National Cheat Sheet: How much money WeWork made — and lost — last year … & more

New York /
Apr.April 27, 2018 08:00 AM

Clockwise from top left: Here’s why the defecit Trump hates is good for real estate, WeWork sold $702M in junk bonds, Zillow loses its luster for some brokers and the Mayor of Boca Raton took bribes from Palm Beach developers.

Here’s how much WeWork made and lost last year
Investors readily bought $702 million in junk bonds from WeWork in the co-working space’s initial public offering. WeWork intially planned to sell fewer bonds, but upped the offering after a flood of interest. WeWork has 234 locations around the world, but is pushing for more with a $4.4 billion investment from SoftBank. But not everyone’s feeling bullish on the company. “We cannot get comfortable with the company’s financial and operating position, which includes a massive asset/liability mismatch that is usually a recipe for disaster, significant cash burn, cyclically untested real estate business model, and uncertain path to profitability,” said one analyst. [Bloomberg and TRD]

That trade deficit Trump hates? Here’s why real estate needs it
President Trump had talked tough against China, saying its created an unfair trade imbalance. He’s vowed to reverse the deficit, but it has been a boon for the real estate industry, experts say. The imbalance essentially means foreigners will have more money and they’ll likely invest it in things like U.S. real estate. And while foreigners tend to invest in New York real estate, experts predict any changes would have impacts throughout the country. [TRD]

Zillow becoming too pricey and ‘diluted’ for some
Some brokers have soured on using Zillow, according to TRD’s L.A. bureau. Some complained that the cost of leads once priced at $20 have recently tripled. And the price bump hits brokers where it hurts: their own pocket. The site’s popularity has become a deal-breaker for some because with so many using it, fewer eyes hit brokers’ pricy ads. “At one point in time, Zillow sold to team leaders. Now they’re diluting it by selling to many agents,” one broker said. [TRD]

MAJOR MARKET HIGHLIGHTS

Boca Raton mayor took bribes from Palm Beach developers, police say
Mayor Susan Haynie was busted on corruption and misconduct charges after records showed she took $335,000 in bribes from Palm Beach developers James and Marta Batmasian. With a portfolio topping $100 million, the Batmasians are the largest commercial property owners in Palm Beach County. They paid Haynie and her husband about $86,000 for work on their properties, prosecutors said. She’s been arraigned and released on a $12,000 bond. [TRD]

Chicago developer buys $1.3M Echo Park apartment project
A company tied to Chicago’s Bond Companies bought a two-lot Echo Park property and hopes to pick up the development of an apartment complex where the last owner left off. Santa Monica-based DE Architects filed plans Tuesday for the seven-story project with 47 units. The project is eligible for a bigger development if it includes more affordable units. The project will include parking at ground and subterranean levels. [TRD]

Chinese developer defaults on $174M in debt a year after $4B New York play
China-based Zhonghong Holdings defaulted on more than $174 million debt, a year after it tried to buy the New York-based senior living facility chain Brookdale Senior Living for $4 billion. That deal fell through when Chinese regulators cut off the company’s access to credit. Moody’s warned small and mid-sized developers in China that it’ll be tougher now given domestic credit conditions. [TRD]


Related Articles

arrow_forward_ios
Wendy Silverstein (Credit: Getty Images)
Wendy Silverstein, co-head of WeWork’s real-estate fund, is out
Wendy Silverstein, co-head of WeWork’s real-estate fund, is out
WeWork CEO Adam Neumann (Credit: Getty Images and iStock)
WeWork’s side businesses are fizzling
WeWork’s side businesses are fizzling
Sarah Pontius (Credit: Union College)
Another head rolls at WeWork
Another head rolls at WeWork
15 Hanover Place in Brooklyn (Google Maps)
Lonicera Partners developing 314-unit building in Brooklyn
Lonicera Partners developing 314-unit building in Brooklyn
Surfside site’s stalking horse bidder signed contract, auction slated for February as claims could reach $1B
Surfside site’s stalking horse bidder signed contract, auction slated for February as claims could reach $1B
Surfside site’s stalking horse bidder signed contract, auction slated for February as claims could reach $1B
Valley National CEO Ira Robbins and Bank Leumi USA CEO Avner Mendelson (Getty, Valley National, Bank Leumi)
Valley National acquiring Bank Leumi USA for $1.1B
Valley National acquiring Bank Leumi USA for $1.1B
Longfellow Real Estate Partners CEO Adam Sichol with renderings of 310 East 67th Street (Friends UES, Rendering by DBOX, Longfellow)
Blood Center rezoning on Upper East Side approved
Blood Center rezoning on Upper East Side approved
39 Clarkson Street (Google Maps)
Hudson Square office building sold for $46M
Hudson Square office building sold for $46M
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...