Chief Executive Officer & Director, VERIS RESIDENTIAL INC
NYSE TV: Veris Residential
The New York Stock Exchange welcomes Veris Residential, Inc. (NYSE: VRE) to the podium in celebration of its 30th anniversary of listing. To honor the occasion, Tammy Jones, Chairman of the Board of Directors, will ring The Opening Bell®.
About Mahbod A.c.a.
Mahbod Nia, CEO of Veris Residential, has described the company’s transformation from a two-thirds office firm to a pure-play multifamily REIT, a process he said involved selling over $2.5 billion of office assets and growing its multifamily portfolio to over 7,000 units. In interviews, Nia stated that the company’s strategy is supported by strong market fundamentals, including job and wage growth, limited new supply in its core Jersey City waterfront market, and a long-term housing shortfall. He noted that Veris Residential has raised guidance, reinstated its dividend, and announced a plan to sell $300–500 million of less strategic assets to further deleverage its balance sheet and fund up to $100 million in share repurchases. Nia has also emphasized the company’s focus on environmental, social, and governance (ESG) initiatives, describing them as a lens for decision-making that aligns with shareholder value. He cited examples such as installing smart thermostats with a payback period of under a year, achieving a 50% reduction in scope 1 and 2 emissions over three years, and partnering with MIT’s Center for Real Estate on decarbonization research. Nia characterized the company’s approach as one that seeks to address climate risks while reducing operating expenses and improving returns.
Transcript (112 segments)
✨ AI-enhanced transcript with speaker attribution
K
Kristen Scher0:55
Good morning and welcome to NYSE TV Live. I'm Kristen Scher here in studio above the trading floor while stocks are coming off of fractional gains for the S&P 500 and the Dow Jones Industrial Average. Wholesale price data this morning coming in just a hair hotter than expected, and it does follow consumer prices that ticked up in October according to data yesterday, and that was as economists had expected. Well, after a steady slowdown in price gains the past two years, yesterday's data does create questions around the Federal Reserve's path forward on interest rates. So let's take a look at what is on tap in today's show: with inflation back in focus amid the data and a red sweep in Washington, we'll hear from a markets guest and an economist on where we go from here. Plus, Donald Trump is building his cabinet, starting the Department of Government Efficiency and appointing Florida Senator Marco Rubio as Secretary of State. Political expert JD Durkin, who joined during the election, is going to rejoin me in studio this morning. Plus, we'll see real estate company Veris Residential celebrate the opening bell, and its CEO will join us live on the floor after the market opens.
Well, it's a huge week for this inflation data that we've been covering. A day after fresh consumer price data arrived, investors are breaking down wholesale inflation that did come in about a half hour ago. Here are the numbers: headline wholesale prices of 2.4% from the same time a year ago; core was up 3.1%. These numbers are still above the Fed's long-term targets. We had seen 2.4% be a little bit hotter than economists had expected, and on a month-over-month basis in October we saw those wholesale prices rise two-tenths of a percent from September, which was in line with expectations. And again, the core number of 3.1% a little bit hotter than economists' expectation of 3%. Month over month, core was up three-tenths of a percent and the estimate was two-tenths of a percent. Now, core does strip out those volatile food and energy costs, and so it is a number that the Fed does follow closely when it assesses the data, both on inflation and the jobs front, in determining its path forward for interest rates.
Well, as we await that market open, I do want to talk through more about how markets are responding to the latest data that we've received so far. And joining me now is Michelle Schneider; she's the chief strategist at MarketGate. Michelle, it's great to see you this morning as always. And how should our viewers or investors be looking at the latest read on inflation?
M
Michelle Schneider3:40
Well, first of all, good morning, Kristen. Well, I think you have to go back a little bit and say that we've had 42 months now of consecutive CPI numbers over 3%, and now with the PPI numbers being a little bit hotter. What we can definitely conclude to date is that inflation has stopped going down. So of course the question is always going to be going forward: what can we expect? And let's keep sort of the politics side of it out of the equation right now because people are looking for actual real indicators. And that's where I always turn to the basic trifecta of what I call in terms of how we can gauge whether or not this is just a blip and policies will actually prove to be more deflationary or inflation's going to come screaming back. Number one is we're looking at another reinversion of the bonds, right? And so basically what that could mean is economic growth, which would be obviously the cherry, or it could mean the return of inflation is on the way. So in terms of bonds, you've got to keep your eye there. You've got to keep your eye on the gold and the silver market, not only the pricing of both but whether silver starts to outtake gold — that's inflationary. You have to look at the dollar, which right now is not showing any sign of inflationary pressure; if anything, it's been incredibly strong. And you have to look at some of the soft commodities, in food particularly; I like to look at sugar; it hasn't really gone down very much. And if you look at the agriculturals in general, there are pockets that are still screaming much higher while others are still very low. And how that all plays out, I think, will give people a better indication of where inflation's going to go. And these CPI, PPI numbers, which many people feel are cooked, how representative they really are in terms of what the consumers expect.
K
Kristen Scher5:36
Interesting. And so we had seen for at least consumer prices yesterday, Michelle, it was some of those costlier rents, for instance, that did send prices higher. We're heading into the holiday season now; we have a new administration set to come into the Oval Office as of January 20th. I do see this morning though that traders are still pricing in another quarter of a percentage point rate cut come the Fed's next and final decision this year, which is in December. Based on the data, do you think that that is the right decision?
M
Michelle Schneider6:08
Well, you know, it's a very big house of cards right now. And by the way, services has been the stickiest in terms of the inflation, and that's something to watch in terms of the Fed. I mean, some people will scratch their heads and say, well, why would they lower when we have stock prices at all-time highs? And certainly if you look at it like that as a generalist, that could be a question. But if you go under the surface, not all of the stock market is at all-time highs. And this is where I like to look at the key sectors, which would be the small caps, the retail, and the transportation. And though they've done well, they're not at all-time highs; transportation is. So the question is, what would he be doing to anticipate lower rates? And mostly it would be that higher interest rates at this point could indeed affect the consumer and the job market. And I don't know if he's necessarily looking ahead at the Trump policies, but if he's looking at it right now, lowering it could help him have some confidence in terms of keeping the job market fresh, keeping the consumers in the game, and keeping borrowing costs from getting much higher as yields have been screaming up as opposed to down. And by the way, he speaks today, so there'll be a lot of ears listening on that.
K
Kristen Scher7:25
That's right, Michelle. 3 p.m. Eastern, I believe, is when the Fed chair is set to give those remarks, just an hour before the market closes. And we've seen more data coming since we heard from the Fed last Thursday. What does a Trump administration, and really a red sweep in DC, mean for the markets?
M
Michelle Schneider7:43
Well, it is quite interesting. I mean, first of all, we obviously can see that America voted for major change and did not necessarily like what the Democrats were saying. So there's a consensus there, and it's basically from the economic standpoint. So there's a lot of optimism in terms of what it means for the market. I mean, we can see actual results right now that we can anticipate might or might not continue, of course, based on this inflation conversation we just had. But obviously Bitcoin — I mean, that's been the big thing. So what is Trump going to do? Get rid of capital gains tax on Bitcoin and cryptocurrencies? He said that today, so that could still be a big opportunity. If you're not into Bitcoin, obviously you can look at some of the other altcoins; Ripple is one that we're very interested in. But also tariffs is going to be a big factor, and bringing everything back to the United States as much as possible. The question is going to be: can that actually be achieved without much higher costs for either raw materials, which would be inflationary? And if he can do it successfully with deportation and having enough people to fill the jobs, maybe more automation, it could be a really good year, especially if we calm things down geopolitically. So in essence, there are two aspects of the economy that drive besides the consumer. Obviously, interest rates would be one, but energy — and I think that's his biggest thing — is reducing energy costs, which could be a boom but could also be, you know, a curse in essence because it could also gear towards recession. So there's a lot of stuff he's saying, but we don't really know how it's going to play out, which is why I go back to those indicators I said at the beginning: watch the consumer most importantly.
K
Kristen Scher9:34
All right, Michelle Schneider, chief market strategist at MarketGate.com. Michelle's going to rejoin me after the market opens. Michelle, thank you. Thank you! All right, well stay with us because up next we will dive deeper into Trump's wave of appointments, including the newly created Department of Government Efficiency. We'll also cover Florida Senator Marco Rubio's installment as the Secretary of State. Up next.
I
Interviewer10:00
So John, tell us a bit about the partnership you have with Santander and Openbank. It's a Spanish man, it's a Spanish company. This is my only Spanish partnership. Santander has a long history with the game of golf and being a professional golfer. It's a true honor to be a part of it. And well, we're here at the New York Stock Exchange for the soft launch of a new online bank here in the US, being Openbank. Now John, when deciding which brands you partner with, what factors do you consider?
J
John10:30
I tried to get brands that represent me in some kind of way, right? And trying to at least have the opportunity to partner with somebody from Spain, a family that grew up in Northern Spain like myself — not the same city but close enough — that has a close history with the game of golf. I thought it was a no-brainer, right? They've also been involved in other sports like Formula 1 and many others. I think that was an easy choice, right? But I think every brand I've had, I tried to see what their expertise is, what their motto is, and what they portray to the world, right? And that's what I try to link myself with, so my image in itself, or what is the name John, is either uplifted by those brands or related to those brands, right? And I try to be picky. Luckily, I've been able to have some great partners to join with and keep on going on those ventures.
I
Interviewer11:25
Now, Santander is growing in the US market, which is a journey you yourself are familiar with. Do you see any parallels between your own experience in the US and what Santander is doing today?
J
John11:32
There is a difference when you're playing in different parts of the world. The golf courses are different, the setting is different, right? So to be as complete a player as you can be, you have to play in all different environments. And coming to the US is a massive one, right? Three of the four big majors are played in the US, all the big events are played in the US. So being able to come here...
K
Kristen Scher12:00
Good morning and welcome back to NYSE TV Live, everyone. I'm Kristen Scher here in studio above the trading floor. Well, as we await this market open, traders sent stocks to record highs in the wake of Donald Trump's decisive presidential victory, and new developments are taking shape with his cabinet coming to fruition. Earlier this week, the president-elect named Elon Musk and Vivek Ramaswamy to the Department of Government Efficiency in an effort to curtail government spending. While the department is not an official government agency, it would work with the White House and the Office of Management and Budget. And joining me now with more is JD Durkin; he's a political expert and CBS News contributor. JD, it's great to have you.
J
JD Durkin12:45
Good to be with you. Good morning, great to see you.
K
Kristen Scher12:47
So it's been about a week since you and I touched base, of course in the wake of these election results. Indeed, DOGE for short — Department of Government Efficiency. What does this mean?
J
JD Durkin12:58
I think everyone is still trying to figure it out. It's not the first attempt here from an incoming president or a Congress to try and figure out where's the pork, where's all this extra spending that we want to get rid of. It's just not entirely clear, Kristen, exactly how this is going to work. There is a law on the books signed from 1972 that gives the president of the United States pretty broad authority to sign an executive order and in doing so take the advice and counsel from private sector participants — in this case, Vivek Ramaswamy and Elon Musk. If this is created as an agency, as people are expecting it to be, it's not clear that they would actually need Senate confirmation, but they would still be subject to federal ethics laws. And that might be one thing for Vivek Ramaswamy, an entirely different set of unique challenges for Elon Musk. His companies — Tesla, SpaceX, and the others — have not just been the subject of a sweeping, really staggering number of federal government investigations, but you also have all these lucrative contracts: $15 billion for SpaceX alone between their work for the Department of Defense and NASA. And under those federal ethics laws, he would have to divest himself or figure out a way to remove himself from direct conflict of interest. So this is the sort of thing in this transition, lame duck period of the outgoing Biden administration, we're going to talk a lot about, and rightfully so. I think the Senate is still trying to figure out what this actually looks like in practice.
K
Kristen Scher14:18
Okay, so I do need to ask — great context that you're always able to provide for us, JD. The facts here on NYSE TV Live: DOGE, we know that Elon Musk had been a big supporter of Dogecoin. Department of Government Efficiency — I mentioned DOGE earlier because that is the acronym in some ways of this. And we've seen cryptocurrency be on the rise in the wake of a decisive Trump victory. Is there a connection to make here?
J
JD Durkin14:40
I think for Elon Musk, it's a fun connection. Now Dogecoin itself, as the meme coin, it's up some 250% in the last month. But Tesla's stock is also up 50% in the last month. And listening to Vivek Ramaswamy give his interviews, he says we're going to have a lot of fun in the process here. Elon Musk has called for a public commentary period of sorts where he says he wants this to be very transparent, Kristen. And I have no doubt he will leverage the awesome power he has on the artist formerly known as Twitter, which of course he bought for $44 billion — now X — to get direct insight and input from the public about where do you want to see cut spending, what parts of the government should we look to go after. Again, it's not entirely clear. Now the thing that's worth noting is that the president can create this Department of Government Efficiency without Congress. The president very much needs Congress to enact any of the spending cut recommendations that come about from Elon Musk and Vivek Ramaswamy. And that's why that underscores the challenge for House and Senate Republicans right now in terms of that 53 votes that they have, and they really can't afford to lose very many to either get these nominees across the finish line or to enact these spending proposals.
K
Kristen Scher15:47
I do want to talk about that because it effectively — since we last spoke, now there's certainly a red sweep in DC. What will that mean for policy going forward?
J
JD Durkin15:58
It means that there are a lot of things, especially in terms of the tax code and re-upping those Trump tax cuts — he doesn't need 60 votes in the Senate, he doesn't need a supermajority. He's going to use this very wonky procedural mechanism known as budget reconciliation. All you need is 50 votes plus the vice president in order to change parts of the tax code. But in terms of immigration policy, a lot of other sweeping policy proposals, you will still need 60 US senators to end the filibuster — in other words, to actually put a piece of legislation on the floor for a vote. And we can't forget that in this current makeup of the Senate, yes, Republicans will have 53, but three of those senators voted to convict Donald Trump. So we're going to keep an eye on Susan Collins, Lisa Murkowski, and Bill Cassidy of Louisiana. He also has people like Thom Tillis in North Carolina, not always a Trump fan, and also Mitch McConnell — he may not be Senate majority leader for very much longer, but he is still going to be a member of the US Senate. So that margin is really close for Republicans to even pass budget reconciliation; you need some of those skeptical GOP voices to align with Donald Trump. And for those that need 60 votes, you're going to need a handful of Democrats to be willing to go against their own party's interests and side with the president.
K
Kristen Scher17:09
We only have a few moments left, JD, so just in about 15 seconds: what does this mean for Fed Chair Jerome Powell? It seems as if he's going to be allowed to finish out his term. We're going to have a lot of conversations about Fed independence. I know that Donald Trump wants more of a say, but Powell has been very clear that if he's asked to step down, he says I serve at the pleasure of Congress, not the president; I will not step down. But certainly the conversations about Fed independence are going to be something very front and center once the FOMC continues to meet in 2025. JD, I hope you'll come back. Such great insight as always. Our resident political expert and CBS News contributor JD Durkin joining me on set.
All right, well as Veris Residential prepares to ring the opening bell this morning, we'll take a closer look at the real estate market and how rising mortgage rates are affecting buyer activity. Up next.
I
Interviewer17:57
Since we last talked, I know you have a major announcement you just made — the largest deal in the ASPM space. So talk to me.
G
Guest18:04
Yes, yes, yes. And I understand that it's with an NYSE-listed company — we can't say the name — Fortune 10 company. Yes, Fortune 10 company. Tell me about this deal. First and foremost, this is a deal that changes startups, okay? And we're super excited about it. And why they decided to partner with us for three years, very large deal, was technology that we developed. We actually help them automate all their security risk assessment questionnaires, build a real-time software inventory, and prioritize, remediate, and prevent risks before they get to the cloud.
I
Interviewer18:44
Let's talk about how you recently launched risk detection at the design phase. Can you talk to me more about this and how earlier detection in the software development of these kinds of problems will help enhance the security outcome for businesses?
G
Guest18:54
Based on NIST, the cost of fixing a defect at runtime when it reaches the cloud is 100 times more than in the design phase. So what we did: we developed our own private LLM model that scans every feature request that gets into the development lifecycle, and automatically we generate threat modeling stories and mitigations before one line of code is written.
I
Interviewer19:24
I do want to talk to you about a new product that I know you are going to be unveiling soon. Can you tell me more about it?
G
Guest19:30
I can't share all the details, but I will say the following: we're using the AI-driven deep code analysis technology to identify software architecture. The next phase is to visualize your software architecture in a very interesting way. It's like a living and breathing organism; it changes every day, so you need to visualize it to help developers.
K
Kristen Scher19:58
Welcome back to NYSE TV Live, everyone. I'm Kristen Scher here in studio. Well, we're about 10 minutes away from the opening bell, and I do want to bring in my colleague Trinity Chavez, who joins now on the trading floor with more on the real estate sector. Good morning, Trinity.
T
Trinity Chavez20:10
Good morning, Kristen. That's right. So with mortgage rates on the rise this fall, the housing market is feeling the squeeze from rising costs to shifting buyer demand. Here to break it all down and what it all means for consumers is Michael Guzik, he is a chief economist at ConstructConnect. Michael, good morning.
M
Michael Guzik20:28
Good morning, Trinity. How are you?
T
Trinity Chavez20:31
I'm great. Thank you for joining us on the show this morning. Let's just start talking about how rising mortgage rates have impacted home buying activity this year. And are there any specific regions or demographics that are feeling this impact more than others?
M
Michael Guzik20:45
Yeah, so that's a great question. And what we're looking at is really single-family versus multifamily. These markets really do seem to be trending in their own sort of unique directions. Single-family was a lot more sensitive to interest rates when they were increasing two years ago. With this falling of rates now, I suspect — we suspect — that single-family is going to outperform in the near term. And that's part of what our near-term 2025 forecast is for around 13.3% growth on the single-family side. Multifamily will improve in 2025 but not at that same kind of encouraging rate.
T
Trinity Chavez21:23
What's the indicator? Why is single family going to improve over others? What do you think is driving that demand?
M
Michael Guzik21:31
It really, I think, comes down to rate sensitivity, right? We've seen high home prices relative to incomes and disposable income for several years now. And so even small changes in those interest rates are really affecting those monthly mortgage costs. And that's why I think the single-family market has been so much more sensitive to rate changes. So it was difficult for us when rates were increasing; hopefully we'll see a turn of events here coming into 2025.
T
Trinity Chavez21:58
That's really encouraging, Michael. Speaking of additional costs, I do want to talk about materials and labor that are currently affecting home construction. And how do these costs play a role into affordability challenges for both builders and buyers?
M
Michael Guzik22:12
Absolutely, great question. So you know, we look at in terms of really two major components: the materials part and the labor part. And if you look at our data for the last year, we've had roughly negative 1 to 2% contraction, right? So we've had modest contraction on the material side for almost all of 2024. But when you look at the labor part, we still have somewhere around 4 to 4.5% labor cost increases, again annualized. And the challenge there is that we simply don't have enough qualified labor in the workforce. And so this is the long-term challenge. When we talk to our clients, we keep telling general contractors and trade contractors: your human resources strategy in the years to come is going to be one of the greatest determinants of your company's long-run success.
T
Trinity Chavez22:57
And with mortgage rates at some of their highest levels in years, what are we seeing when it comes to shifts specifically in buyer behavior, such as increased preference for renting or downsizing?
M
Michael Guzik23:10
Great question. You know, I think that really goes back to the vacancy rates, right? We can look at those; those certainly fell for a very long time, which created a surge in multifamily construction. Those vacancy rates have now started to tick up a little bit, right? But long run, you pointed out, those higher interest rates continue to bring people into the multifamily market because they simply can't afford those single-family homes. Again, this is why all of our viewers need to be very careful about single-family versus multifamily trends and data, because they are no longer simply mirroring one another.
T
Trinity Chavez23:55
Can you talk to me more about some factors that could impact the overall housing sector, or policy changes for that matter, that could potentially shift the trajectory of the housing industry in the coming year? And what should industry stakeholders keep an eye on?
M
Michael Guzik24:07
Great question. So you know, one of the things that is encouraging is, I think, a relaxation of regulations, right? Getting more available land out there into these single-family and multifamily residential spaces so that we can create the supply that will support all the household formations that we're seeing. Right. On the other hand though, any increases in cost — whether that's because of tariffs and the consequences of those, maybe some unintended consequences of tariffs — we could see rising material prices. And then secondly, the other thing would be how labor policy works, especially when we think about the diversity of the people in the construction field. We have people from all walks of life who are in the construction trades. And if for any reason that is impacted because of forthcoming policies, right, and we have a tightness in labor market supply, that's only going to keep that year-over-year labor cost I was talking about previously elevated. And so that becomes another real problem.
T
Trinity Chavez25:07
Michael, is there anything specific that you're focusing on going into the new year 2025? You are the chief economist at ConstructConnect, so is there anything that you're specifically following?
M
Michael Guzik25:17
Well, you know, we continue to just look at the macroeconomic environment; I think that's very important. The other thing is just to look at where credit markets are moving, right? Credit markets are so important to those interest rates that decide whether a family can make a 6% monthly mortgage work or not. And so we continue to really carefully follow those financial indicators of where rates are headed.
T
Trinity Chavez25:43
Great. Thank you so much, Michael. It's always a pleasure having you on the show. Have a good day. Thank you. Now, don't go anywhere. We have the opening bell coming up next. Stay tuned.
I
Interviewer25:56
We're here at the New York Stock Exchange with the startup challenge by Snowflake. So tell me, what were your key takeaways from this competition and how do you see these insights influencing BigGeo's journey forward?
G
Guest26:11
It was incredible being down there for the Snowflake startup competition. It was really encouraging to see where they're going with their ecosystem. And what they're doing with native apps specifically is where we're kind of going to market with them. And the support network, for me, was the biggest takeaway. Once we met with them, and we were like we're going to work together, it was just everybody piled in and we got the job done. So I was very encouraged. And we're not following a cuisine; we're actually leveraging the culinary art form of churrasco, which is very traditional Southern Brazilian cuisine. We've been doing it for 45 years. So you're right, we only have 72 restaurants in America but 96 globally. But our whole essence of our brand is about scaling the authentic culinary art form that we know our guests love around the world.
I
Interviewer26:51
When it comes to cuisine, there are many different trends out there, right? Especially as people are more health conscious these days. So how are you keeping up with these trends but still being true to your brand?
G
Guest27:02
What we love about it is everything we serve is nutrient dense and good for you. So it's up to you and your diet and how you like to diet, but we've done that for 45 years. What's exciting is our innovation around that is even getting better. We just rolled out whole branzino and seafood, so we're just now beginning the fresh seafood platform, and we're really excited about that.
I
Interviewer27:22
Oh, that sounds delicious. We're going to have to try it when you open up your new restaurant just a block or two away. That's right. Talk to me about when that's going to be opening.
G
Guest27:31
We're opening by probably middle of December. It's at the World Trade Center, really excited. So it's our second one in Manhattan; we have one in Midtown. It's 18,000 square feet. The one in the World Trade Center is ground level, it will be about 5,000 square feet. So really excited to open that; can't wait to host you there.
I
Interviewer27:47
Now, you've experienced significant growth in recent years — we talked about over 90 restaurants worldwide, over 70 here in the United States. What would you attribute your success to and how do you think you're going to continue momentum?
K
Kristen Scher28:01
Welcome back to NYSE TV Live, everyone. I'm Kristen Scher here in studio. Well, today's bell ringer, Veris Residential, has undergone several name changes as it continues to transition within the real estate sector. The company was established back in 1949 as Cali Associates. 35 years later, in 1994, the company underwent a dramatic change in more than one way. Not only did it rebrand under a new name, CI Realty, but it also began trading on the New York Stock Exchange that summer. A few years later, in 1997, the name changed again to MARC Realty Corporation after the company merged with Patriot American Office Group and the MARC Company. And in 2021, the company changed its name one last time to Veris Residential, reflecting a shift in focus from office space to multifamily residential buildings. Trinity Chavez joins me now on the trading floor to talk more about today's opening bell. Trinity, what is the action down there?
T
Trinity Chavez29:02
Hey, Kristen, good morning. That's right, so Veris Residential is celebrating 30 years as a listed company here at the New York Stock Exchange. As you can see behind me, there are dozens of their friends, colleagues, employees here to see them ring the opening bell in just a few moments. And Veris Residential is again celebrating this monumental milestone with their company: 30 years here by ringing the opening bell. This company develops, owns, and manages premier multifamily communities. We're going to be speaking to the CEO a little bit later on in the show about what's driving the demand of the rental properties that we're seeing, the biggest trends right now in the sector, the whole housing sector, and also their plans for the rest of the year as well as going into 2025. And for viewers who might not know, Veris Residential owns 22 communities with 7,621 apartment homes. And again, since its latest rebranding in 2021, the company develops, owns, and manages premier multifamily communities. So we're going to be talking about all of that and more with the CEO just right after he opens up the US equity markets. In fact, we're going to go to that opening bell and we'll meet you on the other side, Trinity.
That's right, with the opening bell podium here, set to open with a mixed market. Let's take a listen.
K
Kristen Scher31:12
All right, we are officially off to the races. The stock market opening for trade; we are looking at fractional gains across the board, of course in the wake of new inflation data today and yesterday. Well, rejoining me now to break down what it means for you as a viewer and an investor, Michelle Schneider, she's a chief strategist at MarketGate.com. Michelle, great to have you back with me here. And of course, fractional gains at the open. Between our earlier segment and this market open, I was joined by JD Durkin, a political expert, to talk more about Trump's cabinet. How the building out of this cabinet might have an impact — do you see a business impact at play?
M
Michelle Schneider31:53
Well, one thing that I read today that I hadn't really put together until I saw it is that his cabinet is very much millennial. So it is encouraging to see that we're getting a younger generation coming in to gain the experience in terms of being able to run the country, the government, the economy, and so on. So I think that's a positive, that's a real positive. So what does that mean? If we do manage to achieve some of the objectives like cutting back on government spending, reducing the debt — and I'm not even going to go into the lofty calls that we have — even any change would be a positive change there. If we start to look at things like expanding outside of the central bank and going more into digital currency, which we're seeing, all of this could be positive and a shift in the market. But it also could mean — again, we have to keep our eye on the inflation factor, because what we want more than anything is money to be in the consumer's pocket and not be afraid of inflation. And that's why that's going to continue to be my focus regardless of who became president. But with Trump especially, because we know in terms of his populism, that's what he really wants; he wants America to be happy and he'll do whatever he can to make that happen, I believe.
K
Kristen Scher33:17
So Michelle, with yields rising in recent weeks, do you see opportunity in the bond market?
M
Michelle Schneider33:24
Well, as we mentioned in the first segment, the bond yields have been high, and in fact they're actually delivering a higher return right now than stocks, which is very interesting. Because if that's sustained, then we might see people pile more into a bond type of situation, a fixed income, rather than stocks. But I wouldn't worry about that because it seems to me that the Fed will probably cut. And if that's the case, they are going to then reverse things where the long bonds could continue now to rise and the yields could continue to fall. So that could be the better opportunity. I just think it's a little too soon to say jump in and buy long bonds or do the opposite of what a lot of people like Druckenmiller have done — short the long bonds anticipating that we'll stay higher for longer because of the fear of inflation. This is a really interesting point right here, I think so. I would do nothing in terms of the bond market. I think we'll know soon enough if the TLT starts really catching a bid and the bottom is actually in at around 88 or 89 and we can get back through 95, then I would start to think: yeah, there's your opportunity. And then of course, what does that mean in terms of the trickling effect? Obviously, probably bullish for metals, energy, and other commodities.
K
Kristen Scher34:47
So as this post-election rally has stalled, do you think that's what? What does that mean basically? I guess I'm wondering for investors: is it a natural consolidation phase or is it something else?
M
Michelle Schneider34:58
Well, right now I don't see any real major risk happening right here at the moment. In fact, the stall, if it's more in the tech space, is probably healthier because what we want to see is money rotate into small caps, into retail, into transportation, into the banking sector, into the areas that are more US-centric. And that's what we're seeing right now, so that has to continue. Let's look at XRT; that's my favorite, I call that the grandma of the US economy. If XRT, which was in a 10-month consolidation, actually continues to firm here at around $80 level and starts to shoot higher, I would say that the opportunity there is tremendous. Particularly if you look at some of the things that have been undervalued in the retail space — not necessarily some of the consumer discretionary, but this notion of the 'thin trade' that we've talked about, which is things that people will do to make themselves feel better as they start to lose weight from the diet drugs.
K
Kristen Scher36:05
I see XRT opening up about 7/10 of a percent higher here, Michelle, as you referenced earlier for our viewers following along on their own programs. But Michelle Schneider, we've got to leave it there. Thank you so much, great to see you as always. Michelle's a chief strategist at MarketGate.com. Have a great day. All right, well we are officially off to the races here at the stock exchange. Stocks extending fractional gains today, and Veris Residential just celebrated that opening bell as we showed you to celebrate 30 years here at the exchange. Up next, we'll speak with the company's CEO. Stay with us.
G
Guest36:43
What you need is the commitment of all the employees that it's a priority, that we value culture, that it's a differentiator that helps us better support our partners and our customers. And I think all 20,000 people truly believe that, and so we're focused on it. But you have to be willing to change too. And that's always one of the challenging parts when you think you have a great culture; it's easy to say, okay, let's just not break it. But if you just say that, you say let's just not break it, okay, then you're not evolving, right? And the world around us is changing every day, and you have to respond and react to that. And that means you have to do that for the business and respond to those external dynamics, but it means you have to do it for the culture as well. We've been through a very difficult few years as a country, and that means that you need to support your employees differently given those circumstances. I'll tell you, it's really important to listen to that cohort because their needs and the pressure that they're under is very different. And that's where I think we add a lot of value, and we add a lot of value to those partners even outside of the credit program. We can actually help them on other topics: HR, finance, other things that we do where we have a more established process will help our partners, and we do that just in the spirit of partnership. It means a lot to that group because they do have a totally different set of demands. And one of the things we did in the reorganization is we realized that a lot of what they need and a lot of what we needed to do to support our partners was common across industries. The customer experience has never been more important than it is right now. There is very little friction.
K
Kristen Scher38:43
Welcome back to NYSE TV Live, everyone. Veris Residential celebrated the opening bell just moments ago, and I do want to bring in my colleague Trinity Chavez who is standing by with the firm's CEO. Hi Trinity.
T
Trinity Chavez38:57
Hi Kristen, that's right. Joining me now as Veris Residential CEO, Mahbod Nia. He just is fresh off the bell podium, opening up the US equity markets to celebrate 30 years of Veris Residential. How are you feeling right now, and tell me why it was important for you to celebrate this monumental milestone here at the exchange?
M
Mahbod Nia39:17
Well, firstly, thank you Trinity and the New York Stock Exchange for having us here. It's an absolute pleasure and a really momentous moment to be here. This is the 30th anniversary of the company's public IPO, which happened in 1994. And I think we're really here to celebrate 30 years of the company's existence, which is really an accomplishment for any company if you think about all the external shocks and challenges that one faces and evolving trends that one faces over that time frame. The company's been remarkably adaptable at transforming itself over that time frame and really positioning itself not only to survive for 30 years but to be in a very strong position to thrive from here.
T
Trinity Chavez39:56
And speaking of thriving, you are one of the leading competitors when it comes to the residential housing space, and you've had significant growth over the past three years — continued growth, I should say. Talk to me about what you think is driving this momentum and how you think you're going to continue to sustain it.
M
Mahbod Nia40:14
Yeah, no, look, it's really again remarkable, and I could not be more thankful to the team we have. We have a little over 200 employees who come in day in and day out and really put a lot of effort to extract the maximum value from our assets. We are in a fortunate position as a relatively new multifamily company. We have the highest quality properties in the market; we've developed most of them, the best amenitized in growth markets. And there seems to be a lot of demand for them, particularly in a post-COVID world where people are still spending one or two days a week typically working from home. They want to be in a place that's comfortable, that has all the health and well-being benefits of our properties — the amenities, the ability to allow them to work, socialize, exercise, and play in our property.
T
Trinity Chavez41:02
Well, home is where the heart is, right? Home is where the heart is. Well said. Now I know that you have been with Veris Residential for about four years now. The company's existence, as you said, was established in 1994 for 30 years. So talk to me, walk me through some of the biggest transitions that you have noticed with this company and some of the most memorable moments.
M
Mahbod Nia41:21
Well, this has to be one of the most memorable moments for myself and the team. But I've been there for four years. When I joined, we were really an office company — two-thirds of the business was suburban office. And there was a reconstitution of the board and management team, and we really shifted the strategy. And it turned out to be the right call: away from office, where we saw negative headwinds, to multifamily, where we believe there are still continued long-term fundamental demand drivers that position the company very well for continued success. So that's been really — we've gone from really two-thirds office to no office and now multifamily. And as you said, it's really high performing, overlaid with a best-in-class operating platform using the latest technology, including a number of AI solutions. We have the best personnel and they're really extracting a lot of value from those assets.
T
Trinity Chavez42:15
Now we have about 60 seconds left. I do want to know about what you think right now consumers want when it comes to their home, and how are you staying up with that as well as staying ahead of the curve and innovative and continuing to meet your business strategies?
M
Mahbod Nia42:32
Well, there's been a trend that we've seen for some time now of almost a convergence of residential multifamily with hospitality and technology, candidly. And so I think what residents want is to have all the efficiencies and the benefits of a tech-oriented solution to managing their properties, but with a human touch and the availability of a human when they need it. They want to have amenities, as I said, to be able to not only live in their apartment but also have shared space where they can work, socialize, exercise. Our properties have a wide range of amenities from bowling alleys to karaoke rooms to amphitheaters and a whole host of golf simulators. And I think that's very sought after, particularly today.
T
Trinity Chavez43:23
Amazing. Well, thank you so much. It was a pleasure speaking with you. Congratulations again. I'll let you join your team to continue the celebration.
M
Mahbod Nia43:28
Thank you for having me. Thank you.
T
Trinity Chavez43:31
Absolutely. Now we're going to take a quick break, but when we come back we're going to take a closer look at the real estate sector and how recent developments are affecting home buying sentiment. So stay tuned.
I
Interviewer43:43
We're here at the New York Stock Exchange. You're here with the startup challenge by Snowflake. So tell me, what were your key takeaways from this competition and how do you see these insights influencing BigGeo's journey forward?
G
Guest43:55
It was incredible being down there for the Snowflake startup competition. It was really encouraging to see where they're going with their ecosystem. What they're doing with native apps specifically is where we're kind of going to market with them. And the support network, for me, was the biggest takeaway. Once we met with them and we were like, we're going to work together, it was just everybody piled in and we got the job done. So I was very encouraged, and I know Brent can speak for that as well. It was knowing that we picked the right ecosystem to go to market with; Snowflake was that for us.
I
Interviewer44:27
Now Brent, the data center and cloud landscape is evolving rapidly. How does BigGeo's technology align with the future of data centers and what role do you envision for your company in this transformation?
B
Brent44:40
It's an incredible technology for the data center space. We're having these conversations on a daily basis with some of the world's largest hyperscalers. Our technology sits right up against — it's built on first principle solutions from the ground up to increase performance at the data center. So we're looking at this technology as a way to reduce the amount of electricity consumption for data centers when it comes to geospatial performance, which is vastly becoming — or quickly becoming — one of the largest computing workloads at the data center. So it's a very important technology to align with our hyperscaler partners and give them more, save them on electricity so they can spend that on artificial intelligence.
I
Interviewer45:23
All right, now we're here at the New York Stock Exchange, you're on the trading floor. It's awesome. I've seen all the movies. Well, tell me, how does it feel to be here and how does this experience align with BigGeo's goals and visions?
B
Brent45:37
Well, first of all, it's great.
K
Kristen Scher45:41
Welcome back to NYSE TV Live, everyone. I'm Kristen Scher here in studio. Well, to continue the housing conversation, I want to bring in my next guest, Ravi Kantha. He is with the Sarah K Team; he's a principal and founder at the Kanta Team, and he joins me now with more. Especially as we talk about: does it make more sense, Ravi, to own or rent in this environment? What would you say?
R
Ravi Kantha46:03
You know, it's interesting. People ask that question all the time, and it really depends on personal circumstances to some large extent. But my advice to clients is usually: are you going to live in this place for more than 5 to 7 years? Because when you look at most markets, the closing cost of entering and exiting a property — buying and selling — if you're doing it within a 2 to 4 year span, it's basically a gamble; you're hoping the market makes up for the 6, 7, 8% of closing costs that you're going to incur on the way in and out. And it's going to be higher in luxury markets and in urban markets. So I tell people: if you're going to live there longer, you should buy, unquestionably. Especially in high-end markets — New York, LA, Miami — those markets typically over a 5 to 7 year track will move north. Obviously, if you decide to sell in the middle of a downturn, that's not the case. But rental demand is always high; there's a nationwide shortage in housing. And if you're paying sky-high rents, look, mortgage rates are a little higher right now, but it's still worthwhile. There's that corny saying in real estate: marry the house, date the rate. You can refinance a property; you can't turn back the clock and lower the rent that you initially paid, which set the barometer for where your rent was going over the years.
K
Kristen Scher47:24
I want to learn more about your clientele, which areas you service, and what you're seeing among those potential buyers right now.
R
Ravi Kantha47:31
Sure. We specialize in luxury real estate in New York City, so we do a lot of work in prime Manhattan, brownstone Brooklyn. Our clientele comes from all across the world, frankly. We sell everything from full-time residences to pied-a-terre to ultra high net worth individuals all over the world. And that market never stops, right? We have downturns, and I'd say the last two years are probably the slowest two years on a volume basis in New York City that I've seen in my career. And that is destined to change. Most New York City downturns — most real estate downturns — don't last for two years; that's a long time for volume to be low. Mortgage rates really threw a wrench in everything. We had this explosion of demand during the latter half of COVID, and then when mortgage rates were really low, it just led to this inescapable urge for most people to do something. Rates were low, demand was high, the market was flying — let's get out there and buy something, and a lot of people did. And then when rates started coming up, it slowed down. And then last year, January, February, it felt like it was going to get busier, and then the Fed comes out and says they're kind of halting, they're not going to lower rates, and everybody just pumped the brakes. Obviously, there's no direct correlation between the Fed and mortgage rates, but they are connected, and people look at the Fed's decisions as a barometer of where things are going, how confident they are in the economy.
K
Kristen Scher48:53
What does a red sweep in Washington mean for your business and your industry?
R
Ravi Kantha48:56
Well, look, the initial response from the market has been super positive. The stock market is flying since the election. I think people are generally anticipating that the Trump tax cuts become permanent in some way, form, or fashion. They may not be exactly what they were, but something is going to happen, and it's probably going to happen pretty quickly. So those are generally taken as positives. But the negatives and the uncertainty: what does the economic policy of the new administration mean for inflation and for the economy long term? There are concerns about inflation; tariffs is the buzzword. But I think it also has to do with: are we reducing spending? Are we increasing spending? That's what Wall Street seems to be looking at, and that is a big driver for our market. My clientele, a lot of financial services professionals, are all sort of cautiously optimistic right now about what 2025 looks like. When I look at it, historically, if you talk to any loan officer today, they'll tell you the historical averages for mortgages have always been higher. So this shouldn't be that high historically, but everybody has short-term memory. People remember 3% mortgages, so it's in their head that a 6.5% or a 7% is a lot and it's expensive, and I should wait. At some point, that psychology has to change because we're not heading back to 3% anytime soon. It's just a question of what is that standard where people say, 'You know what, I'm just getting back in the market. The stock market is good, my earnings are good, I need to get back out there and buy a house.'
K
Kristen Scher50:25
So let me ask you this: with a stock market that is at record highs and doing very well since this presidential election, how should a viewer look at perhaps investing in a property in real estate versus investing in stocks?
R
Ravi Kantha50:40
Well, it's a good question for a financial adviser, but as a real estate broker I will tell you: I see no downside to investing in real estate ever. And if you want to have a well-balanced portfolio, it's definitely part of that whole equation. But from a personal standpoint, too, is it your home, is it rental real estate, how are you looking at it? There is definitely no downside to investing right now. Prices are not going to go down from where they are now. We've had two low years on volume; there is no way that the market says, 'Okay, we'll have a price correction now.' It would have happened already. So I don't think we're going to see that, and I think it's a good decision for people to get in the market. So the answer is both — both are good investments, both are good investments. It's actually one of the biggest struggles we have in the luxury sector when the stock market is doing really well: people don't want to pull their money out of it. So we have high rates and a good stock market, so there's a tug of war between real estate and the stock market. It's like, why would I pull my money when the market's doing so well? But at the same time, when you have inflation concerns, real estate is traditionally a really good place to be.
K
Kristen Scher51:39
Ravi, so good to get your take. That's Ravi Kantha, principal of the Kanta Team at Serhant. Ravi, thank you.
R
Ravi Kantha51:45
Thank you, appreciate it.
K
Kristen Scher51:47
Okay, well real estate isn't the only thing making news in our program today. Trinity Chavez is on the floor with more about some noteworthy weather developments taking place. Hi Trinity.
T
Trinity Chavez51:59
Hey Kristen, so from powerful typhoons in Asia to brush fires in the Northeast and some potential storms brewing along the Gulf Coast, extreme weather is making headlines across the globe. Here to help us understand and navigate these developments and their potential impacts is our in-house meteorologist, Dave Marran. Dave, thanks for joining us.
D
Dave Marran52:18
Good morning, good to be with you.
T
Trinity Chavez52:22
Now I do want to talk about the typhoon that we're seeing picking up in Asia right now. What are some of the key driving factors that are starting to form these weather conditions, and how should that region be bracing?
D
Dave Marran52:33
Yeah, so this is a really unusual pattern. We've had now four named storms at one time in the West Pacific, which in November is unprecedented. So most recently, we just had a storm that moved into Hong Kong; fortunately it's dissipating, it was relatively weak. A much stronger storm, kind of similar to a major hurricane, just moved across Northern Philippines. Now the Northern Philippines, interestingly enough, is an area that sees more typhoons than just about anywhere else on Earth, so they are prepared for something like this. But still, it's a strong storm. That storm is then going to move into Taiwan in the next couple days — a weaker storm — and then finally, 2 days or so after that, another strong storm is expected to impact Northern Philippines.
T
Trinity Chavez53:13
Can you talk to us more about how this storm will specifically impact energy and supply chain sectors?
D
Dave Marran53:20
So I think the main thing: the region around the Philippines, they do export a lot of electrical goods — semiconductors and things like that. So the supply chain there, the ports, and some of the shipping lanes will certainly be impacted at least for the next week or so from the typhoon activity.
T
Trinity Chavez53:40
And there have been a lot of brush fires that are impacting the Northeast in the US, especially here in New York even just this past weekend. There were a lot of brush fires in Brooklyn and other areas of New York, and you could really smell it in the air quality around the city. Talk to me more: is this a pattern that we are going to see more of moving forward?
D
Dave Marran53:57
Well, what we can say certainly is that we're coming out of one of the driest periods for this region that we've seen. The October period around the New Jersey-New York area was the driest not just for October but for any month on record. So you know, we kind of set the stage here with very dry conditions. And whenever you see the wind whip up, that's typically when we see the spread of the wildfires. In terms of where we go from here, it's sort of a mixed bag. As we look into week two, that outlook does suggest that we could see normal or even above-normal precipitation or rainfall, so that's going to be helpful. Looking further out into the winter though, the forecast is uncertain. Some of the forecast models suggest we're going to see more of a normal precipitation pattern, which would be good — especially good when you think about the reservoirs; this is the time of year where we tend to replenish the reservoirs in advance of the summer, where there's higher demand. But some of the models also suggest it could be a drier pattern. So right now, it's kind of very — we're just going to have to monitor the situation.
T
Trinity Chavez54:57
As we approach peak hurricane season, what is the outlook for storm activity in the Gulf Coast, and how will this impact industries like oil and natural gas?
D
Dave Marran55:08
Yeah, so amazingly enough, we're talking about the potential here for another storm to impact areas in the Eastern Gulf of Mexico. Typically at this time of year, 95% to 90% of the hurricane season in the Atlantic is over, but this is an unusual year; we're seeing a lot of activity. Just in the last couple days, we saw Tropical Depression number 19 form near Central America. Typically this time of year, when you do see late-season activity, that's the area where we see it. The projection here over the next 4 or 5 days is for it to move into near Central America and then up toward the Yucatan Peninsula. It's after that where the forecasts really start to become uncertain, but some of those forecasts do suggest that the storm could then move into Florida sometime in the middle or latter part of next week. So at this point, a lot of uncertainty, but it's definitely something that residents in Florida will need to monitor.
T
Trinity Chavez56:00
How does climate variability play into the frequency or intensity of hurricanes or when it comes to typhoons such as the one that we're seeing right now in Asia?
D
Dave Marran56:10
Yeah, so the short answer is it's complicated; it's more complicated than temperatures, right? We know the scientists have shown a very strong, high confidence relationship between global temperatures and climate change, but with tropical cyclones, it's less clear. And the reason is because there are more factors. Tropical cyclones rely on sea surface temperatures, which are going to warm in our warming world, but they also rely on instability in the atmosphere and the amount of wind shear in the atmosphere. In terms of how climate change will impact those factors, it's less certain. So overall, it's sort of a less confident forecast, but generally the expectation is we're going to see more intense storms, especially in the Atlantic basin.
T
Trinity Chavez56:56
We have about 60 seconds left here, Dave. But I do want to talk to you about: how do natural events like these happen simultaneously? How do economists — or from your vantage point — how do you prepare from an economic standpoint to weather the storm, so to speak?
D
Dave Marran57:11
Right, I mean this is something that's being studied very actively by a lot of different groups. With climate change, one of the expectations here is we're going to see not just warmer temperatures but more extreme weather, more extreme storms. So the potential to see — like we're seeing right now in the West Pacific Basin — four typhoons or four tropical cyclones active, similar thing in the Atlantic. The longer answer is there's probably going to have to be a lot of study into how we're going to address these things. But in the short term, certainly we're going to need more resources, because it's not just that we're going to be responding to maybe one active extreme event impacting the United States, but potentially two or three.
T
Trinity Chavez57:53
And I'm sure this is a story that we are going to continue to cover. Dave, it's always a pleasure having you on the show. Thank you so much.
D
Dave Marran57:57
Thank you for having me. Take care.
T
Trinity Chavez58:01
Now I'm going to bring my colleague back in, Kristen Scher in studio. Kristen, we are here on the trading floor as you see. There's still about 100 people gathered here on the trading floor as Veris Residential is making their way around the exchange after celebrating being listed here for 30 years, ringing the opening bell. So again, still an action-packed floor as we get trading kicked off and get ready for another busy day, Kristen.
K
Kristen Scher58:28
Trinity, you're exactly right. It's great to get that color from the floor. Of course, as we see stocks just kind of stalling out, consolidating some of their gains in a natural phase post-election. That's going to do it for today's show. Thanks for watching.
N
Narrator59:48
In life, I'm reminded that it's not about the destination; it is truly about the journey.
S
Speaker1:00:00
My pleasure to greet you today from the center of the US capital market here at the New York Stock Exchange. I want to just take a minute and not just talk to the people that are in the room, but I want to speak to the rest of the team around the globe. These are the people that made this happen, and I know that there is no way we would be here if it wasn't for you. Everyone at Flutter is proud to join such a distinguished list of companies on this great stock exchange. Not many people get to do something big in this world, and we get to do something truly special. This is such a wonderful place to both look back and look forward. Look how far we have come. I'm so optimistic about what lies ahead. It has been a privilege to be here.