- WeWork Is Bankrupt—And SoftBank’s Losses Are $14 Billion and Counting “It is an astounding amount of money to have lost on a single company, and it marks one of the worst bets ever on a startup. The scale of the loss is especially striking given the industry: Competitor IWG, with similar revenue to WeWork, has a market value of $1.7 billion.” (The Wall Street Journal)
- WeWork Flopped. Have Flexible Offices? “One reason why the sector remains small is that WeWork and IWG’s offices mainly appeal to startups, particularly in the tech sector. Big companies do sometimes use co-working space—if they are opening a regional hub, say—but never took to it in big numbers.” (The Wall Street Journal)
- WeWork Anticipated Shedding Another 32% of Global Offices in Run-Up to Bankruptcy Petition “WeWork's turnaround plan assumed it would exit 163 global locations including 43 outside the United States and Canada in the run-up to the flexible office space provider's bankruptcy filing this week.” (CoStar)
- Google Just Canceled $15B in Bay Area Projects. Does It Signal a Bigger Problem? “Google has been cutting both jobs and its budget since the beginning of this year, and in February the company stated that it anticipated incurring $500 million in costs in the first quarter in connection with reducing its office space globally.” (Commercial Property Executive)
- Meridian Capital under investigation by Freddie Mac “While the probe is ongoing, Meridian is barred from brokering deals on behalf of Freddie Mac lenders. Herzka’s firm has placed a broker on leave and is working with Freddie on its inquiry, according to a source familiar with the investigation.” (The Real Deal)
- Fannie Mae Subjects Broker-Involved Agency Loans to Pre-Review “
Washington-based Fannie Mae (FNMA) alerted lenders on Tuesday that all agency-backed loans involving brokers are now subject to pre-review, Commercial Observer has learned.” (Commercial Observer) - Kennedy Wilson looks to push into the loan business “Kennedy Wilson’s move to credit also comes as it has adjusted the values of some assets to reflect current market conditions — the accounting practice known as mark-to-market. Those adjustments contributed to a significant loss in the third quarter.” (The Real Deal)
- Banks ramp up industrial real estate lending in 2023 in retreat from office “Investors' generally bullish view on industrial real estate in recent years, driven by the rise of e-commerce, has lost some steam in recent months amid worries about consumer spending and the potential for a recession.” (S&P Global Market Intelligence)
- CMBS Distress Rate Rises for 10th Straight Month “Looking across the CRED iQ distressed rate heat map (below), all property types are in the red — with the exception of retail, which achieved the most significant reduction in overall distress rate in October. Meanwhile, self-storage landed in the red for the first time in two years.” (Commercial Observer)
- Hotel Investors Are on the Hunt for Property Deals “Four out of five investors surveyed by Jones Lang LaSalle Inc. say they plan to be net buyers of hotels over the next 12 months. That’s the highest rate since the commercial real estate firm started polling investors in 2000.” (Bloomberg)
- The future of malls? It’s all about adapting to their surrounding communities “Some mall owners are bringing residential to their mall properties, too. This often happens when a large section of a mall, perhaps an anchor tenant, becomes vacant. Mall owners might then demolish an older structure and build new multifamily units on the site.” (RE Journals)
- How to Create Passive Income Through Real Estate Syndication “Syndication isn’t for everyone. Investors have limited flexibility on the commitment, compared to solo investing, and the ROI could take years. Investors also have limited control — especially since the syndicator/sponsor manages the assets for them.” (Kiplinger.com)
- They Risked Their Lives to Clean New York Offices. Now They May Strike. “Now Ms. Klimas, 66, along with thousands of others who mopped, dusted and scrubbed 1,300 buildings during the worst of the pandemic, are sending a message as their bosses signal that they may cut back on health care contributions: Don’t mess with our benefits.” (The New York Times)
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