— U.S. Retail Worker Turnover Surges; Asset-Based Lending Has Huge Potential; Bernard Arnault Buys $230M in LVMH Stock; Barclays and AGL Launch Private Credit Fund; Getir Raises $500M at Slashed Valuation; U.S. Household Net Worth Hits Record; JPMorgan Pays Premium for California Office Building
1. U.S. Retail Worker Turnover Surges
A 2022 McKinsey survey found that employee turnover in the retail sector is 70% higher than in other industries, and the pandemic has made it worse.
According to Korn Ferry, part-time retail employee turnover hovered around 75% pre-2020, but has now reached 95%, with no signs of slowing.
Retail workers are increasingly dissatisfied due to low pay, erratic schedules, monotonous work, increased theft, and difficult customers.
Walgreens spokesperson Kris Lathan stated that customer and employee well-being is a top priority, and the company provides free mental health counseling and support services for staff.
(Bitcoin’s price is highly volatile, with both positive and negative news triggering large swings.)
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2. Asset-Based Lending Has Huge Potential
Rob Camacho, co-head of Blackstone’s asset-based finance division, says there is still plenty of room for growth in the asset-based finance market.
In an interview, Camacho noted that current investment-grade bond yields are extremely high — levels rarely seen in the past two decades.
More high-rated companies are expected to issue asset-backed bonds, as many don’t have access to the traditional corporate bond market. While corporate bonds offer lower costs, they are standardized and lack flexibility.
Private credit firms like Blackstone can offer companies more tailored financing, where the borrower’s credit rating matters less.
Camacho said Blackstone can also partner with regional banks to expand their lending products and volume.
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3. Bernard Arnault Buys $230M in LVMH Stock
In July, luxury giant LVMH reported a disappointing earnings report, hit by slowing economic growth in China and the U.S., and persistently high inflation and interest rates. Since then, its stock has fallen 14%.
According to data, LVMH billionaire CEO Bernard Arnault has purchased a total of $230 million worth of shares during the dip.
As of now, Arnault and his family own 48% of LVMH’s shares and nearly 64% of the voting rights.
LVMH stock dropped 7.8% in August, dragging down the broader luxury sector and France’s CAC 40 index.
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4. Barclays and AGL Launch Private Credit Fund
Barclays Plc is set to launch a new fund in partnership with AGL Credit Management to enter the $1.5 trillion private credit market.
The Abu Dhabi Investment Authority may become a major backer of the fund, which could debut with $1 billion in equity.
The partnership will combine Barclays’ lending capabilities with AGL’s credit investing expertise, allowing them to more directly compete with private equity giants like Blackstone.
Barclays has recently set aside cash specifically to expand in private credit.
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5. Getir Raises $500M at Slashed Valuation
Turkish grocery delivery startup Getir is raising $500 million in new funding. During the pandemic, Getir was one of the hottest startups.
In this round, Getir’s valuation has plunged from $11.8 billion in early 2022 to $2.5 billion. The round is being led by existing shareholder Mubadala Investment Company, with participation from VC firm G Squared and Michael Moritz, who recently left Sequoia Capital.
Founded in 2015, Getir and a dozen other delivery apps raised more than $5 billion during the pandemic.
Now that demand for grocery delivery has declined, most of Getir’s competitors have been sold off or shut down.
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6. U.S. Household Net Worth Hits Record
The Federal Reserve reported today that in Q2 2023, U.S. household net worth rose 3.7% to a record $154.3 trillion, largely thanks to strong stock market and housing performance.
During the quarter, the value of household stock holdings rose by $2.6 trillion, and real estate value increased by $25 billion. The S&P 500 posted its biggest gain since late 2021.
However, home prices may struggle to remain high due to high interest rates dampening buyer confidence.
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7. JPMorgan Pays Premium for California Office Building
According to Commercial Observer, JPMorgan Asset Management has agreed to buy the Pen Factory, a Class A office building in Santa Monica, California, for $165 million.
The property spans 222,000 square feet and was previously owned by the California State Teachers’ Retirement System (CalSTRS).
Year-to-date, the average price per square foot for Los Angeles office buildings is $231 — but this deal closed at a hefty $745 per square foot.
Activision Publishing and GoodRx lease 90,000 and 130,000 square feet in the building, respectively.
That institutional investors like JPMorgan are willing to pay a premium to acquire offices sends a strong positive signal to the market.
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This content is sourced from Financial Times, Bloomberg, and The Real Deal, among other financial news outlets.