From an undisclosed location in Manhattan, billionaire developer and local radio host John Catsimatidis told New Yorkers that President Donald Trump’s chances of winning the 2020 presidential race looked good.
“The betting line in Las Vegas is laying 3 to 1 for Trump to win,” he said on conservative talk radio station 77 WABC late Tuesday, while “manning the party desk” for the station’s watch event.
Though the president echoed this confidence early Wednesday morning, by the afternoon, no clear victor had emerged. The fate of the presidential election falls to several key swing states and may not be determined for several hours, if not days, as millions of mail-in ballots are counted. As of 12:30 p.m., former Vice President Joe Biden was close to winning crucial states Wisconsin and Michigan, with Democrats confident that he would, according to the New York Times.
Reached Wednesday, Catsimatidis, CEO of the Red Apple Group, didn’t seem swayed, doubling down on his support for the president.
Other real estate industry vets who spoke with The Real Deal in the election’s aftermath were similarly unfazed, saying they expected to wake up to a deluge of results and conflicting reports.
Still, some were uneasy at the idea that results could remain uncertain for a prolonged period.
“I’m not surprised at all. The country is deeply divided,” said George Fontas, a lobbyist whose clients have included major real estate investors and developers, including LeFrak, Thor Equities, Silverstein Properties, the Witkoff Group and Cammeby’s International Group. “There is no strong consensus one way or the other between the parties and between people who think that their country is on the wrong path.”
Others said they were anxious about what the election will mean for the federal government’s response to the coronavirus crisis.
“There’s a lot at stake here. I think that it is unfortunate that it is framed as a Trump versus Biden paradigm,” said Joy Construction principal Eli Weiss, adding that he is focused on whether another federal stimulus will be approved in the next 90 to 100 days, regardless of who wins. “To me, it’s us against a global pandemic. We’re fighting for our lives — literally and economically.”
Weiss noted that as an affordable housing developer in New York, he is still concerned with the outcome of next year’s mayoral and City Council races.
Jed Resnick, chief operating officer of Douglaston Development, agreed that local races are usually his main concern, but said this year, all eyes are on the presidential election and Washington’s response to the pandemic.
“In a typical year, local politics are more important than federal politics — but the single biggest challenge facing real estate and all Americans is Covid,” said Resnick. “That’s the elephant in every room.”
The real estate industry has watched the presidential race closely, in part because of Biden’s proposed changes to tax breaks, including 1031 exchanges and Opportunity Zones. Though the Democratic challenger hasn’t unveiled a detailed tax plan, some are worried he could target other favored tax maneuvers that drew attention during the Trump presidency, including depreciation.
FIA Capital Partners’ David Goldwasser, who assists owners of distressed real estate properties in New York, Florida and other markets, said if the election is disputed and takes weeks or even months to sort out, some real estate investors may try to limit their exposure to Biden’s proposed reforms.
“I think people will be fully exploring the 1031 exit … or some type of tax shelter to replace that 1031 in advance, because they don’t want to be left holding the bag,” Goldwasser said.
U.S. stocks rose Wednesday, despite the uncertainty over the results. Developer MaryAnne Gilmartin said the markets could likely withstand another week or two of not knowing who will be president, given that delays were widely expected. But if the outcome isn’t revealed for weeks or months, confidence would likely erode.
“Uncertainty is bad for our business. It is bad for any business,” she said. “Uncertainty can produce panic, it can lead to people shorting things they previously felt good about.”
Florida developer and billionaire Jeff Greene said Republican presidents are typically more beneficial to business interests in the short-term, given the party’s aversion to regulation and raising taxes. But Greene, a former Democratic gubernatorial candidate in Florida, thinks Biden will promote important environmental policies and boost the middle class.
“I think we have to think beyond the present and provide for a stable currency, interest rates that reasonably reflect inflation and allow the market to be more freer in that space,” he said.
For now, as with the rest of the country, the industry will have to wait and see how the race plays out.
“As long as we have a clear election and peaceful and smooth transition of power, we’re going to be fine as we always have been in the U.S.,” said Alicia Cervera Lamadrid, managing partner of Miami-based Cervera Real Estate, who voted for Trump. “It would have been nice to have a clear winner. But we have to be patient, and we’ll get there.”
But some have prepared for unrest. A number of retailers along shopping arteries in New York City and Los Angeles boarded up their stores. Protests occurred in cities including Washington, D.C., and Seattle, but they were reported to be largely peaceful.
“In general you want markets to be stable and you want clarity,” said Miami developer Avra Jain. “Whatever happens, you hope people will accept it. What you don’t want is for people to incite the situation and encourage violence.”
Katherine Kallergis, Georgia Kromrei, Keith Larsen and Akiko Matsuda contributed reporting.
The post Real estate on edge with election too close to call appeared first on The Real Deal Los Angeles.
Powered by WPeMatico