1. The 2nd biggest employer in the US is a TEMP AGENCY – Kelly Services (with more than 550,000 people working for them in the average year). GE is 3rd largest with 300,000. Wal-Mart is first with over a million employees.
2. American Homes 4 Rent, the 2nd biggest landlord following Blackrock shed 15% of staff following a second quarter loss.
Please consider American Homes 4 Rent Said to Fire Employees After Loss.
American Homes 4 Rent (AMH) yesterday fired a group of workers, with a focus on acquisition and construction staff, after the housing landlord reported a fiscal second-quarter loss, according to a person with knowledge of the terminations.Only 56% of their properties are rented and the group still wants to spend $100 million a month to buy 800-1000 more homes.
The company, owner of almost 20,000 single-family homes, has cut about 15 percent of its workforce this year, including an earlier round of terminations before its initial public offering last month, said the person, who asked not to be identified because the information is private. The Malibu, California-based company, which raised $705.9 million in the IPO, had a net loss of $14 million, or 15 cents a share, on revenue of $18.1 million in the quarter ended June 30, according to a statement this week.
Single-family landlords have struggled to turn a profit while acquiring homes faster than they can fill them with tenants. Hedge funds, private-equity firms and real estate investment trusts have raised more than $18 billion to purchase more than 100,000 rental houses in the past two years. American Homes 4 Rent, founded by B. Wayne Hughes, is the largest single-family landlord after Blackstone Group LP’s Invitation Homes, which has spent more than $5 billion on 32,000 homes.
American Homes 4 Rent executives Peter Nelson, Jack Corrigan, Sara Vogt-Lowell and Janice Stack didn’t respond to e-mails and telephone messages seeking comment on the firings.
The landlord is slowing its property purchases, with plans to spend as much as $100 million a month on 800 to 1,000 additional homes, Corrigan, the company’s chief operating officer, said on an Aug. 21 earnings conference call.
“As far as being able to put money to work, I mean we could easily ramp back up to $300 million-a-month pace if we have clarity that we would have that capital available,” he said. “But we don’t want to get too far out over our skis.”
American Homes 4 Rent owned 19,825 properties for an investment of $3.4 billion as of July 31, according to its earnings statement. About 56 percent of the company’s homes were leased as of June 30.
Don't worry! They could triple that "but they don’t want to get too far out over their skis”.
Really?! What if they already are?
Such silliness explains why existing home sales are relatively robust compared to new home sales. The latter is now slumping because of higher mortgages rates.
Any downturn in the property market will sink this group. And such a downturn may easily be at hand.
For further discussion, please see New Home Sales Plunge 13.4% in July, June Revised Lower; Blame Rising Mortgage Rates
Addendum:
I originally posted "56% of their properties are not rented". The person who caught my typo, said "I would be worried silly if only 56% of my properties were rented".
Not to worry, this is OPM (Other People's Money) American Homes 4 Rent is playing with. I am sure the CEO and executive staff of AMH will do quite well no matter what happens, even if AMH goes bust and takes down all the investors in the process.
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
