Professional investors appear simultaneously excited about the 'melt up' and wary about what could be next. » Read More
Billionaire real estate investor Barry Sternlicht had declared Greenwich, Connecticut, with its glut of mega-mansions for sale, "may be the worst housing market in the United States."
"You can't give away a house in Greenwich," he said at CNBC/Institutional Investor's Delivering Alpha conference last week.
One broker has an idea for how to fix that.
"Get some start-up to buy them and put 12 people in them and work," said Fred Glick, a real estate veteran who is currently CEO of brokerages Arrivva and U.S. Spaces.
"That's actually happening out here in San Francisco," he said. "They're buying a big house and putting 12 to 15 people in it at $3,000 to $4,000 a month, and it's working."
Of course, Silicon Valley also has a long track record with companies being operated out of houses.
As Barron's noted over the weekend, the joke in Silicon Valley lately is that Meg Whitman's recent split and accelerated downsizing of Hewlett Packard "will return the business to its 1939 roots under David Packard and William Hewlett: a tech shop run out of a garage."
As for gilded Greenwich, it has traditionally been the trophy, as opposed to the launching pad, for business success. Such a departure from its highfalutin history toward divvied-up work-mansions seems unlikely barring some dramatic catalyst.
But, "if Greenwich itself did something with giving start-ups some tax incentives, I bet you'll get some people out of New York to move up to Greenwich and start getting it going," Glick said.
There is now an abundance of "Silicon Alley" talent in New York City — where rents have surged — to draw upon.
And Sternlicht, chief executive of Starwood Capital Group, just moved from Connecticut to Florida, having tired of Connecticut's onerous taxes. He is part of an exodus of successful businessmen from the area, including Paul Tudor Jones and former New Jerseyan David Tepper.
A surge in new listings and a drop in sales has left Greenwich with a 12-month supply of homes on the market as of June, up from 7.7 months a year earlier, according to Bloomberg. Taxes are one factor, along with lifestyle changes across all generations that favor renting or buying newer homes in emerging communities (such as "active senior living" centers).
While certain to stir upset in the neighborhood, something "like Start-Up BNB" — an Airbnb-style service that matched start-ups with available rental space — could work well in Greenwich, said Glick.
Certainly, the deluxe accommodations — indoor pools, for instance, and plenty of outdoor and parking space — would seem a strong selling (or rather, renting) point.
And if that doesn't take? "Make 'em into dorms," Glick said.
People complaining about how risky the stock market is ought to take a look at the so-called safety of today's bond market.
An aging population, an institutional aversion to the volatility of stocks (which are often said to already be trading at "fully valued" levels), and the persistent bearishness of most investors on the "macro" economy have all combined since the 2007-08 financial crisis to push a global wave of money that otherwise might purchase stocks into bonds instead.
The medical community is breathing new life into Google Glass.
The once-anticipated hot tech trend that consists of a pair of eyeglasses with a computer, microphone and camera built into the frame failed to catch on with the broader mainstream market when it debuted to select consumers in 2013. But now, the old technology is taking on a new function — serving as a tool for doctors in emergency situations.
Crisis? What crisis?
Billionaire George Soros, speaking Thursday, a week after Britain voted to leave the European Union, said that "shocking" decision has "unleashed a crisis in the financial markets comparable in severity only to that of 2007-8."
The Bank of England's governor, Mark Carney, meanwhile said it was likely "some monetary policy easing," like a rate cut, would be necessary in response.