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Manhattan’s Paramount Group received an unsolicited takeover bid early last month for about two-thirds of what the company was worth prior to Covid. Just a few weeks later, the real estate investment trust’s board unanimously rejected the offer from activist investor Bow Street, noting that its offer was “inadequate and significantly undervalues” the office landlord run by Albert Behler. The hedge fund’s bid, however, was in line with Paramount’s stock price, which plunged at the onset of the pandemic and has hovered at just under $10 a share since. And the REIT, which has a market cap of about $2 billion, may still be on the table for a higher offer.
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Manhattan’s Paramount Group received an unsolicited takeover bid early last month for about two-thirds of what the company was worth prior to Covid. Just a few weeks later, the real estate investment trust’s board unanimously rejected the offer from activist investor Bow Street, noting that its offer was “inadequate and significantly undervalues” the office landlord run by Albert Behler. The hedge fund’s bid, however, was in line with Paramount’s stock price, which plunged at the onset of the pandemic and has hovered at just under $10 a share since. And the REIT, which has a market cap of about $2 billion, may still be on the table for a higher offer.
Dec. 15, 2020 8:00 am ET
Empty co-working spaces are helping push office vacancies in big cities to levels not seen in decades, threatening the commercial-property sector’s reputation as a haven for investors.
Office buildings are often considered relatively protected from economic shocks because most tenants are locked into long-term leases of five years and often more. Landlords could count on steady income even at times when corporate profits are down.
The rise of co-working and other forms of flexible, short-term office space is starting to change that dynamic. These spaces make up a growing share of the office market in cities like New York, San Francisco and Los Angeles. Because co-working leases typically last only a few months to a year, vacancies are starting to soar when many companies are working remotely.