Weekly News (October 3, 2018)
1. Korean Restaurant โGumKangSanโ filed bankruptcy again
- The restaurant (Owner: JiSung Yoo) filed chapter 11 on 7/12/2018
- Frist chapter 11 filed in 2015 during wage dispute
- Debt is about $500K- $1M and Loaners are about 49, including fine by NYC fire department ($41,000) and Health department ($35,000)
- Real reason to file chapter 11 this time is to protect eviction by landlord
- Total debt to LL is about $810,000 (rent: $189,000/ tax:$244,000/ water: $48,000, etc)
- According to the restaurant owner, it is reaction from that LL could not sell the property due to the lease contracted till 2024
- 2015 wage dispute judgment ordered the owner to pay $$2.67M โ filed first bankruptcy
- The owner changed his title of a property to his wife, according to Manhattan court
2. โE Martโ announced opening the 1stย Store in LA, USA
- 712 South Olive Street, LAย โ mixed Use complex in Jewelry District
- Lease: 10 years / estimated lease amount: $40M/ 1stย โ 3rdย floor in 6 story building (total: 52,000 sf)
- Fit to โGrocerantโ style trends
- Opening will be toward end of next year
- The building is famous landmark building (built in 1917)
- Possibly it will compete against Wholefood nearby
- The plan decided after complete retreat from China
3. A Luxury Condo in West Village sold at $43.5Mย โ Highest price last month
- 160 Leroy street /penthouse unit
- 7700 sf/ 5 bedroom /5 bath/ super large library/ movie screen/ 4944 sf own roof top terrace with own swimming pool
- Buyer : Michael Rubin (owner of โKyneticโ/ owns some New Jersey devilโs stock)
4. New Jersey will charge tax on Airbnb
- Starting on 10/1, 5% occupancy fee, 6.625 sale tax (also local town can charge 3% as an option)
- Reason : more tax revenue for hotel type of service /also possible hotel industryโs lobbying
5. Z-Gen will next major home buying force
- Z-Gen: Born in 1995 (23 Y) โ 2010 (8 Y)
- Survey for 1995-1999ย โ over 85 % has a plan to buy a home during next 5 years
- Y-Gen (millennium generation) shows 87 % /X-Gen shows lowest %
- Biggest blocking factorย โ student loan ( Z-Gen:32%, Mill-Gen:17%, X-Gen:7%)
- Location preferenceย โ suburban area (Z-Gen: 60%, X-Gen: 26%)
- Down paymentย โย 50% paid less than $10,000 (12% paid more than $50,000)
- Period for preparation of down payment: 93% of Z-Genย โย less than 5 year (only 68% of Mill-Gen )
6. Many people wish to buy home, but cannot: Why?
- Home price move up and interest rates is also increasedย โ lowest buying power since 2008
- Home owning rate is increased slowly and steadily, but younger generation is still lower rateย โ Mill-Genย owning rate is 8% lower than Baby boomer Gen when they were Mill-Gen
- Fannie Mae warns that Baby Boom Gen put houses on the market and younger gen is not ready to absorb and, then home price might be decreased sharply
- Existing and new house sales are decreased for past few months
- New house builder stopped building new house for 4-5 years after financial crises, and last few years new construction recovered to fair level, but slow down again last two month
- June new home saleย โย 631,000 (yearly rate)ย โย 3% down / Julyย โย 627,000 (1.7% down from June) / Augestย โย 629,000
- According to NAR, July existing home sale: 5.34Mย โย 7% down from last month (forecast was 5.42M)
- Existing home salesย โ continuous decreasing for last 4 monthsย โย might be in market adjustment period
7. Fed Reserve raised Reference IR again by 0.25% on 9/26/2018
- ย โย Reference IR: 2.00-2.25%
- This 3 times : March, June, September
- Fed Reserve forecasts 3 times next and 1 time in 2020ย โ no change in 2021
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