—— U.S. Housing Market Shows Recovery in December; Asia’s Richest Man’s Group Shorted; Tishman LA Project Supports Minority Investors; Harbor Launches $1.6B Real Estate Debt Fund; Azure Weakness Sinks Microsoft; European E-Commerce Giant Cuts 30%; Apollo Eyes Millicom Acquisition
1. U.S. Housing Market Shows Recovery in December
According to newly released data from real estate company Redfin, the number of U.S. homes pending sale in December, adjusted for seasonality, rose by 2.9% compared to November—the largest month-over-month increase since October 2021.
Additionally, the number of home tour requests and clients contacting agents also increased, signaling a recovery in the housing sales market.
Redfin’s head of economic research stated that as the dollar depreciates and interest rates decline, there are signs that homebuyers are returning to the market. The 30-year fixed mortgage rate has dropped to 6.15%, the lowest since September.
Redfin agent Angela Langone said the total number of homes going under contract in Q4 even surpassed the entire fourth quarter.
However, Redfin warned that the housing market is far from safe. Buyers still face tight inventory, poor affordability, and an uncertain economic outlook.
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2. Asia’s Richest Man’s Group Shorted
According to a report released today by prominent short-seller research firm Hindenburg Research, the firm believes the Adani Group has engaged in market manipulation and fraud.
Adani Group is a business empire founded by India’s richest man, Gautam Adani.
Following the release of the report, shares of Gautam’s Adani Enterprises and Adani Transmission dropped 1.5% and 9%, respectively. The combined market value of his ten companies fell by $12 billion. One of the group’s 2032 USD bonds also plunged 7% to 71.5 cents on the dollar.
Hindenburg disclosed that it had shorted Adani Group through U.S.-listed bonds and other derivative instruments.
The report revealed that many entities linked to Gautam’s brother Vinod Adani showed no clear signs of operational activity.
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3. Tishman LA Project Supports Minority Investors
Recently, commercial real estate investment firm Basis Investment Group (BIG) invested $30 million in equity—11% of total equity—into Tishman Speyer’s mixed-use residential project in Santa Monica, California.
Seventy-five percent of BIG’s shareholders are people of color and women, and the firm has invested over $1.3 billion to date. Tishman Speyer CEO Rob Speyer said partnering with BIG also reflects the company’s commitment to promoting racial diversity in the industry.
The development is planned in two phases and is currently in early stages. Once completed, the project will offer 617 residential units, including 116 affordable housing units, with 31,000 square feet of retail space on the ground floor.
In 2021, a Tishman project in Boston sought to include 161 African American and Latino investors.
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4. Harbor Launches $1.6B Real Estate Debt Fund
Today, Harbor Group International (HGI) announced the launch of a new $1.6 billion debt fund called the HGI Multifamily Credit Fund, which will invest in apartment buildings and other multifamily properties.
A division of the Canada Pension Plan Investment Board invested $585 million in the fund.
HGI President Richard Litton stated that the fund offers fixed- and floating-rate senior and mezzanine debt, as well as preferred equity, with expected returns between 8% and 12%. He noted that high mortgage rates and strong fundamentals in the rental apartment market create attractive conditions.
Since 2021, rising benchmark interest rates and broader economic uncertainty have caused commercial banks to tighten lending. HGI identified this opportunity and began fundraising for the fund. Half of the fund’s capital has already been deployed.
Harbor’s new fund offers senior and mezzanine debt products backed by multifamily real estate assets.
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5. Azure Weakness Sinks Microsoft
Today, software giant Microsoft warned that its cloud business revenue growth would slow significantly in the coming months. Due to concerns over softening demand for its enterprise software Azure, Microsoft shares fell 3% to $234.67.
Azure has long been a highlight in Microsoft’s earnings, outperforming PC software and gaming sales. However, on Tuesday, CFO Amy Hood told investors that Azure sales could decline by 4% to 5% this quarter.
Analysts at BMO Capital Markets downgraded Microsoft’s stock, and at least 10 other brokerage firms also cut their price targets.
In recent months, Wall Street has been lowering revenue forecasts for the entire tech sector. In the last quarter, Texas Instruments—one of the world’s largest chipmakers—also reported its first revenue decline since 2020.
Microsoft’s shares initially rose with the broader market but quickly erased gains after the earnings report.
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6. European E-Commerce Giant Cuts 30%
Recently, Prosus NV—one of Europe’s largest e-commerce asset holders—and its parent company Naspers announced plans to cut about 30% of corporate staff.
Prosus CEO Bob Dijk said in an interview that layoffs will affect offices in Hong Kong, Amsterdam, and South Africa, impacting a total of 15 locations.
Bob noted that the macro environment is becoming increasingly challenging, and capital costs are rising. As interest rates climb, so does the risk premium.
As of March last year, Prosus employed 30,000 people through its investments in online video, food delivery, and digital payments businesses.
The rising cost of capital and economic pressures have forced Prosus into major workforce reductions.
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7. Apollo Eyes Millicom Acquisition
Sources revealed that leveraged buyout firm Apollo Global has partnered with former SoftBank executive Marcelo Claure and is considering acquiring Latin American telecom company Millicom International Cellular.
The Apollo-led consortium is expected to offer close to $20 per share. As of Tuesday, Millicom shares were trading at $14.83 on the Nasdaq, giving the company a market cap of about $9 billion. News of the potential acquisition sent Millicom shares soaring 19.1%.
Apollo and Marcelo are not interested in assuming Millicom’s $6.9 billion in debt, citing current volatility in the capital markets.
Last year, Apollo acquired Lumen Technologies’ phone and broadband business for $7.5 billion.
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This content is sourced from Financial Times, Bloomberg, and The Real Deal, among other financial news outlets.