Eddie

How to value a data center (the way KKR does it): Revenue = contracted MW × $/kW × 12 months NOI = revenue − non-power opex − property costs Stabilized EV = NOI / exit cap rate + pipeline value Power costs get passed through under take-or-pay. So NOI is cleaner than it looks. The exit cap rate is the stabilized unlevered yield. Effectively the spread over the tenant's credit rating. Hyperscaler on a 15-year take-or-pay compresses that cap rate fast. Pipeline value is unused land with permitted power access that can be built out later. In supply-constrained markets, that undeveloped capacity can move the valuation more than the operating asset itself. What institutional buyers underwrite at exit: contract tenor and structure, power certainty, land title vs. lease, expansion headroom, uptime track record, rack density capability. What they haircut: single-tenant concentration, bespoke specs, leased land, sub-10yr WALT, non-core locations, thin margins after energy and capex.$ The exit buyer universe is core infra funds, sovereigns, and listed platforms. They are pricing long-duration investment-grade cash flows. They want a stabilized annuity with a growth option attached. Build it, lease it, stabilize it, sell the annuity. That's the playbook.

KKR Thesis: Certainty as a Service The scarce resource in AI infrastructure is certainty. A hyperscaler building a data center campus coordinates with 100+ counterparties across power, land, fiber, capital, and components. Every one of those relationships is a potential failure point. KKR's thesis is that value is migrating away from standalone asset owners toward integrators who can absorb that complexity and deliver synchronized capacity on schedule. The integrator who makes complexity disappear commands the premium. The asset owner who sits in the middle of 100 counterparties and hopes for the best gets squeezed out.

50 oil and gas companies disappeared in 10 years. Not one filed for bankruptcy. They were acquired by the 20 top serial acquirers. Those 20 outperformed inactive peers by 130% in shareholder returns. The Rise of the Oil & Gas Serial Acquirer

Manchester City sería sancionado con el descuento de 60 puntos por 115 infracciones al Fair Play financiero. El anuncio oficial del castigo se hará antes de finalizar la temporada. Esta sanción llevaría al club al último lugar de la Liga Premier y sería condenado al descenso.

Who else remembers the April Fools' "fight" on Grandstand???

Open Letter on Housing, Fannie & Freddie @realDonaldTrump @pulte @SecScottBessent @FHFA @USTreasury $fnma $FMCC We studied housing square footage per capita adequacy, and found that there is no problem there. The US in fact has more residential square footage per capita than any other country in the world. This is not a housing shortage, despite what so many say. The problem is that bigger houses are inefficiently housing fewer people. The post-COVID low rate environment locked people into a lifecycle real estate position. Empty nesters can't sell, first time home buyers cannot buy. Second-hand home inventory is near all-time lows due to record low supply, not record demand. Prices are high due to the same reason. Home equity is now a record $35 trillion, nearly doubling pre-COVID levels. 40% of homeowners own their homes free and clear - a record. And about 30% of all home buyers pay for homes without borrowing. Older homes were upgraded at a record pace during COVID, extending and refreshing the usefulness of residential real estate. Artificially low interest rates, ~$6-7 trillion in helicopter cash and forgivable loans helped drive both the home updates and high housing prices. Work from home moved the office into the home, often expensed or deductible. People with white collar jobs and means chose to live/work in exotic or remote locations. All of this together does not speak of a housing shortage, or a housing problem. Instead it is a problem of current residential space allocation and mobility, and this problem was created by government manipulation of interest rates, cash money supply, and COVID lockups that went on too long and changed work/home behavior. Government created the problem and now maintains policies that prevent free markets from reaching a solution, not the least of which is keeping the GSEs inefficiently run while in conservatorship. Recall Pulte's video upon arriving at Fannie Mae - no one was in the office buildings. The companies have become atherosclerotic, inefficient government programs, while a decade of financial engineering optimized for homeowner wealth accumulation rather than housing market velocity/mobility/fluidity. Government must fix this problem by facilitating efficient re-allocation of housing stock with higher housing velocity/mobility through the release of the GSEs into free markets. This is a problem made for the GSEs. Through well-targeted programs, the GSE can help the free market find spaces to intelligently reallocate , and help US citizens with housing mobility. Building more new overpriced, poorly built homes in increasingly dangerous flood zones and other hazardous fringe areas is not the solution. It adds to the problem through high maintenance burdens on new homeowners with little equity in their homes. Rather, to build mobility/velocity of homeowners and housing space, the GSEs need to be recapitalized and retain easy access to capital markets. They also need to be run by real mortgage executives, not government functionaries. To achieve this they need to exit conservatorship in a manner that excites markets to fund these companies, now with guidelines to prevent risk-taking outside of their purpose, and grow their purchases of mortgages of well-targeted specification. I should have written this into the Recurrence piece itself.

North London Bubble story on this by @isabel__loubser newjournal.substack.com/p/rave-star-mr…

This gets me every time 🤣🤣🤣

BREAKING: Thoma Bravo just released their LP meeting slides. The world's largest software PE firm thinks the market has it completely wrong on software right now. Public markets are panic-selling software based on AI fear. Here's what they're seeing:

@conkers3 Yes definitely - very important to have an understanding of this risk

Have you considered the Private Credit risks YOUR PORTFOLIO could be exposed to? Or considered the Debt/ Credit risks wrt #LLOY #BARC $BX #SMT #DGE #HICL #III #INPP #PIN $KKR #TFIF #SEQI $BLK #RECI #NWG #MGCI #DGE #SpaceX? Find out why IT MATTERS⏬now⏬ x.com/conkers3/statu…

Miss Soccer AM

BREAKING NEWS: The court challenge being filed by @paramountco - @Skydance to upend the @netflix - @wbd deal confirms my "Defcon-1" reporting on the Ellison's strategy going forward involves a lawsuit. Also confirmed is my "Plan D" reporting from Sunday in launching a proxy fight for $WBD board seats, though my understanding the efforts by $PSKY go further: The want to show $NTFLX shareholders how much they will lose in market value if the battle continues. So far they've lost $160 BILLION in market value since $NTFLX stock hit its one-year high in July and the bidding war began. The legal morass will turn up the heat even more on $NTFLX stock, $PSKY predicts, and that will be bad for $WBD shareholders since the $27.75 offer is cash and STOCK. The other part of their plan is to show that $NTFLX-$WBD is a regulatory loser (Trump weighed in this weekend suggesting as much), while $WBD shareholders have an easy out and just take their $30 all cash offer, as opposed to stock with an uncertain value and an equity stub in the $WBD spin off that could be worth less than $1. Of course @netflix disagrees with all of this, and this weekend told me the $WBD wants nothing to do with what $PSKY has offered. $NTFLX has hired its own Trump-friendly lobbyists who set up the pow-wow between Ted Sarandos and the president, and that the deal doesnt violate antitrust by combining two top streaming properties and to push back on the notion that Larry Ellison has Trump in his pocket. But as I reported this weekend, a Trump official told me the @netflix deal for $WBD will get an intense reg review, and $NTFLX's biz model might also get reviewed, which could squeeze its share price even more. Yes lots of gamesmanship here, book worthy at that. Ummmm....

absolute gold - Head Bag Fila Nike

@nickdemarco_ No interest in it whatsoever - mindless TV crap

Am I the only person who has absolutely no interest in ever watching even 2 minutes of ‘Traitors’ and can’t stand the constant pushing of it?

On the weekend of the third round of the fa cup this classic advert by Dunn & Co from 1979