Oklahoma City's real estate has true grit
The Oklahoma City real estate market has “backbone,” and that makes it a “determined competitor” even during the unfolding era of the coronavirus pandemic.
Although it might be seen as damning with faint praise, I prefer to seeing it as saying
Oklahoma City has true grit. Take it. It's the only good news from “Emerging Trends in Real Estate 2021,” the much-anticipated annual report on investment prospects by the Urban Land Institute and PwC (PricewaterhouseCoopers).
Here's the bad news, which isn't exactly news, but it is so stark as to be soul rattling:
“The COVID-19 pandemic appears poised to affect almost all aspects of our lives, including the use of real estate, for many decades.”
For many decades. I knew that. "Affect" can be negative or positive, but either way, seeing it in print, put so plainly, brought it home.
“Times of great change always present significant opportunities,” said W. Ed Walter, global CEO of the Urban Land Institute, as the report was released this week during the ULI Virtual Fall Meeting. “In the near term, our suburbs will benefit from new growth spurred by shifting demographics and changes to living and working patterns resulting from the COVID crisis. Our cities will have the opportunity to respond by re-imagining their public realm, building more resiliently, and reinventing assets, such as retail, that were already struggling before the pandemic.
"As an industry we have the opportunity to strengthen by truly embracing diversity and tackling the challenges faced by our communities.”
The coronavirus isn't the only thing reordering real estate, said Byron Carlock, who leads PwC's U.S. real estate practice.
“Now, more than ever, the
That's us, here in the middle of the country at a major crossroads, Interstate 40 and I-35. If things aren't rosy here now, it's largely because things aren't rosy anywhere, though we're also singing the crude oil blues.
real estate industry has the chance to take the lead in using planning and development skills and investment capital to reshape our work and lifestyle environments,” he said. “These tools can be used to address societal issues of safety, green space and racial equity. The gauntlet of responsibility is ours to embrace, and industry leaders see the opportunities and are responding with investment and leadership.”
The report, based on interviews with hundreds of property owners, developers, investors, advisers and others, is always an important read. This year, it's a critical read.
Now, the Oklahoma City stuff.
The report places the Oklahoma City market with Indianapolis; Birmingham, Alabama; Kansas City, Missouri; and Louisville, Kentucky, in the subgroup “determined competitors” of the major group “backbone markets.”
The report explains: “Determined competitors are diverse markets that are having success in reinvigorating their downtowns and neighborhoods. These markets tend to be strong ancillary locations in their regions ... all very affordable with a favorable quality of life.”
That's us, here in the middle of the country at a major crossroads, Interstate 40 and I-35. If things aren't rosy here now, it's largely because things aren't rosy anywhere, though we're also singing the crude oil blues.
“Emerging Trends” again puts Oklahoma City among “markets to watch,” even with an overall ranking at just No. 73 (out of 80), with Hartford, Connecticut, just ahead at No. 72, and Louisville just behind at No. 74.
Here's a gut punch: retail buy-hold-sell recommendations. The report lists 20 markets and Oklahoma City is 19th, with just 6% of survey respondents saying “buy,” 50% saying “hold,” and 44% saying “sell.” Just ahead is Omaha, Nebraska (8% buy, 50% hold, 42% sell), and just behind is Madison, Wisconsin (zero buy, 83% hold, 17% sell).
Here's where we rank in various other categories. Note that no markets were identified as either “strong” or “weak.”
• Investor demand: Oklahoma City is “average,” but on the low end, with Honolulu just ahead and St. Louis just behind.
• Development and redevelopment opportunity: Oklahoma City is below average, just three from the bottom, with Memphis, Tennessee, just ahead and New Orleans just behind.
• Local public and private investment: Oklahoma City is on the low end of average, with Hartford just ahead, and Tallahassee, Florida, just behind.
• Availability of debt and equity capital: Oklahoma City is on the low end of average, with Honolulu just ahead, and Spokane, Washington/ Coeur d'Alene, Idaho, just behind.
• Shape of the local economy: Oklahoma City is near the bottom of average, with New York-Manhattan just ahead, and Cleveland, Ohio, just behind.
So many low-average rankings. If anything is saving our bacon, it's homebuilding, where “Emerging Trends” places Oklahoma City prospects at No. 52 (Milwaukee, Wisconsin just ahead and Virginia Beach/Norfolk, Virginia, just behind).
Hug a homebuilder today.