One of my favourite stories from the team this week was this tale by Dakin Campbell and Meghan Morris about the Lord & Taylor building in midtown Manhattan which has become a massive, $US850 million headache for WeWork.
While the property was supposed to be the site of WeWork’s new global headquarters when it was purchased in 2017, it’s instead become a symbol of the coworking company’s grand ambitions gone unchecked.
The landmark property is still under construction, but as WeWork slashes thousands of jobs – eliminating the need for a new headquarters – and faces a difficult financial future after shelving its IPO, the building’s fate is in doubt.
Amazon had reportedly been in talks to take over part of WeWork’s lease, but those discussions now appear to be on ice.
As one source told the New York Post, the Lord & Taylor building has “become the real bloodsucker at WeWork.” Considering all the troubles going on at the co-working company right now, that’s saying a lot. It will be interesting to continue to watch the impact of WeWork on the New York real estate market. In NYC and London, WeWork is the largest private sector office tenant. What would it mean for the city’s commercial real estate market if WeWork were to go away?
Readers, would love to hear your thoughts!
Have a great weekend!
We talked to 24 people about the hedge-fund wunderkind at Elliott who wants to shake up AT&T. Here’s why management should be terrified.
The latest campaign for the Wall Street hedge fund Elliott Management is a big one, taking on the well-known American staple AT&T.
The man in charge of pushing the massive company to make the changes the $US38 billion fund sees fit is39-year-old Jesse Cohn, the billionaire Paul Singer’s right-hand man.
Other than Singer himself, Cohn is the person most responsible for the transformation of Elliott from a distressed-situations specialist to the sprawling institutional behemoth it is today, with a separate private-equity arm and billions ready to be deployed for a new activist campaign.
Cohn’s tactics have included shrewdness and aggression in the 100-plus campaigns the Long Island, New York, native has run for Singer. Business Insider talked to more than two dozen of his colleagues, competitors, detractors, and friends, who said Elliott’s rise mimicked Cohn’s own personal rise in the firm and in corporate America.
BlueMountain is shuttering its flagship hedge fund, and cofounder Stephen Siderow is leaving. The struggling firm will be almost entirely out of the hedge-fund game.
BlueMountain is winding down its 16-year-old flagship fund, the $US2.5 billion BlueMountain Credit Alternatives Fund, to focus on its collateralized-loan-obligations business for its new corporate owner, Assured Guaranty.
BlueMountain cofounder Stephen Siderow will also leave the firm at the end of the year, the firm said in a statement.
The manager, which just a year ago was running several different hedge-fund strategies, has pulled back from the space in just 10 months.
JPMorgan has a complex relationship with WeWork. Here’s a sneak peak at what Wall Street analysts will be asking when it reports earnings.
Earnings season for big banks kicks off next Tuesday, with JPMorgan among the firms turning in third-quarter results.
JPMorgan has worked with WeWork and its co-founder Adam Neumann in several capacities, including would-be lead underwriter on a recently failed IPO.
No analysts we talked to called out specific expectations for JPMorgan writedowns on WeWork. Some said questions about the IPO are expected given its high profile.
WeWork-related topics that could draw attention include JPMorgan’s lending situation with the company, and how it’s valuing WeWork investments. Other issues like rate cuts and net interest income are also in the spotlight. .
Meet 2019’s Rising Stars of Wall Street shaking up investing, trading, and dealmaking
Meet the 2019 class of Wall Street’s rising stars. From starting a hedge fund before age 30 to running their own alternative-data shops and helping lead $US27 billion investments, this group of young finance leaders is in a league of its own.
We’ve included people with a variety of roles and experiences from companies including Apollo Global Management, Blackstone, Goldman Sachs, BlackRock, and the New York Stock Exchange. Here’s our list of the next crop of Wall Street leaders.
We’re starting to get a sense of the damage WeWork has wrought on Wall Street, and it could cost Goldman Sachs $US264 million
Morgan Stanley analysts said in a recent note they are now ‘baking in’ Goldman Sachs taking a $US264 million writedown on its WeWork investment in its third-quarter earnings.
Jefferies said in September that it wrote down $US146 million related to its WeWork stake, citing uncertainty around timing and pricing of the co-working company’s IPO.
“We think it is possible that some of the banks we cover may also take similar writedowns,” Morgan Stanley analyst Betsy Graseck said in a note to clients.
- The ‘Warren Buffett of bonds’ tells us why he’s ‘obsessed’ with climate-change investing – and where he sees the biggest opportunities
- Dyslexic, failing at school, and partially blind: How Larry Hite overcame the odds to become one of the most successful self-made stock traders using a strategy that’s ‘accessible to anybody’
In tech news:
- Adam Neumann lent money to phone distributor PCS Wireless this spring, showing how his family office is investing beyond startups
- Exclusive data shows how much buzz Disney Plus, Apple TV Plus, and HBO Max have built with streaming users before launch
- There’s a ‘revolving door’ at Amazon, where company insiders are ditching the retail behemoth to expose its inner workings and make a fortune
Other good stories from around the newsroom:
- Popular direct-to-consumer brands like Away, Dirty Lemon, Glossier, and Mailchimp are pouring money into building content studios as they go beyond performance marketing
- The CEO of Dick’s Sporting Goods reveals how he decided to move away from gun sales in his stores and why he wishes Mitch McConnell had ‘the guts’ to act on gun control
- Lonely, burned out, and depressed: The state of millennials’ mental health in 2019