——The developer purchased a Wall Street office building and converted it into an apartment; the median price of second-hand housing exceeded $400,000 in May; the six major US banks may give back $80 billion to investors; the food giant Kellogg plans to split into three; FedEx builds package tracking intelligence Software; BlockFi gets $250 million in credit facility; Dartmouth College cancels grant loans.
1. Developers buy Wall Street office buildings
A joint venture between two developers, Silverstein Properties and Metro Loft, has agreed to buy a 30-story Wall Street office tower for $180 million and plan to transform it into a 571-unit apartment complex over the next three to four years. residential building.
Nathan Berman, founder of Metro Loft, said many old Wall Street office buildings are being phased out, and it is only right to convert them into apartment buildings.
Between 2020 and 2021, 13,000 apartments were added across the U.S. through office building renovations. In many cities, homeowners are considering similar renovations, which can not only increase housing affordability, but also make use of “buildings”.
Nathan expects the project will cost a third less than blasting and rebuilding residential buildings on the site.
Developers need to choose the method of “office building to residential building”
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2. Second-hand home median price tops $400,000 in May
According to the latest statistics from the National Association of Realtors, the median sale price of a second-hand home in the United States broke through $400,000 in May, setting a new record.
In addition, the total sales of second-hand housing decreased by 3.4% compared with April to an annualized 5.41 million units, a decrease of 8.6% compared with May last year, and the decline has continued for 4 months.
Still, demand outstripped supply in the housing market, which also contributed to a 14.8% year-over-year increase in the median existing-home price to $407,600, a record not seen since 1999.
Lawrence Yun, the chief economist at NAR, believes that the impact of higher mortgage lending has not yet been reflected in the May data, and second-hand home sales will continue to decline in the coming months.
In parts of the U.S., housing inventory has climbed rapidly, with the number of homes for sale in Austin up 146% in May compared to a year ago; the Denver area jumped 76% compared with a year ago.
At the end of May, 1.16 million homes across the U.S. entered the home-purchase contract phase, a 12.6 percent increase from April. At the current rate, it would take 2.6 months to sell out all the homes on the market.
May’s housing sales data has not fully reflected the impact of rising interest rates
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3. The 6 largest U.S. banks may give back $80 billion to investors
JPMorgan Chase & Co. plans to return $18.9 billion to investors in the form of dividends and share buybacks, according to estimates provided by analysts at Barclays.
Bank of America and Wells Fargo & Co. are also expected to return investors $15.5 billion and $15.3 billion, respectively. The nation’s six largest banks are expected to return a total of $80 billion to investors.
Barclays analyst Jason Goldberg said banks have not repurchased shares during the pandemic, so there are more cash savings this year. In addition, although the current economic situation is not optimistic, the growth of fixed-income businesses is relatively considerable.
On Thursday, the major banks will unveil their annual risk test, which will be used to assess the maximum amount of money they can give back to investors. In the coming weeks, the bank will also announce its capital layout for the financial year.
Banks will pass stress tests to determine the final reward and make capital allocation for the future
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4. Food giant Kellogg plans to split into three
Kellog’s, a well-known convenience food manufacturer in the United States, said in a statement today that the company plans to split into three separate companies, which will be responsible for the sales of breakfast cereals, global snacks, and vegetarian food. After the split, the company will focus more on the global snack business.
It is reported that Kellogg will be split into three through two tax-free spinoffs. The company will initially split the breakfast cereal business, with two splits expected to be completed by the end of 2023.
Steve Cahillane, CEO of the company, believes that such an independent enterprise can better utilize resources and stimulate real growth potential.
Last year, Kellogg’s snack sales reached $11.4 billion; vegan food sales were $340 million; and breakfast cereal sales in North America were $2.4 billion.
Well-known brands in the snack segment include Pringles, Cheez-It, and Pop-Tarts.
Kellogg’s 3 major food divisions are all very profitable
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5. FedEx builds smart package tracking software
FedEx Corp. and FourKites Inc., a delivery-tracking software company, are teaming up to build a data platform that can predict delays and improve the consumer experience.
The smart logistics platform developed by the two companies is called FourKites X. The platform combines FourKites’ logistics tracking technology and data from FedEx’s 16.5 million daily deliveries. Currently, the service can cover 2.5 million packages per day.
Sriram Krishnasamy, CEO of FedEx’s data science division, said the whereabouts of every package is very valuable data. The more data the software absorbs, the more accurate predictions and delivery times can be improved, which can bring more value to merchants.
Founded in 2014, FourKites has helped more than 1,000 businesses track their logistics.
In this strategic cooperation, FedEx provided Four Kites with an undisclosed amount of investment. Four Kites also received a $200 million infusion in previous funding rounds, bringing its valuation to more than $1 billion.
Four Kites X platform can predict delays in package delivery, as well as delivery time, to provide customers with more information
Source: WSJ – FedEx and FourKites to Share Package-Tracking Data
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6. BlockFi Secures $250 Million Credit Facility
BlockFi Inc., a well-known cryptocurrency lender, said that cryptocurrency exchange FTX agreed to provide it with a $250 million revolving credit facility (revolving credit facility) to improve the health of BlockFi’s assets and liabilities to survive the cryptocurrency winter.
The cryptocurrency market has plunged over the past two weeks, with BlockFi rivals Celsius and Babel Finance freezing customer withdrawals.
Recently, BlockFi admitted that the current market situation has had a negative impact on the company’s growth, and the company has also been forced to lay off more than 200 people. In February, the company also paid a $100 million fine to the U.S. SEC for lending cryptocurrencies without registering securities.
On the BlockFi platform, users can earn decent annual returns by lending cryptocurrencies
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7. Dartmouth College cancels financial aid loans
Dartmouth College, a leading Ivy League school, announced this week that it will use grants to “wipe out” undergraduates’ federal and private student loans starting with the summer semester.
The school revealed that the endowment has reached $388 million, and the school hopes to raise a total of $500 million in endowments by June 2023.
Taking loans out of a bursary package relieves students of stress in the future and allows them to pursue their dreams more carefree. More than 450 Dartmouth undergraduates have received grant invitations for the new academic year, and cancelling loans could help students save $5,500 a year in debt.
In the Ivy League, Brown University and Princeton University also offer bursaries without additional loans to undergraduates.
Loans are included in many grants, and several Ivy League programs use endowments to help students relieve loan stress
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The content of this article comes from various financial news media such as The Wall Street Journal, Financial Times, and Bloomberg.