Elgin Area Chamber Of Commerce: Peloton May Have Suitors, Office Use Slowly Rises, Brixmor Posts Strong Retail Year

Press release from the Elgin Area Chamber of Commerce:

February 08, 2022

Peloton May Have Suitors

Stationary bike and treadmill maker Peloton reportedly has big-name retailers queuing up to buy the company in a deal that could include the new factory it is building in Ohio.

Online retailer Amazon, athletic apparel company Nike and personal electronics company Apple are the leading possibilities, according to reports from CNBC and Wall Street Journal that cite unnamed sources.

Peloton’s stock has been on a downward glide path since peaking last year at more than $155 per share. It’s no longer the pandemic darling now that more people are preferring to hit the gym and fewer work from home.

Two weeks ago, the company’s share price hit its lowest level since March 2020 at about $23 per share when the New York-based company announced a temporary halt in production of bikes and treadmills. It's a far cry from when Peloton couldn’t keep up with demand during the pandemic’s first year, but now warehouses are stacked with its product.

Activist investor Blackwells Capital has been pushing for the company’s board to fire John Foley, Peloton's CEO, and sell. Foley and other insiders own about 80% of Peloton shares compared to Blackwells Capital’s less than 5%.

A deal may not happen. One reason would be anti-trust hurdles such a sale could face with the federal government.

Office Use Slowly Rising

The number of new omicron cases is falling sharply but office users don't seem to be rushing back to the office except in Phoenix.

Phoenix’s office use more than doubled for the week that ended Feb. 2 to reach 37.1%, according to Falls Church, Virginia-based security firm Kastle Systems. Most major metropolitan areas the company tracks showed minor increases in office use for the week.

Kastle gathers anonymous employee data from workplaces where it provides access-control technology. While it is only a sampling of buildings by one security company, the data gives a peek into how employees and employers are responding to office use during the pandemic.

Phoenix’s big jump still fell short of its peak of more than 44% last August. The city’s office use had dropped to below 10% at the end of 2021.

In Texas, Austin and Houston inched close to the midway point each had surpassed several months ago. Austin was a big gainer with a 4.2 percentage point increase to hit 47.7%, while Houston added 2.2 percentage points to reach 47.4%.

Brixmor Posts Strong Retail Year

Brixmor Property bought and sold retail properties to close out a better 2021 than 2020.

The New York-based real estate investment trust spent more than $191 million on two properties in the Atlanta suburb of Roswell; a shopping center in Naples, Florida; and a center in Pawleys Island, South Carolina. Those purchases brought the REIT to six acquisitions for the year.

It sold eight during the final three months of 2021 in addition to two partial properties for $116.2 million. For the year, the REIT sold 17 properties along with 15 partial properties for $244.3 million.

Since the end of the year, Brixmor has bought a property in Brea, California, and one in Dallas for $131.9 million.

Brixmor reported funds from operations, a key financial measure for REITs, of $522.34 million in 2021 compared to $437.78 million the previous year.

Source: www.CoStar.com

This press release was produced by the Elgin Area Chamber of Commerce. The views expressed here are the author’s own.