Opportunistic real-estate funds run by private-equity firms have nearly $145 billion in so-called dry powder for future investments, up from $120 billion at the end of last year.
T Bills
$100 invested in three-month Treasury bills in 1928 grew to only $2,141 by the end of last year while it became $46,379 invested in medium-grade corporate bonds and a whopping $624,534 if invested in stocks.
Activist Investing
Activist hedge funds have seen their investments climb about 14% through July. That trails the S&P 500’s gains of about 20% through the same time period. But it’s better than 2022, when activists as a unit were down more than 16% for the full year.
WeWork
WeWork, once one of the world’s most valuable startups worth $47 billion, said excess supply of commercial real estate, greater competition for flexible space and uncertain economic conditions resulted in losses in the second quarter. The company’s stock is down more than 95% since its public listing, with an estimated market capitalization now around $450 million.
Mortgage Lending
Total commercial and multifamily mortgage lending is expected to fall to $504 billion this year, a 38% decline from 2022.
Apartment Values
Apartment-building values fell 14% for the year ended in June after rising 25% the previous year.
Hedge Fund Flows
Hedge-fund firms that have more than $5 billion in assets had net inflows of $14 billion in the first half of this year. Those with between $1 billion and $5 billion had inflows of about $1 billion. Firms managing less than $1 billion, by contrast, had net outflows of some $2 billion.
Private Equity
Private funds’ gross assets recently surpassed those of the commercial banking sector at more than $25 trillion. That is up from $9 trillion in 2012.
Mall Debt
More than $14 billion of loans backed by local malls comes due in the next 12 months with about a fifth of all malls financed through commercial mortgage-backed securities underwater.
CRE Sales
Rampant uncertainty has pushed commercial-property sales to their lowest level in years. Investors purchased only $130.5 billion worth of U.S. commercial property the first five months of 2023, a 61% decline from the same period last year.