“The ABI score is a leading economic indicator of construction activity, providing an approximately nine-to-twelve-month glimpse into the future of nonresidential construction spending activity.“
“However, house prices are close to a record high relative to average incomes. This is important because it makes it even harder for prospective first time buyers to raise a deposit. For example, a 10% deposit is over 50% of typical first time buyer’s income. A potential buyer earning the average wage and saving 15% of take home pay would now take five years to raise a 10% deposit.”
“Despite the increase in house prices to new all-time highs, the typical mortgage payment is not high by historic standards compared to take home pay, largely because mortgage rates remain close to all-time lows – in fact, on this measure affordability remains broadly in line with its long run average, as shown in the chart“
WeWork is trying to go public again, this time via a SPAC.
Below is a link to their investment deck. Lots of interesting data.
The company lost $1.7bn last year but expects things to improve as normal conditions return.
They believe a WeWork solution would save 26% vs. the cost of traditional real-estate.
The transaction puts enterprise value at $9bn or 6.6x adjusted 2023E EBITDA.
There are a lot of adjustments to EBITDA that need to be looked into and SPAC transactions have issues, but on the surface that looks a lot more reasonable than the peak valuation of $47bn.
