Hello Brick Brief readers, 

Today we’re seeing unemployment rise, grocery anchored retail draw fresh capital, and homebuilders forecast another weak quarter for the housing market.

📉 Rates Back in Focus as Labor Softens
Rates moved back into focus as US unemployment climbed to 4.6% in November marking a four year high and confirming a cooling labor market. That slowdown strengthens the case for Fed rate cuts as weak hiring momentum and prior job losses begin to outweigh inflation risks in policy discussions.

🛒 Grocery Anchored Retail Draws Fresh Capital
Grocery anchored retail continues to attract large pools of capital as Bain Capital and 11North raised $1.6B to scale an open air shopping center platform focused on necessity based retail. We have seen a surge of recent interest in the asset as Publix continues to acquire shopping centers it anchors to secure control and reduce ownership uncertainty; Blackstone recently acquired $440M of grocery anchored centers in Texas and joined the $2.3B take private of Alexander & Baldwin, Hawaii’s largest grocery anchored retail owner.

🏠 Builder Incentives Mask Housing Strain
Homebuilder Lennar missed Q4 earnings expectations as it relied on incentives such as mortgage buydowns and price adjustments to sustain sales volume. The company guided to lower orders deliveries and margins next quarter as affordability remains strained and incentives stay necessary to move inventory.

US unemployment hits 4.6% four-year high in November – Weak hiring momentum and October job losses reinforce labor market cooling and strengthen the case for further Fed rate cuts despite still-elevated inflation (FT)

US business activity growth hits six-month low in December – Slowing new orders across manufacturing and services signal fading momentum into 2026 while rising input costs could keep inflation risks elevated (Reuters)

Citadel’s Ken Griffin warns White House must distance itself from the Fed – Investors fear Trump could appoint a politically aligned Fed chair which risks undermining central bank independence and market confidence (FT)

Fed’s Bostic warns further rate cuts risk reigniting inflation – Atlanta Fed president says easing policy too far could undermine Fed credibility as price pressures remain stuck above target (Reuters)

House advances SPEED Act to fast-track AI data center and semiconductor permits - Big Tech-backed bill cleared a key procedural vote as lawmakers push to cut NEPA review timelines to accelerate U.S. AI infrastructure buildout amid competition with China (CNBC)

Texas sues Xcel Energy over $1B Smokehouse Creek wildfire – The utility faces negligence and consumer protection claims that could force infrastructure replacements and prevent shifting fire-related costs onto ratepayers (Bloomberg)

US home-flipping ROI falls to 23.1% in 3Q 2025 – Record home prices pushed flipping profits to a 17-year low cutting activity and forcing investors to be far more selective by market (GlobeSt)

Home improvement contractors stay cautiously optimistic – 65% expect revenue gains over the next year even as hiring skilled labor and rising costs remain key constraints (HousingWire)

Zillow names Rockford, Illinois the most popular housing market of 2025 – Affordability drove demand toward midsize Midwest cities (Zillow)

New York leads major U.S. metros in discounted home listings – 3.6% of listings saw price cuts in November, flat MoM and down from 3.8% YoY even as typical home values rose 3% YoY to $699,394, while the national discount rate held at 2.72% (TheRealDeal)

US apartment rents fell 1% YoY in November to $1,693 – Affordability is improving at the margin as rents decline for the 28th straight month but most major metros remain unaffordable for minimum-wage earners (Realtor.com)

Sun Belt multifamily vacancy hits 9% in Q2 2025 as US multifamily vacancy rises to 7.0% – Oversupply in Southern metros is driving concessions and slower rent growth while Midwest and coastal markets remain relatively tighter (GlobeSt)

Imports at Port of Los Angeles fall 11.5% YoY in November – Early inventory builds to avoid Trump-era tariffs and ongoing trade uncertainty signal continued headwinds for US goods demand into 2026 (Reuters)

Industrial outdoor storage shows resilience as institutional capital moves in – IOS rents are up 123% since 2020 with vacancy near 5% as supply constraints and diversified tenant demand draw growing interest from private equity and pensions (Bisnow)

Target tests redistributed fulfillment to speed next-day delivery – Shifting online orders across stores and adding overnight nodes could boost demand for last-mile warehouse space in dense markets (GlobeSt)

US retail sales flat in October – Higher costs squeeze lower- and middle-income households while spending by higher-income consumers continues to prop up overall demand, reinforcing a barbell economy (Reuters)

Charlotte, NC tops U.S. retail markets in 2025 – Sun Belt demand and limited new supply drove strong retail performance despite elevated store closures nationally (CoStar)

PJM power auction set near $17B as data center demand surges – Record capacity costs driven by AI-driven electricity load are expected to deepen utility bill affordability pressures and deliver windfalls for independent power producers (Bloomberg)

Lennar shares fell 4% after the homebuilder missed Q4 earnings expectations but beat on revenue as it relied on incentives and price adjustments to sustain sales volume, pressuring home-sale margins. The company guided to lower orders, deliveries, and margins in the next quarter as affordability remains strained and incentives stay necessary to move inventory (Barrons)

Bain Capital and 11North JV raises $1.6B for grocery-anchored retail – The partnership is scaling its open-air shopping center platform as private capital continues to target necessity-based retail (Bisnow)

Insight: Over the past few days we have seen a cascade of grocery-anchored retail activity as interest in the overperforming asset class heats up. Grocers like Publix are continuing to buy the centers they anchor to secure control of their real estate, reduce ownership uncertainty, and capture upside in high-growth markets like Florida, while Blackstone has recently announced a $440M acquisition of grocery-anchored centers across Dallas, Houston, and San Antonio and joined the investor group taking Alexander & Baldwin private in a $2.3B all-cash deal for Hawaii’s largest grocery-anchored retail owner.

190 former Sonder hospitality leases hit the market across 17 states – Gordon Brothers is selling leaseholds tied to Sonder, a short-term rental hotel and apartment operator now in Chapter 7 (Bisnow)

RBC Real Estate sells $570M defaulted loan tied to Veritas Investments’ 1,500-unit San Francisco apartment portfolio – Revere Housing bought the debt as lenders continue to unwind distressed rent-controlled multifamily assets (Bisnow)

Informed.IQ raises $63M from Invictus Growth Partners – The funding supports expansion of its AI-powered loan verification and fraud detection platform across mortgage, auto finance, and consumer lending (HousingWire)