Holding companies; defined as a parent business that owns controlling stock or membership interests in other companies (subsidiaries). Berkshire Hathaway is a common example. Another prominent example is Saks Global, a holding company of luxury department stores and commercial property. Owning household names such as Saks 5th avenue, Neiman Marcus, Bergdorf Goodman, and Saks OFF 5th, Saks Global is a major market player in the luxury retail space.
As of January 14th 2026, Saks Global entered chapter 11 bankruptcy due to missed debt payments, failed integration of acquisitions, and slowing consumer demand for discretionary goods (non essentials, i.e., luxury products). Chapter 11 is a restructuring bankruptcy where the firm can continue operations, but only under strict court scrutiny. Said firm must pay down debts in an orderly fashion and restructure their capital. The main headwind behind Saks current fiasco is its 2024 acquisition of Neiman Marcus–a luxury department store similar to Saks 5th avenue. Saks acquired Neiman for 2.7 billion in a debt heavy deal in 2024. Now, although Neiman had its own chapter 11 fiasco in 2020, it (unlike Saks) dealt with its problems. The debt burden for this acquisition came from Saks' borrowings, not Neiman's balance sheet. Timing was of the essence for this deal; Saks borrowed heavily amidst high 2024 rates, further distressing the firm throughout a prolonged period of slowing consumer demand, all leading to the eventual decline.
After eventually falling behind on hundreds of millions of dollars worth of debt payments, Saks officially entered chapter 11 and is working with PJT (the main Investment Bank involved in the transaction) to restructure. Saks secured 1.75 billion of debtor in possession (DIP) financing from senior secure bondholders. DIP is a type of financing in distressed scenarios that allows firms to continue operations and restructure rather than liquidating, this debt is labeled as “super-priority”, meaning it must be paid back before other outstanding debts.
Along with the debt infusion, Saks immediately hired a new CEO to help them navigate this process. Geoffroy Van Raemdonck, former Neiman Marcus CEO who was instrumental in leading Neiman out of bankruptcy in 2020. Will Raemdonck prove valuable to Saks in a time of slow consumer demand and heightened stress on the un-affordability of the economy as many Americans see it? Or, will this be another case of a firm taking on too much debt in a strategic acquisition, badly integrating the acquired firm, thus leading to the perpetrators demise. Many window shopping New Yorkers hope the former is true.
Equity Insights
↓BlackStone (BX): The alternative asset manager dropped 5.6% on Wednesday January 7th following Trump's TruthSocial post attempting to ban institutional investors from buying single-family homes. Institutional investors as a whole are a small part of the rental market but rentals are a big part of Blackstone's business. Presuming congress enacts this ban, it could prove disastrous for Schwarzman and co.
Theme of the Week
“People live in homes, not corporations”. This phrase has been used by Donald Trump in reference to the uptick in institutional investors buying up single-family homes and renting them out to families / individuals. According to public statements, the administration is currently working on encouraging congress to codify legislation banning large, institutional firms from buying up single-family homes. The stated rationale behind this policy is that these big buyers have more powerful cash bids with easy access to cheaper credit, easily outbidding families for homes and simultaneously raising prices due to the resulting higher demand.
Some observers suggest that by painting these types of buyers as the villain the current administration is trying to show their intense / shrewd focus on affordability ahead of the 2026 midterms in order to keep the GOPs supermajority in congress, thus easing their efforts in lawmaking and in enacting their proposed legislation. Others view the effort as a policy response to individuals' affordability concerns in the housing market.
In the ever quickening world of social media, immediately after Trump's TruthSocial post regarding this development, alternative asset managers and institutional home buyers stocks fell significantly. Blackstone–an alternative asset manager–dropped 5.6% on Wednesday January 7th following the news. On the investment side of things, investors will need to decide whether they think this will affect their portfolios in the long term or if it will turn out to be just a one time slap on the face by the administration with minimal long-term impact.
On the economic side of things, analysts are divided on the role institutional buyers play in housing prices. Estimated to make up just 2.5% of the rental market and even less of the overall housing market, banning these big-cap small-players may not have a big effect on lowering home prices, some analysts say. An alternative view emphasizes supply rather than buyer composition. Advocates of this approach suggest that the real remedy is building more, raising supply through higher construction rates which in turn will lower prices.
Overall, the administration's focus on institutional home ownership highlights the broader debate over affordability ahead of the 2026 midterm elections.
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