If it costs you too much time and money to do a project in California the answer is easy—go to a Free State like Texas or Tennessee. More profits, less grief. So, a major housing developer is leaving California. In the midst of a housing shortage, caused by government, one less developer.
“The company said it was “committed to the execution of the construction, lease-up and stabilization of our projects in these impacted markets while continuing to be good fiduciaries for our capital partners,” according to a statement from CEO Joe Keough provided to Multifamily Dive.
Newsweek contacted Wood Partners on Thursday after the first unconfirmed report of the developer’s withdrawal from California appeared on social media, but did not receive a response.
An X user named John Otter said that he had learned from “senior guys” at the company that Wood Partners had closed all of their California operations and had let go its entire staff in the Golden State. “Everybody,” Otter wrote early on Thursday on the social media platform.
According to the social media user, Wood Partners concluded “it no longer makes sense to try and do apartment development in California. Even when things hopefully ‘recover’. They’re right,” he said.tarts Here
By recover they means when California ends the Uniparty State and has responsible people, not radical socialists in charge. This is more evidence the DOOM LOOP, death by suicide, is quickening its pace.
Major Housing Developer Pulls Out Of California
Newsweek, 7/26/24 https://www.newsweek.com/wood-partners-major-housing-developer-pulls-out-california-1930553
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A major housing developer has announced it will no longer pursue new projects in California.
Atlanta-based Wood Partners, one of the country’s largest real estate developers, did not provide a reason for its withdrawal, but said it would complete projects already underway in the state.
The company said it was “committed to the execution of the construction, lease-up and stabilization of our projects in these impacted markets while continuing to be good fiduciaries for our capital partners,” according to a statement from CEO Joe Keough provided to Multifamily Dive.
Newsweek contacted Wood Partners on Thursday after the first unconfirmed report of the developer’s withdrawal from California appeared on social media, but did not receive a response.
An X user named John Otter said that he had learned from “senior guys” at the company that Wood Partners had closed all of their California operations and had let go its entire staff in the Golden State. “Everybody,” Otter wrote early on Thursday on the social media platform.
According to the social media user, Wood Partners concluded “it no longer makes sense to try and do apartment development in California. Even when things hopefully ‘recover’. They’re right,” he said.tarts Here
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“The entire state of California with 40 million people will produce less rental housing than Dallas/Ft Worth with 8 million people in 2024,” Otter wrote. “This is solely because of the financial burdens imposed on apartment development in CA that simply don’t exist in DFW and other places,” he added.
“However dismal apartment Twitter thinks things are in CA, those of us in the trenches know the reality is far, far worse. Apartment production in CA in the coming years is going to be terrible, and the worsening supply-demand imbalance is going to make apartment housing much more expensive.”
Texas-based rental housing economist Jay Parsons, who commented on Wood Partners’ withdrawal from California, agreed with Otter.
“Why exit a market that is so undersupplied while favoring ‘high-supplied’ markets? Wood didn’t give a reason publicly, but its exit tells you a lot,” Parsons wrote on X on Thursday.
“Many West Coast cities have made good progress on reforming zoning and streamlining permits, but a) still work to do and b) much of that progress has been offset by intensifying regulatory pressures facing operators after an apartment property is built,” Parsons added.
Newsweek previously reported that “blue states” such as California and New York are facing a chronic undersupply of homes due to excessive regulations that stifle new construction projects.
Daryl Fairweather, chief economist at Redfin, previously told Newsweek that it is easier to build in Texas than in states such as California or New York “because of more relaxed zoning laws, less red tape, cheaper land, and cheaper construction costs. There is also strong demand for homes from out-of-state buyers.”
The current shortage of homes in the Golden State could be fixed by making it easier for developers to build new multifamily homes. “California has already passed zoning reform at the state level; now those laws need to be enforced, and development needs to be supported instead of interfered with,” Fairweather said.
It is not just the zoning laws and permits that is a problem it is also all the self righteous organizations that want a say in what the project should look like or off to court. Good foe Wood. Bad for California.