ALTERNATIVE INVESTMENT NEWS ROUNDUP
🏠 Real Estate

The Best Of Times Or The Worst?

Depending on who you listen to, US real estate is a great opportunity or a potential investment trap. Let’s take a look at some of the recent takes and analysis:

• Fitch Ratings - 91% of US housing is overvalued. They estimate prices are about 11% too high. Rather than projecting a correction, they simply expect pricing growth to moderate to low-to-no year-over-year growth over the course of 2024.

• Cities will see some increasing supply from office conversions. According to Moneywise, conversions will bring 55K additional apartments.

• From short to long? Kyle Bass is a hedge fund manager known mainly for a few excellent trades. Most notably for betting against the subprime mortgage market in the runup to the great financial crisis. He’s now vacuuming up real estate in Florida, Texas, and Tennessee.

• Is selling pressure letting up? Barron’s reports that the Blackstone Real Estate Income Trust was able to fulfill all client requests to withdraw money from the fund in February. That’s the first time since 2022. The total amount of withdrawal requests also decreased in February. The less investors try to pull from real estate funds, the less pressure there will be to sell off assets to fulfill the requests.

• There’s always a contrarian. Many have prophesied the collapse of office space real estate as work from home took root during the pandemic. There are still asset managers who feel there is value in office space and commercial real estate right now.

Other News

• CNBC has an interesting video about the real estate crash in China. At just under 9 minutes, it’s a very accessible summary.

• Ark7 announced they had crossed over $2M in total dividends distributed to investors.

• Landa’s new(ish) lend offering has reached $1M in total investments.

🎵 Music Royalties

• The UK’s Intellectual Property Office issued a report against some proposed changes to royalty payments for music played on streaming services in the UK.

• Sony is reportedly settling (terms undisclosed) a years-long copyright dispute with several artists. The suit centers around Sony’s handling of the “termination” clause of US copyright law. That should, in theory, allow artists to reclaim copyrights sold to record companies after 35-40 years under specific circumstances. However, Sony had refused termination arguing that it did not apply.

• Wired has some interesting reporting around where TikTok is going amid the ongoing dispute with UMG. As songs have continued to disappear from the platform, more videos with “decontextualized audio” (phrases, comments, etc… taken out of context) have been emerging.

💡 Equity Crowdfunding & Startups

• Reddit is preparing to go IPO. They are apparently seeking a valuation somewhere around $6.5B. This will be an interesting test of investors’ appetites for unprofitable companies, as well as of the IPO market itself. If Reddit’s debut goes well and the stock market continues to hold up well, we may see the “IPO window” open up further and more companies following suit.

• Rentberry announced potential interest in acquiring WeWork. Rentberry is a proptech company that’s gone through a number of successful equity crowdfunding rounds. In a potentially interesting twist of fate, retail investors may (indirectly) end up owning WeWork for pennies on the dollar after institutional VC spend years pouring $22B into it.

• Research from EquityZen suggests that 28% of former “unicorn” startups have since lost that status, based on secondary market trading information.

• Arrived Homes shared that their Wefunder raise is about to start moving. They are said to be finishing some of the paperwork and may start accepting actual community investment dollars as soon as this week.

🎨 Other Assets

• EquityMultiple is expanding the available options for anyone looking to get started with short-term, high-yield private credit offerings. The new Alpine Notes Basecamp offers a 9% target APY over a 3-month term and a $1000 minimum investment for first-time investors.

• Finlete officially launched their first offering.

• Upright shared performance information about their Horizon Residential Income Fund, reporting over 10% annualized returns, among other metrics.

• Groundfloor announced on X the availability of “rollover notes.”

• Rally completed its first exit via auction. Users on the platform voted to auction a rare sports trading card. The results were mixed. The final price was $132K. That’s a big jump from the $85K valuation it was trading at on Rally’s secondary market. However, it actually falls short of the $135K valuation that it IPO’ed for on the platform.

🌐 SITE

This is our first newsletter without a feature story in some time. I kept this one short because we recently brought a puppy home. He’s starting to settle in now, but the first couple of weeks were a real challenge.

I will try to bring back the feature story starting from the next edition. If you prefer this streamlined format, please let me know!