The Brick Breakdown

Hello Brick Brief readers, 

Hope you guys had a great weekend.

Recently we saw consumer inflation expectations drop to pre-tariff levels, strong California industrial performance, and iBuyer Opendoor’s stock jump 175%. 

We’re in for a big week with a speech from Fed Chair Powell, June home sales data, and earnings from Alexandria, Digital Realty, Hilton, Chipotle, and D.R. Horton. Let’s lock in.

Finally, with June new and existing home sales set to provide the most current read on the market, I’m decided to hold off on my mortgage rate buydown article until this weekend.

📉 Inflation, Rates, and Trade Risk
Inflation expectations dropped to pre-tariff levels, a positive sign for the Fed as anchored expectations are key to managing future price growth. But with tariffs lifting consumer prices and EU retaliation looming, policy uncertainty remains high.

🏭 LA Industrial Holds Strong Amid Trade Shifts
Rexford posted solid Q2 results as leasing demand and supply constraints supported its SoCal portfolio, with rent pressure easing on improved U.S.-China trade clarity. Prologis also reported strong results last week, signaling broader resilience across the industrial sector.

📈 Opendoor Skyrockets on Retail Momentum
Opendoor’s shares surged 175% in its best week since going public as hedge fund support and retail trading fueled investor interest in the company. The rally highlights speculative appetite despite continued housing market softness.

This Week in Real Estate: Key Events & Data

Quick Markets

30Y Mortgage: 6.81% (-1 bps) 

10Y Treasury Yield: 4.42% (-3 bps)

WSJ Prime Rate: 7.50%

FTSE NAREIT Index: 769.50 (+0.28%)

30-day SOFR Average: 4.35%

Market Pulse & Rate Watch

Tariff escalation is reviving inflation risks and global trade tensions, delaying Fed rate cuts and amplifying uncertainty for businesses and consumers

Inflation expectations fall to pre-tariff levels – University of Michigan survey shows sharp drop in one- and five-year outlooks as consumer sentiment hits five-month high (CNBC) 

Firing Powell would erode Fed independence – Trump’s pressure campaign risks unanchoring inflation expectations and weakening the Fed’s ability to fight future price surges (WSJ)

EU prepares retaliation plan as US tariff threats escalate – Bloc braces for 30% duties on exports and eyes countermeasures including tech taxes, procurement bans, and trade barriers (Bloomberg)

Tariffs push up prices for goods like appliances in June CPI – Companies begin passing costs to consumers as inflation pressure builds beneath stable headline figure (Bloomberg)

Fed’s Goolsbee warns tariffs may delay cuts – Ongoing trade uncertainty complicates inflation path, extending timeline for potential Fed easing (Reuters)

Brick by Brick: ChatGPT Error Jeopardizes Chicago Housing Authority’s Appeal in $24M Lead Case

The Chicago Housing Authority’s attempt to overturn a $24M  verdict fell apart after its legal team cited a fake court case generated by ChatGPT, exposing critical lapses in fact-checking.

• A January jury awarded $24M  to two children exposed to lead-based paint at a CHA-managed apartment in Rogers Park
• Property managers Habitat Company and East Lake Management were cleared of liability and later settled for smaller amounts
• Habitat then sued the CHA for legal malpractice, arguing the agency’s missteps damaged its finances and reputation
• CHA’s outside counsel, Goldberg Segalla, submitted a motion referencing a fabricated case called Mack v. Anderson, which partner Danielle Malaty sourced from ChatGPT without verifying
• Malaty was fired after the error was revealed, and the law firm has since revised its internal policies and retrained its staff
• The judge allowed plaintiffs to pursue sanctions, and the CHA has stated it will not cover any portion of the $390,000 in legal fees tied to the faulty filing
• Habitat has ended its decades-long partnership with the CHA, and the agency remains without a permanent CEO while dealing with broader fallout from the lead crisis

Takeaway: Tools like ChatGPT can speed up research, but they often produce false information that looks credible at a glance. Regardless of the industry, attention to detail remains essential. Because ChatGPT can fabricate sources or cases, it’s critical that we verify every output before relying on it in any professional context. For Malaty, one careless mistake ruined decades of hard work 

Policy & Industry Shifts

Federal crypto and housing policies are diverging, as blockchain gains traction for real estate deals while rental aid cuts and ADU incentives reshape affordability strategies

Trump signs landmark crypto law, unlocking CRE rails – The GENIUS Act and related bills create first federal framework for stablecoins and tokens, paving way for blockchain-based real estate deals (Bisnow)

Insight: Stablecoins let investors move money instantly, while blockchain and smart contracts can act as the escrow, holding funds until both sides meet the deal terms, removing the need for a middleman to verify and settle the transaction.

Trump’s two-year rental aid limit puts 1.4M at risk – Proposed HUD policy could displace low-income working families and destabilize public-private housing partnerships (AP)

Bipartisan bill backs second mortgages for backyard homes – Proposal would provide federal guarantees to boost ADU construction and ease affordability crisis (WSJ)

Residential

Housing construction showed signs of life in June, but high rates and tariff uncertainty continue to suppress sales and stall broader recovery.

June housing starts rise to 1.32M but still down YoY – Tariffs and high rates weigh on construction despite gains, with permits flat and uncertainty lingering (WSJ)

Moody’s Zandi warns of housing market ‘red flare’ – Elevated mortgage rates, softening price growth, and tariff uncertainty leave home sales ‘uber depressed’ (Inman)

Regional

D.C. multifamily market stays strong despite federal cuts – Apartment demand holds steady as job growth outpaces peers and housing affordability favors rentals (CushmanWakefield)

Industrial

Ocean freight rates fall for fifth straight week – Drewry cites post-tariff demand weakening, though trans-Pacific rates remain above early May levels (FreightWaves)

Port of Oakland container volume drops 10% – Tariff uncertainty and shifting trade routes drive non-seasonal decline, with loaded imports down 11.3% from May (FreightWaves)

California Forever plans 2,100-acre defense hub – Billionaire-backed Solano Foundry aims to revive California manufacturing near Silicon Valley (Bloomberg)

Market Mix

Opendoor surges 175% in retail-driven rally – The iBuyer platform, which purchases and resells homes online, posts record volume after hedge fund endorsement, marking its best week since going public via SPAC (Bloomberg)

Insight: Hedge fund manager and ‘Carvana hedge fund guy’ Eric Jackson is calling Opendoor the next Carvana, framing it as a high-upside turnaround now that Zillow and Redfin have exited iBuying. He points to Opendoor’s cost cuts, shift to an asset-light agent model, and Bloomberg’s $12B revenue forecast as drivers of potential 100x returns. Retail traders have recently been piling in. (You can click the Twitter thread above for his full thesis on X)

However, I think it’s important to keep in mind that Jackson probably entered below $1 per share, and the more visibility his thesis gets, the more it benefits his position as new investors drive up the price.

Private lenders reshape CRE debt markets – Axonic’s James Jordan says opportunistic recap strategies are filling the void left by regional banks, offering flexible solutions to overleveraged borrowers (IREI)

Hospitality

U.S. hotel demand weakens in July – RevPAR fell 3.7% YoY as business travel stays soft, alternative lodging gains popularity, and weekend strength can’t offset weekday drag (CoStar)

Retail

Retailers see mixed July traffic as shoppers get selective – Best Buy and Walmart lead visit gains, while overall foot traffic dips YoY amid direct Prime Day competition (Placer.ai)

Healthcare

Medical office holds firm despite $1T Medicaid cuts – Landlords tighten underwriting but demand remains strong as aging demographics and urban fundamentals offset policy risks (Bisnow)

Earnings & Real Estate Impact

​​Rexford’s LA industrial portfolio remains strong as Q2 leasing holds firm, with recent U.S.-China trade clarity easing tariff pressures and supporting a steadier outlook

LA-based industrial REIT Rexford Industrial Realty met Q2 FFO expectations with $0.59 per share, supported by strong leasing activity and resilient demand for its infill Southern California portfolio. While rent growth is under pressure from tariff-driven uncertainty, Rexford expects long-term fundamentals to remain strong through H2 2025 due to persistent supply constraints and regional demand (CommercialObserver)

Financings

Loans

CCI Real Estate lands $67M construction loan for mixed-use project in Athens, GA – Affinius Capital finances 240-unit 290 Lumpkin redevelopment at University of Georgia (REBusinessOnline)

Refinancings

Hackman, Affinius secure $280M refi for NYC’s Silvercup Studios – Loan from Apollo and Deutsche Bank dates back to 2020 acquisition of the Long Island City film campus (TheRealDeal) 

Bow River Capital secures $70.3M loan for industrial park in Nampa, ID – Floating-rate refinancing covers 605K-sf Class A Park84 complex delivered in 2024 near Boise (REBusinessOnline)

M&A

Company M&A

Hunt Cos. acquires majority stake in national developer Carter – Move positions both firms to pursue large-scale real estate projects, with Carter retaining its Atlanta headquarters (CoStar)

Building & Portfolio M&A

Industrial

Stonelake Capital Partners sells $920M industrial portfolio – 91-building, 7.6M-sf portfolio sold across 13 deals to institutional buyers in major Sunbelt metros (IREI)

Mapletree sells $241M Sun Belt warehouse portfolio – EQT Real Estate acquires 2.4M-sf, 10-property package across Georgia, Florida, and Texas as investor demand for industrial assets stays strong (CommercialObserver)

Insight: When two major firms sell larger industrial portfolios in the same region, I think it’s worth asking whether they’re cashing in on peak valuations or repositioning ahead of shifting conditions. In regards to these two deals, Stonelake framed its exit as the close of a decade-long investment strategy, while Mapletree cited a strong outcome for investors and plans to reinvest in higher-quality assets.

Multifamily

Greystar buys Miami apartments for $94M – Firm acquires 358-unit Avana at the Moors from Nuveen, which paid $71M in 2018, with $65.5M Freddie Mac loan (TheRealDeal)

Far West sells $62M LA waterfront apartments – Villa Del Mar in Marina Del Rey is the metro’s first multifamily trade since 2019, driven by scarcity and Silicon Beach demand (CommercialObserver)

Hospitality

Nahla Capital bids $275M for stalled Raleigh Miami Beach project – Shvo holds right of first refusal and may match offer to retain control of Rosewood-branded condo-hotel development (TheRealDeal)

Office

Sunny Hills Capital buys Los Angeles office campus for $72.5M – New York Life sells 462K-sf Culver City complex for $160 per sf amid rising investor interest in Westside markets (TheRealDeal)

Institutional Fundraising

Invesco and Bozzuto launch $1B JV to buy apartments – Venture targets East Coast multifamily with value-add strategy, starting with 220-unit Orlando acquisition (Bisnow)

Distress Watch

Mount Street U.S. buys San Francisco metro hotel in foreclosure – Firm acquires Hyatt House Pleasant Hill tied to a $204M loan as Bay Area lodging defaults accelerate (TheRealDeal)