Location Strategy Chartbook 08.08.2026

• 23,000 jobs lost in July. (Losses occurred in retail, finance, hospitality, local gov't education)

• 264,000 people leave the labor force

• Wage growth falls to 3.2% = lowest in 5 years (and totally wiped out by inflation right now)

Prime-age labor force participation rate (workers ages 25 to 54).

• November: 83.8%

• Now (July): 83.4%

• 1.7 million prime-age workers have left the labor force since November 2025.

Total labor force participation rate lowest since February 2021.

Inflation is totally wiping out wage gains. The financial squeeze is real for many Americans right now.

Wage growth in the past year: 3.2% -->Lowest in 5 years
Inflation: 3.5%+

Wage growth is not contributing to inflation right now. That means many workers will struggle in the months ahead.

Joe Weisenthal, Bloomberg: In the last 30 years, residential and non-residential construction have generally gone up and down at the same time. One was in the early 200s, when we had China shock + housing boom.

The other divergence is now.

Back in March, analysts warned that the greatest energy crisis ever would send oil to the triple digits. Prices barely spent any time there. Five months later, benchmark Brent crude is around $83 a barrel.
 
Part of the explanation is that, instead of a fifth of global supply being shut off, the Strait of Hormuz sprang lots of leaks—some ships snuck through and oil found a way out through pipelines. And, in addition to coordinated reserve releases, China saved the day by buying much less than usual.
 
Even adding a fudge factor to all that, though, there’s a huge gap in the math.
 
“It’s mystifying to us,” says Eric Nuttall, senior portfolio manager at energy-focused investment firm Ninepoint Partners.

Billionaire Barry Sternlicht's Starwood REIT landed a $1.02 billion cash infusion from Apollo Global Management giving Apollo a 41.5% stake in a newly formed joint venture holding roughly 120 of Starwood's affordable housing complexes with locations that weren't specified. Starwood, a nontraded REIT, will retain the remaining 58.5% stake as well as day-to-day operational and asset management control.

Starwood among the nation's largest apartment owners, with more than 63,000 units as of the end of the first quarter. About 40,000 are market-rate apartments, and roughly 23,500 are affordable units concentrated in high-growth Sun Belt markets, including Texas and Florida. As of March 31, Starwood owned 598 income-producing properties valued at roughly $22.4 billion and reported occupancy of about 94%.

Mortgage applications are trending down

Fannie Mae's Purchase Application-Level Index (PALI) and Refinance Application-Level Index (RALI) are sets of weekly indices sourcing data from our automated underwriting system, Desktop Underwriter® (DU®), to provide timely and ongoing tracking of mortgage application activity and historical trends.

During the hotel real estate investment trust's second-quarter earnings call, Jim Risoleo, chairman, president and CEO of Host, said the company now expects both its comparable hotel RevPAR growth and comparable hotel total RevPAR growth to both range between 4.75% to 5.25%. That's an increase of 75 basis points and 125 basis points, respectively, from their midpoints in the company's previous full-year outlook.

• "This reflects the outsized rate growth we achieved in the first half of the year, and our expectation that rate growth will normalize in the second half of the year," he said.

• Revenue per available room growth in the second quarter topped Host's expectations, with broad-based strength across both markets and business mix, Risoleo said. Sustained luxury resort demand, strong group performance and elevated rates associated with World Cup matches drove growth for the portfolio.

• “We estimate that the event contributed approximately 160 basis points of RevPAR growth in the second quarter,” he said. “For June alone, RevPAR in our World Cup markets grew 15% compared to 12% in non-World Cup markets.”

• Maui, New York and San Francisco led that growth with improvements in key business transient markets also adding some performance tailwinds, he said. Maui in particular saw RevPAR grow 14% and total RevPAR grow 11%, reflecting strong demand growth as occupancy grew more than 8 percentage points in the quarter.

• Group room revenue grew 7% during the quarter, the result of fairly even room-night and rate growth, he said. Host’s portfolio sold 1.1 million group room nights during the quarter, and its definite group room nights on the books for 2026 now stand at 3.8 million. Total group revenue pace is up more than 5% compared to the same time last year.

• Food-and-beverage revenue grew 6% during the quarter while other ancillary revenue remained flat, Risoleo said. The growth in on-property spending was offset by a decrease in attrition and cancellation revenue compared to last year’s tough comparisons.

Upon closing, the combined company will operate in 26 markets and approximately 520 active communities across the Southeast, Mid-Atlantic, Texas, the West, and the Midwest.

Dream Finders and Beazer will create the 6th largest homebuilder in the US. Both builders currently focus on the entry level or move up buyer

July's average asking rents for Los Angeles apartments rose just 0.02% from June, well below the market’s historical July average gain of 0.28%. Asking rents reached $3.02 per square foot, while annual rent growth slipped slightly into negative territory at about -0.01%.

Nationally, apartment rents also flattened in July, but the broader market continued to outperform Los Angeles. U.S. annual rent growth improved to 1.0% from 0.8% in June, and several Northern California markets, including San Francisco, San Jose and the East Bay, ranked among the strongest performers.

While recently completed luxury high-rises continue to post strong occupancy and command some of the highest rents in the metropolitan area, mid-rise properties are facing a much more difficult leasing environment.

The divide has widened even as downtown remains one of Houston's most desirable rental locations. Average asking rents stand at roughly $2,300 per month, roughly $1,000 above the metropolitan average, supported by the area's concentration of high-paying jobs, entertainment venues, restaurants and cultural attractions.

LS update on DFW growth: In the DFW area, tremendous growth has occurred in the surrounding counties as growth has moved outwards.

By absolute numbers and in percentage growth, top 5 growing counties in DFW

Parker County is growing fastest on a percentage basis