—— Canadian Wildfire Smoke Blankets New York; China’s Export Volume Drops; Dell Family Office Gains $10 Billion; Goldman Sells Irish Mall at a Loss; U.S. CMBS Delinquency Rate Continues to Climb; Google Plans AI Consulting Services; Tesla Hits Seven-Month High
1. Canadian Wildfire Smoke Blankets New York
Due to wildfires in Canada, New York City was shrouded in thick pollution and smoke, becoming the most polluted city in the world.
On Tuesday evening, New York City Mayor Eric Adams issued a statement saying that air quality alerts were in effect across all five boroughs. Conditions were expected to improve by Wednesday morning, but might worsen again later in the day.
The mayor advised residents to reduce outdoor activity and remain cautious until conditions significantly improve.
The Canadian government expects this year’s wildfire season could be the worst in history. So far, 8.2 million acres of forest have burned, 413 wildfires remain uncontained, and 26,000 Canadians have been forced to evacuate.
New York City’s air pollution reached 222 on the U.S. Air Quality Index (which ranges from 0 to 500), a level considered very unhealthy.
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2. China’s Export Volume Drops
The latest statistics show that in May, the volume of Chinese goods exported to most regions shrank. Exports to the U.S., Japan, Southeast Asia, and France each dropped by more than 10%.
Due to investor concerns about weakening global demand for goods, stock prices in Mainland China, the U.S., and Europe all fell today.
This Thursday, the U.S. will release data on wholesale inventories and initial jobless claims. China will release its latest PPI and CPI figures this Friday.
Many countries have reduced their purchases of Chinese goods, sparking concerns about global demand and economic health.
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3. Dell Family Office Gains $10 Billion
Broadcom is poised to acquire cloud computing company VMware for $61 billion. Michael Dell’s company holds a 36% stake in VMware.
If European regulators approve the deal, 58-year-old Dell stands to receive $10 billion in cash and more than $10 billion in Broadcom stock.
Alisa Mall, CFO of Dell’s family office, DFO Management, plans to use the funds to diversify the company’s investment portfolio—covering real estate, infrastructure, and energy.
Alisa believes now is a good buying opportunity and may even deploy investments ahead of receiving the Broadcom payout.
She previously worked for nearly 12 years at Carnegie Corp., focusing on real estate and natural resources investments, and joined Dell’s company in September 2022.
According to Bloomberg’s Billionaires Index, Dell’s net worth has surpassed $54 billion.
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4. Goldman Sells Irish Mall at a Loss
Insiders revealed that Goldman Sachs is considering selling Ireland’s largest shopping center—Blanchardstown Shopping Center—for €650 million, a loss compared to its purchase price.
At the end of 2020, Goldman acquired the mall from Blackstone for €750 million. Goldman is currently in talks with CBRE and Eastdil Secured regarding the sale.
The property is a two-level shopping center with 180 retail units. Key tenants include Primark and Marks & Spencer. The mall is also adjacent to two retail parks and a five-story office building.
In 2016, Blackstone acquired the mall with funding provided by Goldman, which later took over via a debt-for-equity swap.
Recently, Ireland’s commercial real estate market has mirrored the U.S., with sharp declines in investment volume and deal activity.
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5. U.S. CMBS Delinquency Rate Continues to Climb
In May, the CRED iQ commercial real estate debt delinquency rate rose for the fourth straight month, reaching 4.2%—28 basis points higher than in April.
Year-to-date, the delinquency rate has increased by 29%, highlighting the significant challenges facing the commercial real estate sector.
The worsening delinquency trend is mainly due to weak office property performance, high interest rates, and tighter lending conditions.
Among all property types, office loans showed the most volatility in delinquency rates. Multifamily property delinquency saw a slight decline.
Among all commercial property categories, retail properties led in both delinquency and special servicing rates.
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6. Google Plans AI Consulting Services
Today, Google’s cloud division announced it will launch consulting services focused on artificial intelligence, aiming to help clients better integrate AI into their daily operations.
Carrie Tharp, Vice President of Industry at Google Cloud, said that while companies have grown curious about generative AI’s potential in recent months, many still don’t know where to begin with the technology.
Google hopes to leverage its deep AI expertise to boost its competitiveness in the cloud computing market, where it still trails behind Amazon and Microsoft.
Bloomberg projects that by 2032, generative AI could generate $1.3 trillion in revenue from hardware, software, and services.
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7. Tesla Hits Seven-Month High
Today, Tesla’s stock rose as much as 4.3% to $230.83, marking its ninth consecutive trading day of gains—the longest rally since January 2021.
Despite a steep recent drop, Tesla’s year-to-date gain has reached 87%, driven by a broader rally in tech growth stocks.
On Tuesday, Tesla’s Model 3 sedan officially became eligible for the full federal tax credit, which is expected to boost demand.
Additionally, Twitter welcomed a new CEO, easing investor concerns that Elon Musk was overly distracted from running Tesla.
Morgan Stanley advised investors not to chase Tesla’s stock blindly, noting that the current AI boom has little to do with the company.
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This content is sourced from Financial Times, Bloomberg, and The Real Deal, among other financial news outlets.