Daily Alpha · Substack
· Midday Alpha · by Buzzberg Research
The decision-useful Substack items are heavier Q1 Treasury issuance and a Brookfield CRE walkaway that shows refinancing stress in occupied trophy assets.
Themes on this desk
Treasury supply
The first QRA points to far more marketable borrowing in Q1 than in recent years, a term-premium risk.
CRE refinancing
Brookfield walking away from a $600M, 95%-occupied skyscraper shows higher rates can erase equity in occupied assets.
Nonconsensus flags heavier Q1 Treasury issuance, complicating curve management
Nonconsensus says the first QRA release shows far more marketable borrowing coming in the first quarter than in recent years, making it harder for The House to manipulate the curve; it also flags pricing near 80% odds of a Democratic sweep.
Heavier Q1 issuance can add term premium and complicate the Fed/Treasury mix just as investors debate cuts.
Watch Q1 auction sizes and long-end yield reaction.
Source →Brookfield walks away from a $600M, 95%-occupied skyscraper as higher rates erase the equity case
QTR flags Brookfield walking away from a $600 million luxury skyscraper that is 95% occupied, arguing higher rates have wiped out the equity case even in a trophy asset.
The example shows a well-occupied trophy asset can lose its equity case under higher rates.
Watch Whether other occupied trophy assets are handed back.
Source →