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Cheniere slashes outlook for LNG investment amid pandemic – Financial Post

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Cheniere Energy Inc, the largest U.S. liquefied natural gas (LNG) company, said it expects investment in new projects worldwide to slump this year and next as the industry grapples with the coronavirus-led economic slump that has sliced 30% off worldwide fuel demand.

Cheniere also said demand for the super-cooled fuel could potentially fall in coming quarters, a reversal from years of record-setting growth, as slower economic activity and high storage inventory levels reduce the need for imports.

Before the pandemic, demand for LNG had grown sharply as nations like China and India shift away from dirtier coal for power generation and home heating.

The global recession is expected to cause investment to fall, cutting the expected growth in new projects worldwide in 2020 and 2021 to 65 million tonnes in capacity, compared with its previous forecast of about 130 million tonnes.

“Supply and demand dynamics are tightening the competitive landscape,” Cheniere’s Chief Financial Officer Anatol Feygin said on a call after the company posted first-quarter results. Cheniere’s net income nearly tripled in the quarter.

Cheniere also said that more customers had said they would not take delivery of LNG cargoes recently, but did not give a specific number. It does not expect the canceled LNG cargoes to have a material impact on its forecasted financial results for 2020, as most of its business is through long-term contracts.

During the first quarter, the company said it recognized revenue of approximately $53 million associated with canceled LNG cargoes.

Cheniere also said robust LNG supply growth over the past several years, along with warmer winters and strict virus containment measures, have caused global gas prices to drop. Gas contracts in Europe and Asia have plunged to record lows over the past week or so.

Separately, Cheniere said it still expects to complete the third liquefaction train at its Corpus Christi LNG export plant in Texas in the first half of 2021 and the sixth train at its Sabine Pass LNG export plant in Louisiana in the first half of 2023.

The company said while it was taking measures to combat the spread of the coronavirus, it was not expected to hit costs or the schedule for its Corpus Christi Train 3 or Sabine Pass Train 6.

Cheniere shares rose 1.4% in early afternoon trading on Thursday.

(Reporting by Arathy S Nair in Bengaluru and Scott DiSavino in New York Editing by Nick Zieminski and Marguerita Choy)

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Volkswagen closes $2.6 billion investment in self-driving startup Argo AI – Yahoo Canada Finance

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Volkswagen closes $2.6 billion investment in self-driving startup Argo AI
Signage at a Volkswagen dealership is seen in London, Britain

(Reuters) – German automaker Volkswagen AG <VOWG_p.DE> has closed its $2.6 billion investment in Argo AI, the Pittsburgh-based self-driving startup disclosed in a blog post on Tuesday.

Argo, founded in 2016 by Bryan Salesky and Peter Rander, is now jointly controlled by VW and Ford Motor Co, which made an initial investment in Argo shortly after it was founded.

Details of the VW investment, which does not include an agreement to purchase $500 million worth of Argo stock from Ford, was announced last July.

VW’s agreement includes the transfer to Argo of its Munich-based Autonomous Intelligent Driving unit, which boosts Argo’s employment to more than 1,000, according to Salesky.

Last week, VW disclosed that its supervisory board had approved several projects in a multibillion-dollar alliance with Ford that also was announced last July.

Ford created Ford Autonomous Vehicles LLC in 2018, pledging to invest $4 billion until 2023 and had sought outside investors to help share the spiraling cost of developing autonomous vehicles.

(Reporting by Paul Lienert in Detroit; Editing by Nick Zieminski)

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Volkswagen closes $2.6 billion investment in self-driving startup Argo AI – TheChronicleHerald.ca

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(Reuters) – German automaker Volkswagen AG has closed its $2.6 billion investment in Argo AI, the Pittsburgh-based self-driving startup disclosed in a blog post on Tuesday.

Argo, founded in 2016 by Bryan Salesky and Peter Rander, is now jointly controlled by VW and Ford Motor Co, which made an initial investment in Argo shortly after it was founded.

Details of the VW investment, which does not include an agreement to purchase $500 million worth of Argo stock from Ford, was announced last July.

VW’s agreement includes the transfer to Argo of its Munich-based Autonomous Intelligent Driving unit, which boosts Argo’s employment to more than 1,000, according to Salesky.

Last week, VW disclosed that its supervisory board had approved several projects in a multibillion-dollar alliance with Ford that also was announced last July.

Ford created Ford Autonomous Vehicles LLC in 2018, pledging to invest $4 billion until 2023 and had sought outside investors to help share the spiraling cost of developing autonomous vehicles.

(Reporting by Paul Lienert in Detroit; Editing by Nick Zieminski)

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Estoppels are critical in a CRE investment purchase – Real Estate News EXchange

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If you’ve purchased a commercial or residential condo, you would have encountered an estoppel certificate.

There are many reasons for obtaining a condominium estoppel (the information I discuss here is applicable only to single- and multi-tenant investments, excluding multifamily rentals):

* they provide insight into the project’s reserve fund;

* illustrate if there are any unpaid contributions or arrears;

* and determine if its bylaws and policies are in good standing.

Estoppels are just one of many due diligence items I encourage buyers to ask for.

Let’s look at the importance of obtaining estoppel certificate(s) during your investigation of an investment property.

A recent example

A landlord and tenant negotiated a tenant improvement allowance which was to be paid to the tenant once they had completed their improvements. The tenant was a national company with a few different departments handling various elements of the lease administration.

The tenant did complete the work but somehow forgot to thereafter ask for the agreed-upon amount of cash. The property was subsequently sold to another investor.

The investor did not obtain an estoppel certificate from the tenant during its due diligence period.

Sometime after the sale, the tenant realized they had failed to request the tenant improvement amount at the appropriate time.

Had the buyer requested an estoppel certificate from the tenant at the time of purchase, they would have insulated themselves from this problem.

How open do you think the previous owner is to paying this significant sum of money after the sale?

The tenant improvement allowance was amortized into the lease, which increased the tenant’s lease payment.

The buyer does not feel obligated to pay it, because they paid more for the property due to the cap rate applied to that increased rent.

Elements of an investment property estoppel certificate

The certificate must be executed by the tenant and may include, but is not limited to, the following declarations:

* the lease constitutes the entire agreement between both parties;

* the amount of security deposit held;

* any additional signage rent;

* there is no litigation outstanding between the two parties;

* there are no existing lease defaults by either party;

*  any improvements required to made by the landlord have been completed;

*  any amount agreed to be paid by the landlord for tenant improvements has been paid.

We use estoppel certificates that can be one or several pages long.  It typically depends on the complexity of the transaction, number of tenants involved and the sophistication of the buyer.

Getting an estoppel in place

A landlord typically does not want to go through the work and disturb the tenants until the buyer has removed all conditions.

A buyer doesn’t typically want to remove conditions until the estoppels have been provided.

A remedy can be to provide the certificates after the buyer has removed conditions, provided there is a process agreed to if something surfaces within the estoppel that requires a resolution prior to completion of the deal.

There are many issues that can surface if estoppels are not included within a commercial real estate investment sale.

If a seller is reluctant to allow this requirement to be written into the purchase agreement, treat this as a red flag.

It could be in your best interests to walk away before investing your time and money.

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