisis point is behind us,
Speaker 1: because now people are willing to realize that the values
Speaker 1: have changed and that we're moving forward. But certainly there
Speaker 1: could be some bumpiness in the next twenty four months.
Speaker 4: You just moved to New York City. I did from
Speaker 4: San Francisco. I did give us the expert view and
Speaker 4: just San Francisco, I mean, where are we has bottom.
Speaker 4: Is it coming back? What's driving it, what's good, what's bad?
Speaker 1: I would say never bet again San Francisco. It's a
Speaker 1: very resilient economy. It has been since the gold Rush.
Speaker 1: As you know, it is coming back. I think if
Speaker 1: you look at Market Street. Market Street's the big thoroughfare
Speaker 1: in San Francisco. Two years ago, everyone said Market Street's dead,
Speaker 1: it's never coming back, you know, write it off. Well,
Speaker 1: what's happened in the last twelve months, and the city
Speaker 1: anchored it because they're coming back to the office five
Speaker 1: days a week. At the midpoint, Notion, which is a
Speaker 1: growing AI company, you just took a very large lease
Speaker 1: from Brookfield, resetting that building to have increasing value. And
Speaker 1: on the other end, you have groups like BXP who
Speaker 1: are doing amazing work with the City of San Francisco
Speaker 1: to redo the plaza and make sure that it's safe
Speaker 1: for people who are coming and going from the downtown
Speaker 1: core right next to that rich transit of the Ferry
Speaker 1: building coming and going. So you see these signs across.
Speaker 1: It's just a fill in from there, and the streetscape
Speaker 1: still feels incredibly vibrant in San Francisco. So the other
Speaker 1: thing I really like right now is Daniel Lourie is
Speaker 1: calling leaders to participate in government, including people like Sam
Speaker 1: Maltman who are on his transition team. But he's also
Speaker 1: bringing back other businesses into San Francisco, making sure it's
Speaker 1: not just too reliant on the tech economy, but finance, legal,
Speaker 1: other sectors coming in and being vibrant in that city.
Speaker 10: So, speaking of San Francisco, Amy Price, president of Vigo,
Speaker 10: joined us maybe about two months ago or so, and
Speaker 10: she's one of the well known voices people in the
Speaker 10: commercial real estate space, and she said that she believes this.
Speaker 7: Fourth quarter is the bottom.
Speaker 10: She called it definitively from her view in about fifteen
Speaker 10: seconds or so.
Speaker 7: Do you agree, Yes, I agree completely, She's right there.
Speaker 6: You go appreciate that, all right, both, thank you very much,
Speaker 6: really appreciate that. Liz Hart Newmark, President of North America, Lisa,
Speaker 6: we very much appreciate it. Definitely come back, Thanks so much.
Speaker 6: Abigail Doolittle joining us from Bloomberg.
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