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Deals & Dealmakers

Wall Street veteran Heidi Learner putting her money on change

Savills Studley’s chief economist Heidi Learner said an atmosphere of political uncertainty is affecting the real estate market more than usual, and could play a larger role in determining the future of real estate going forward.

Learner, who focuses on labor force modeling and quantitative CRE analysis at Savills Studley, has been watching the markets closely for the last five years she has been at the firm.

A native of the Boston area, Learner went on to attend the University of Pennsylvania, where she did a dual degree program between the engineering school and Wharton School of Business.

After graduating with a degree in engineering and economics, Learner thought she was going to become a biotech equity analyst on Wall Street, but instead became intrigued by the bond market through one of her classes on fixed income.
She took a job at the now-defunct Wall Street investment bank Salomon Brothers, spent time as a bond portfolio manager at MEAG New York Corporation, was an associate director at Barclays Bank and a VP at JPMorgan Chase, and served as a VP with State Street Corporation.


Before joining Savills Studley five years ago, she was working at a bank that was starting up a fixed income division. But after the bank decided to instead shut the department down, Learner began to think about going elsewhere.

“I thought, there’s got to be something that takes a little bit of a longer term view that isn’t necessarily so tied to the trading cycle or quarterly profits,” Learner told Real Estate Weekly.

Using her background in research, she began looking outside the box, and found what she was looking for on LinkedIn.
Her position at Savills Studley is her first job outside of Wall Street, and the stark differences between the two aren’t lost on her.

“I was used to being in a trading environment, where people are making quick second decisions, holding assets for a period of minutes,” said Learner. “It’s a much slower, more thoughtful process (in real estate) because holding time for tenants is typically no less than 10 years. So they’re making decisions 10, 15 to 20 years into the future. And any one data point is going to be really just a blip in the life-cycle of their real estate exposure.”

Learner joined Savills Studley a few years post-recession, and has watched the market take some time to recover.

“I like to point out that we are in the eighth year of recovery, and that we should expect some moderation in growth. In many markets that will correspond to new office supply specifically, so watching that trend could be interesting,” said Learner.

“It’s an interesting time, a lot of political uncertainty that will make the environment, for lack of a better word, interesting in the months ahead, in regard to domestic policy and international factors.”

One facet of the market Learner said will be important to watch in the next several months is companies such as WeWork that have leased huge blocks of office space.

“Because their growth has corresponded with a period of economic growth, it will be interesting to watch what happens to their tenant base when things begin to slow. It’s just a question of when not if, that’s certainly a concern I have,” said Learner. “I think their model in the U.S. is a little unproven. They have these leases that they’re signing for 10 to 15 years, and their tenants are coming in sometimes for one, two and three months.”

But it’s not just WeWork that could see upheaval in their empire — Learner said there are many other existing companies that would need to shed space during any downturn.

Learner and the team at Savills Studley have seen an increase in office employment in NYC that has corresponded in a decline of office square footage, as companies shrink their footprints and downsize.

“There’s a shift in composition in New York, which was traditionally driven by the finance industry. But the shift toward greater presence of tech firms that tend to allocate less square footage per worker than traditional companies, that’s really altered the demand for space,” said Learner. “So one law firm job is not equal to one IT worker job, in terms of space utilization.”

In Hudson Yards, developers have been successful at leasing huge swaths of office space to big-name tenants, despite a long log in availability.

“The concern for me is what happens to space that is left behind and how effective landlords will be at releasing these very large blocks of space in leasing it, and whether they’ll need to invest a significant amount of improvement dollars to enhancing the space,” she said.

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