U.S. Inflation Slowed for Sixth Straight Month in December

U.S. inflation eased in December for the sixth straight month following a mid-2022 peak as the Federal Reserve aggressively raised interest rates and the economy showed signs of cooling.

The consumer-price index, a measurement of what consumers pay for goods and services, rose 6.5% last month from a year earlier, down from 7.1% in November and well below a 9.1% peak in June.

Core CPI, which excludes volatile energy and food prices, climbed 5.7% in December from a year earlier, easing from a 6% gain in November. Many economists see increases in core CPI as a better signal of future inflation than the overall CPI. Core prices increased at a 3.1% annualised rate in the three months ended in December, the slowest pace in more than a year and down from 7.9% in June.

The figures added to signs that inflation is turning a corner following last year’s surge. They also likely keep the Fed on track to reduce the size of interest-rate increases to a quarter-percentage-point at their meeting that concludes on Feb. 1, down from a half-percentage point increase in December.

U.S. stocks climbed Thursday and investors bought U.S. Treasurys, lifting bond prices and weighing on yields. The S&P 500 added 0.3%, while the Dow Jones Industrial Average gained 0.6%, or 217 points. The technology-heavy Nasdaq Composite also rose 0.6%.

Easing inflation follows several signs that U.S. economic activity cooled in late 2022. U.S. imports and exports fell in November from October, while retail sales, manufacturing output and home sales all declined. Job and wage growth slowed in December, though the labor market remained tight with historically low claims for unemployment insurance at the start of the year.

 

“The December CPI report was welcome good news after a very bad patch for inflation,” said Bill Adams, chief economist at Comerica Bank. He said consumers are getting relief from lower gasoline prices and moderating food prices, as well as declining prices for other goods.

On a monthly basis, the CPI fell 0.1% in December, due to sharply falling energy prices. That compared with a gain of 0.1% in November and 0.4% in October. Food-price increases also slowed last month. Core CPI rose 0.3% in December, up from November’s 0.2% rise but down from 0.6% increases in August and September.

Goods prices, a key driver of inflation over the past year and a half, fell for the third straight month in December as prices fell for products such as autos, computers and sporting goods.

Improving supply chains and reduced demand have relieved price pressures on goods, but services prices continued to climb in part because of wage gains in a tight labour market.

Some economists worry that still-high wage growth could keep consumers flush with cash and companies eager to raise prices to compensate, holding inflation above the Fed’s 2% target.

“Taming services inflation will be the Fed’s biggest challenge this year,” said Ryan Sweet, chief U.S. economist at Oxford Economics.

Shelter prices rose 7.5% in December from a year earlier, the Labor Department said, and a broader measure of services prices that excludes utilities rose 7% during the same period. Both increases were the biggest since 1982.

Daycare and preschool prices rose 5.4% in December from a year earlier, the biggest increase since 2006, while those for home-health care increased 6.1% in the same period. Hospital services prices, meanwhile, jumped 1.5% in December from the prior month, the sharpest monthly increase since 2015.

Inflation remained high across the globe in November, though it abated during the month, the Organization for Economic Cooperation and Development said Tuesday. Consumer prices across the Group of 20 largest economies—which contribute four-fifths of economic output worldwide—rose 9% from a year earlier in November, down from October’s 9.5% increase, the first drop in the G-20 inflation rate since August 2021.

Prices rose sharply in 2021 as the U.S. economy rebounded from the Covid-19 pandemic, powered by pent-up consumer spending that got a boost from low interest rates and government stimulus. Snarled supply chains fueled higher prices for many goods. Russia’s invasion of Ukraine in early 2022 also tightened supplies of energy and other commodities, further stoking inflation worldwide.

Inflation pressures on goods dissipated last summer as supply chains improved and energy prices fell. Shipping costs from China to the West Coast are near pre pandemic levels. Gasoline prices have declined, with the national average price of regular unleaded gasoline at $3.27 a gallon on Thursday, down about 50 cents a gallon from mid-November, according to OPIS, an energy-data and analytics provider. Gasoline prices peaked in mid-June at a record $5.02 a gallon.

“Logistics prices have also slowed materially, shipping costs are back to where they were pre-Covid,” said Jake Oubina, senior economist at Piper Sandler. “The alleviation on the cost side is creating the wherewithal to discount more aggressively as we head into 2023.”

The clearest impact of Fed tightening so far is in the housing market. Existing-home sales fell in November for a 10th straight month as high mortgage rates boosted buyers’ costs.

Ian Snowden, a 33-year-old tech salesman, said the shift to remote work after the pandemic hit allowed him to move to Asheville, N.C., where he has easy access to hiking, fishing and other outdoor activities.

The move proved expensive, though. After losing out to cash buyers in bids for existing homes, Mr. Snowden signed a contract in September 2021 to buy a newly constructed property. By the time his home was completed the following June, mortgage rates had doubled. On top of that, the construction company told him that he was on the hook for an extra $25,000 to offset unexpectedly high costs for concrete, labor and other items—or he could back out of the contract.

At that point, Mr. Snowden said, he was already selling his old house and had made plans to move, so he wasn’t going to back out. “So much was already in motion,” he said. Between the higher mortgage rates and the additional costs, the monthly mortgage payment increased $200, he said.

—Austen Hufford contributed to this article.

Kobe Bryant’s Lakers Jersey Could Fetch a Record $7 Million at Sotheby’s

A Los Angeles Lakers jersey regularly worn and signed by Kobe Bryant will be auctioned next month with a high estimate of US$7 million, making it the most valuable Bryant jersey to appear on the open market.

The late basketball star wore the gold jersey on Lakers media day on Oct. 1, 2007, and throughout the NBA Western Conference finals on May 9, 2008. During the 2007-08 season, he scored 645 points in the same jersey over 25 games, according to Sotheby’s, which is handling the auction. He was named league’s most valuable player that year, his only MVP season.

This is also the only gold jersey Bryant wore during the 2008 NBA playoffs, Sotheby’s said. He wore it again for his official MVP portrait that year.

“Sports artifacts with this type of long-term, heavy wear are a rarity in the collecting space, with many modern items worn for just a single game,” Brahm Wachter, Sotheby’s head of streetwear and modern collectables, said in a news release.

This jersey has been featured in murals and artworks depicting the basketball legend across the globe. There are more than 15 such murals in California alone, including the painting by artist Jonas Never located near the team’s arena in Los Angeles, according to Sotheby’s.

Photo by Greg Cohen of Los Angeles Kobe Bryant mural by Jonas Never is included in the lot. Courtesy of Sotheby’s

A shooting guard, Bryant spent his entire 20-year professional career with the Lakers. He appeared in 18 All-Star games, won two Finals MVP awards, and two gold medals on the 2008 and 2012 U.S. Olympic teams.

Bryant, along with his daughter Gianna and seven others, died in a helicopter crash in Calabasas, Calif., in 2020. He was 41.

The jersey will be sold at Sotheby’s online from Feb. 2-9, with bidding starting at US$5 million. It will be on public exhibition from Feb. 1-7 in Sotheby’s New York galleries.

The auction house declined to disclose the identity of the consignor. The jersey is offered with a collection of photographs of Bryant in this jersey taken by Greg Cohen, and a number of related items, including artwork, t-shirts, pins, books, and more.

The current record for any item of Kobe Bryant sports memorabilia is a game-worn and autographed jersey from his 1996-97 rookie season. It sold for US$3.7 million in 2021 at Goldin Auctions.

Is This the ‘It’ Chair of 2023? Interior Designers Think So

AN UNFUSSY and downright brutish, midcentury vintage chair design has been muscling its way into even the most traditional of homes lately. Though no cozy La-Z-Boy, the seat is getting high marks for a wabi-sabi style that celebrates imperfections, thanks to exposed bolts, obvious joints, plain-Jane planks and unpolished wood. Some look like little more than two pieces of wood attached to legs, but keyhole details or sculpted backs can make them sweeter. Designers and dealers are calling the increasingly in-demand seats, which hail primarily from Scandinavia and Europe, brutalist. At online marketplace 1stDibs, searches for “brutalist chair” are up 115% year over year.

“These mid- to late-century chairs are raw, organic and almost harsh,” said Maureen Ursino, an interior designer in Colts Neck, N.J., who’s been buying them for clients because they add “a contemporary element in not too intense of a way.” Recently she placed a single Danish pinewood chair, likely a survivor of the 1970s, in the bathroom of a Larchmont, N.Y., home. “I used it as a decorative accent, as though it were a piece of art,” she said.

Heidi Caillier planted an oak example from Germany in a child’s bedroom in San Francisco. The Seattle-based designer welcomes “the sense of patina” the seats bring to a project: “Like maybe this chair has been in this family for years and keeps being passed down but also is not too precious.”

Though this simple wood chair is unquestionably trending, skeptics take issue with its equally buzzy “brutalist” label. Florence de Dampierre, author of “Chairs: A History” decries that description as sloppy. “Brutalism refers to an architectural style from the ’60s, of concrete,” she said. “The term for this kind of modern chair might more appropriately be handicraft.” Meanwhile, Los Angeles interior designer Martha Mulholland traces its influences to the rustic modern Scandinavian simplicity of Axel Einhar Hjorth and 18th-century Tyrolean furniture. (The Future Perfect, a retailer of collectible pieces, labels its examples above as such.) “The beauty of the design is in the simplicity of seeing the wood grain and joinery detail,” said Ms. Mulholland. She prefers to classify the seats as European Primitive Modern: “I would say the chair is more primitive than brutal, but it’s a matter of semantics.”

At Chairish, a reseller of vintage design where interest in the terms “brutalist” and “wabi-sabi” are building, Noel Fahden Briceño, vice president of merchandising, says European dealers first applied the term. Although the name is being used loosely, she said, “when dealers started titling these chairs ‘brutalist,’ I said, OK, I can see that.”

Whatever you want to call the seats, designers are embracing the little brutes because they are unexpected. “I like that they feel unrecognisable,” said Ms. Caillier. “So many chairs have become trendy and overused, but it’s hard to find the same one of these chairs more than once.”

The design is also proving quite versatile. “There is a boldness and sharp sculptural quality to them, and they can hold their own in any room because they are simple,” said Ms. Mulholland. “They can cover a lot of ground aesthetically.” She recently used a couple of primitive three-legged walnut chairs underneath the living room windows of a home in Los Angeles’s Lafayette Square. The historic Craftsman home boasts its original unpainted mahogany woodwork. “I was playing into that masculinity,” she said, “but I also liked the contrast of putting the chair up against a pink velvet drape.”

The chairs’ roughness tends to clash intriguingly with softer, more feminine elements like that. This visual dissonance has helped fuel their popularity. “You can use one chair as an accent piece, even if the rest of the room is refined,” said Ms. Fahden Briceño.

Ms. Ursino says these chairs are not known for their coziness and may need a little help—she upholstered the seats of brutalist chairs she set around a game table to boost their comfort. Other designers are stationing them around meal tables, however. Los Angeles interior designer Lauren Piscione placed eight barrel-backed examples in a dining room, their rugged homeyness contributing to the calm of the space.

In a Tudor revival by Seattle interior designer Lisa Staton, a family of five pulls up oak versions made in the Netherlands in the 1970s. A depression in the seat makes them quite comfortable, said Akash Niranjan, the father in the household. “We work from home three days a week and often find ourselves sitting at the dining room table for long stretches and have not had any issues,” he said. “Our three young kids like them as well.”

Indoor or Outdoor Dining? With These Hybrid Spaces, You Don’t Have to Choose

When building his Sonoma, Calif., home, Mukesh Patel had a request: He wanted a simple way to enjoy farm-to-table meals. He meant it literally.

Mr. Patel had purchased a 100-acre lot with his wife, Harsha Patel, 59, for $5.7 million in 2016 that included a small fruit and vegetable farm. He then worked with architect Christie Tyreus to construct a 2,100-square-foot, two-bedroom home for $3 million.

The home features a glass-enclosed kitchen-dining room with exterior pocket doors that open up on two sides to make it easy to walk from the terrace to pick fresh food: tomatoes, avocados, lettuce. The other side of the dining area leads to the living room. “You pick, you cook, then you eat—it’s a smooth transition,” says Mr. Patel, 64, a technology executive. The two moved into the new house from Pleasanton in 2020 but kept their Pleasanton house as a secondary home.

Homeowners are rethinking their indoor dining setups, replacing formal, enclosed rooms with elaborate spaces that give the feel of dining al fresco, with the option to be protected from the elements.

The interior designs also offer greater access to the kitchen, by direct proximity or by combining the cooking and dining areas in an open plan. At the same time, architects are being asked to make the most of killer views, installing automated glass doors and screens to create a seamless transition with the exterior.

 

“This is as close to dining outside you can get without being outside,” says Paul Masi, principal of Bates Masi + Architects, an East Hampton, N.Y., architecture firm.

Recently, a dining area Mr. Masi designed included two dining-room tables next to each other, with one indoors and the other outdoors. When the homeowners entertain in good weather, they can open the pocket doors to double the room space. Insect screens make it comfortable to eat even at dusk. Wide-plank Ipe wood floors outside mimic the wood floors indoors, and an oak wood ceiling stretches between the indoor and outdoor spaces to create a uniform look.

Another project includes a dining area that opens directly to the outside via two sides of glass doors, with pocket doors separating the space from the kitchen.

“There is nothing abrupt that changes from the interior to the exterior,” says Mr. Masi. Creating these hybrid dining spaces means there are fewer requests for separate outdoor kitchen and eating areas, especially in colder climates, he adds.

After purchasing a Manhattan Beach, Calif., home for $8.5 million in 2019, Michael Mothner, 41, wanted a dining room the family was “actually going to use.”

During a 2½-year renovation, Mr. Mothner created a formal dining space that borders an upstairs living room and kitchen, and opens up to a private terrace with a view over the family pool and the ocean. The indoor-outdoor setup makes it easier to host family dinners that are casual but not like a picnic. “We wanted something that doesn’t feel super formal and is going to be functional,” says the digital-marketing agency founder.

Wendy Word, an interior designer who worked with Mr. Mothner and his wife, Savanna Mothner, says she was able to extend meals from the dining room to the outside by making the table and the rug easy to position partially outdoors. Another dining table is outside on a covered terrace. “They want to be able to gather spontaneously and be able to use the outdoor footprint,” Ms. Word says.

With open floor plans, setting off the dining room while making it conveniently close to the kitchen is a challenge, says Ms. Tyreus, who worked with Mr. Patel.

Instead of creating a separate space, Ms. Tyreus added three kitchen islands. The island bordering the dining area has a decorative sintered stone facade, making the dining space more like a sleek bar area. Kitchen islands farther away include hidden refrigerator drawers and underneath storage. “When in the dining room, [the counter] looks like this beautiful stone block,” she says.

Los Angeles real-estate agent Rayni Williams says luxury homeowners pay a premium for dining rooms that blend into separate spaces. She sees dining areas that are separated by a wall of art, or another dividing element, from the main living area, providing easy access to the exterior and to the kitchen.

The idea is to create an eating area that gives priority to exterior views. “They know that’s the real money shot—that’s the way to maximise the dollar,” she adds.

Ms. Williams and her husband, Branden, are representing off market a $48 million home in Los Angeles that has nearly 7,000-square feet of outdoor space and a dining area with a large glass wall that can retract vertically to open to the exterior. The dining table inside the home is on wheels to make it easy to relocate throughout the area, including to a spot near an outdoor fireplace, she says.

Even in colder climates, homeowners are finding creative ways to craft scenic indoor-outdoor dining spots. After buying a vacation home for $765,000 in Hyde Park, N.Y., in 2021, Thorsten Hayer, 42, was thrilled to use what he calls a fancy garage as a dining area that opens to the exterior through two sets of barn doors. With a dining table and bar, the exterior room allows him to entertain while enjoying the outdoors.

The main home, built in 1876, has a formal dining area, but the family eats dinners mainly in the outside space. When the doors are open, it feels like they are dining in the garden. “It’s a nice progression from grilling a hot dog on the fire pit and going into a garage space,” he adds.

The best coffee tables to get you through summer

Choosing a coffee table is harder than it looks. More likely to take the same beating as your dining table, it needs to serve its purpose as everything from a footstool and impromptu table to keeper of the remote controls and, well, coffee table books. As a focal point in your living room, it has to complement your lounge in style and materiality, as well as working with the shape and size of your room, all without compromising functionality. Nothing to it, right?

To get you started, we’ve assembled our top six coffee tables. They’re a diverse range, from well known (and not so well known) classics, to space savvy, contemporary solutions versatile enough to suit any living room style.

Noguchi Coffee Table

Japanese American designer Isamu Noguchi took his inspiration from nature to create this classic coffee table from Vitra using just three elements to create a perfectly balanced structure. It has never gone out of style since it was released in 1944, $4,760 from Living Edge

Rondo Pouffe Table

This clever design, which allows for three perfectly sized pouffe seat to store below is from Adelaide based TH Brown, legendary mid century Australian designers and manufacturers. The Rondo Pouffe table was only re-released last year and is $2,500, including glass top from TH Brown

 

Nakashima table

 

Another re-release, the Nakashima table designed in the 1940s by George Nakashima, has splayed tapered legs to give this table from Knoll a modernist edge, $8,110 from dedece

Drop Leaf SideTable

A little short on space? No problem. The design of the drop leaf side table by Hvidt & Mølgaard, the latest designers to join the fold at &Tradition, allows it to be folded up when not in use. Released in 1956, it’s refined form makes it ideal for apartments, as a side table or any small space where a stylish table would look at home, from $3,630 from Cult

Artie Wave table

Looking to anchor your living space? This solid table could be just what the designer ordered. Suitable for use inside or out, the curved lines of the versatile Artie Wave table soften its heavyweight status, $2,875 from GlobeWest,

Wild Child table

Transparent furniture is useful in smaller spaces where a larger table might feel too oppressive. Ditch the clear glass options with the Wild Child table, made from holographic acrylic in rainbow colours, $750 from Fenton&Fenton,

New data reveals record yields in Australian rental markets in 2022

The Australian rental market achieved record growth over 2022 as yields go from strength to strength, CoreLogic reports.

While CoreLogic’s Quarterly Rental Review for Q4 2022 showed a slowdown in the pace of growth for the second consecutive month in December last year, rentals experienced a record 10.2 percent increase over the year. 

The December results are just the latest markers of a rental yield upswing, which has seen values rise 22.2 percent since September 2020, the largest upswing on record. It has taken the national median weekly rent valuation from $430 to $519.

Author of the report and CoreLogic head of research, Eliza Owen, said December figures revealed a 2 percent increase, down from a 2.3 percent increase in the September quarter, coinciding with a lift in the rental vacancy rate to 1.17 percent.
“The decline in quarterly rental growth rates observed in the December quarter was led by the capital cities where rents continued to increase but at a slightly slower rate than they have done in September and June quarters,” she said. 

In the capital cities, Canberra still holds the top position as Australia’s most expensive city to rent, with a median weekly rental value of $681, edging out Sydney at $679 per week, followed by Darwin at $579 per week.

At the other end of the scale, Melbourne maintains the title of Australia’s most affordable rental capital at $507 per week, followed by Adelaide on $518, Hobart on $552, Perth at $553 and Brisbane at $588.

Ms Owen points to shifts in migration patterns in recent years to explain the disparity between the country’s largest capitals and Canberra, which reveal a weakening trend for new arrivals in Canberra compared with Sydney and Melbourne.

​“Unlike Canberra, high levels of net overseas migration to NSW and Victoria has vastly offset negative net internal migration flows in the year to June 2022,” Ms Owen said. “Prior to the pandemic, Sydney and Melbourne alone accounted for around two thirds of net overseas arrivals, with high density city centres being among the most popular destinations. This has likely contributed to unprecedented annual growth in unit rents over 2022, which was 15.5 percent  across Sydney and 14.2 percent in Melbourne.” 

Best Stock-Fund Managers of 2022

Well at least it wasn’t as dreadful as the Great Depression. Or even the financial crisis of 2008.

But for any mutual-fund manager trying to cope with the sea of red ink that flooded financial markets in 2022, that’s meagre consolation. In a year when soaring interest rates and sky-high inflation left the S&P 500 index with a 19% loss and triggered an even worse year for the bond market, an estimated $8.2 trillion of stock-market wealth in the U.S. simply evaporated.

Even most of those value- and income-focused mutual-fund managers who “outperformed” the broad index did so by confining their losses to the single digits—little comfort for investors.

Indeed, of the 1,410 actively managed mutual funds that met the criteria for inclusion in the Winners’ Circle, The Wall Street Journal’s quarterly survey of top-performing stock managers on a 12-month basis, a mere 40 wrapped up 2022 in positive territory. The average loss for the whole group, according to data provided by Morningstar Direct, was 18.2%.

To outperform in 2022 required a fund’s manager to have taken outsize positions in the energy sector—the only one of the 10 industries that make up the S&P 500 to record a gain in 2022. In fact, the magnitude of the rally in energy resulted in the sector coming within a whisker of doubling in its weight within that large-cap market index, hitting 5.23%.

And energy bets were what powered three Kinetics funds to top positions in the Winners’ Circle—not only the winning fund, but the runner-up and the No. 4 finisher.

 

“It seems as if we’re always a contrarian, but recently that has been working for us,” says James Davolos, a portfolio manager at Horizon Kinetics LLC, who serves on the investment committee for the three Kinetics funds. Between 30% and 60% of the assets of No. 1 fund Kinetics Small Cap Opportunities Fund (KSCOX), runner-up Kinetics Paradigm Fund (WWNPX) and No. 4 finisher Kinetics Market Opportunities Fund (KMKNX) were invested in energy-related holdings over the course of 2022, he says.

Kinetics Small Cap took home the crown with its 31.9% gain. The Paradigm fund gained 29.2%, and Market Opportunities gained nearly 15%.

Contest requirements

To qualify for inclusion in this Winners’ Circle survey, funds must be actively managed U.S.-stock funds with more than $50 million in assets and a record of three years or more, as well as meet a handful of other criteria. The survey excludes index and sector funds, funds that employ leverage strategies and most quantitative funds. The results are calculated by Morningstar Direct.

Important to note: These are stock funds that outperformed in specific market environments, and may have elements that make them unsuitable for some investors, ranging from their fee structure to their longer-term performance or volatility.

Mr. Davolos says he has no plans to abandon his highly concentrated and contrarian investment approach with the dawn of a new calendar year.

“The world isn’t going to quickly revert back to the way it was in 2018 or 2019,” he says. “We think we’re in the early stages of a transition to a five- or seven-year transition period. We were positioned for that in areas like energy and other hard assets that we thought would be more resilient. And we believe that most businesses will continue to face a difficult operating environment and a compression in their profit margins.”

That’s why Mr. Davolos and his team have designed the Kinetics portfolios to have hefty overweight positions in companies and industries that he believes will be able to demonstrate more-resilient profit margins. Energy royalty companies—and especially Texas Pacific Land Corp., which represented anywhere from 50.9% of assets in the Market Opportunities Fund to as much as 64.8% of the Paradigm fund’s holdings—will remain a focus, he says. Texas Pacific is one of the biggest landowners in Texas and funnels oil-and-gas royalties that it earns from those drilling on its land directly to investors.

But Mr. Davolos is also looking for opportunities to invest in other areas he believes will be equally robust in face of economic headwinds, whose stocks don’t reflect that potential.

One sector that he finds of particular interest is precious metals, and once again, he’s emphasising royalty income as a way to profit from what he sees as strong fundamentals for the sector with lower risk.

“Gold, in particular, is likely to do well in a period of draconian risk aversion and higher or rising interest rates, as people look for a store of value,” says Mr. Davolos. He also expects precious metals to respond positively to any geopolitical shocks or uncertainty, just as energy did in 2022. But he prefers to avoid exploration and production companies and the cyclicality and risk inherent in the profit cycle of these businesses, and instead looks to companies like Franco-Nevada Corp., another royalty play. “Streams of royalty income are more predictable and rewarding,” he insists.

While none of the top-performing Kinetics funds could be described as being diversified, Mr. Davolos also is keeping an eye open for opportunities to add other inflation-resistant, value-priced securities to these portfolios. For instance, noting that “government contracts are likely to be immune to inflation,” he has established and built on positions in CACI International Inc., a defence contractor that emphasises communications, cybersecurity and other technology services. He also likes Brookfield Asset Management as a way to indirectly profit from government spending on infrastructure, and has hung on to holdings in financial exchanges like CME Group Inc. and Intercontinental Exchange Inc. “Any company that provides an intermediary service—connecting two counterparties that are trying to manage their own risks—will remain critical” to the economy, he argues.

A faithful finish

Unsurprisingly, other top-performing managers in the 2022 year-end Winners’ Circle also beat the odds and triumphed by bucking conventional wisdom.

The year’s third-place finisher is one of the smallest funds in the survey. Schwartz Value Focused Fund (RCMFX) may have only $51.7 million in assets, but it turned in an impressive return for its investors, wrapping up the year with a 21.2% gain. And the fund is managed by Schwartz Investment Counsel in Plymouth, Mich., which oversees a universe of other portfolios, including Ave Maria Value Fund (AVEMX), the Catholic-values fund that ended the year with a 4.2% advance, putting it in 11th place in our survey.

 

Both funds are overseen by a team headed by George Schwartz, the founder, chairman and CEO of Schwartz Investment Counsel. He and son Tim, the firm’s chief investment officer, began adding energy stocks to Schwartz Value a few years ago, just as the pressure on pension funds and other mutual funds to divest their fossil-fuel holdings began to take effect.

“Our focus is on buying out-of-favour stocks when they are cheap, and when we believe they have a great recovery potential,” the elder Mr. Schwartz says. “When the energy sector had gotten so depressed it was ridiculous, we bought those stocks aggressively.” By the end of 2022, 41% of Schwartz Value’s assets were invested in an array of energy companies. “That decision has been a big boon for us,” he says.

Like Mr. Davolos, Mr. Schwartz is a fan of Texas Pacific Land, by far the fund’s single largest holding at 27.6% of fund assets. But he adopts a more, ahem, catholic (as in “all encompassing”) approach to energy investing, allocating capital to major global integrated producers and refiners like Chevron Corp., exploration-and-production companies such as Devon Energy Corp. and service companies like Schlumberger NV.

A Yeti fan

And he, too, is casting a (slightly) wider net. While hanging on to precious metals investments (Franco-Nevada and producer Barrick Gold) and what he sees as core value holdings in Berkshire Hathaway, last year Mr. Schwartz added new positions in an array of specialty manufacturing companies like A.O. Smith Corp. (water treatment and heating) and Yeti Holdings Inc. (drink coolers, drinkware and related gear). One of his largest new holdings is in RH, formerly known as Restoration Hardware, the specialty retailer of luxury furniture. “We like companies that are out of the mainstream,” he says, adding that RH shares now change hands for 15% more than the average price Schwartz Counsel paid to establish its position starting in September 2022.

 

Scott Barbee, manager of the No. 5 fund in the Winners’ Circle, Aegis Value Fund (AVALX), echoes his fellow outperformers in crediting the energy sector with his portfolio’s 2022 return of 10.5%.

“Back in the early stages of the pandemic, when investors were flocking to the big-name technology stocks, energy stood out like a sore thumb,” he says. Selling pressure from sustainable-investing funds and others trying to avoid fossil fuels “frightened everyone away from the sector.” But Mr. Barbee, who seeks out cyclically depressed businesses that he believes are poised for a rebound, opted to invest in the sector beginning in early 2021. “They were trading cheaply, they had long-lived asset bases, and their balance sheets are in amazing condition,” he says. The latter consideration became particularly important as interest rates began to soar last year; companies with lower debt levels remain insulated from this source of pressure.

By the end of 2022, Aegis Value had 37% of its assets invested in the fossil-fuels area, in holdings ranging from coal producer Hallador Energy Co., to International Petroleum Corp. and Akita Drilling Ltd.

“The tailwinds for this sector are likely to be with us for some time,” Mr. Barbee says. But he’s taking some of his energy holdings off the table, and redeploying that capital into other sectors. He added to the fund’s exposure to the metals mining industry (its largest position has been copper giant Amerigo Resources Ltd.) and boosted its stake in precious metals by investing in Centerra Gold Inc.—adding to a list of gold producers that already included Orezone Gold Corp. and Equinox Gold Corp. “This is another neglected corner of the market, and we believe our holdings will do well at current gold prices and phenomenally if gold goes higher” in response to inflation and interest-rate trends, he says.

None of the top-performing managers of 2022 voiced much optimism about the likelihood of seeing a broad market recovery in 2023.

“How much will be needed to bring inflation under control?” says Mr. Barbee, referring to the prospect of further interest-rate increases. “That’s why we emphasise companies with strong balance sheets, since they’re more likely to get through whatever we’ve got coming.”

Top Office Owners Don’t Want to Own Only Office Buildings Anymore

Many of the most prominent office developers in the U.S. are shifting gears, looking to buy or build real estate that isn’t office.

Boston Properties Inc. is planning to develop 2,000 residential units up and down the East Coast. The firm, which owns more U.S. office space than any other publicly traded company, also is developing millions of square feet of lab and life-science space.

New York office owner SL Green Realty Corp is teaming up with Caesars Entertainment Inc. in a bid to convert a Times Square office tower into a casino.

Even the companies behind some of the world’s most glamorous skyscrapers are seeking out other types of real estate. Empire State Realty Trust, owner of the Empire State Building and other office towers, late in 2021 started adding multifamily properties to its portfolio for the first time. Silverstein Properties, best known for developing the World Trade Center in lower Manhattan, is raising a $1.5 billion fund for converting obsolete office buildings into apartments.

The efforts come as the Covid-19 pandemic and rise of remote work have reordered American habits around the workplace, dimming the importance of office towers that populate city business districts. Shares of publicly traded office owners have broadly declined as investors and analysts worry that the companies’ growth prospects have been hurt by the likelihood of a long-term decline in office demand.

The U.S. office vacancy rate was 12.3% at the end of the third quarter, about where it was at its peak during the global financial crisis, according to data firm CoStar Group Inc. The rates in some major metro areas—including New York, Washington, D.C. and San Francisco—are at the highest levels that CoStar has recorded in more than two decades of tracking this data.

Corporate tenants are flooding the sublease market with office space, the main way to reduce their footprint before their leases expire. About 211.8 million square feet of sublease space is now available, nearly double the amount available compared with the end of 2019, and the highest ever recorded for major office markets, CoStar said.

Companies are also putting off searches for new space as they brace themselves for a possible economic downturn in 2023. New business searches for office space fell in 2022 to 44% of what they were in 2018 and 2019, according to VTS, a firm that operates a data platform that tracks tenant demand.

Other real-estate sectors, especially residential, seem to offer more promise.

“Office is in a state of flux these days,” said Rich Gottlieb, president of Keystone Development + Investment, a West Conshohocken, Pa.-based developer specialising in offices that has four residential projects in the pipeline in South Florida and the Philadelphia region. “But there’s still a housing shortage out there.”

Office developers pivoting toward residential or other property types say they remain bullish on the office business. Many have predicted throughout the pandemic that businesses will return in greater numbers because, they have said, the best collaboration requires face-to-face meetings in a workspace—not over Zoom.

And more recently, office owners can point to encouraging signs, including the growing number of employers who are ordering workers back to the offices and the strong demand for space with the best facilities and locations.

But developing state-of-the art office space requires an enormous capital investment to meet workers’ desire for the highest possible air quality, energy efficiency and amenities.

The economics of the residential business are currently more compelling, said Tony Malkin, chief executive of Empire State Realty Trust. He would still buy office buildings at the right price. But apartment-building acquisitions produce an immediate return and require “minimal capital expenditure,” he added.

An office landlord known as New York City REIT, whose share price has fallen below $2 during the city’s recent office slump, said it was moving beyond a focus on New York office buildings, according to a December filing with the Securities and Exchange Commission. The company said it would seek to acquire hotels and parking lots, among other non-office investments.

The shift away from new office development already is having a moderating impact on new construction. About 153 million square feet of office construction was under way in the third quarter of 2022, down from 184 million in the first quarter of 2020, according to CoStar.

Meanwhile the popularity of residential projects is having the opposite effect on the apartment pipeline. Close to 500,000 units—the most since 1986—are expected to be completed in 2023, according to a CoStar estimate. That is up from 368,000 in 2019, the firm said.

Some office developers began expanding into residential projects in the years leading up to the pandemic. AmTrust Realty Corp., which has a portfolio of about 12 million square feet of office space in Chicago, New York, Toledo, Ohio and other markets, completed its first residential development in 2020, a 270-unit project in Brooklyn.

The pandemic intensified AmTrust’s appetite to do more residential investment, said Jonathan Bennett, president of the family-controlled business. As one example, he noted that AmTrust has owned for years an office building in Tarrytown, N.Y., on a 7-acre site facing the Hudson River.

AmTrust has long considered the building a good candidate for residential conversion. Now, with the Tarrytown building’s vacancy rate high, the company is moving ahead with planning and obtaining local-government approvals for a development with scores of apartments.

“There was so much vacancy in the building, I said to my board, there will be no better time for us to put forward this plan,” Mr. Bennett said. “If this is what you want to do, this is the time to do it.”

How to prepare your property for sale in a trade shortage

Preparing a home for sale has never been more challenging. A construction crisis means materials and trades are pricier and harder to come by so renovation budgets and timelines are blowing out. Trade portal hipages.com.au recently reported that 85 percent of tradespeople on their site have had to raise their rates this year as timber and metal prices soar in the wake of a global supply chain crisis, coupled with a scarcity of skilled labour and trades.

CoreLogic’s Cordell Construction Cost Index revealed that building expenses increased 9 percent over the 12 months to March, the highest annual growth rate since the introduction of the GST in 2001.

Property stylist Justine Wilson of Vault Interiors says mammoth renovations should be shelved for sellers on a tight timeline right now.

“Almost across the board, everything from materials to furniture is taking longer to source,” she says. “What used to be a one-month lead time is turning into 14, 16 or sometimes 24 weeks. 

It’s doubling or tripling the standard time and that has a flow on effect for anyone trying to renovate for sale, she says, but there are multiple fixes vendors can undertake to add value quickly.

“See what you can do on a cosmetic level before knocking out walls and attempting things that are going to need trades,” Wilson says. “You can give your place a facelift with styling or a fresh coat of paint rather than structural changes.”

Read more stories like this in the launch edition of Kanebridge Quarterly magazine. Order your copy or subscribe here

Refresh your strongest selling points

While the old adage says kitchens sell houses, Justine Wilson says vendors needn’t install a new one.

“Kitchens and bathrooms will always entice buyers so have them looking as fresh as possible. If you can’t order a whole new kitchen then use laminate paint to update cupboards, change out door hardware and consider peel and stick tile options to modernise really dated splashbacks. You could also swap out older benchtops and choose a laminate or Caesarstone top because they seem to be in ample supply at the moment.”

Home offices are also an asset in a post-pandemic marketplace.

“Whether it’s a nook under the stairs or a self-contained study it will appeal to buyers because people want an office or media zone separate to the rest of their family,” Wilson says. “You can get freestanding prefab pods, convert a garage, or garden shed rather than going through the expensive and long process of getting something approved and built.”

Take it outside

According to the recent Great Australian Backyard survey by Adbri Masonry, 80 percent of respondents said an entertaining space out back plays an important, or very important, part in decision making when buying a property.

“The outdoor dining and entertaining area is a staple for every Aussie home because it adds a new dimension to how you can entertain while enhancing the appeal of your home,” says landscaping expert and Adbri Masonry brand ambassador, Jason Hodges.

Since timber and carpenters are hard to come by, he suggests refreshing your outdoor area with pavers with a high pressure hose down.

“If you have a paved or decked area, you can give it a clean to inject new life,” he says. “If you’re starting with a blank canvas, consider creating your own aesthetic with a small format paver such as Havenbrick, which allows you to create different patterns with a variety of colour tones to choose from. Also, adding a cosy fire pit as part of your outdoor entertaining area means your space becomes usable all year round.”

A veggie patch can also add to the family-friendly nature of a home, as can embracing a wellbeing element, like a meditation space.

“The beauty of the backyard is its diversity,” Hodges says. “With a little effort and a dash of creativity it can be transformed into the space which is right for you, be it a Zen garden or sleek entertaining area. It’s yours to define. Plus, it can reap financial rewards when selling.”

Invest in styling for maximum ROI

Staging a home for sale is a quick, temporary fix which often means you can avoid the wait for trades. Stylists like Justine Wilson have warehouses of items ready to go so a tired listing can be revived within days rather than weeks or months.

“Styling adds value when you’re presenting your home for sale and can completely uplift a property without any renovation,” she says. “If you can’t redo your kitchen or bathroom then look at putting that money into the best presentation possible,” she says.

Window dressings like these custom made blinds from Tuiss can be ordered online and are suitable for DIY installation

 

Homeowners can start by making sure the house is neat and decluttered, the carpet is steam cleaned and windows are washed. Even the smell of the home has proven to help with the sale. A study by UK-based real estate agent comparison site GetAgent revealed which scents sell homes. Top aromas included freshly baked bread (with 37 percent of respondents claiming it would entice them to buy), followed by fresh linen (36 per cent), freshly brewed coffee (27 per cent), new carpet and freshly cut grass (both 25 percent).

“You could go a step further and have your home professionally staged so that it stands out online,” Wilson says. “We’ve seen anywhere from a 5 percent to 20 percent increase in the sale price after presenting a home well.” 

She says to view styling not so much as an expense, but more of an investment. 

“By presenting the space correctly, with the right flow, function, and scale of furniture, it can help buyers who have trouble visualising its potential.”

Noma, One of the World’s Top-Rated Restaurants, Is Closing Its Doors

Noma, the Danish restaurant considered one of the best in the world, said Monday that it would close its doors next year and reopen as a test kitchen.

“To continue being noma, we must change,” Noma’s owner René Redzepi said on the restaurant’s website, without elaborating why the restaurant was closing to regular service in the winter of 2024.

Restaurants have struggled during the pandemic to cope with mounting food costs and diners staying home. Fine-dining establishments in particular have had trouble hawking expensive menus to patrons. At Noma, a meal currently costs at least $500 a person.

Mr. Redzepi said that starting in 2025, Noma would become a test kitchen and would sell products online. He said Noma would also have pop-ups around the world.

“Serving guests will always be a part of who we are, but being a restaurant will no longer define us,” he said.

He said on Instagram Monday that he and his team had planned the move for the last two years.

“It’s scary and weird but I also know it’s the right thing to do,” he said. “As soon as the pandemic hit I had this feeling in me that it was time for something different.”

He said he was on a plane bound for Kyoto, Japan, where Noma was set to open a pop-up restaurant for two months.

A representative for the restaurant said Mr. Redzepi wasn’t available for comment.

Mr. Redzepi opened Noma in Copenhagen in 2003 and eventually became the crown jewel in a booming food scene. He introduced Nordic food to new audiences and foraged through Danish shorelines and forests for ingredients like herbs and roots. As word spread about Noma’s experimental dishes, it became almost impossible to get a reservation.

After Noma was first named the world’s best restaurant in 2010 on Restaurant magazine’s influential list, it received about 100,000 reservation requests a month for its 40-seat dining space. It was named the world’s best restaurant again four more times. The restaurant has three Michelin stars.

Noma led Copenhagen’s reinvention as a fine-dining destination, drawing talented chefs and real-estate developers to Denmark’s capital. It also attracts diners who make pilgrimages from all around the world to try its multi-course menus. Noma has served dishes including pork neck with bulrushes and violets and king crab with leeks rolled in ashes.

Noma used to be based in an old warehouse on Copenhagen’s docks before closing in 2016 and reopening at a new location two years later.

Mr. Redzepi said in a 2015 blog post that he had been a bully and a terrible boss at times because he was under pressure. He said he would yell at employees over messing up dishes for journalists or overcooking fish. He said as a result that he had changed Noma’s culture to boost staff morale.

When Having It All Means It’s All Falling Apart

The first message, received while I was at the office one day last month, drowning in work, informed me that my daughter had lice. The second confirmed my son had it, too.

The third, which came as my deadline was approaching and I was feeling phantom itchiness on my scalp, announced that my son’s wonderful kindergarten teacher had quit the week before and was never coming back.

I felt like I’d been cast in an adult version of “Alexander and the Terrible, Horrible, No Good, Very Bad Day.” Everything—work, life, parasites—had collided. In addition to having no idea which crisis to tackle first, I questioned how I’d gotten there in the first place.

Sometimes there is a fine line between having it all and it’s all falling apart. After a stretch when many of us laboured to be Santa at home and year-end heroes at work, all while facing a tripledemic, we could stand to take a deep breath, shift our perspective and, when all else fails, laugh at the absurdity of it all.

“On your bad days, when nothing is going right, you go, ‘Oh, my God, I’m a horrible parent. I’m a horrible employee. I’m a horrible wife. I’m a horrible everything,’” says Lilian Tsi Stielstra, a mother of two grown children in Vancouver, Wash. The 58-year-old says she still remembers the morning years ago when she confidently marched into her office in her brand-new black power suit only to realise it was adorned with a blob of her one-year-old’s snot.

One lawyer and mother of four in Pennsylvania told me she’d once dropped her child off at soccer practice, then figured out, in the blur of juggling back-to-back calls, she’d dropped the wrong child. A nonprofit executive mistakenly threw the plastic bag containing his homemade lunch in the trash and commuted to the office cluelessly clutching a bag filled with cat poop. One tech leader recounted to me the time she received a text message while stationed in a glass conference room in her bustling office. It was her fiancé, breaking up with her.

Some tales of work-life clash are grisly, like presenting to a client in Chicago still bloodied from fresh dental work. Some are eventually funny, like when your child bursts into a research meeting of scientists to announce his pet lizards are having sex.

Navigating our different responsibilities and identities has never been easy. These days, it’s compounded by our current stew of illnesses, corporate chaos and the pressure on parents to make up for everything kids lost during the pandemic.

“It’s all colliding,” says Lisa Duerre, who spent a day last August dealing with an ailing sibling, an anxious child, a crucial client pitch and a dog who decided right then was a good time to get sick all over the carpet.

The chief executive of RLD Group, which advises tech companies on culture, Ms. Duerre recently had a coaching client kick off a session by placing her forehead down on the desk, overwhelmed by caring for a parent with dementia while dealing with a corporate reorganisation.

For those in the throes of acute work-life tensions, Ms. Duerre recommends first pausing. Take three deep breaths. Notice how you’re feeling—are you screaming “Just cancel everything!” in your head? Are your shoulders scrunched up near your ears? Tell yourself you’re just going to choose the next right action, and the next, one at a time. Ask yourself what’s most important to do right now, and then ask for help where you need it.

Go to a peer first if you can, she says, so you’re not constantly sounding alarms to your boss. When you do approach your manager with a problem, bring some possible solutions rather than plaintive queries. The paediatrician only has an appointment during the client meeting; would you prefer I call in from the parking lot there or send someone else to the meeting in my place?

Messy days, and tragic and scary moments too, are part of having a full life. Shouldering many roles, from dad to dog owner to team leader, makes us happier, says Yael Schonbrun, a clinical psychologist and assistant professor at Brown University, though it can also make some situations harder.

“When we have a life that has a lot of meaning and purpose, it’s often quite uncomfortable,” she says.

See if you can find the silver linings in your busy, complicated days. For example, limited time can force us to be more focused and present, says Dr. Schonbrun, the author of a book about how working parents can manage feeling overwhelmed. Stepping away from work to see our kids or tend to another responsibility can breed bursts of creativity.

When our lives are bigger, a loss or challenge in one area often doesn’t hit as hard.

“Even though I might run at a higher anxiety and higher stress, I don’t run lonely,” reasons Shelley Nelson, who juggles two kids and a job at a financial-technology company. She hit a run of bad luck starting in late 2021, breaking her hand right as she was starting a new job, leaving her with one for typing. Then came pinkeye, a flat tire that made her late for a meeting where she was to meet her new executives, Covid-19 infections for nearly the whole family and the death of her husband’s grandmother.

“I was, like, this is not who I am,” she says of all the accommodations she had to request from her new manager, from extra work-from-home days to time off.

She laughed to keep from crying. She wished she could do better, at everything. But she told herself she was managing as well as she could, and found the bad days built resilience.

I did, too. When the woman at the lice-treatment centre examined my hair and assured me that good moms get lice, I took the diagnosis as proof of my hands-on parenting. When my son came down with a mystery fever the following week, I cherished the extra cuddles on the couch. By the time my daughter was hit with a stomach bug on Christmas Eve, just as my editor was texting me about a column, I was less fazed by it all.

Nothing seemed to be going as planned, but it still felt like a privilege to have so many things I loved, constantly colliding with each other.

Australian home value declines hit record lows

Australian home values have hit a record low, data from CoreLogic has just revealed.

The CoreLogic Daily Home Value Index showed a -8.4 percent decline on January 7 after a high on May 7 2022, exceeding the previous record of peak-to-trough declines of -8.38 percent between October 2017 and June 2019.

Australian homeowners may be in for further declines, with more falls expected.

CoreLogic says last year’s consecutive rate rises following on from a 300 basis point increase in the cash rate are responsible for the sharp fall as borrowers struggle to finance home purchases.

The Reserve Bank of Australia has increased the cash rate in an attempt to draw down inflation in 2023.

Increasing strain on households, CoreLogic notes that right now Australians are carrying more debt than through historic periods of rate rises. In addition, post lockdown spending and higher inflationary pressures may have resulted in less household savings which could be used as a home deposit.

The three largest capitals have experienced the greatest falls, with Sydney seeing a peak-to-trough decline of -13 percent, followed by Brisbane on -10 percent and Melbourne at -8.6 percent. To put the falls in perspective, the significant drops follow an unprecedented national home value rise of 28.9 percent between September 2020 and May 2022. At the end of last year, CoreLogic data shows that home values were still 16 percent higher than they were five years ago.

Larry Ellison, Ken Griffin and Other Rich Buyers Kept the Luxury Market ‘Separated From Reality’ in 2022

The luxury real-estate market may have returned to earth slightly in 2022 following a whirlwind pandemic-induced free-for-all in 2021. Still, some of the country’s richest buyers managed to log big-ticket deals.

There were at least seven deals closed for $100 million or more in 2022, down from the eight closed the prior year, according to data from appraisal firm Miller Samuel and The Wall Street Journal’s reporting. In total, there were 44 sales across the U.S. closed for $50 million or more. While that’s down from 48 in 2021, it’s still the second highest total on record and a significant uptick from the 23 recorded in pre pandemic 2019, according to Miller Samuel’s Jonathan Miller.

The flurry of major transactions, despite a general normalisation of the broader market, rising interest rates and recession jitters, shows that, at the very highest end, the ultra luxury market “is separated from reality,” Mr. Miller said. “It has nothing to do with the normal housing market.”

Read on for a closer look at some of the year’s biggest deals, which were concentrated in three states, New York, California and Florida.

1. The Gemini estate in Manalapan, Fla.

Buyer: Oracle‘s Larry Ellison

Seller: Netscape’s Jim Clark

Sold: $173 million

Listed: Off-market deal

Oracle co-founder Larry Ellison is known for his expensive taste in real estate, the tech billionaire owns a swath of homes in trophy property markets like Malibu, Lake Tahoe, in Silicon Valley and on the Hawaiian island of Lanai. It was no surprise then that Mr. Ellison topped the list of 2022’s largest residential deals with his record-setting $173 million June purchase of an oceanfront estate near Palm Beach. The deal is the largest ever closed in the state of Florida.

The deal was also evidence of how the Palm Beach ultra luxury market continued to escalate in value, even as pandemic restrictions began to wind down. Mr. Ellison purchased the property from another billionaire, internet entrepreneur and Netscape co-founder Jim Clark, who purchased it for $94.2 million in 2021.

Known as Gemini, the roughly 16-acre property was long owned by the Ziff publishing family. It is on a barrier island in Manalapan and has about 1,200 feet of ocean frontage and around 1,300 feet on the Intracoastal Waterway. There are several structures, including a 62,200-square-foot main residence and a seven-bedroom guesthouse. The structures are connected via tunnels that run underneath a road that cuts through the estate.

Lawrence Moens of Lawrence A. Moens Associates brokered the deal.

2. The One estate in Los Angeles

Buyer: Fashion Nova’s Richard Saghian

Seller: DeveloperNile Niami

Sold: $126 million

Listed: Auctioned off with no reserve; outstanding debts on the property totalled $190 million

The $126 million sale of a Bel-Air estate known as The One in March marked the end of a nearly decade-long saga that had captivated the Los Angeles real-estate community. Once slated to list for an asking price of $500 million, the property eventually sold at a no-reserve auction conducted by the company now known as Sotheby’s Concierge Auctions. (The price including the auction premium was $141 million.)

The property was the brainchild of embattled real-estate developer Nile Niami, who ran afoul of his lenders on the project amid cost overruns and eventually put the property into bankruptcy in October 2021. Outstanding debts on the property totalled around $190 million at the time of the auction, records show. The buyer was Richard Saghian, the chief executive of fast-fashion giant Fashion Nova.

The enormous property spans around 105,000 square feet with 20 bedrooms, a 30-car garage, a bowling alley, five swimming pools and a beauty salon.

Rayni and Branden Williams of The Beverly Hills Estates and Aaron Kirman of Compass represented the seller, while the Williamses also represented Mr. Saghian alongside Stuart Vetterick of Hilton & Hyland.

3. A Holmby Hills assemblage in Los Angeles

Buyer: Snap’s Evan Spiegel

Seller: Developer Ian Livingstone

Sold: $119.868 million

Listed: Off-market deal

In July, a company tied to Evan Spiegel, the co-founder and CEO of Snap, closed on the $119.868 million purchase of a Holmby Hills estate in Los Angeles, according to property records and people familiar with the situation.

The property, which sits behind iron gates at the end of a long drive, includes a European villa-style main house with an Olympic-size indoor pool, a spa and massage rooms, as well as an outdoor pool with a waterfall, according to a listing description on the website of listing agents Stephen Resnick and Jonathan Nash, who were formerly of Hilton & Hyland but have since moved to Carolwood Estates. Inside, there is a two-story entry foyer with fireplaces on each end, a step-down living room, a formal dining room and a library and screening room, according to the listing. The seller was a company tied to British developer Ian Livingstone, who tapped developer Max J. Fowles-Pazdro to oversee the project, according to records and a person familiar with the property. Drew Fenton, then of Hilton & Hyland but now with Carolwood, represented the buyer.

Property records show that Mr. Spiegel’s company paid an additional $25 million for the site next door in 2021. Neither Mr. Spiegel nor Mr. Livingstone could be reached for comment.

4. A compound in Watermill, N.Y.

Buyer: Developer Michael Karp

Seller: Apparel executive Arthur Rabin and his son, apparel executive Jason Rabin

Sold: $118.5 million

Listed: Off-market deal

In January, a large estate comprising two separate homes in Watermill traded for $118.5 million in an off-market transaction, marking the biggest Hamptons deal of the year, records show.

The sellers were Arthur Rabin and his son Jason Rabin, records show. Jason Rabin is the CEO of the apparel company Centric Brands. His father was the founder of Wear Me Apparel, which was purchased by Hong Kong-based global consumer goods exporter Li & Fung Limited in 2009. The buyer is Philadelphia real-estate developer Michael Karp, according to two people familiar with the situation.

Information on the property is scarce since it was never formally listed, but aerial images show that it includes two large residences as well as two pools and multiple sports courts. A few months after the sale, Mr. Karp put a piece of the property back on the market for $72 million; that piece includes a 17,000-square-foot house with 21 bedrooms, according to the listing.

Hedgerow Exclusive Properties brokered the deal. Neither the Rabins nor Mr. Karp responded to requests for comment.

5. A historic estate in Coconut Grove, Fla.

Buyer: Citadel’s Ken Griffin

Seller: Philanthropist Adrienne Arsht

Sold: $106.875 million

Listed: $150 million

If Larry Ellison is among the country’s most active acquirers of trophy homes, one of his primary rivals is hedge-fund billionaire and Citadel founder Ken Griffin, who owns some of the most expensive homes in the world. He added an estate in Miami’s Coconut Grove area to that lineup in September, when he purchased an estate for $106.875 million, a Miami-area record. The seller was businesswoman and philanthropist Adrienne Arsht, who put the property on the market for $150 million in January.

The waterfront estate includes two separate homes, totalling 12 bedrooms and about 25,000 square feet. The main residence was built around 2000 by Ms. Arsht, and has a great room for entertaining as well as a formal dining room with seating for up to 20 guests. The second property dates to 1913, when it was constructed for three-time presidential candidate and onetime U.S. Secretary of State William Jennings Bryan. Since purchasing, Mr. Griffin has proposed a potential relocation of the older home on the property to another location, where the public would have access to it for the first time, according to his spokesman.

Ms. Arsht was represented by Ashley Cusack of Berkshire Hathaway HomeServices EWM Realty. Mr. Griffin was represented by Jill Hertzberg of the Jills Zeder Group at Coldwell Banker Realty.

6. A Penthouse in Manhattan

Buyer: Julia Koch

Seller: Estate of Microsoft co-founder Paul Allen

Sold: $101 million

Listed: Off-market deal

In July, the estate of late Microsoft co-founder Paul Allen sold a pair of apartments for $101 million in an off-market deal at a boutique building in Manhattan’s Lenox Hill neighbourhood. The buyer was Julia Koch, the widow of late Koch Industries billionaire David Koch, according to people familiar with the situation.

The sale included the building’s penthouse as well as a second unit on a lower floor. Records show Mr. Allen purchased the penthouse unit for $25 million in 2011, though it wasn’t clear what he had paid for the second unit.

Betsy Messerschmitt of the Corcoran Group represented Mr. Allen’s estate in the deal. Leighton Candler of Corcoran represented Ms. Koch.

7. A Blufftop Property in Malibu, Calif.

Buyer: Media mogul Byron Allen

Seller: Self-storage billionaire Tammy Hughes Gustavson

Sold: $100 million

Listed: $127.5 million

In October, a roughly 11,000-square-foot compound in Malibu’s tony Paradise Cove enclave sold for $100 million to billionaire media mogul Byron Allen, the latest in a line of major real-estate buys by the entrepreneur. The seller was self-storage billionaire Tammy Hughes Gustavson, who put the property on the market for $127.5 million in May.

The Malibu estate, formerly owned by Ms. Gustavson’s late father, B. Wayne Hughes, includes a large four-bedroom residence as well as two guesthouses. There is also a screening room, a dining room and a winding path leading to the beach.

Ms. Gustavson was represented by Jade Mills of Coldwell Banker Realty. Mr. Allen was represented by Terence Hill of BT Equities, an in-house broker with Mr. Allen’s family office.

8. A trio of homes on Golden Beach in Fla.

Buyer: InterSystems’ Phillip Ragon

Seller: Multiple sellers, including fashion photographer Bruce Weber and his wife Nan Bush

Sold: $93 million

Listed: Off-market deal

In June, Phillip Ragon, founder of the technology company InterSystems, paid $93 million for three separate homes on Florida’s Golden Beach, near Miami. The deal set a record for Golden Beach.

Together, the three properties spanned about 1.7 acres with about 275 feet of ocean frontage. Mr. Ragon plans to tear down all three homes and build a new trophy residence on the site, according to people familiar with the situation. The sellers of the homes included fashion photographer Bruce Weber and his wife and collaborator, Nan Bush, records show.

The agents who worked on the deal include Danny Hertzberg and Jon Mann of the Jills Zeder Group at Coldwell Banker Realty as well as Eloy Carmenate and Mick Duchon of the Corcoran Group.

9. A Malibu estate with minigolf

Buyer: Movie producer Edward H. Hamm, Jr.

Seller: British videogame designer Jonathan Burton and his ex-wife, Helen Musk

Sold: $91 million

Listed: $125 million

A 6.6-acre estate in Malibu’s Paradise Cove enclave sold for $91 million in December, rounding out a year of big-ticket sales in Malibu. The sellers were British video game designer Jonathan Burton and his ex-wife, Helen Musk, who bought the property for $36.5 million in 2012. The estate has direct beach access with roughly 340 feet of ocean frontage and about 17,000 square feet of living space comprising a main house and a separate guest quarters. The property also includes a tennis court, a swimming pool and a 9-hole miniature golf course. The buyer is film producer Edward H. Hamm, Jr., who is known for films like “Get Out.”

The house first came on the market for $125 million in February but the price was later lowered to $110 million.

Kurt Rappaport of Westside Estate Agency and Lisa Laughlin of Sotheby’s International Realty had the listing. The buyer was represented by Paul Lester and Aileen Comora of the Agency.

10. An oceanfront mansion in Palm Beach

Buyer: Could not be determined

Seller: A partnership that included financier Scot French and real-estate agent Lawrence Moens

Sold: $85.977 million

Listed: $115 million

An oceanfront property in Palm Beach sold for $85.977 million in June, records show. It was listed briefly early in the year for $115 million but wasn’t on the market at the time of the sale, according to the local multiple listings service.

The seller was a partnership that included financier Scot French, managing director of HPS Investment Partners, and real-estate agent Lawrence Moens. The partnership paid just over $64 million for the house the prior year, according to a person familiar with the situation. The identity of the buyer couldn’t be determined.

Sitting on just over an acre of land, the estate has roughly 18,000 square feet of living space, including covered outdoor areas, according to the MLS. The seller had the interior completely redesigned by a prominent Los Angeles interior designer following their purchase, according to the person familiar with the situation.

Mr. Moens of Lawrence A. Moens Associates represented the seller. Dana Koch and Paulette Koch of the Corcoran Group represented the buyer.

You May Be Able to Buy a Self-Driving Car After All

A year ago, investors were wildly optimistic about the potential of automotive technologies such as automated driving. They now risk swinging to the opposite extreme.

Anyone looking for an idea of the cars that might be on sale in five years’ time likely found the news from this year’s CES in Las Vegas more muted than usual. Stellantis showed off new concept electric vehicles on Thursday, including a highly anticipated Ram pickup truck, but in reality it is playing catch-up with peers such as Ford and General Motors. Sony unveiled a brand for its new automotive joint venture with Honda, Afeela, but didn’t give many details of the much-hyped EV they expect to start selling in North America in 2026.

As Stellantis Chief Executive Officer Carlos Tavares pointed out in his keynote speech, more than $1 trillion of market value was wiped off automotive technology stocks last year. This isn’t just about Tesla: Shares in early-stage companies that don’t make profits have been even worse hit. That makes car makers understandably reticent about putting too much weight on—or money behind—the gizmos CES is best known for. Autonomous vehicles, the focus of much futurism in the industry, have taken a public beating, particularly since Ford and Volkswagen in October pulled the plug on their driverless-taxi joint venture.

Investors shouldn’t mistake the cautious turn in communication and funding for a lack of technological progress, though. Driverless taxis run by Alphabet’s Waymo and GM’s Cruise continue to roam the streets of San Francisco and Phoenix, albeit very cautiously and with strict limitations. The problem with these projects is that they are hugely expensive, with no proven business model or clear route to commercial scale. Unless this changes, they could suffer in a tighter financial environment.

Two Western companies above all make meaningful profits from the automation of driving today: Tesla and Israeli supplier Mobileye.

The former now charges $15,000 for its so-called “full self-driving” software package that automates most mundane driving tasks but, crucially, requires drivers to keep their eyes on the road as a backup. Tesla said late last month that 285,000 Tesla owners in North America had bought what it refers to as FSD, though far from all of them will have paid the latest price.

Mobileye, which was spun out of chip giant Intel last year through an initial public offering, has a comparable “eyes-on, hands-off” offering it calls SuperVision, in addition to the more basic assisted-driving technology that generates most of today’s profit. In an update at CES on Thursday, co-founder and CEO Amnon Shashua said SuperVision had a cumulative revenue pipeline of $3.5 billion through 2030, based on the production estimates of car makers that have included the technology in coming models.

Mr. Shashua also gave a levelheaded account of how Mobileye would move into the more adventurous realm of extended “eyes-off” autonomy, at least on and between highways. By adding a second sensor suite and then testing the finished product in an eyes-on “shadow” mode, Mobileye expects to deliver in 2026 the kind of provably safe automated driving that would actually give consumers time back. It said it already had “line of sight” toward $1.5 billion in revenue from one vehicle program that will likely include the product.

It is frustrating that Mobileye can’t yet reveal which brands are backing its latest products, beyond its Chinese launch partner Zeekr, but the supplier’s technological path to a more useful self-driving future seems much clearer than Tesla’s. The car maker run by Elon Musk has no plan to include backup sensors and doesn’t publish data on how often its system requires the human driver’s intervention—an approach unlikely to win over regulators or the broad public.

But the real appeal of Mobileye for investors is that it doesn’t demand an all-in bet on full autonomy: SuperVision and basic driver-assistance packages should underpin profitable growth for years. A forward earnings multiple of 44 times is ahead of 33 times for Nvidia, arguably its closest peer, but Mobileye should grow faster. Plus, a small premium doesn’t seem a big stretch for a company that could, maybe, let you read a book on your future commute.

Are Trendy Fractured Mirrors Too ‘Psycho’ for the Home?

For the recurring series That’s Debatable, we take on a contentious issue of the day and present two spirited arguments—one in favor and the other emphatically opposed.

Are fractured mirrors cool or creepy? Stylish or sinister? We asked pros for their takes on this interior design trend. Plus, five picks for split mirrors worth considering.

No, their slices and shifts make them art objects
 Kelly Wearstler  (Photo by Amy Graves/Getty Images)

FOR KELLY WEARSTLER, mirrors with intentional slices or shifts in their glass offer uninterrupted pleasure. The interior designer hung Lee Broom’s “graphic and playful” Split Long Mirror in the dining room of her Beverly Hills home (left). Large chunks of its capsule shape slip out of line, and its simple black frame follows. Ms. Wearstler said she likes how the mirror refracts light and remixes the reflection of the room and its inhabitants: “Fracturing a mirror into segments immediately alters how you perceive yourself in it, shifting its basic function into an experience.”

Any object that breaks from its traditional form adds a “cool” element of interest and texture to a room, said Suki LaBarre, vice president of merchandising and e-commerce at New York-based ABC Carpet & Home, which sells similarly constructed looking glasses. “The style transforms what is typically a utilitarian object into a statement décor piece.”

Peter Spalding, an interior designer in Portland, Ore., and co-founder of design trade marketplace Daniel House Club, points to a celebrated precedent, the “glamorous” wall of alternating angled strips of mirror in British Art Deco designer Syrie Maugham’s 1930s London apartment. It’s an idea he’d gladly borrow. “A wall of fractured mirrors behind a banquette to define a dining area would be pretty dreamy,” he said, noting that such elements of surprise “elevate [design] from the mundane.”

Instagram and Pinterest have catalyzed interest in fragmented mirrors in recent years. As Los Angeles interior designer and social media influencer Dani Dazey points out, the mirrors “make for a great outfit selfie. The more unique the photo, the more your content is going to stand out.”

Yes, it’s creepy to look at your fractured self

THE SUPERSTITIOUS among us believe broken mirrors bring bad luck—or worse. “There are stories of fractured reflections capturing your soul in very early Roman history,” said Kara Phillips, an interior designer in Fort Worth, Texas, who prefers her mirrors retiring and intact. Ominous mythology aside, these designs create an unwelcome dark and edgy mood, said New York City designer Emma Beryl Kemper, who avoids the style because of the “hardness” and “sharpness” it brings to a space. Another detractor, Sydney interior designer Kate Nixon, agrees. “I seek to create homes that feel warm and inviting, not jarring or uncomfortable,” she said.

It’s this disturbing quality that turns off many naysayers. Think of the opening credits sequence of Alfred Hitchcock’s “Psycho,” where fragmented typography portends a psychotic break. While no one is suggesting such mirrors will lead you to over-identify with your mummified mother, “it’s creepy to look at your fragmented self,” objects Steffie Oehm, an interior designer in San Francisco. They irk Toronto designer Rivki Rabinowitz for different reasons. “For something as benign as a mirror, I am inexplicably irritated by them,” she said, adding that she can’t help but feel they’re “reminiscent of a closeout sale where rows and rows of overly gilded mirrors are featured alongside…literally fractured ones.”

Others reject the specificity of the design. Said Ms. Nixon, “They’re difficult to install in a sophisticated way and to mix-and-match with other styles and eras.” But for San Francisco designer Tay BeepBoop, the bottom-line is that such mirrors can’t even perform their core function: competently reflecting one’s image. “If I need a mirror, I don’t want to look into something wonky,” she said.

IMAGE SPLITTERS

Five more mirrors that break with tradition

Massimo Mirror, $1,250, ArteriorsHome.com

John Richard A Tale of Two Exotic Gold Mirror, $2,363, GraysonLiving.com

Seletti Double Sense Mirror, $699, Lightology.com

Hidden Mirror, $7,315, PoruStudio.com

Revne Mirror, $2,530, JohnRichard.com

The Wall Street Journal is not compensated by retailers listed in its articles as outlets for products. Listed retailers frequently are not the sole retail outlets.