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Clayton Homes

Berkshire’s Clayton is Building Affordable Homes in Denver

Berkshire Hathaway’s Clayton Homes’ subsidiary, Oakwood Homes, has listed 96 single-family homes for sale at Green Valley Ranch, one of the fastest-growing communities in metro Denver.

On2 Homes, Oakwood Homes’ newest brand, is offering four distinct floor plans, with two-and-three-bedroom options available to prospective buyers. With a starting listing price in the low $300’s, On2 Homes’ prices start at half the median cost of a single-family home in metro Denver, now more than $600,000.

“Our customers have been stuck,” said Kristen Nelson, president of the On2 Homes division for Oakwood Homes. “They want to get their foot in the door of the Denver housing market, but steep entry prices keep them trapped in the renting cycle. With On2 Homes, we’re launching a product that delivers the quality of a traditional single-family home at a uniquely affordable price point.”

The affordability of On2 homes is driven by an innovative approach that merges off-site and site-built construction and supply processes, resulting in decreased build time and cost for homeowners. This method also demonstrates Oakwood Homes continued success in making homes constructed with off-site-built and site-built practices indistinguishable from one another.

Built in an off-site home building facility, On2 offers cost-effective, energy-efficient and high-quality homes at a fraction of the cost of site-building. At off-site design centers, On2 Homes uses precision-building techniques to maximize cost, speed and energy efficiency without compromising quality. With unique design features like EnergySmart® utility systems and weather proofing, On2’s single-family homes deliver high quality finishes at a price accessible to more Coloradans. Oakwood guarantees every On2 homebuyer full ownership over their property’s land rights – an increasingly rare opportunity in today’s housing market.

In 2021, metro Denver experienced a 19.3% year-over-year increase in the median listing price of a single-family home. With single-family starter homes beginning at more than $600,000, many Denver residents find themselves priced out of the housing market. With On2 Homes, Oakwood hopes to address Denver’s shortage of affordable single-family homes, expanding the possibility of homeownership to all the city’s residents.

As of December, Colorado has the fourth worst housing shortage in the United States. To keep pace with population gains, the state needs to build 54,000 new housing units annually over the next five years. Much of this burden falls on the homebuilding and construction industry. By utilizing efficiencies found in off-site home building and modular construction, the homebuilding industry can help answer the demand for affordable housing.

© 2022 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 a 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.

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Lessons From Warren Buffett

Lessons From Warren Buffett: This Is the Best Time to Start Saving

Is there a best time to start saving? Warren Buffett says there definitely is.

“Any money you save before you get out and start having a family … any dollar is probably worth $10 later on simply because you can save it,” Warren Buffett said at the 1998 Berkshire Hathaway Annual Meeting. “The time to save is young, and you’ll never have a better time to save than really, pre-formation of a family. Because the expenditures come along then whether you like them or not.”

Buffett’s full explanation on the best time to start saving


See the complete Lessons From Warren Buffett series

© 2022 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.

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BYD

BYD Enters Japanese Market

(BRK.A), (BRK.B)

Berkshire Hathaway-backed BYD has announced its entry into the passenger vehicle market in Japan.

The Chinese EV manufacturer is debuting three models – BYD ATTO 3, BYD DOLPHIN and BYD SEAL.

BYD Chairman and President Wang Chuanfu acknowledged BYD’s long relationship with the Japanese market and said he greatly appreciates the opportunity to grow.

“Over the years, BYD has been deeply engaged in the Japanese market and has accumulated a good market and brand foundation through its pure electric buses, energy storage systems, pure electric forklifts and other businesses,” Wang said. “Today, with the support and expectation of consumers, BYD officially hits the new energy passenger vehicle market in Japan. The longest journey starts with a single step, and we greatly cherish this business opportunity. Full of respect and dedication, we are devoted to providing Japanese consumers with leading technologies, excellent products and high-quality services, aiming to deliver an exceptional travel experience.”

BYD and Berkshire Hathaway

In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares for $232 million. It’s an investment that has paid off handsomely. Berkshire’s original investment of $232 million had grown in value to $7.69 billion as of December 31, 2021.

© 2022 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a 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.

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Berkshire Hathaway Specialty Insurance

Berkshire Hathaway Specialty Insurance Enters Swiss Market

(BRK.A), (BRK.B)

Berkshire Hathaway Specialty Insurance has opened a new office in Zurich, Switzerland, and appointed Leander Metzger as Country Manager.

“Establishing this new office in Zurich reflects our focus on expanding our presence and relationships throughout the DACH region. It is another important step in our strategy to steadily grow our capabilities, our team, and our local presence throughout Europe,” said Andreas Krause, Head of DACH, BHSI. “Leander has had great success building European relationships and we are excited to have him lead our expansion in Switzerland.”

BHSI is now underwriting property, casualty, and executive & professional lines in Switzerland and expects to launch several other product lines there in the coming months.

“We look forward to building our team in Zurich and bringing BHSI’s commitment to excellent technical underwriting and service and our CLAIMS IS OUR PRODUCT® philosophy to customers and brokers throughout Switzerland,” said Leander Metzger, Country Manager Switzerland. Leander has more than 25 years of industry experience. He joined BHSI in June 2016 as Head of Property, Engineering Lines and Risk Control, and will retain that position along with his new role. Before coming to BHSI, Leander held management positions with both insurance brokers and insurers.

© 2022 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 a 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.

Categories
Berkadia

Berkadia Adds Specialty Group, Medical & Life Sciences

(BRK.A), (BRK.B)

Berkadia, Berkshire Hathaway’s joint venture with Jefferies Financial Group, has added Senior Managing Director Sabrina Solomiany to lead Berkadia’s newest specialty group, Medical & Life Sciences.

Solomiany will sit in the Atlanta office and will report to SVP – Deputy Head of Investment Sales Mike Miner.

“We’re thrilled to add to Berkadia’s capabilities with this new specialty group, adding to our suite of expertise,” said Miner. “Sabrina brings extensive experience in the U.S. healthcare and life science sectors and will be pivotal in expanding our footprint in this highly specialized space.”

“I’m excited to join Berkadia and build a national platform focused on delivering investment sales, debt placement and JV equity solutions for healthcare and life sciences investors,” said Solomiany. “Despite current market uncertainty, significant amounts of capital continue to pour into healthcare real estate, a sector that has been historically resistant to economic downturns.”

The new Medical & Life Sciences specialty will provide a comprehensive solution for the various specialties of healthcare real estate including medical office buildings, life sciences, hospitals, surgery centers, post-acute care and behavioral health facilities.

With over 20 years of experience, Solomiany has closed $8.2 billion in total transaction volume, including $6.5 billion of healthcare and life sciences transactions that totaled more than 22 million square feet.
Solomiany joins Berkadia from CBRE where she served as First Vice President and led the Debt & Structured Finance platform for U.S. Healthcare & Life Sciences Capital Markets. Prior to that she was a Senior Director with CBRE’s U.S. Healthcare investment sales team. She specializes in providing healthcare and life sciences real estate investors with acquisition, disposition, debt placement and recapitalization strategies. Ms. Solomiany’s expertise spans various specialties of healthcare real estate including medical office buildings, life sciences, inpatient rehabilitation facilities, short- and long-term acute care hospitals, behavioral health, surgical hospitals, cancer centers, proton therapy, specialty hospitals, free-standing emergency departments, micro hospitals and urgent cares. Her clients include REITs, institutional investors, healthcare providers, developers and private capital investors.

Solomiany received her Bachelor of Science from the University of Florida.

About Berkadia

Founded in 2009 as a 50/50 joint venture between Berkshire Hathaway and Leucadia National Corporation (now known as Jefferies Financial Group), 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.

© 2022 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.

Categories
Lessons From Warren Buffett

Lessons From Warren Buffett: What Aesop Got Right About Investing

Aesop, the legendary storyteller of antiquity, had one of the most important lessons for investors in his fables, according Warren Buffett.

“The first investment primer that I know of, and it was pretty good advice, was delivered in about 600 B.C. by Aesop. And Aesop, you’ll remember, said ‘A bird in the hand is worth two in the bush,’” Warren Buffett said at the 2000 Berkshire Hathaway Annual Meeting. “Now, Aesop was onto something, but he didn’t finish it, because there’s a couple of other questions that go along with that. But it is an investment equation, a bird in the hand is worth two in the bush. He forgot to say exactly when you were going to get the two in the — from the bush — and he forgot to say what interest rates were that you had to measure this against. But if he’d given those two factors, he would have defined investment for the next 2,600 years. Because a bird in the hand is, you know, you will trade a bird in the hand, which is investing. You lay out cash today. And then the question is, as an investment decision, you have to evaluate how many birds are in the bush. You may think there are two birds in the bush, or three birds in the bush, and you have to decide when they’re going to come out, and when you’re going to acquire them.

Now, if interest rates are five percent, and you’re going to get two birds from the bush in five years, we’ll say, versus one now, two birds in the bush are much better than a bird in the hand now. So you want to trade your bird in the hand and say ‘I’ll take two birds in the bush,’ because if you’re going to get them in five years, that’s roughly 14 percent compounded annually and interest rates are only five percent. But if interest rates were 20 percent, you would decline to take two birds in the bush five years from now. You would say ‘that’s not good enough,’ because at 20 percent, if I just keep this bird in my hand and compound it, I’ll have more birds than two birds in the bush in five years.

Now, what’s all that got to do with growth? Well, usually growth, people associate with a lot more birds in the bush, but you still have to decide when you’re going to get them. And you have to measure that against interest rates, and you have to measure it against other bushes, and other, you know, other equations.

And that’s all investing is. It’s a value decision based on, you know, what it is worth, how many birds are in that bush, when you’re going to get them, and what interest rates are.”

Buffett’s full explanation on Aesop and interest rates

See the complete Lessons From Warren Buffett series

© 2022 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.

Categories
Pilot Flying J

Pilot Company and GM Partner on Network of EV Charging Stalls

(BRK.A), (BRK.B)

Berkshire Hathaway-backed Pilot Company and automaker General Motors are collaborating on a national DC fast charging network that will be installed, operated and maintained by EVgo through their eXtend offering.

The network of 2,000 charging stalls will be co-branded “Pilot Flying J” and “Ultium Charge 360”, and will be powered by EVgo eXtend and open to all EV brands at up to 500 Pilot and Flying J travel centers.

GM customers will receive special benefits like exclusive reservations, discounts on charging, a streamlined charging process through Plug and Charge and integration into GM’s vehicle brand apps providing real-time charger availability and help with route planning.

The Pilot and Flying J travel centers plan to feature numerous fast charging stalls provided by EVgo, including high power fast chargers capable of offering up to 350 kW1. EVgo, which is also working with GM to add more than 3,250 fast chargers in American cities and suburbs by the end of 2025, was chosen as a strategic collaborator due to its expertise in building, operating and maintaining DC fast charging infrastructure. Many of these sites will feature canopies to help protect customers from the elements while charging, as well as pull-through capability allowing convenient charging for electric pickup trucks and SUVs pulling trailers.

“We are committed to an all-electric, zero-emissions future, and ensuring that the right charging infrastructure is in place is a key piece of the puzzle,” said Mary Barra, GM Chair and Chief Executive Officer. “With travel centers across North America, Pilot Company is an ideal collaborator to reach a broad audience of EV drivers.”

“GM and Pilot Company designed this program to combine private investments alongside intended government grant and utility programs to help reduce range anxiety and significantly close the gap in long-distance EV charger demand,” said Shameek Konar, Pilot Company Chief Executive Officer. “Our travel centers are well-equipped to accommodate EV charging with 24/7 amenities and convenient proximity to major roadways across the country. We look forward to collaborating with GM and the U.S. Department of Transportation to make convenient coast-to-coast EV travel a reality through our national network of travel centers.”

Third-party research shows that widespread access to highway charging, particularly in underserved urban and rural areas, is a significant barrier to mass EV adoption.

“EVgo, GM and Pilot Company share a commitment to building an electric fueling network that increases access and makes the shift to electrification as frictionless as possible for all. We look forward to this collaboration and ensuring the EVgo network provides nationwide coverage, including critical corridors for road trips,” said Cathy Zoi, CEO at EVgo. “Through EVgo eXtend, we are demonstrating yet another innovative pathway to help America electrify — and showcasing why EVgo’s technology and industry leadership make us the partner of choice to site hosts, automakers and drivers alike as we work together to deliver a cleaner future of transportation.”

This collaboration is targeting the installation of charging stalls at 50-mile intervals across the U.S.

For GM, this development is one more step of its nearly $750 million investment in EV charging infrastructure, including:
• Enabling access to more than 100,000 charge points in the U.S. and Canada through its Ultium Charge 360 ecosystem
• Collaborating with EVgo to build out a network of 3,250 charging stalls in major metro areas by 2025
• Installing up to 40,000 chargers in local dealer communities through GM’s Dealer Community Charging Program, focusing on underserved rural and urban areas

This project builds on Pilot Company’s recently announced “New Horizons” initiative to invest $1 billion to fully upgrade its travel centers with more premium amenities and offerings that aren’t typically available at current EV charging locations. Guests will have access to free Wi-Fi at most locations, expanded seating and lounge areas, updated and modernized restrooms, on-site restaurants including Pilot’s signature fresh hot and cold deli, premium coffee, and shopping for travel essentials and souvenirs while their vehicles are charging. Pilot and Flying J travel centers are open 24/7, ensuring that team members are always onsite to provide consistently high service to guests.

Beyond this program, GM and Pilot Company will continue working with key stakeholders to use new and existing public-private programs to accelerate the development of more public EV charging infrastructure.

Berkshire Hathaway and Pilot

In 2017, Berkshire Hathaway made a $2.76 billion investment in Pilot, obtaining an initial 38.6 percent stake in the company, and Berkshire will become the majority owner in 2023.

© 2022 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 a 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.

Categories
Stock Portfolio

Berkshire Hathaway Closing in on 20% Stake in Occidental Petroleum

(BRK.A), (BRK.B)

A dip in the price of Occidental Petroleum had Warren Buffett adding more purchases of OXY shares on July 11, 12 and 13. The move comes as crude oil prices have dipped 9 percent this week.

In its latest Form 4 filing, Berkshire spent roughly $250 million for 4.3 million shares of OXY stock at prices ranging from $56.9406 to $59.8491 per share.

After these purchases, Berkshire holds 179,741,891 shares of OXY common stock.

The purchases raise Berkshire’s stake to 19.2%, which has it at the cusp of a 20% stake that would see Occidental Petroleum’s earnings added to Berkshire’s earnings. Currently, only the dividends are added to Berkshire’s financials.

In addition to its stake in OXY common stock, Berkshire also holds 100,000 series A preferred stock shares and warrants that Berkshire can exercise for roughly 84M shares of common stock at $59.624 per share.

© 2022 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 a 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.

Categories
Stock Portfolio

BYD Names Louwman as Dealer Partner in the Netherlands

BYD, the world’s leading manufacturer of new energy vehicles (NEVs), has appointed Louwman as its national dealer partner in the Netherlands.

The strategic partnership with the long-established Louwman Group marks an important phase for BYD as it continues to expand its eco-friendly electric passenger vehicle business.

Louwman will offer a digital platform for online ordering, customer service and assistance, and also provide both offline sales and aftersales services for BYD passenger vehicles through its huge dealer network at key locations across the Netherlands.

Several physical stores will be opened at key locations in the Netherlands, starting with Amsterdam. From September, customers will be able to visit the pioneering store in Amsterdam and review BYD’s latest models.

Louwman Group, has a long and successful heritage in the automotive industry dating back nearly a century. Privately owned, it has become one of the largest automotive companies in Europe with branches in 70 locations associated with many global brands. Louwman, like BYD, has traditionally been involved in many successful collaborations, sharing the same ambitions for a greener future through innovative sustainable eMobility solutions.

Michael Shu, General Manager and Managing Director, BYD Europe and International Cooperation Division: “We are proud to start our BYD passenger vehicles journey in the Netherlands with such an experienced and respected partner as Louwman. Louwman’s market recognition and resources combined, will enable BYD to rapidly establish brand awareness and generate sales of our world-leading new energy passenger vehicles in the Netherlands. Like BYD, Louwman is a business that thrives on being innovative. Together we look forward to achieving our shared vision to accelerate electrification and zero-emission transport in the Netherlands.”

Eric Louwman, President of Louwman Group: “It is an exciting partnership and fits perfectly with our goal of ‘Mobility for Life’. BYD is the world’s leading NEV manufacturer who is known around the globe for groundbreaking battery technology, which is at the heart of all BYD’s impressive new energy vehicles. We are delighted to offer a wide appealing range of eco-friendly BYD vehicles to our customers in the Netherlands with the reassurance of superior safety, long range performance and high standards of all-round quality. Leasing companies are already showing great interest in various models.”

BYD and Berkshire Hathaway

In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares for $232 million. It’s an investment that has paid off handsomely. Berkshire’s original investment of $232 million had grown in value to $7.69 billion as of December 31, 2021.

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a 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.

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Berkshire Hathaway Energy

Berkshire Hathaway Purchases Solar Farms in Australia

(BRK.A), (BRK.B)

Berkshire Hathaway’s CalEnergy has purchased two large solar farms, Suntop and Gunnedah, totaling 345 MWp in New South Wales, Australia, from Canadian Solar Inc.

The two projects have long-term offtake agreements with a global leading technology company and will help support corporate decarbonization efforts. The projects have reached substantial completion and are expected to generate over 700,000 MWh of green electricity annually. This is equivalent to avoiding more than 450,000 tons of CO2-equivalent emissions annually or taking approximately 100,000 cars off the road each year.

In addition to the sale of these projects, Canadian Solar and CalEnergy also entered into a multi-year development services agreement that provides a framework for the companies to continue to work together to build out Canadian Solar’s growing renewable energy pipeline in Australia.

“We are delighted to work with CalEnergy in Australia to grow their renewable energy portfolio. The sale of these projects in New South Wales paves the way for a strong collaboration between our respective companies. In Australia, we have now brought seven development projects to NTP (notice-to-proceed) and beyond, and continue to develop and grow our multi-GW solar and storage pipeline. I look forward to continuing to contribute to Australia’s decarbonization and renewable energy growth ambitions.” said Dr. Shawn Qu, Chairman and CEO of Canadian Solar.

© 2022 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 a 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.