Real Estate

Beijing sets planned fires to save property forest

20 Sep 2021

Officials are allowing developer Evergrande teeter on the edge of default as the real estate sector skids. It’s a risky attempt to scorch speculators in an industry used to bailouts, but without incinerating the wider economy. The heat will test the government’s pain tolerance.

Capital Calls: Amazon’s wage rise

14 Sep 2021

Concise views on global finance: The e-commerce giant’s salary strategy could catch on.

Old-timers’ property brawl needs knockout blow

25 Aug 2021

Barry Sternlicht’s Starwood is trading bids with Chicago veteran Sam Zell for $2 bln U.S. industrial real-estate outfit Monmouth. The increments are too small to be decisive. The Monmouth board is sticking with Zell for now, but it's time for a best and final punch from each.

Evergrande’s restructuring clock starts now

20 Aug 2021

The central bank has issued a rare warning to the troubled developer to reduce debt risks, a hint to speed up non-core asset sales. That should calm investors as founder Hui Ka Yan sheds stakes in electric cars, a bank, and more. What will be left, though, looks disappointing.

Capital Calls: Walmart plays both ends of the trade

17 Aug 2021

Concise views on the global economy: The U.S. retailer expects strong sales throughout the year despite a surge in Covid-19.

Evergrande’s hometown hero is rich and generous

11 Aug 2021

S&P has downgraded the developer’s credit to junk as it struggles to raise cash. Luckily its Shenzhen city asset manager is loaded, with over $600 bln in assets. It helped local champion Huawei, and could be Evergrande’s white knight too - but only if Beijing permits.

Capital Calls: Brookfield, Macquarie

9 Aug 2021

Concise views on global finance: An insurance wing of the Canadian financial empire may bring a dash of risk to a conservative Texan insurer, while Australian investment bank Macquarie has snapped up a stake in British utility Southern Water.

Review: WeWork’s debacle had many enablers

6 Aug 2021

Founder Adam Neumann led the hyping-up of the office-sharing upstart, once purported to be worth nearly $50 bln. But he was far from alone. “The Cult of We” by Eliot Brown and Maureen Farrell exposes how banks, return-chasing investors and the media danced around the red flags.

German property deal rejig risks messy stalemate

6 Aug 2021

Landlord Vonovia got the nod from regulators to submit a new $23 bln offer for peer Deutsche Wohnen. Its last bid was scuppered by hedgies hoping for a higher price. A skimpy premium means it may still not get enough shares to take full control, leading to a lengthy standoff.

Asia $5 bln property deal builds on a big pivot

5 Aug 2021

Hong Kong-listed ESR is buying fellow real estate manager ARA, its second big acquisition in months. It’s a bet that asset owners want to swap their offices and shops for exposure to fast-growing logistics and data centres. The region’s expanding REIT markets will help.

Evergrande’s downward spiral runs off the page

30 Jul 2021

Beijing managed the market impact when it allowed quasi-state entity HNA to slide into bankruptcy. It will face more complex problems if privately-run Evergrande folds. The longer authorities wait to signal support, the more pages it will need to add to its corporate disaster playbook.

Hedgie stumble takes German M&A to surreal heights

26 Jul 2021

Investors sank landlord Vonovia’s $21 bln Deutsche Wohnen offer, even though they wanted it to succeed. Too many sat on the shares, hoping for a fatter payout courtesy of Berlin’s odd takeover rules. While the deal may be salvageable, it’s a clear sign of the need for reform.

Real-estate SPAC deal pushes valuation boundary

26 Jul 2021

Peter Thiel and Richard Li’s blank-cheque firm is buying Southeast Asia-focused PropertyGuru in a tie-up worth $1.8 bln. That’s roughly double its failed 2019 IPO and a roof-raising 52 times EBITDA. Rupert Murdoch’s REA is also involved. The price is high for this neighbourhood.

Reckoning looms for Chinese developers’ loan dodge

20 Jul 2021

Forced to cut interest-bearing debt, Chinese real estate companies like Evergrande borrowed $556 bln from their suppliers last year. Now they are struggling to repay, prompting a crackdown. Offloading land assets could raise cash quickly, but developers have cause to resist.

Fortress’ vows to Morrisons look flimsy and finite

6 Jul 2021

A consortium led by the private equity group secured the British grocer’s support for an $8.7 bln takeover by pledging to treat suppliers well and not sell real estate. Yet its promises are not legally binding and expire in a year. The target’s board should have pushed for more.

Housing market can boom without pandemic-era drugs

1 Jul 2021

U.S. and UK real estate are rising at their fastest pace in over a decade. The Fed’s purchases of mortgage-backed bonds and UK tax breaks have outlived their usefulness. The longer that such supports are left in place, the wider the gap between haves and have-nots will grow.

Shared-office buyout would need pandemic booster

29 Jun 2021

Private equity firm CC Capital briefly held talks with IWG over a $6 bln takeover, Sky says. Persuading founder Mark Dixon would require a big premium. And to get a decent return, a buyer would have to believe that flexible working will boom after the crisis. That’s a bold call.

Capital Calls: Genetic gold rush

28 Jun 2021

Concise views on global finance: A company has shown biotechnology called CRISPR can precisely edit defective genes in humans, fueling investment and squabbles.

Capital Calls: Infrastructure, Doximity, Deliveroo

24 Jun 2021

Concise views on global finance: President Biden’s $1 trln bipartisan plan for U.S. infrastructure is a feat of political engineering. Meanwhile, medical-themed social network Doximity finds riches in niches, and UK delivery outfit Deliveroo serves up a favorable court ruling.

Fate of U.S. mortgage giants only half clear

23 Jun 2021

The Supreme Court’s blow to Fannie Mae and Freddie Mac investors leaves a fuzzy future. Bill Ackman’s fund and others had insisted the government illegally confiscated earnings. What Joe Biden wants to do with the firms backing half America’s homes may have bigger consequences.