A report from Bisnow. "Experts have been estimating the likelihood of a commercial real estate bubble for years now. As recently as a year ago, experts in sectors like multifamily denied that bubble-like conditions existed, or at least downplayed the likelihood. Now analysts are changing their tune. Warnings about a commercial real estate price bubble have been increasingly common this year."

"Former Federal Reserve Chair Janet Yellen said so before leaving office, her successor has hinted at it, and Goldman Sachs and Wells Fargo, among others, have broached the subject as well. The upshot is that valuations keep appreciating and investors keep betting that rents can go higher to pay for it. Nonbanks have been facilitating those bets by stepping up their CRE lending in recent years, even as banks started behaving more cautiously in the sector, Bloomberg reports."

"Some banks have loosened their lending standards this year for CRE loans, the better to compete with alternative lenders, the Federal Reserve reports. That means that despite higher interest rates, the money is still flowing to pay for ever-higher-priced CRE deals."

From Crain's New York Business. "Extell Development Co. launched sales at its newest Billionaires Row tower today. The firm is hoping to rake in more than $4 billion selling 179 units at Central Park Tower, though market dynamics suggest that moving the building's bigger, pricier units will be a tall order."

"More homes are on the market for longer, and fewer are being sold, according to data from Miller Samuel. And the pricier the apartment, the more dramatic the slowdown—in part because the supply of foreign buyers looking to park money in Manhattan real estate has dwindled."

"'You had that window of time when the Russians and Chinese were buying with flight capital that are gone, just completely gone,' Andrew Gerringer of new development brokerage the Marketing Directors said, noting that developers along West 57th Street such as Extell could find themselves in trouble."

From Mansion Global on New York. "The Manhattan townhouse market has logged its second strong week in a row, according to the latest Olshan Report. Buyers signed contracts for five townhouses in the week ending Sunday, adding up to 11 such transactions in the past two weeks. In total, there were 23 contracts signed for luxury homes—both apartments and townhouses priced over $4 million—in the week ending Sunday."

"Sellers have had to discount their houses by substantial amounts to get a deal done. On average, a townhouse sold in the past two weeks has gotten a 19% price cut from when it first hit the market."

From National Real Estate Investor. "Visit any urban center in a major U.S. city and you'll see a similar view: cranes dotting the landscape and billboards advertising units in the latest luxury apartment projects. Has the focus on high-end units gotten out of hand?"

"New research from RentCafe found that luxury rental properties had accounted for 79 percent of all apartment construction in the U.S. And in the 2018 that number has grown to a whopping 87 percent. In many cities, a full 100 percent of projects completed in the first half of the year were upscale units."

"According to RentCafe: 'The most active metros in the high-end apartment segment last year were neither New York nor L.A. Metro St. Louis has built nothing but high-end apartments in 2017. Supported by local tax breaks, the urban rehabilitation of St. Louis is driven by luxury developments in an attempt to attract new residents. The luxury market is also thriving in Las Vegas metro — where 100 percent of the apartments built in 2017 were luxury.'"

"'But in terms of scale, nowhere is the luxury segment flourishing more than in Texas. Giant real estate hubs Dallas-Fort Worth and Houston metro take the third and fourth spots, with 98 percent and 97 percent respectively being high-end projects in 2017. Both urban and suburban areas of Baltimore, Cincinnati, Boston, Kansas City, and Atlanta have exceeded 90 percent high-end apartments of new deliveries.'"

From Sparefoot. "Does the overall decline in self-storage rental rates in the U.S. signal an industrywide slump? Well, not quite. On the heels of roughly six to eight years of double-digit rent growth, rental rates are beginning to normalize, said Adam Schlosser, senior director of Marcus & Millichap’s National Self-Storage Group."

"In many markets, rent growth either has narrowed to single digits or has headed into negative territory, he noted. While rental rates have fallen over the last year in oversupplied markets — such as 4.7 percent in Austin, TX and 6.6 percent in Dallas-Fort Worth, TX, according to Yardi— they’ve risen in other places."

"'If you think about it like a stock portfolio, you’re almost safer betting on Detroit today than you are, say, San Francisco, because at this point in the business cycle, there’s likely to be more volatility in real estate prices in San Francisco than there will be in Detroit,' said David Dent, senior real estate market analyst at Yardi."

"Schlosser emphasized that although sophisticated revenue management can’t stop rent growth from softening in supply-hampered markets such as Denver, CO, and Nashville, TN, investors and developers still might find opportunities in micro-markets — standard three- to five-mile trade areas — within those regions. Moreover, experts said, the new-supply crunch should subside over the next couple of years."

"'We have to understand that we cannot continue to push rates at 10 percent a year — the consumer will just be priced out of the market,' Schlosser said."