Monthly Archives: October 2017

Berkshire Hathaway Specialty Insurance Launches Motor Truck Cargo Legal Liability Insurance in Canada

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Berkshire Hathaway Specialty Insurance (BHSI) today announced that has expanded its inland marine product line in Canada with the launch of its Motor Truck Cargo Legal Liability Policy, a new product that protects against the legal liability exposure commercial truckers face when carrying third party goods.

“This product provides Canadian trucking companies with an insurance offering that responds to their needs in both Canada and the U.S. With the industry evolving, and more trucks crossing the Canada-U.S. border annually, we developed a solution that provides modern coverage and is responsive to both Canadian and American exposures,” said Gord Rider, Senior Underwriter, Marine, BHSI in Canada.

The policy is designed for mid-sized Canadian-based motor carriers specializing in transporting commodities primarily in Canada or cross-border with the U.S. Truckers and cargo are covered anywhere within Canada and the continental U.S.

Key policy highlights include:

• Legal liability coverage regarding property of others while in the ordinary course of transit or while at a terminal location for a specified period of time;

• Cross Docking coverage addressing an insured’s legal liability for direct physical loss or damage to property insured in its care, custody or control during cross docking operations at a scheduled terminal;
• Defence costs coverage that is outside of the policy limit;

• Employee theft coverage with respect to an insured’s legal liability for direct physical loss or damage to property insured resulting from theft by an insured’s employees; and

• Expediting expense coverage, such as reasonable additional labor or overtime costs, fuel costs and freight charges, necessary for timely delivery of the property insured when a vehicle cannot deliver the property due to physical loss or damage to the vehicle, including repair of the vehicle.

BHSI’s new Motor Truck Cargo Legal Liability Policy is the latest addition to its Marine & Inland Marine suite of products in Canada. The portfolio also includes Ocean Cargo, Builder’s Risk, and Contractor’s Equipment products.

© 2017 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Berkadia Division to Secure Financing for Mixed-Use Project in Downtown San Diego

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A joint venture led by Manchester Financial Group has engaged Berkadia Hotels and Hospitality to source a $650 million construction loan on the Manchester Pacific Gateway development.

The project is situated on San Diego’s waterfront and is the largest undeveloped urban waterfront site on California’s coast. The $1.3 billion project will include 2,823,188 million square feet of hotel, office and retail space in San Diego’s thriving downtown business district.

Berkadia’s Hotels and Hospitality group has been tasked with sourcing a 50 percent LTC non-recourse construction loan that will close by year end 2017. Berkadia Senior Managing Director Andrew Coleman and Managing Director Jackson Cloak will lead the team’s efforts.

Manchester Financial Group has extensive experience in developing convention center hotels and other commercial real estate, having developed more than $2 billion in assets in 11 states, including the Manchester Grand Hyatt San Diego, the 1,360-room San Diego Marriott Marquis & Marina, and the 249-room The Grand Del Mar—California’s only Forbes Triple Five Star resort. The company is currently in construction on the 1,066-room Fairmont convention hotel in Austin, Texas.

The property will include 1,205,490 square feet of office space, 391,231 square feet of retail space, 2,437 parking spaces, a 260-room boutique hotel, and will be anchored by an 1,100-room Four Seasons hotel.

About Berkadia

Founded in 2009 as a 50/50 joint venture between Berkshire Hathaway and Leucadia National Corporation, Berkadia is a third-party commercial mortgage servicer, as well as an approved lender for Fannie Mae, Freddie Mac, and HUD/FHA.

The company is among the top Freddie Mac and Fannie Mae multifamily lenders.

Berkadia owes its origins to GMAC Commercial Mortgage Corporation, which was acquired in 2009 by Kohlberg Kravis Roberts & Co., Five Mile Capital Partners LLC, and Goldman Sachs Capital Partners. Christened Capmark Financial, the company had $10 billion of originations in 2008 and a servicing portfolio of more than $360 billion before running into bankruptcy in October 2009.

In a deal approved by the bankruptcy court, Capmark sold its mortgage loan and servicing to the newly formed Berkadia in a deal worth $515 million.

The deal brought Berkshire into the heart of the commercial loan serving business, and the company has one of the largest commercial real estate servicing portfolios.

© 2017 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Duracell PowerForward Team on the Ground in Puerto Rico

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Duracell’s PowerForward teams are on the ground in Puerto Rico. The emergency response teams give out thousands of batteries and provide charging stations through their specially outfitted vehicles.

The vehicles wiil deliver $1 million worth of batteries, making this the program’s largest deployment to date.

Since 2011, Duracell PowerForward has been helping affected communities across the country by distributing free Duracell batteries, charging mobile devices, and providing Internet access to those in need so they can connect with family. They have given out over 463,000 batteries in 30 deployments
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The Duracell PowerForward fleet consists of five trucks, custom-designed to handle specific disasters, and strategically stationed to get to any U.S. location within 24 hours. Each one is equipped with mobile charging stations and stocked with thousands of Duracell batteries.

In Puerto Rico, Duracell has deployed two of its highest capacity vehicles. The Heavy Haulers pull trailers that help them transport over 100,000 AA batteries – more than any other vehicle in the fleet. Normally, one is stationed in San Francisco, California while another is kept in Portsmouth, New Hampshire. These trucks specialize in handling earthquakes, floods, landslides, wildfires, hurricanes and winter storms.

“We at Duracell have been deeply moved by the resilience of those in Puerto Rico. Through our PowerForward initiative, a program I am most humbled and proud to be a part of, we will be distributing more than $1 million worth of batteries to local residents over the next month or more,” said Ramon Velutini, Vice President of Marketing at Duracell. “Trusted power is absolutely critical following widespread power outages caused by storms like Hurricane Maria, and we will be offering free Duracell batteries to help residents stay safe and connect with their loved ones by powering mobile devices, radios and flashlights, and providing trusted power for critical medical devices like dialysis machines, hearing aids and ventilators.”

© 2017 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

BYD Powers Up in Australia Market

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BYD Company Ltd., the world’s leading manufacturer of rechargeable batteries, is focusing on the Australian renewable energy market with its proprietary Lithium-Iron Phosphate battery.

At All-Energy Australia 2017 – the country’s largest renewable energy exhibition, BYD exhibited its MINI-ES, B-Box – in high-voltage and low-voltage versions – and Containerized Energy Storage solutions to provide the market with increased efficiency, economy and flexibility.

The BYD B-Box Storage System comes in two versions: low-voltage B-Box LV and high-voltage B-Box HV. The B-Box LV system operates with a Goodwe S-BP inverter, making it the cost effective; and the B-Box HV system operates with an SMA Sunny Boy Storage inverter, which raises the system’s level of efficiency. Both are aimed at the retrofit market that is booming in Australia, that is, a market in which people already have solar panels installed and want to install an energy storage system.

Another advantage of the BYD B-Box systems is that they are modular and scalable from 2.5kWh to 442kWh – users can increase the capacity of parallel battery rack to meet different requirements of energy storage – whereas major competitors only reach 13.5kWh with a large-sized system.

A variety of configurations of the two versions of the BYD B-Box can also be used for commercial purposes.

The MINI-ES is a small-sized, all-in-one residential energy storage system that is easy to install and maintain, with an original capacity of 3kW / 3kWh that can be expanded to 6kWh. This system is fully certified by Australia’s SAA, in line with the latest Australian AS / NZS 4777.2: 2015 standard, and has become very popular with a number of Australian local power grid companies and electricity retailers.

Over 500 Australian households have already installed the BYD MINI-ES.

The BYD Containerized Energy Storage has a modular design to meet different large-scale energy storage projects demands, and features extreme safety, reliability and efficiency. It can be used for peak load and frequency regulation to stabilize renewable energy or as a back-up system to prevent outages.

Current installed capacity of BYD ESS exceeds 400MWh globally.

BYD and Berkshire Hathaway

In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares. It’s an investment that has paid off handsomely. Berkshire’s original investment of $230 million is now worth roughly $1.8 billion.

For More on BYD, read the Special Report: BYD, Berkshire’s Tesla.

© 2017 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

NetJets Gives Up On China, For Now

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Berkshire Hathaway’s NetJets has scrapped expanding to China, at least for now.

NetJet’s had a small presence in the country through its China subsidiary, NetJets Business Aviation (Zhuhai), which also had Hony Jinsi Investment Management Ltd., and Fung Investments as stakeholders.

NetJet’s push into the China market began in 2014 when it received its Chinese Air Operator’s Certificate. It got its toe into the China market flying two Hawker 800s , but demand for fractional ownership has been weak from the outset.

“We still foresee tremendous long-term opportunities for business aviation, however, current economic and operating conditions are not yet ideal for business expansion,” NetJets said in a statement. “NetJets’ customers will continue to enjoy private aircraft travel to and from China and other Asian countries using aircraft from our programs in the US and Europe.”

© 2017 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

BYD ADL Pure Electric Buses Running in Liverpool

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The city of Liverpool is now the first British provincial city to run pure electric buses from the BYD ADL partnership.

The BYD ADL buses will be operated by Arriva Merseyside and begin service later this month on the City Centre Circular Routes 26 and 27, known as The Belt.

In July 27, 2015, BYD announced a joint project with British bus manufacturer Alexander Dennis Limited to build single-deck zero-emission buses.

The delivery of the buses follows a joint bid under the Government’s OLEV scheme by Arriva North West and Merseytravel. The new buses will operate an intensive service from the Liverpool One bus station and be based at Arriva’s Green Lane bus depot in Liverpool. BYD chargers have been installed in the depot.

The order is significant in that it is the first to be won by the ADL BYD partnership (with ADL as prime contractor on this occasion) outside London where the partnership has enjoyed considerable success, winning every Transport for London (TfL) tender so far for full size pure electric buses – a total of 157 are now in service or on order to serve TfL routes.

The buses for Merseyside will cover 100 to 130 miles per day (most will operate 12 hours a day but one duty cycle calls for a 19-hour operating schedule) and will be charged overnight. In line with all ADL BYD joint products, the new buses are designed to operate a full day’s duty cycle on one charge, without the need for disruptive ‘top up’ charging during the working day and enjoy the benefit of lower cost off peak electricity. The BYD ADL solution ensures that operators do not have to purchase additional buses beyond the number of their current diesel fleet in order to maintain service on the route due to the outstanding battery capacity and range.

The ADL BYD Enviro200EVs being supplied to Arriva feature a provincial specification with the fitting of 38 seats. There is space for another 32 standing passengers and there are USB charging points throughout the buses.

Howard Farrall, Arriva Merseyside managing director said: “Arriva is committed to ensuring its fleet meets the latest clean vehicle standards. We are extremely proud to be joining forces with ADL and BYD UK at the forefront of the electric bus revolution. This new partnership will further contribute to Arriva’s ‘Destination Green’ environmental goal, which includes ambitious plans to reduce carbon emissions, conserve energy and invest in renewable sources”.

“This is a landmark moment not just for the successful BYD ADL partnership but for the roll-out of zero-emission electric buses in British cities. We are delighted as prime contractor to help Arriva Merseyside and Merseytravel make buses an even cleaner and greener option for Liverpool. Arriva’s Enviro200EV demonstrate that the technology is ready to roll out fully electric buses in provincial towns and cities without compromising on operational efficiency,” said Arthur Whiteside, Managing Director – UK Sales at ADL.

“Liverpool is pioneering a route for other British cities and one which they can follow with full confidence that the BYD ADL partnership can deliver a range of proven, efficient and attractive products which can play a key role in improving city street air quality. We will be working hard to build on our leading role in London in other cities”, said Isbrand Ho, Managing Director, BYD Europe.

BYD and Berkshire Hathaway

In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares. It’s an investment that has paid off handsomely. Berkshire’s original investment of $230 million is now worth roughly $1.8 billion.

For More on BYD, read the Special Report: BYD, Berkshire’s Tesla.

© 2017 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

BYD Expands North American Facility

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BYD, the world’s largest manufacturer of electric vehicles, is celebrating the addition of a new wing to the current BYD Coach and Bus facility in California.

The expansion of its Lancaster, California facility brings it total manufacturing space to nearly 450,000 sq. ft. This expansion nearly quadruples BYD’s facility from its initial 2013 footprint.

The growth of BYD Coach and Bus reflects a rapid transition to electric transportation and will allow BYD to build up to 1,500 battery-electric buses annually. Since BYD established its U.S. electric bus manufacturing capabilities in Los Angeles County, the company has created nearly 800 full-time jobs throughout the state. This manufacturing facility expansion will enable BYD to hire up to 1,200 full-time workers at top production-line capacity.

This manufacturing facility is powered 100% by renewable energy, which is provided by the City of Lancaster’s Energy Company, Lancaster Choice Energy.

BYD is the undisputed leader as North America’s largest electric bus manufacturer, having delivered 137 electric buses in the U.S. and Canada, including more than 75 buses delivered in 2017. BYD is currently producing an additional 300 buses based on current customer orders and has options for more than 300 additional electric bus purchases.

BYD’s buses operate in transit agencies, universities and airports across North America, with more than 40 customers including LA Metro, Los Angeles Department of Transportation, Stanford University, UCLA, UC San Francisco, UC Irvine, Anaheim Resort Transportation, Long Beach Transit, Denver Regional Transportation District, City of Albuquerque, SolTrans, SunLine Transit, Link Transit, COMO Connect, Antelope Valley Transit Authority, and many others.

The BYD Coach and Bus facility also supports R&D and assembly for BYD’s battery-electric medium- and heavy-duty trucks, including delivery, drayage, refuse, and yard trucks, among other product lines. These trucks incorporate the same proven core components that are used in BYD’s commercialized buses and vehicles with several hundred million service-proven miles. By the end of 2017, BYD will have delivered 70 all-electric trucks to 15 customers in North America, with orders for more than 140 trucks to-date.

BYD and Berkshire Hathaway

In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares. It’s an investment that has paid off handsomely. Berkshire’s original investment of $230 million is now worth roughly $1.8 billion.

For More on BYD, read the Special Report: BYD, Berkshire’s Tesla.

© 2017 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

GEICO on Ward Group’s Top 50 Insurers for 27th Year

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Few companies are able to stand the test of time and maintain an outstanding financial performance spanning nearly three decades.

GEICO has notched a spot on Ward Group’s 2017 list of 50 top performing insurance companies. GEICO is one of only a few companies to have earned a top 50 designation for 27 consecutive years.

“The ability to remain in this position for more than two decades is a remarkable achievement in our company’s history and demonstrates a high-level of trustworthiness from our growing customer base,” said Bill Roberts, GEICO president and chief operating officer. “We are proud to be recognized by The Ward Group as a top performing insurance company.”

To develop its annual top 50 list, Ward Group analyzes the financial performance of nearly 3,000 property and casualty insurance companies domiciled in the U.S., and identifies the top performers over the previous five year period (2012-2016).

Jeff Rieder, partner, head of Ward Group mentioned that low investment returns, rising loss costs, and competitive market conditions continue to impact financial returns for the industry. “In selecting the Ward’s 50, we identified companies that pass financial stability requirements and measure their ability to grow while maintaining strong capital positions and underwriting results,” said Rieder.

© 2017 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Berkshire Takes Stake in Italian Insurer

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Berkshire Hathaway Inc. will buy an approximately 9 percent stake in Italian insurer Societa Cattolica di Assicurazioni Scrl from Banca Popolare di Vicenza SpA.

The transaction will be at 7.35 euros per share for a total of cost 115.9 million euros.

On August 3, Standard & Poor’s confirmed Cattolica’s rating as BBB – and the outlook as stable.

Cattolica’s stand-alone credit profile (SACP) was confirmed at bbb+.

© 2017 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

BNSF to Benefit From $11 Million Oakland Rail Spur

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A refrigerated gateway to Asia for U.S. meat exports has cleared its last big hurdle in Oakland, California.

The access will benefit Union Pacific Railroad and BNSF Railway.

Port of Oakland Commissioners last week approved an $11 million rail spur to Cool Port Oakland. It’s the final piece of an ambitious plan to make this city a vital link in the food chain.

The spur will connect Union Pacific tracks with Cool Port, a 280,000-square-foot distribution center now under construction on 25 acres of Port property.

BNSF will also have rail access to the rail spur at no cost.

When the project is completed, in mid-2018 an estimated 27,000 20-foot containers of meat could ship from Oakland annually. The final destination will be export markets across Asia.

“The concept is to bring vast quantities of chilled or frozen beef and pork to Oakland via the rails,” explained Port of Oakland Maritime Director John Driscoll. “At Cool Port, the product would be transferred in a temperature-controlled setting from rail cars to shipping containers, then whisked across the street to outbound vessels.”

International logistics specialists Lineage Logistics and local operator Dreisbach Enterprises are building Cool Port under a lease agreement with the Port. The Port has agreed to oversee construction of the 2-mile-long rail spur. The Port will share rail costs with the developers. A $5 million grant will offset part of the cost. Union Pacific will construct a portion of the spur on its property.

Oakland is already a leading U.S. gateway to Asia for agricultural products including meat. Port officials say Cool Port could significantly increase shipments of beef and pork from the Midwest. The products would be exported overseas to satisfy growing Asian demand for U.S. premium meat. Proximity to the docks means cargo could be quickly transferred from rail to ship with minimal cost.

© 2017 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.