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We’ve Got to Get Out of This Place

OOH ...Here's One Thing

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JCDecaux urban-beautification transit shelter

OOH …Here’s One Thing

 

by Jim Johnsen,
Managing Director, Johnsen, Fretty & Company

 

 

We’ve Got to Get Out of This Place

Given Trailhead’s recent activity (Trailhead Media Adds Nearly 2000 Faces) in the acquisition market, they would lead you to believe that Green Acres is the place to be.   

This got my partner Gabe and I thinking.  Will New York, Los Angeles, San Francisco, Boston, Detroit, Chicago etc. ever snap back?  I am sure many of us who rely on national advertising to drive our ships are contemplating that very question daily…and have been for an agonizingly long 6 months.  

Does the elevator go to the ground floor?  Does my iPhone screen always crack?  Can I get around death and taxes?  Said another way, after a healthy debate and a little research, we believe that there is too much centrifugal force in each of the U.S. “megacities” to witness a permanent urbanization reversal.

the urban renaissance we have experienced for the last decade is alive and well, even in the face of pandemic.  

I would even go further to say that the urban renaissance we have experienced for the last decade is alive and well, even in the face of pandemic.  

How can I say that?  Well for starters I recommend you give a listen to the following presentation to the Manhattan Institute. Either this guy has done his homework or he is incredibly good at serving up the bourgeois.  I think it is the former. Click the link for the impressive analysis on⇒ Millennial Migration and the Future of Cities

If you don’t have a full hour to listen in to this presentation (who does?), I would recommend you fast forward to minute 25 and listen in for 5 minutes.  He makes a very strong case that post pandemic, well educated, well paid 25 to 34 year old’s will continue to seek out the megacities that offer both job and cultural satisfaction.  

Here is one comment from one of the viewers of the presentation which I think expresses the thoughts of a lot of young people: “No one is “shackled to urban areas”.  The suburbs and rural areas are flat out boring as hell and have like 1/20th of the options and amenities as cities, let alone if you are more active in social circles.  The burbs and the small towns just don’t give you that vibrancy.”  If that is representative, then that gives us older folk some insight into the millennials psyche.  

Okay, great, so large cities are here to stay, so therefore national advertisers that want to target those demos in large markets should turn on their budgets like a firehose soon, right?  Not so fast Kemosabe.  If you dig a little deeper, you will see evidence that not all urban centers will fare as well during the next urbanization.  There is a good body of data that shows that the millennials are more mobile than ever, moving over 3 times as often as prior generations in this age bracket.  What’s causing these migrations?  Jobs and quality of life…and not necessarily in that order.  See this link to Smartasset.com ⇒Where Millennials Are Moving – 2020 Edition

As a small but poignant example of that, had you told someone at Gannett Outdoor 20 years ago that Nashville was going to be squarely on the national radar, they would have told you to have another martini.  How about Austin?  

Long short, we should all be thinking about how millennials are moving around in the U.S. if we want to think about trying to drink as much water as we can from that firehose.
Click link here⇒Reimagining the postpandemic economic future

And one last piece of good news for Monday morning.  It’s not as bleak as you think.  Here is a quote from a recent Seeking Alpha article on the REIT industry:

“Realty Income does have exposure to health and fitness (7.1%) and theaters (6.3%), which have been hammered. However, rent collection continues to improve there. The company received 93.8% of rent in September, with theaters representing about 57% of uncollected rent.”

Q4, here we come.  

We gotta get out of this place
If it’s the last thing we ever do
We gotta get out of this place
’cause girl, there’s a better life for me and you

The Animals – We’ve Gotta Get Out Of This Place 

Jim Johnsen

 

jfco.com
Securities transacted through StillPoint Capital Member firm FINRA/SiPC

 

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