Latest / Bloomberg Intelligence / McEnearney's Howell on Urban Housing Shift Back to D.C. (Audio)

Transcript

McEnearney's Howell on Urban Housing Shift Back to D.C. (Audio) · Bloomberg Intelligence

• 0:02
  Speaker 1: Global business news twenty four hours a day at Bloomberg
• 0:05
  Speaker 1: dot Com, the Radio plus Mobile Act and on your radio.
• 0:08
  Speaker 1: This is a Bloomberg Business flag from Bloomberg World Headquarters,
• 0:13
  Speaker 1: assigned Charlie Pellett's Stock flore today. The cost of living
• 0:16
  Speaker 1: a gained in April by the most in three years,
• 0:19
  Speaker 1: and a trio of FEDE officials suggest higher rates could
• 0:22
  Speaker 1: soon be warranted. Tenured on two thirty seconds, yeald one
• 0:26
  Speaker 1: point seven six percent, SMP five hundred Index down nine
• 0:30
  Speaker 1: to two thousand forty seven, A drop there of point
• 0:33
  Speaker 1: nine percent. Has stackdown fifty nine, a drop of one
• 0:37
  Speaker 1: point three percent down, Industrials down one hundred eighty points,
• 0:41
  Speaker 1: a drop of one percent, Gold up six ten the
• 0:44
  Speaker 1: ounce to twelve eighty, a gain of five tenths of
• 0:46
  Speaker 1: one percent. Crude of eighty three cents of arrow fifty
• 0:50
  Speaker 1: five on West Texas inter Media, Crude a game of
• 0:53
  Speaker 1: one point seven percent. I'm Charlie Pellett. That's a Bloomberg
• 0:57
  Speaker 1: Business flash. You're listening to Taking Stock with Kathleen Hayes
• 1:02
  Speaker 1: and on Bloomberg Radio, Broadcasting live today at the Kimpton
• 1:07
  Speaker 1: Morrison House Hotel in Alexandria, Virginia, the Washington metro area
• 1:12
  Speaker 1: home of Bloomberg ninety one and one oh five point
• 1:15
  Speaker 1: seven fm h D two one of the big reports
• 1:18
  Speaker 1: the markets have had their eye on today and certainly
• 1:20
  Speaker 1: the three feed officials who are suggesting maybe rate hacks
• 1:23
  Speaker 1: are possible in June housing starts new home construction having
• 1:27
  Speaker 1: a nice game last month of six point six percent
• 1:30
  Speaker 1: nationally to nearly one point two million at an annual rate.
• 1:34
  Speaker 1: What is going on in the Washington D C. Area?
• 1:37
  Speaker 1: How about people who left to go to the suburbs
• 1:40
  Speaker 1: trying to rush their way back into the district. Joining
• 1:43
  Speaker 1: us now is David Howell. He's c i O, it's
• 1:46
  Speaker 1: Chief information officer at McNerney Associates, a leading Washington d C.
• 1:51
  Speaker 1: Metro real estate company. Thanks for joining us today, David.
• 1:53
  Speaker 1: Thanks appreciate the operating to be here. So what is
• 1:56
  Speaker 1: the big trend now? I when I first came to
• 1:58
  Speaker 1: the East coast about thirty years why can't believe it?
• 2:00
  Speaker 1: So long I started coming to Washington for work. I
• 2:02
  Speaker 1: was coming financial news in the fit. I remember what
• 2:04
  Speaker 1: the old district was like. It is so different now,
• 2:07
  Speaker 1: it really is, and and the trend has been with
• 2:10
  Speaker 1: real development and real boom in d C, and people
• 2:13
  Speaker 1: have been migrating more towards the district. There's been a
• 2:16
  Speaker 1: real huge development boom in d C, with huge development
• 2:20
  Speaker 1: towards apartments and condos um and particularly with orientation towards
• 2:26
  Speaker 1: apartments and condos without parking, without with any orientation towards
• 2:32
  Speaker 1: towards cars, which is a completely new development. David speak
• 2:37
  Speaker 1: about nightmare community, I'm wondering, what's the commune? Can it
• 2:40
  Speaker 1: be like tonight? How come long can people expect to
• 2:43
  Speaker 1: to stay in in traffic if let's say the whole
• 2:46
  Speaker 1: the city's in full swing. Well, and I think that's
• 2:49
  Speaker 1: part of what's driven the move towards the district people
• 2:52
  Speaker 1: that have been migrating from the outer suburbs. An hour
• 2:56
  Speaker 1: long community is not at all unusual, and particularly if
• 2:59
  Speaker 1: they're driving. And we've had some recent problems with Metro
• 3:02
  Speaker 1: in particular. Um and although they will get those problems fixed, UM,
• 3:06
  Speaker 1: it's washingt d C typically has the second longest commutes
• 3:09
  Speaker 1: in the country. UM And so forty five minute, hour long,
• 3:12
  Speaker 1: hour and a half commutes are not unusual. Well, you know,
• 3:15
  Speaker 1: we look earlier today to Mark Jinks. He's the city
• 3:17
  Speaker 1: manager for Harry and Alexandria, and he talked about I
• 3:21
  Speaker 1: asked him what was the biggest thing in his forty
• 3:23
  Speaker 1: years in managing, you know, urban development he's a city
• 3:26
  Speaker 1: manager here. Of course, the rail link for the Washington
• 3:29
  Speaker 1: C area. He said, it's made a big difference. Does
• 3:31
  Speaker 1: Washington d C need more of what you just described
• 3:34
  Speaker 1: dwellings that don't rely on cars and public transportation that
• 3:38
  Speaker 1: mose people around it does? And I think, UM, those
• 3:41
  Speaker 1: areas in the closer in suburbs and d C that
• 3:43
  Speaker 1: have planned well for transit have the one are the
• 3:47
  Speaker 1: ones that have really prospered. Alexandria City, Arlington have done
• 3:50
  Speaker 1: that extremely well. Some of the outer suburbs of Fairfax
• 3:53
  Speaker 1: County they're learning they have not that done that quite
• 3:56
  Speaker 1: as well. They have not done as dense planning around
• 3:59
  Speaker 1: the metro stops as Arlington and Alexandria have. The Maryland
• 4:03
  Speaker 1: suburbs have done that probably better than some of the
• 4:05
  Speaker 1: Virginia suburbs have. They're learning. UM. The silver line out
• 4:10
  Speaker 1: through some of the areas in Fairfax County they've learned
• 4:13
  Speaker 1: and they're doing that better UM and they're profiting from it.
• 4:17
  Speaker 1: UM and So those closer in suburbs that did that
• 4:19
  Speaker 1: well in the beginning, they've done very well. UM. The
• 4:22
  Speaker 1: ones that are doing it now, they're going to prosper
• 4:24
  Speaker 1: in the long term. And the revitalization that you see,
• 4:28
  Speaker 1: let's say in a place like Alexandria, can you comment
• 4:31
  Speaker 1: on that, you bet? Again, those those areas that are
• 4:33
  Speaker 1: around the metro stops that that allowed for dense um
• 4:37
  Speaker 1: development in the very beginning, they've done very well. The
• 4:40
  Speaker 1: ones that UM Vienna in Fairfax County immediately comes to mind,
• 4:44
  Speaker 1: where they had single family houses and broader townhouse communities
• 4:48
  Speaker 1: rather than town centers and more dense development. UM. They're
• 4:53
  Speaker 1: having to rethink their planning. Now. Where would you like
• 4:55
  Speaker 1: to see a new metro stop. That's a great question
• 4:58
  Speaker 1: because frankly, those new met pro stops are really hard
• 5:01
  Speaker 1: to come by now because the land is so hard
• 5:03
  Speaker 1: to to purchase now, is so expensive to do UM.
• 5:07
  Speaker 1: I think, frankly, those new metro stops probably aren't going
• 5:10
  Speaker 1: to happen now. What's really going to happen now is
• 5:13
  Speaker 1: they simply have to rethink the zoning and the planning
• 5:15
  Speaker 1: around where those metro stops are now. So speaking of things,
• 5:19
  Speaker 1: getting more expensive, not going to new associates, your real
• 5:22
  Speaker 1: estate company. Prices go up, commissions get higher. Business must
• 5:25
  Speaker 1: to be really good. But what does it mean for
• 5:27
  Speaker 1: the potential home buyer and the potential home seller in
• 5:29
  Speaker 1: this area? You know, Ultimately markets seek balance over time,
• 5:32
  Speaker 1: and where we've seen this explosive growth in d C
• 5:34
  Speaker 1: um as compared to the suburbs ten years ago, in
• 5:36
  Speaker 1: the last boom, it was the suburbs that were booming
• 5:39
  Speaker 1: that it will seek balance over time. Um As prices
• 5:42
  Speaker 1: have gone up in d C. Ultimately, it's going to
• 5:44
  Speaker 1: reach a point where prices have come to a point
• 5:46
  Speaker 1: where people will start to move back more to the suburbs.
• 5:50
  Speaker 1: Not the suburbs are dead now. Is just a little
• 5:53
  Speaker 1: bit more affordable in the suburbs, and it will get
• 5:56
  Speaker 1: people will come back to the suburbs. New York City,
• 5:58
  Speaker 1: Coastal California. A lot of foreign he has come in
• 6:00
  Speaker 1: and help boost those prices. Is that happen in washing
• 6:02
  Speaker 1: d C. I don't think it's happened in DC as
• 6:04
  Speaker 1: much as it has in San Francisco. In l A
• 6:06
  Speaker 1: and New York we've seen some of that, but just
• 6:08
  Speaker 1: not as much as it has in those other big cities.
• 6:11
  Speaker 1: Tell me about the issues that your customers are most
• 6:16
  Speaker 1: concerned about in an interest rate environment with low as
• 6:19
  Speaker 1: interest rates are now. Obviously rates are not the issue.
• 6:22
  Speaker 1: Down payment is the biggest issue for most of our folks.
• 6:25
  Speaker 1: Um And and not that that's an enormous issue, but
• 6:29
  Speaker 1: down payment is the bigger issue than payments. Well, David Hall,
• 6:33
  Speaker 1: we thank you so much for joining us today. Thanks
• 6:35
  Speaker 1: for the opportunity, appreciate being here. I was just gonna ask,
• 6:37
  Speaker 1: I want to. I just wanted to if there's one
• 6:41
  Speaker 1: thing that you could describe now and say it's going
• 6:44
  Speaker 1: to be different you come back in a year from
• 6:47
  Speaker 1: now or so on, what is the what do you
• 6:49
  Speaker 1: think is gonna be the biggest change here? I think
• 6:51
  Speaker 1: the biggest change here is going to be jobs, because
• 6:54
  Speaker 1: our biggest challenge here has been with the sequestration and
• 6:57
  Speaker 1: the cutbacks and defense spending UM that really arecipitated the
• 7:00
  Speaker 1: downturn in our market here. That's eventually going to get better.
• 7:04
  Speaker 1: So I think our market here is going to be
• 7:05
  Speaker 1: better a year from now than it is now. Um
• 7:08
  Speaker 1: And frankly, Northern Virginia market was impacted more to the
• 7:12
  Speaker 1: negative than most of our market because of the cutback
• 7:14
  Speaker 1: and defense spending. Contractors here are learning how to to
• 7:18
  Speaker 1: to adjust for that. So I think our market is
• 7:20
  Speaker 1: gonna be better a year from now than it is now.
• 7:22
  Speaker 1: Very interesting. Thank you very much, Thank you appreciated David Howell.
• 7:27
  Speaker 1: He is the chief information officer and executive vice president
• 7:31
  Speaker 1: of McInnerny Associates. They're based in Washington, d C. Thank
• 7:35
  Speaker 1: you very much. We are broadcasting live from the Kempton
• 7:39
  Speaker 1: Morrison House Hotel and alex Hendria, Virginia. This is Bloomberg Radio.
• 7:46
  Speaker 1: Coming up Bloomberg Law brought to you by Deutch Jakins PC.
• 7:49
  Speaker 1: If you feel you've been unlawfully terminated, you owe it's
• 7:51
  Speaker 1: yourself to call the law firm of Detch Jakins now
• 7:53
  Speaker 1: for a free phone consultation called eight hundred four nine
• 7:56
  Speaker 1: eight zero.