Cities investing heavily in AI

In partnership with

New here? Join the newsletter (it's free).

Which cities are investing heavily into AI? link

• Beijing leads globally with 66.2% of its venture funding going to AI-native companies. That's slightly ahead of Silicon Valley’s 62.4%, though Silicon Valley still commands over 65% of all global AI-native funding by volume.

• Paris, with 43.2% of its venture funds aimed at AI, joins Silicon Valley and Beijing to form the “AI Big Three.” Together, these three regions attract nearly 80% of global AI-native investment across top ecosystems.

• New York City and Seattle lag behind, with only 14.2% and 14.8% of venture funding going to AI startups. This shows a clear divide between traditional tech hubs and newer AI-focused centers.

Grocery stores attracting investors link

• Grocery-anchored CMBS issuance hit $1.7 billion over the past three quarters, showing its strongest run since 2022. Q4 2024 alone saw $604.9 million issued, a major rebound from just $122 million in Q1 2023.

• National grocery-anchored centers are holding steady with cap rates between 6.37% and 6.8%, while local grocers face more risk, with rates peaking at 8.46% in late 2024. That gap shows investors are rewarding brand strength and tenant stability.

• About $3.6 billion in grocery-anchored loans mature in 2026, with $2.5 billion of that facing tighter refinancing conditions. The average debt yield in Q1 2025 was 11.63%, slightly down from 11.99% a year earlier, suggesting stricter lending standards.

Apartment rents decline in more than half of U.S. markets link

• National median asking rent in May was $1,633, down 1% year-over-year and $72 below the August 2022 peak. Nearly 25 of 44 tracked markets saw rent drops, the most since September 2023.

• Austin saw the steepest decline, with rents falling 8.8% to $1,385—its lowest since early 2021. Other major declines were in Minneapolis (-6.3%), Columbus (-3.5%), Nashville (-3.4%), and Portland, OR (-3.4%).

• Cities with fewer new permits like Cincinnati (+7.4%), Tampa (+4.2%), and St. Louis (+4%) had the biggest rent gains. New construction remains a key pressure point in markets like Austin, which permitted nearly 65 new multifamily units per 10,000 residents.

Zillow: Northeast housing competition heats up while Sun Belt offers breathing room link

• In Northeast cities like Buffalo, Boston, Hartford, and Providence, there are at least 10 serious buyers for every home. Over half of homes in these areas are selling above asking price and within 10 days.

• In contrast, Sun Belt markets like Miami and Houston are seeing much lower competition, with just 2.6 engaged buyers per listing in Miami. 12 out of 14 less competitive metros are located in the Sun Belt.

• Nationally, inventory is up 20% year-over-year, and 25% of sellers dropped prices in April — the highest April rate on Zillow’s record. Nearly 91% of buyers believe home listings should be freely viewable.

First-Time Home Buyers Making Up a Smaller and Smaller Share of the Market link

• The share of first-time home buyers has dropped from 50% in 2010 to just 24% today. High mortgage rates near 7% and record home prices are making it harder for new buyers to enter the market.

• This affordability crunch is leading more people to rent instead of buy. That’s putting upward pressure on rental prices across many cities.

• The Federal Reserve sees this trend as a challenge, as rising rents feed into housing inflation. It complicates efforts to bring overall inflation down.

Number of older adults using cannabis reaches new high link

• Cannabis use among adults 65+ rose from 4.8% in 2021 to 7% in 2023, a 46% increase. Back in 2006–2007, it was under 1%.

• Usage was highest among white, college-educated, married individuals earning $75K+, with older women showing a sharp increase. Men still use cannabis more, but the gender gap is shrinking.

• Seniors with chronic diseases like diabetes, hypertension, and COPD are using cannabis more often. In some memory care communities, cannabis is being used as an alternative to stronger medications.

Study suggests banks are avoiding mortgages in California wildfire zones link

• Traditional banks are pulling back from issuing mortgages in California wildfire zones, especially in areas like Los Angeles, while fintech lenders are stepping in. The study found these digital lenders offer better terms in high-risk areas, despite the growing climate threats.

• Data from 650 lenders in 2018 and 2020 shows traditional banks assign more risk to high-fire zones than fintechs, which may underestimate the environmental danger. This trend could increase default risks if disasters worsen, potentially costing the government billions.

• Indirect pressures like rising insurance costs and natural disasters are eroding home values in risky regions. One example cited was a 14% drop in home prices over five years in areas hit by Hurricane Sandy.

PropCorn

Propcorn is an AI-powered real estate analytics platform that helps investors, developers, and brokers make data-driven decisions through market insights, property intelligence, and predictive analytics.

Mapped: U.S. housing affordability by state

• Iowa is the most affordable state, with a median listing price of $294,600 and a home price-to-income ratio of just 3.0. The state has also issued over 10,000 new housing permits annually since 2022 to keep supply strong.

• Montana ranks as the least affordable due to a 66% spike in home prices over four years, outpacing the national average of 50%. Incomes there haven’t kept up, leading to a sharp affordability gap.

• Columbus, Ohio, has fewer affordable housing units per capita than New York or San Francisco. Despite Ohio ranking third overall for affordability, local shortages are driving problems in specific cities.

Entrance fee continuing care communities outperforming rentals

What’s hot in self storage design today?

Zumper’s National Rent Report for May ’25

National multifamily report – May 2025

Mid-Year 2025: Multifamily Trends

Proptech Startups That Just Got Funded

Mapped: Countries Where People Don’t Exercise Enough

A house designed and built by a US President!

Link to the listing

That's all folks. If these emails aren't for you anymore, you can unsubscribe here.

Cheers,

Vidit

Instagram

P.S - Read past newsletters here