The Real Deal New York

National Cheat Sheet: Home Depot and Lowes profit from the home construction slowdown … & more

By Maya Rajamani | June 07, 2018 03:45PM

Clockwise from top left: Lord & Taylor closing flagship store on Fifth Avenue, Sam Zell uses vulgar language in response to #MeToo question, Douglas Elliman’s new platform to provide tools for agents, and Wafra head of real estate fired for sexual harassment.

Home Depot and Lowes are profiting from the home construction slowdown
New home construction is slowing down — sending prices up — which means more and more homeowners are renovating their current homes, Bloomberg reported. As a result, stores like Home Depot and Lowe’s are seeing an influx of customers. Renovations and repairs may also be on the rise because homes throughout the U.S. are aging, according to the outlet. [TRD]

Home flipping rates hit 6-year high nationwide: report
In the first quarter of 2018, the rate of home flips reached its highest level in six years, according to a report by ATTOM Data Solutions. New York City had a 20 percent increase in home flipping compared to the first quarter of 2017 and Chicago saw an increase of seven percent year over year. The average gross profit from a home flip was $69,500 according to the report. [TRD]

Equity Group Investments chair Sam Zell uses vulgarity in response to #MeToo question
The chairman of Equity Group Investments shocked some audience members at a REITweek investor conference on Wednesday when he responded to a question about the #MeToo movement and diversity in the workplace. “I never promoted a woman because she was a woman. I never demoted a woman because she was a woman. My issue is what you do, what you produce, how do you interrelate to the rest of the business,” Sam Zell said at the conference. “I don’t think there’s ever been a, ‘We gotta get more p—y on the block, OK?’” he added. The audience at the conference gasped and laughed at Zell’s comments, according to Bloomberg. [TRD]

Douglas Elliman’s new platform, the ‘Douglas,’ to provide tools for agents
Real estate brokerage Douglas Elliman has launched a new platform that allows agents to access marketing tools and an app store. The “Douglas,” as the platform is called, has developed a number of partnerships with third-party apps and may expand upon its existing ones, Douglas Elliman’s CTO Jeff Hummel said. The brokerage also has a back-end portal for listings coming out this year. [TRD]

Wafra’s head of real estate, Francis Lively, fired after VP accuses him of sexual harassment
Global investment firm Wafra Investment Advisory Group fired head of real estate Francis “Frank” Lively after a vice president accused him of sexually harassing her for years, Bloomberg first reported. The vice president, Sabine Kraut, filed a complaint with the Equal Employment Opportunity Commission claiming she was repeatedly forced to reject Lively’s advances. His harassment made Kraut fear for her safety and cost her promotions, she said. [TRD]

MAJOR MARKET HIGHLIGHTS

Lord & Taylor’s Fifth Avenue flagship store closing after more than 100 years
Lord & Taylor’s Fifth Avenue flagship store is closing after more than a century, parent company Hudson’s Bay Company announced this week. The news comes less than a year after Hudson’s Bay sold the store to WeWork and partner Rhône Capital for $850 million. The move “reflects Lord & Taylor’s increasing focus on its digital opportunity and HBC’s commitment to improving profitability,” the company said. Nine other Lord & Taylor stores will also shutter by the end of the year. [TRD]

Palm Beach real estate developer running for Florida governor
Real estate developer Jeff Greene, who has said he plans to “disrupt West Palm Beach” with new development is running for Florida governor. Greene’s net worth is $3.8 billion, according to Forbes, and it’s likely he’ll put some of that money toward his campaign. This isn’t the first time Greene has run for office. In 2010, he tried to win the Democratic primary for U.S. Senate, but lost to Kendrick Meek. [TRD]

Where California’s leading gubernatorial contenders stand on housing
The two top-placing candidates for California’s election primary for governor — Democrat Gavin Newsom and Republican John Cox — champion the idea of building more housing, particularly for the state’s homeless population. Where they disagree is on whether the state should entrust private or government forces to tackle those issues. TRD takes a look at their past statements on the issue here. [TRD]

Illinois developers could benefit from statewide historic preservation tax credit
A statewide historic preservation tax credit that was approved by the Legislature last week could be a positive for Illinois developers. If Gov. Bruce Rauner signs on, developers could get a 25 percent state income tax credit for certain expenses they incur on projects that involve historic buildings. “It’s a great tool for saving buildings and helping a developer finance deals,” Chicago attorney Darryl Jacobs said. [TRD]

Saudi government buys Jackie Kennedy’s childhood home for $43M
The Saudi government has purchased Jacqueline Kennedy Onassis’ childhood home, the Wall Street Journal first reported. AOL co-founder Steve Case and his wife sold the seven-acre property in Virginia to the government for $43 million. The new owner “understands the historical significance of the Merrywood home and has tremendous respect for its place in American history,” a spokeswoman said. [TRD]