johnny

a true loss for the board

I would guess people who have been trying to keep their weight down have gone up, and people up, down. I'm one of the people who generally is trying to keep weight on. I've got from a peak of 205 to around 175, although the first half of that was just from moving from LA to the rural midwest. My diet has been total garbage--eating entire bags of cookies, etc. So I'd guess probably 120% of the weight lost is muscle, with the -20% being fat gain. It'll be interesting to see some attempts to aggregate the life expectancy outcomes of all of these lifestyle degradations, and weigh them against the actual COVID impacts. Probably won't be politically acceptable to play that game for a few years. But still interesting to consider how many 30 year olds are doing sort of irreparable metabolic damage to themselves in order to help their (probabilistic generalization) grandparents squeeze a few more months out.

There's just so much emotion-driven anti-landlord sentiment. I don't get putting the best cap rates in the entire real estate world on what I think has the most frightening populist tail risks. You guys need to understand: 75% of dem primary voters under 40 voted for Bernie Sanders. Have you ever listened to Chapo Trap House? When every underemployed 25 year old is on Facebook leftist groups sort-of-joking about putting their landlords into gulags, doesn't this make you think maybe we should be adding a few hundred bps to our required yield to compensate for guillotine risk? Real estate is the ultimate rule-of-law bet. I've seen way more deterioration in the social contract on that (from both parties) over the past few years than seems priced in by a 20% move.

Hostile-activist-nonagenarian-Buffett would be a very cool final act

This is a great specific example of something I'm generally concerned about in this area--that however high the FFO yield may be, that FFO is going to be redeployed into mallstuff by mallguys running mallreits. If I really were gungho on malls, I'd be more likely to prefer the relatively indirect 50% shot through Brookfield, since we at least know they have a plausible alternative path for cash if it ever becomes apparent it's time to cut bait. Not as cheap though, of course.

I'm not sure how much you would be able to generalize the example of the Westside Pavillion to the entire portfolio of these companies, and even if you could, I don't think it would obviously present a favorable investment. 1. West LA is in a sort of unique situation, with a lot of price-insensitive techCos deciding there's a strategic need to lock down oversized campus territory. I don't think there's a general shortage of office space, even in LA, otherwise those guys buying DTLA Prefs would be billionaires by now. 2. That mall has been a ghost-town for at least a decade. Once you add those ten years (and cash bleed) to the overall analysis, I suspect the office conversion is probably close to zero IRR. 3. After eating the losses on it for a decade, Macerich had to sell part (75%!!!!) of its interest in the property to get the ball rolling on the re-development. So they ate losses for all those years only to split the salvage value 1-to-3 with somebody else. Looks like a good outcome year-over-year, but seems like a loser to me.

im absolutely shocked to learn that a poster on my beloved value board has been getting involved in poorly thought out situations in largely ignored markets, oblivious to parentco and litigation issues

Since everybody here is so skeptical, thought I'd drop this take on the company--not exactly a screaming bull case, but it presents the important components of the bull case in a reasonable way: https://www.cbinsights.com/research/report/wework-strategy-teardown/ Some things I thought were interesting: 1) There is an implication 4 years ago that they're basically turning around and leasing, all-in, at about 2x what they pay. 2) Related to 1, this article mentions a 30-40% operating margin 3) They're really leaning hard on software to try and extract as many "desks" from a space as possible--this is probably a meaningful advantage they have over the competition, it's palpable if you just tour a few different coworking spaces. 4) This claim, for which no elaboration is offered: "This technology, combined with increasing buying power from constructing at scale, has lowered the cost of adding a new desk to $9,504 in September of 2017, from $14,144 a year prior, representing 33% savings." Though hunting those numbers down they seem to be a "gross capital expenditures / desk" calculation.

I'd say the locations I've seen seem to be something like maybe 65% "rented" space v. 35% community space. But the rates on the 1 person offices are pretty silly high on a per square foot basis. I'd say you're paying something like $800 for 60 square feet in DTLA. So add 40sqft of shuffleboard or couches to that and you're paying $8/sqft in a market where comparable office rents are probably like $2-3. Their pricing on substantially higher occupancy arrangements don't seem to decay very much on a $/sqft basis either, so going off of the 1-person office is not as distortive as it may intuitively seem. You're never going to be able to drop bonds in half-billion dollar increments being that boring bro

14M sqft as of April '18, giving us a very clean $2,500/sqft valuation, before community adjustments of course.

I'm in LA and I'm seeing a lot of higher-end coworking spaces sprout up. Everybody keeps insisting to me a major component of WeWork's value proposition is the networking opportunities offered to members, and the Community Value. So how do we project the qualify to that community when all the richer or price-insensitive people are Hoovered up by some place with more comfy couches and in-house baristas? The only non-cost advantage WeWork has is that they can say that members have access to coworking spaces all over the world. But I'm trying to visualize that Venn diagram: People that need coworking space, live such a jet-setting lifestyle that a Xintiandi, Shanghai office has real option value, and also don't want to just pony up the extra few hundred bucks for the nicer space at NeueHouse? I guess it's just a matter of time until WeWork tries to thread the needle and open up some WeWork Reserve Centurion spaces, or whatever.

https://www.remingtonoutdoorcompany.com/sites/default/files/ComprehensiveFinancialRestructuring.pdf Now that we're rolling a year off of Trump, I'm more interested in looking around this space. Did everybody get shaken out already?

I understand what you meant, I was just joking. Like I said, I hadn't looked at the financing at all (I did initially snap-assume they were just throwing all external negative rate germany dollars at it)

I'm the wrong person to ask to make the case for it. I've been on the other side of the trade on pretty much every JAB interaction with the public markets. I just wanted to take this opportunity to talk shit about Keurig. (translation: I didn't even read the financing details) The trading has been wild though. The implied value of the equity has doubled and halved since open.

No opinion on this, but wanted to try and draw some out of any of you. The deal says DPS holders get $103.75 in a special dividend, and retain 13% of the combined company. Pre-announce, DPS was $95.65, and it's now $118.83. So by my math, if we give take Friday's closing price of DPS as IV (seems rich), the current price is made up of $103.75 in dividend and about ~$12.43 of retained DPS, leaving only ~$2.65 for the Keurig component. This only catches my attention because I remember the Keurig take private was at something like $14 Billion, and the current price of DPS implies that the value of Keurig is actually only around $3.7B. And of course, no credit for all of the synergies that could come from Snapple flavored K Cups or whatever. Since I was short GMCR when it was taken private, I feel like this is some kind of vindication. That's the only reason this thread exists. Anybody think Keurig was turned into a good business somehow in the past three years?