The Suburban American Dream Is Going to Make a Comeback

(Bloomberg Opinion) -- What happens when all of the advantages of living in big cities go away and new disadvantages of expensive urban density are revealed? This week's guest on Masters in Business, activist real estate hedge-fund manager Jonathan Litt, founder and chief investment officer of Land & Buildings Investment Management LLC, says he thinks it means a rebirth of the American dream of suburban home ownership.

Litt has spent the past 25 years as a strategist and an investor in both public real-estate securities and direct property ownership. Litt says the work-from-home experiment during the coronavirus pandemic has turned out better than expected: Productivity is higher and new technologies create a much better experience than in the shorter post-Sept. 11 version.

The high costs in big cities such as New York and San Francisco likely mean new challenges for commercial real estate and investing in real-estate investment trusts that own office buildings. His biggest bets are in the suburban single-family home market. He said he is expecting the annual population loss of about 1% from big urban centers to increase as post-pandemic millennials and city-dwellers rediscover the appeal of suburbia.

His favorite books are here; a transcript of our conversation is here.

You can stream and download our full conversation, including the podcast extras, on iTunes, iTunes, Spotify, Overcast, Google, Bloomberg and Stitcher. All of our earlier podcasts on your favorite pod hosts can be found here.

Next week, we speak with Luke Ellis, chief executive officer of Man Group Plc, a global active investment manager with $104.2 billion in assets under management.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Barry Ritholtz is a Bloomberg Opinion columnist. He is chairman and chief investment officer of Ritholtz Wealth Management, and was previously chief market strategist at Maxim Group. He is the author of “Bailout Nation.”

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