We are going to tell you where you may want to consider owning property and where not. This is because there is a new generation of urban radicals on the march and it bodes ill for commercial real estate.
Following their drubbing in the general election, conventional wisdom assumes democrats would take something positive from their Biden-era setbacks and change course.
Sadly, that’s not the case. The progressive wing of their party is now doubling down on the idiosyncratic policy preferences that led to their defeat and attempting to export them to the rest of the country.
Quoting National Review, “Mamdani’s rise to the forefront of Democratic politics in America’s largest city might be written off as a historical accident – the culmination of a series of unfortunate events that pitted him against a corrupt and unloved Democrat – turned – independent incumbent mayor and a disgraced former governor. But the candidate’s success also represents a repudiation of the accumulated wisdom Democrats gleaned from their failures over the course of this decade. “That repudiation isn’t limited to New York City.” The italics are mine.
Democrats control nearly all major metro areas in the nation. Convulsive unrest, high taxes, a high cost of living, and poor public services characterize most of them.
These municipalities and others “face the compounding crises of maladministration, restrictive zoning regimes enforced by special interests; the failure or refusal to police quality-of-life crimes, which beget neighborhoods more susceptible to violence and property crime; profligacy and indebtedness at an embarrassing scale; public services that serve no one save bureaucrats whose perpetual employment seems more important than the programs they’re supposed to administer.” Vital city blogger David Schleicher.
Now they want to export this dysfunction to the rest of the nation.
Who are ‘they’ you ask? With many minority groups shifting right due to these urban woes, ‘they’ tend to be, well-educated, upper middle class, and white. It is this majority white, progressive, urban coalition that is driving things ever more left with their extremist ideology.
Interestingly enough, three of the nations least ethnically diverse cities, Minneapolis, Seattle, and Portland have changed the least in this regard from a policy standpoint. Office holders may come and go but, their policy priorities of freezing rents, taxing the wealthy, promoting an anti-Isreal message, and of course, “reforming” the police remain the same.
Despite their recent electoral drubbing these urban progressives now seek to turn their cities into vehicles designed to export their idiosyncratic and dysfunctional policy priorities to the rest of the nation.
They want nothing more than to see the high taxes, high cost of living and poor service delivery associated with their cities exported to the suburbs and exurbs.
Whether it is Mamdani in NYC, Omar Fetch in Minneapolis, or Katie Wilson in Seattle, the social contract they offer is the same old Maoist claptrap: state run grocery stores, “free” buses, rent freezes, “no more billionaires,” and punitive taxation of individuals and corporations.
As an income property owner, you may not want to be in this new generation of urban radicals’ line of march.
It brings to my mind, “Sherman’s March to the Sea.” During the Civil War, Union General William Tecumseh Sherman marched from Atlanta, GA to the port of Savannah, destroying all military targets, as well as industry, infrastructure, and civilian property in his path; an intentional “scorched earth” policy.
You can attempt to avoid this with DSTs. There is a plethora of offerings, be they multifamily, retail, industrial, etc. in red states: Texas, Florida, the Carolinas, Georgia, Tennessee, Kentucky figuring conspicuously.
This DST property mix is constantly changing. However, the low-tax, pro-business, pro-property rights environment has remained constant.
There is enough risk incumbent in commercial property investment given its applied nature. Unlike a personal home, the value of a commercial property is directly tied to its ability to produce consistent cash flow, and long-term appreciation. This can and will vary over time.
Why potentially exacerbate this by owning property in the path of this new wave of urban radicalism? They don’t appear to be going away. Maybe you should consider getting out of their way with DSTs.
