- New Supply Chain Risk: 22,000 Dockworkers Who May Soon Strike “In a world contending with no end of economic troubles, a fresh source of concern now looms: the prospect of a confrontation between union dockworkers and their employers at some of the most critical ports on earth. The potential conflict centers on negotiations over a new contract for more than 22,000 union workers employed at 29 ports along the West Coast of the United States. Nearly three-fourths work at the twin ports of Long Beach and Los Angeles, the primary gateway for goods shipped to the United States from Asia, and a locus of problems afflicting the global supply chain.” (The New York Times)
- CMBS, CRE CLO Transactions Pass Their First Stress Test “Rating agency KBRA just came out with a look at securitization credit performance in commercial real estate in the wake of the pandemic. The news? “CRE securitization credit performance among conduit, single borrower/large loan (SB/LL), and CRE collateralized loan obligation (CLO) transactions has held up reasonably well,” the report noted. ‘That is not to say that there were no major challenges along the way, but lessons learned from the GFC [global financial crisis] helped to mitigate the credit impact of COVID.’” (GlobeSt.com)
- KKR, GIP Close on $15B Acquisition of CyrusOne “International investors KKR and Global Infrastructure Partners have closed the $15 billion acquisition of data center REIT CyrusOne, which was first announced in November last year. Funds controlled by the two firms acquired all outstanding shares of common stock, including the assumption of existing debt. CyrusOne stockholders approved the merger last month.” (Commercial Property Executive)
- New York’s Class B and C Office Owners Mull Flex to Fill Space “Some landlords rode out the pandemic without making additional investments in their assets and now aim to compete on price alone. Other owners saw prospective tenants pivot to Class A office space dripping with 21st-century technological upgrades, cozy lobbies and soaring rooftop terraces, and renovated their modest-sized high-rises to compete with the One Vanderbilts of the world. Still others contemplated tearing down their buildings after missing out on months of rent while inflation rose and their debts piled up.” (Commercial Observer)
- Multifamily Flips Spur More Evictions: Report “Strong demand for city living is leading to rising rents, which in turn increases valuations of apartment buildings and attracts buyers looking for a quick profit. Such speculative investments tend to be accompanied by more evictions, according to a report released this week. Communities of color, which already face higher rates of eviction, are more likely to bear the brunt of that potential displacement, the authors write.” (The Real Deal)
- New Balance Bulks Up Manufacturing Presence in U.S. Amid Global Supply Chain Backlogs “New Balance, a privately held business known for its cushioned sneakers and retro-inspired workout gear, has opened a manufacturing facility in Methuen, Massachusetts, the company announced Monday. The move strengthens its reliance on North America for production, as businesses try to navigate an obstructed global supply chain, said President and Chief Executive Joe Preston. The move comes as prominent business leaders are considering whether globalization as we know it is coming to an end.” (CNBC)
- Walmart to Transform Wisconsin Hub into Next-Get Distribution Center “The discount giant is making a multi-million-dollar investment in high-tech automation for its regional distribution center (RDC) in Menomonie, Wis. The investment is part of a broader initiative the retailer announced in July 2021 to renovate 25 of its 42 regional distribution centers with automated technology. The retailer hopes to support a broader digital transformation in its supply chain aimed at increasing the speed, efficiency, and safety at which products are distributed. The first phase of the renovation will be completed by the end of the year.” (Chain Store Age)
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