—— U.S. Commercial Real Estate Posts First Price Drop in Over a Decade; AI Boom Doubles Jensen Huang’s Wealth; China Powers Burberry Sales Growth; Geely Increases Stake in Aston Martin; Meituan Launches Hong Kong Sister App; Montana Becomes First U.S. State to Ban TikTok; NYC Rents Hit New Records Across Three Boroughs
1. U.S. Commercial Real Estate Posts First Price Drop in Over a Decade
Moody’s data shows that in Q1, U.S. commercial real estate prices fell 1%—the first decline in more than ten years—with multifamily properties and office buildings being the main drags.
In Q4 last year, excluding farmland and residential properties, banks held at least 60% of the $3.6 trillion in commercial real estate loans, with smaller banks facing greater risk.
The Federal Reserve’s recent semiannual Financial Stability Report warned that the scale of commercial property repricing could be large and may result in significant credit losses.
On Tuesday, Fed Vice Chair for Supervision Michael Barr told lawmakers that regulators are closely monitoring risks from commercial real estate and have tightened oversight of banks.
Many restaurants and retailers in Manhattan have closed, and companies have reduced office space, forcing landlords to lower rents or sell buildings.
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2. AI Boom Doubles Jensen Huang’s Wealth
Riding the wave of this year’s AI investment boom, chipmaker Nvidia has become the best-performing stock in the S&P 500.
Nvidia CEO Jensen Huang’s personal fortune has risen 98% this year to $27.3 billion, making him the biggest winner among global tech billionaires.
Last year, tech stocks saw major pullbacks and Huang’s wealth was nearly halved. But with the rise of OpenAI’s ChatGPT and other AI tools, Nvidia—maker of critical AI chips—has become a top pick.
Last year, the U.S. barred Nvidia from selling advanced chips to China, which may cost the company hundreds of millions in annual revenue.
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3. China Powers Burberry Sales Growth
In the fiscal year ending April 1, British luxury brand Burberry saw same-store sales rise 7%, beating expectations of 5.6%, thanks to strong post-COVID demand from Chinese consumers.
However, with same-store sales in the U.S. falling 7% in Q4, Burberry’s stock dropped 6% today.
Sales in China grew 13% during Q4, driven by high demand for the brand’s trench coats and apparel. In contrast, American consumers increased overseas travel and cut back on domestic spending.
Burberry’s growth was entirely driven by China, while the U.S. market continues to weaken.
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4. Geely Increases Stake in Aston Martin
British sports car brand Aston Martin disclosed in a filing that China’s Geely will acquire a 17% stake worth £234 million and appoint a board member.
Geely already owns stakes in European brands such as Volvo, Renault, and Aston Martin.
Following the announcement, Aston Martin shares surged as much as 25% pre-market, adding $118 million in market value.
Analysts say Aston Martin’s limited cash reserves and scale leave it vulnerable to operational issues.
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5. Meituan Launches Hong Kong Sister App
Sources say food delivery giant Meituan, backed by Tencent, is preparing to launch a sister app called KeeTa in Hong Kong as early as next week, initially targeting users in the city’s northern district.
On the mainland, Meituan dominates the food delivery sector, with rivals including Foodpanda and Deliveroo.
KeeTa is now listed on Hong Kong’s iOS App Store and is available for download by select invited users. The company has also started recruiting delivery workers for walking and cycling.
Meituan is set to release its quarterly earnings next Thursday and currently has no plans for international expansion.
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6. Montana Becomes First U.S. State to Ban TikTok
Today, Montana Governor Greg Gianforte signed a bill banning TikTok statewide.
The law will likely face numerous legal and constitutional challenges over issues such as free speech.
The ban prohibits Montana residents from downloading TikTok from app stores, meaning new users cannot register. However, enforcement may prove difficult for those who already have the app.
TikTok spokesperson Brooke Oberwetter said the law violates the free speech rights of hundreds of thousands of residents and that the company is working to defend their rights to express themselves and earn a living.
Montana is the first U.S. state to enact a TikTok ban, but legal and public opposition is expected.
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7. NYC Rents Hit New Records Across Three Boroughs
A new report by Douglas Elliman shows that in April, the median rent for new leases hit record highs in Manhattan, Brooklyn, and northwest Queens.
Manhattan’s median rent rose 8.1% year-over-year to $4,241—$66 above March’s previous record. Brooklyn and Long Island City saw rent increases of 15% and 13%, respectively.
Luxury apartments in Manhattan had a 13% jump in median rent to $11,310. In Brooklyn, studio and three-bedroom rents rose 8.5% and 47%, showing demand and pricing are up across all unit types.
The current rental inventory is 10% below the 10-year average, tightening the market further.
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This content is sourced from Financial Times, Bloomberg, and The Real Deal, among other financial news outlets.