Private-equity firms are racing to help portfolio companies in vulnerable industries by calling in money from investors. As Casey Sullivan reports, LPs have seen a surge in capital calls, and PE shops are already talking through alternative exit strategies and doing daily check-ins to examine financial performance in real time.
Bets on getting people out of the house and into places like theme parks and restaurants for entertainment have been slammed by the coronavirus. Casey and Alex Morrell took a look the Apollo-owned parent company of Chuck E. Cheese, which went on a spree of remodeling restaurants before the pandemic, and disclosed earlier this month it had tapped restructuring advisers and set up a committee to evaluate options.
Advertisement
Meanwhile, Blackstone reported that the value of its PE funds plunged nearly 22% in the first quarter, with a big hit from energy investments. But CEO Stephen Schwarzman also noted that some investors are holding remote due-diligence meetings and forging on with capital commitments.
"We had one fund that was supposed to be having a big due-diligence meeting with, I think it was over 130 or 150 different attendees, and it was just done on Zoom," Schwarzman told analysts. "And much like the rest of the way we're all working, everybody was pretty adjusted and cool about that."
Read on for a look at a surge in all-to-all bond trading, a deep dive on the future of flex-office companies, and to hear what VCs are saying about winners and losers in the payments space.
Thanks for tuning in,
Meredith
Advertisement
Filet at $2 a pound
As volatility rocked credit markets in March and traditional dealers stepped away, electronic trading platforms saw record volumes. All-to-all, an anonymous form of trading in which trades are sent out to the entire market — not just dealers — and can be executed by anyone, in particular enjoyed a surge in activity.
As Dan DeFrancesco reports, investment firms with cash on hand were able to buy up high-quality bonds at far cheaper prices thanks to all-to-all trading: "I was getting filet at $2 a pound," Steve Chylinski, head of fixed-income trading at Eagle Asset Management, told Business Insider.
Shannen Balogh asked top investors to share which payments players they think are best positioned to come out strong on the other side of the coronavirus crisis, which has upended customer spending behavior and sparked a surge in ecommerce.
Advertisement
Some are betting on B2B players that enable small businesses to compete with the likes of Amazon, while others think that companies with strong point-of-sale tech will see a wave of new customers as merchants shift digital.
As Meghan Morris and Alex Nicoll report, the flex-space industry is facing a short-term crunch as employees fear returning to dense floors and small businesses that relied on these spaces cut headcount.
But in the long term, 10 real-estate experts, from employers to landlords, said they expect flexible offices to be an even more critical component of real estate as companies hesitate to lock in long-term leases and rethink their real estate footprints – but warned that not every provider will survive.
Inside Hudson Yards as the coronavirus slams retail
To persuade Neiman Marcus to anchor the 1-million-square-foot mega-mall at the heart of the $25 billion Hudson Yards development on Manhattan's West Side, the project's builders lavished tens of millions of dollars on the upscale department store and postponed reaping profits on the space for years.
Now, Neiman Marcus is eyeing filing for bankruptcy in the coming days, according to multiple media reports. Dan Geiger explains how Related and Oxford, two of the city's most ambitious developers, are facing the prospect of a potential renegotiation where they may have little choice but to offer Neiman Marcus even more favorable terms.
Alex Morrell, Dominick Reuter, Jennifer Ortakales, and Rebecca Ungarino teamed up to take a look at how big banks decided the futures of America's small businesses.
NewsletterSIMPLY PUT - where we join the dots to inform and inspire you. Sign up for a weekly brief collating many news items into one untangled thought delivered straight to your mailbox.
What to expect when you're back in the office: 7 real-estate experts break down what the transition will look like, and why the workplace may never be the same
AT&T CEO Randall Stephenson is retiring, and COO John Stankey will replace him
'We should be prepared for a new normal': 3 real estate experts on how the coronavirus is transforming offices and accelerating the rise of industrial property