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Feb 10, 2026
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LONG
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"The regional banks... are not lending today to the regional builders. So, the regional builders are somewhat paralyzed... The top 20 home builders, they don't need regional banks, right? They got their own balance sheet." A credit crunch at the regional bank level specifically hurts small, private competitors. Large public builders (DR Horton, Lennar, Pulte) have access to capital markets (corporate bonds/stock) and cash. They will absorb the market share of the paralyzed private builders who cannot get construction loans. Long the large incumbents who can build through the credit cycle. If interest rates stay historically high for too long, demand destruction could eventually hit the large builders despite their supply-side advantage. |
CNBC
Squawk Pod: Kalshi CEO on Super Bowl wins & N...
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Feb 10, 2026
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AVOID
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"They can't afford to compete with the big banks... they don't have the capacity to be able to be lenders there." Rechler, a board director at the NY Fed, is explicitly stating that the business model for regional banks is currently broken regarding commercial and construction lending. If they cannot lend, they cannot generate yield, and they lose their primary utility in the economy compared to "Too Big To Fail" banks. Avoid the sector until the yield curve normalizes or consolidation occurs. A sudden, aggressive Fed rate cut could rapidly repair regional bank balance sheets. |
CNBC
Squawk Pod: Kalshi CEO on Super Bowl wins & N...
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Feb 10, 2026
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LONG
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"New York's best quarter for office leasing in years... The facts are saying people and companies believe in New York... investing in New York, and aren't afraid." The market has priced NYC Office REITs (like SL Green or Vornado) for a "doom loop" scenario. Rechler provides proprietary data suggesting the bottom is in (leasing up, luxury sales up 30%). If the "death of NYC" narrative is wrong, these assets are severely undervalued. Contrarian Long on NYC-specific real estate exposure. Crime/Quality of life issues (mentioned regarding homeless encampments) could reverse the trend if not managed by the Mayor. |
CNBC
Squawk Pod: Kalshi CEO on Super Bowl wins & N...
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Feb 10, 2026
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AVOID
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Rechler explicitly says regional banks are "broken," "can't afford to compete with the big banks," and "don't have the capacity to be lenders." Construction and Commercial Real Estate (CRE) lending were the bread and butter of regional banks. If they are retreating from this due to capital constraints and regulatory pressure, their earnings growth engines are stalled. They are losing their best clients to private credit or G-SIBs (Global Systemically Important Banks). Avoid the sector. Even if they appear "cheap" on book value, they are value traps with no clear path to growing their loan books. A sudden, aggressive Fed rate cut cycle that steepens the yield curve and rescues their balance sheets. |
CNBC
RXR CEO Scott Rechler on housing affordabilit...
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Feb 10, 2026
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LONG
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Rechler states there is a "supply gap" of 4-7 million homes, but "regional banks... are not lending today to the regional builders." Homebuilding is capital intensive. Small, private builders rely almost exclusively on regional bank construction loans. If that capital spigot is turned off, small builders cannot build. Large public builders (D.R. Horton, Lennar) do not rely on regional banks; they have investment-grade balance sheets and access to public debt markets. Therefore, the "broken" regional banking system forces market share consolidation into the hands of the large public builders. Long large-cap builders as they are the only ones capable of bridging the supply gap in a credit-constrained environment. A severe recession that crushes overall housing demand regardless of supply constraints; persistent high rates locking up buyers. |
CNBC
RXR CEO Scott Rechler on housing affordabilit...
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Feb 10, 2026
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LONG
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Regarding the political backlash against firms like Blackstone buying homes, Rechler notes it is "marginal" and that "most of them are focused on Build-to-Rent versus buying inventory." The market fears regulation will stop institutions from owning homes. Rechler clarifies that the smart money has already pivoted to "Build-to-Rent" (BTR). This pivot aligns with the government's goal (creating new supply) rather than fighting it. This reduces regulatory risk for BTR operators and positions them to solve the supply crisis. Long BTR-focused REITs. The political headwinds are overstated, and the underlying demand for rentals remains high due to the affordability crisis preventing home ownership. Specific legislation banning bulk ownership of single-family homes, regardless of whether they are new builds or existing inventory. |
CNBC
RXR CEO Scott Rechler on housing affordabilit...
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