This is set up for those wanting to chat about Real Estate Investment Trusts (REITs).
Try to keep this chat line open for REIT discussions–only rule is to leave politics aside.
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3/25/2025
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— CTO, a high yielder, just reported. It seems to be chugging along nicely, though per share FFO growth is much less than absolute FFO growth due to ATM common issuance. CTO has liquidity but has 2025 and 2026 debt to deal with. I think the refi rates will be higher. CTO is a relatively small REIT, mostly in retail 66%, with 30% mixed use and 4% office. It is ~90% leased up. CTO has a small kicker in the form of an equity interest in a public net lease REIT that it manages.
— Adding a worry bead for PSTL next to ARE (science is out of favor) which is next to DEA (the usual suspect). No position in any of these.
JMO. DYODD.
Bear, Are you picking up pennies in front of a steam roller? APLE was one I bought in Dec / Jan. of 2020 thinking a hotel Reit that focused on hotels near airports would be a great holding. Little did I know Covid would shut down all travel. Who could have seen that one coming?
Now, I just flipped PSTL for a .25 profit. wasn’t worth the worry. There is a new Sheriff in DOGE who is going after all the cattle rustlers and bad guys. We can see this movie coming to theaters near you.
This movie is being advertised so far ahead of the release date I don’t need a magical 8 ball to come up with possible outcomes.
USPS is not as safe a government renter as it was once thought to be as I bet it will be on the Sheriff’s hit list and it was giving me a not sleep well at night worry on PSTL. As for DEA, it has already been telegraphed by bad robot productions that leases can be broken if properties are not needed by the tenant who is the major renter this landlord relies on.
About ARE, who specializes in MOB’s ( medical office buildings) I have been reading that other property REITS have found it is not that difficult to renovate vacant office buildings to make them useful for bio-tech companies. Signaling this niche market in commercial real estate does not have as wide a moat for entry by competitors as it was once thought. Not to mention other factors like what happens in a slowing economy. ARE has bonds which might be a safer bet although they don’t offer the same opportunity for capital gains as the common if the stock price recovers.
Just my thoughts on DYODD
PSTL – As I see it too many post offices, one in every town, often near each other. (I have 4 within a 5-10 min drive.) First class, magazines, catalogs, paper ads – declining or gone. Package delivery a bright spot, so last time around it was targeted for big price increases to bail out the PO’s failing business segments. (Equals less shipping volume, equals fewer PO’s needed.) PSTL is rated a “buy” by 9/10 website pumpers and is being called “a long term grower.” Perhaps the risk here is not yet fully discounted.
DEA – The loggers have announced they are cutting down half the forest. Optimistic to assume all 100 of your trees will be safe.
Nice yields on DEA, ARE and PSTL but since the odds are changing quicker than the tote board at the track, I am not willing to place any bets right now.
– FWIW I looked at, liked but did not buy APLE just before the pandemic. Instead I bought a much smaller hotel company with nice Sunbelt locations. It’s been a long anxious wait but they survived and resumed preferred dividends, SOHOO. JMO. DYODD.
lol Bear,
I took a loss on APLE just a small one, then I took Tim’s and everyone else’s advice in 2020 and started buying babies ( preferred’s ) being thrown out with the bathwater back in March thru Sept. a lot of good ute’s that investors desire when times are good and the herd was panic selling. That saved my bacon and made my nest egg grow.
AFAIK, there is one post office for every zip code.
ARE (Alexandria Real Estate) is exactly the type of REIT I’m looking at right now. Nice streak of annual div raises, low payout ratio, beaten down savagely from its highs. In a very resilient business. I like it alot at this price. This week or very soon I’m going to get into it. I have DEA on my watchlist as well. Payout ratio indicates possible trouble. Would rather see a dividend cut before I jump in, but I’ve seen this before where a bottom settles in, and then they cut div, initial reaction is lower price, but very soon it bounces above todays level for a cap gain. I don’t like waiting on these to flush out because then you miss the bounce and thats where the big gains comes from, just more of a question mark with DEA I think. But ARE, in my very humble opinion, solid buy right here.
PP, Do you buy this for potential cap gains, or a long term hold? It had a nice run up in 2022 to $203 a share, but has pretty much been on a downward trajectory since then. It’s currently around 2015 levels.
I agree it has a nice dividend of around 5.5%, but I don’t understand what has caused the decline from it’s 2022 highs. Just interest rates? Overall commercial office space worries? Or are they struggling to keep office space rented? They appear fairly geographically diverse. Do they rely a lot on government contracts? I’ll obviously have to do more research, but thought you could provide some color. I can’t find on their website a list of tenants. I’m sure it’s there, just haven’t dug around much yet.
It looks like they just secured $550 MM at 5.5% to pay off 2025 maturing 3.45% notes.
Mark, I’d buy this right now for a long term hold as I’m unsure where the bottom is. I will say, I think if it were to drop from here, it would drop no further than the 70’s. If it were to drop that much that would be painful. I don’t think it will but one can never tell. This is a very well managed company at around a forever high yield now. The one time it was higher was the GFC in 2009 when the company actually ended up ditching their dividend raise policy and cut the dividend severely (50%+). It took 7 yrs for dividend to reach the previous levels. But since 2009 it’s been a nice steady straight line up in terms of dividend raises. So, to answer your very first question, long term hold for sure, capital gains should be significant in the years ahead. They manage their debt very well and are the premier REIT for life sciences. Undergoing some transition from oversupply in the industry. Thats the word, rate worries and over supply in buildings responsible for their precipitous drop in share price. Good news according to analysts is the over supply problem is in the process of being rectified. I would think share price losses now built into the price. From my reading they are definitively not suffering in attempts to keep their spaces rented. I don’t believe thats ever really been an issue for them over the years. In terms of government contracts, I’m unsure on that. Recent article on SA has some commenters mentioning that, it’s on my list to review this weekend but as of yet I haven’t done so. Recent share price drop since the election would seem to indicate many have felt that could be an issue going forward. My strategy has been to buy a small percentage to get involved, them have some loose change if the stock heads lower. I’m 50/50, some go higher, some go lower after I buy initially. But I think this is a great level for that first purchase. For this one I see dozens of very small purchases in near future fine tuning a position. But intent for me is long term hold. I really like this company and its mgmt. The dividend cut in 2009 is what I like to see. I don’t typically like companies that refuse to cut despite obvious headwinds. It normally never works out to see a company yield going to the rafters to compensate for poor mgmt.sorry, very long winded response.
Hey Pig, I have also been eyeing ARE. As a Boston native, I’ve seen their successful run, and now recent struggles. I am holding back (for now) because I think this latest life science cycle was one of the worst in history so using historical shocks may not be appropriate. The amount of supply is simply staggering, especially in their main markets like Massachusetts and San Diego. Rewind to 2022/3, and life sciences was one of the hottest CRE areas to allocate with significant $ deployed over the last couple years. it can take a LONG time for that supply to hit the market as the new buildings are specialized and the conversions from office can be painfully slow and expensive. So my guess is that it will still take more time for this to all get absorbed.
With that said, I am a believer in biotech for the long haul, so I don’t see these getting stranded like offices and malls. ARE has some truly trophy properties.. so I am getting close to a starter..I also have my generally equity exposure/beta as low now as I think things are a bit bubble.. if a correction occurs, the selloff will likely be broad, even names w improving fundamentals.
Disclosure: I am long a few REIT commons as it’s impossible to completely time the market. This includes SUI,FRT, and HPP. Am also eyeing SITC and GTY.
Btw, did you get any NMKCP or PNMXO from the dump last week?
I am also playing the Cedar prefs tender. Just don’t tell anyone… they will likely shoot me!
Maine, great stuff, thanks for posting. Maybe best to hold off on ARE for a bit. I won’t wait long though, lol. Currently have GTY, BNL, O, VICI, and NNN in terms of REITs.
I did not participate in the NMKCP or PNMXO dumps, must have missed those. I do seem to have a full load of the illiquid Utes though.
Pig, (and Maine) thanks for the added color. I tried researching a little more last night. I found their earnings release from June ’24 and it listed the 20 top tenants. US Government was #12 with 1.3% of rent and 6.1 years avg lease term remaining. I’m sure there are clauses for breaking leases. Plenty of large cap pharma, a few universities, and a couple tech companies.
Don’t big pharma and universities receive large government grants? So the exposure could be a bit higher than 1.3% if factoring the possible loss of grant money to these other tenants? Obviously, none of them would be wholly dependent on govt. money, and shouldn’t affect their ability to pay rent; nevertheless, it is something to consider. They actually have a sub heading under risk factors that specifically addresses government and global factors.
I am a bit concerned about their $12 Billion in debt for a $16 B market cap company, but they seem to be managing it pretty well, and rates are in the 3-5% range for the most part.
This has been on my watchlist for a few years, I’ve just not dug into them because I didn’t like share price. But with a 5.5% dividend and what I feel to be a more reasonable price, I will probably initiate a starter position to keep it forefront on my radar. I think it’ll take a couple quarters before we have a better understanding of the govt. impact, if any – broader market included…..and as Maine noted, a correction will likely include the babies WITH the bath water, so there may be a sale ahead.
Question for the group. I know Bear follows REITs so I hope to hear from you.
I have VERY little exposure in this sector.I am wary of mortgage REITs having been all my life in the building business and been through a few economic down turns and have seen how this affects people struggling to pay their mortgages. Similar to car loans, when the economy goes south banks and loan companies bear the brunt of bad loans.
I have a small holding of RITM D Because at one time I had a hybrid home loan that Newrez inherited and respected how aggressive they were on collection.
My question is has RITM made any effort to recall any of their preferred? especially the A & B which are now floating?
Recently we have seen various companies get ahead of the curve and issue new preferred or new debt to call existing preferred and BB. But these companies that continue to pay high interest rates I assume because they think rates will continue to come down.
I respect the companies that fall in the category of pay the bill ahead of time or when due. The other group makes me nervous who are willing to pay higher interest. FYI, I try not to be a yield chaser on stocks I want to hold and not trade which is why I bought then sold RWTN
Hey Charles, I believe RITM reports earnings next week so maybe Mike N. (CEO) will comment.. as you may recall, he had previously hinted they would be called two quarters ago, then backed off that comment last quarter. My guess is they will be called within a year, but not confident in that guess, he is keeping his options open. FWIW, their 5 year bond is trading much better than all the other mREIT bonds issued recently at 9%+. Their issue is an 8% coupon and trading above par. That’s my way of saying that the market is not too worried about their credit risk.
AFAIK, IVR is the only mreit to call one of their outstanding prefs recently.. am kinda surprised NLY hasn’t called, esp series I.. but just think they are keeping their options open and willing to pay to high coupon for now, esp if there is any hint the fed may get more aggressive.
My fav mREIT pref is currently efc-b priced below $23. PFF did it dirty on Friday, so I’m not sure the price will stay down here long.
Maine, I see what you mean. but to me it answers my question about risk and why they haven’t called A & B. CUSIP U76664AA6 current price 102.5 S&P rated B-
They borrow 775 million 3/4 of a billion in March 2024 and they still haven’t paid off some of the preferred.
Maine as an aside, Ellington bought Allington and they delisted the AIC and AAIN Baby bonds. The AIC is due on March 15th 2025 any word posted yet of this being called ?
Ellington bought Allington? Is that like Armand Hammer buying Arm & Hammer?
Lt, lol
BTY, you’re good at options. The tariff wars haven’t gotten to India yet. The biggest producer of drugs purchased by Americans. Maybe research a few to short when the time comes. I was looking at RDY and was surprised they have plants also in the US so it might not be as bad for them if tariffs hit. Then again who knows.
I haven’t heard but also haven’t been following. I wouldn’t worry too much about Ellington as a credit risk. They have a diversified book and are one of the better managers within securitized.
https://youtu.be/-YatPii_nH4?si=WCAieQ8FbyLO-q6l
Why would there be a call notice for a note that’s maturing?
REIT preferreds are my biggest sector and RITM preferreds my biggest holding mostly RITM-D because of the higher float rate in a couple years. I’ve done very well with high divvies plus some trading profits. Very low default rate so far, that could change in a major crash but everything else would suffer too maybe not as much.
Charles—I owned a lot of ritm-d and rode it down and then back up and sold at my cost of $23.25. I actually thought they might go under and worried a lot. Castigated myself for owning too much of it.
I’m not a fan of those who say it has f2f loans so f2f preferred issues are not a problem as they offset each other. If interest rates stay at this level, or move higher, their loans might suffer/go bad. Making it hard for them to service their preferreds. I think the risk/reward is not favorable. JM2C
Whidbey, I bought RITM-D in Sept. @ 23.65 and have collected 2 divy’s and sold today at 23.75 Maybe there will be good news in a week when they report earnings. I don’t know. My feeling is with their mortgage servicing business they are doing ok but you know the old saying buy on the rumor, sell on the news. They went x-dividend Jan. 31st so I have the dividend locked in and 3 months to decide if I want back in.
Charles, thank you for your kind words. I have a wealth of experience in investing in mREITs extending over decades. I am glad to share that with the board. I can sum it up like this: I have lost money 85% of the time.
I tend to be a long term holder. Like you, I worked in real estate and I learned early on that real estate is a cyclical business. (“You’re riding high in April. You’re shot down in May” – Sinatra)
The problem I have had with the mREITs over the years is that mREITs don’t listen to their Inner Sinatra. As they try to get bigger, management becomes overconfident about their skills, their hedging abilities and the non-existence of cycles so they overleverage. At some point the interest cycle turns. Interest rates move the wrong way and the vaunted hedges fail. (Wipeout, Surfaris, 1963)
Its easier to invest in mREITs when rates are predictable. Last few years, even last few months, most expert predictions have been way off. I generally avoid mREITs these days unless like , you know, I mean, the yield is like, really, really good and the lucky penny is sure to finally turn up heads. I am down to one. (mREIT, that is. Still no lucky penny.)
JMO. DYODD.
Bear I took a real estate class back in the 80’s with the thought of getting my license. They had a local business leader teaching the class. Being just the one class he didn’t need a teaching degree. He had some stories to tell. He had the largest flooring store in the county. Actually became one of my customers 20yrs later.
The real estate sales people were making big bucks and always spending it on new furniture, cars, dining out and leveraging real estate they bought for themselves. The carpet and flooring salespeople in his store were the same. This was before the big discounters like Home Depot.
Invariably these sales people got in trouble for over spending and not saving for a downturn in the market.
DEA Easterly Government Properties is a REIT that owns government properties leased to the safest of tenants. DEA dropped on fears of budget cuts giving it a fat 9% yield. It bounced back. Pundits at TOWS say the fears are overblown and most rate it a strong buy.
I have mixed opinions. Figuring DEA’s contract rents were safe, I was ready to pull the trigger. Then Wolf Street cited a WSJ report that about 2/3 of government owned properties and 3/4 of leased properties are being considered for disposition. Many properties are under utilized, implying little impact if disposed of.
The harder question is lease breaking. The easier question is walk away clauses. The trade press estimates that about 7-8% of government properties in any given year have termination rights. AI might summarize this as “melting ice cube.” I am wait and see on DEA. JMO. DYODD.
Bear – At the present time I’m avoiding any type of REIT that leases to the federal government, due to uncertainty in the sector.
I do own a security that had one building leased to the federal government (over 500,000 sf) and they signed a 10 year lease renewal for the property. However, there was a clause in the lease stating they could terminate the lease early – and they did. The building has now been sitting empty for over a year and is scheduled to be demolished. At one point in time the property had been worth close to $100M.
Bear and Lou
I suggest looking at CDP in the Federal space. I’m long.
COPT Defense Property REIT (CDP) focuses on mission critical spaces and has a huge presence as the landlord for the intelligence and military communities.
I have PSTL on my radar. There is talk of privatizing the USPS and the price may drop significantly.
Greg, The winds are a changing. CDP peaked at around 32.00 a share and has a current yield around 4% at 29.44 I’m no technical reader, but the chart looks in a downtrend. I am going to assume you bought at a lower cost and are still above water.
Avoiding is a good decision. Looks like more potential bad news for DEA etc buried deep in the official OPM early retirement memo (online.) I don’t think the “strong buy” REIT pumpers on TOWS have noticed it yet, wondering how they will spin it. The OPM memo is blunt.
“Going forward, we also expect our physical offices to undergo meaningful consolidation and divestitures, potentially resulting in physical office relocations for a number of federal workers.”
– Deferred Resignation Email to Federal Employees, January 28, 2025
Disclosure: I do not own DEA. JMO. DYODD.
A list of retail chain store openings and closings for 2024 and 2025. The usual suspects for the usual reasons. You’ll recognize the names from the big REIT tenant lists.
Store closures hit highest level since pandemic — see who is shutting down the most locations
https://www.cnbc.com/2025/01/23/store-closures-rise-led-by-party-city-big-lots-walgreens.html?
JMO. DYODD.
Prospect, a tenant of Medical Properties Trust, Inc MPW, is reported to have filed for bankruptcy. The MPW REIT is priced under $4.00 and has an 8.4% yield. MPW had another tenant that went into bankruptcy in 2024. If I remember correctly MPW was in so deep that it chipped in money to help its tenant out. (My landlord never did that.) There was litigation. The magic words “private equity” appeared in an unflattering story.
I can’t guess the impact of the new bankruptcy. Commenters elsewhere suggest that it is all better now, that the newly bankrupt tenant is smaller and its failure was not unexpected. I don’t follow MPW so DYODD. JMO.
Thanks for the distraction Bear. No horse in the race and don’t follow it. When people ask if MPW bonds are worth the risk I think of RILY.
When people start handing the doo bag around I wonder if you can find the next taker and how fast you can get rid of it.
Any opinions on Peakstone Realty (PKST)? It has a plenty of hair on it, and management has much more to do to regain investor trust, but it is trading at a significant discount to NAV, has insiders buying, recent transformative acquisitions, and selling non-core assets and paying down debt.
Looks like you answered your own question. I don’t know anything about PKST so I did take a look.
— PKST looks like an interesting speculation if only for the high divvy. I can’t say how safe the divvy is.
— Until recently PKST was a ~60% office REIT with a lot of cash. Offices are an unpopular asset. They tend to sell at a discount these days.
— “Industrial Outdoor Storage” is a trendy niche real estate segment. (Please, oh please, don’t call it a trailer parking lot or an equipment rental lot anymore.) In general, there seems to be a demand for it but location is key.
— A $500 million acquisition by a REIT with a $400 million market cap is large.
— The new IOS acquisition means a lot more debt to pay and a lot less balance sheet cash.
— PKST has 100 million of mortgage debt due in 2025. It hopes to sell the mortgaged properties.
— Tenant quality seems mostly~50% fine. PKST uses a definition of Investment Grade tenant that I don’t like. (Rant omitted)
— The newly acquired IOS leases average 4.7 years PKST seems to think that it will be able to renew leases at higher rents. Maybe. Maybe not. IOS space can be tough to find, but it’s not hard to relocate trailers.
— Risks: A recession may reduce the demand for truck storage. Higher interest rates may increase financing costs.
— Can’t tell if this was an expensive acquisition. If so, may limit the debt the properties can carry. Big Bad JPMorgan does not give money away.
— Added PKST to my watch list. Thanks
JMO. DYODD.
Thanks Bear… much appreciated.
I hope a post on smoking is not off topic here. Realty Income O is a dividend increaser, a big, diversified, crowd pleaser pumped incessantly by the Buy Buy Big REIT Guy. VICI is a casino gambling REIT that is always a safe bet much loved on the Other Website. Whitestone is a micro REIT with a history: dividend cutter, too small market cap, tenants too small, geographically over concentrated, lawsuits, conflicted management, a fairy tale frog long-waiting for a magic kiss from a princess. The 2024 results are in:
O down 8.4% YTD
VICI down 10.2% YTD
WSR up 13.9% YTD
Warren Buffett said something about picking up a cigar butt for the last puff. Deep value occasionally wins out. Even if Mother Fidelity disapproves of your conduct. JMO.DYODD
Bear,
A lot of investors tell themselves with dividends received they broke even.
As for the Big Reit guy not sure who you’re talking about, but on several stocks I was researching this past week BT kept popping up and I noticed he seemed to have an uncanny aptitude to do a buy recommendation on stocks that hit their peak just as the article came out. At least on the ones I happened to be looking at.
I’ve never quite understood the fascination with Realty Income (O) on the Other Board, but Seeking Alpha shows the 10 year return of the stock to be 6.16% overall. While this doesn’t include dividends, a simple S&P 500 index fund trounces the stock over the same period of time. While I’ve never owned the common stock, their preferred stock was always a good holding for me.
kaptain lou—I’m with you–don’t understand the fascination with Realty Income. Seems to me that the larger they get to more difficult it is to ‘move the needle’. One thing for sure–it is a ticker on Seeking Alpha with lots of followers and this page views which is really the objective of SA.
I think if you look at the long-term chart, say from the mid-90s to about 2020, O did quite well and raised the divvie along the way. Since then, it’s been a bumpier ride.
Recently added to my position in ARE.
Yield of 5%, with great fundamentals.
A non cheerleader view of the stock is on this link.
https://seekingalpha.com/article/4669610-alexandria-real-estate-ordinary-after-all-reit-stock
DYODD
— Advance Auto Parts AAP is closing 700 stores, about 500 corporate and 200 franchised, and four distribution centers. I didn’t see parts stores as major tenants on my “usual suspects” REITs list . Exceptions were WP Carey WPC and Agree ADC. For WPC, AAP was a Top 25 tenant (#12) with 299 stores and 1.5% of rent. Agree had a number of AAP stores but only a few in the US West. (WPC is controversial (think: “kindered”) and is now being pitched by the pundits as a high yield value play. Agree is a trending favorite. )
— Store closings may not impact REIT rent flow in the short run. In the long run, there will be more vacancies to be filled. Auto parts stores join dollar stores, drug stores and conveniences stores as REIT tenants exhibiting weakness. JMO. DYODD.
The issue I see for drug stores and its a big issue, is not only are Walgreens, Rite aid and CVS competing against each other they are competing with the grocery and retail stores like Walmart and Target. They are in small strip malls in just about every town in America.
CVS and Walgreens control the major corners within 3 miles of my house, a total of 5 stores. One CVS has closed, and that’s a dedicated structure so I assume they are still paying rent. There’s another inside the Target across the street.
If they can’t make a profit in my hood, they are in real trouble as the area has otherwise “blown up” with $5 mill+ homes and Californians are rapidly moving here (Henderson, NV).
They need a CEO with a new business model.
As to the dollar stores, every one I’ve been in is terribly cluttered and devoid of anything most people would buy. I don’t understand how they make money.
Goodwill is better organized.
If this were Mexico, I’d assume they are narco money-laudering operations.
I’ve asked the CEO of a private reit I’m invested in if they keep up with the financials of the companies that are tenants and the answer was “not unless they stop paying rent, because they don’t have financial covenants in the lease”
We’ve got a few of each type.
There are far too many auto parts stores in our locale; Some within a few miles of each other. Makes no sense. Additionally, we have car dealers here that MANDATE vehicles bought at their locations bring the vehicle TO their location for any repairs or the warrantee is canceled.
Hi Howard,
I had a local dealer junior guy tell me I had to bring my wife’s new plug-in hybrid to the dealer for service. I asked to talk to the service manager, who disavowed that and chewed the guy out in front of me. Not sure that it wasn’t all just theater for my benefit, but the service manager was clear that such requirements are illegal in California.
I am not aware of any state where requiring a car to be brought to the dealer for repairs (or the warranty is void) is legal. That all got worked out in most states almost a hundred years ago (from what I looked at some years ago).
The “edges” of this are being litigated in some related industries (farm equipment jumps to mind), but IIRC, this is pretty well settled in the consumer space.
There are a few cars where “dealer repair” is practically required (like Tesla in its first few years, ditto for Rivian) because there weren’t any other places that could fix them (yet) – but even Tesla has had to back off from this.
If you find a car dealer doing that, you should call your state consumer protection department (or AG’s office, if you don’t have a state/county consumer dept). They usually like these kinds of “softball” wins.
For anyone interested, I think there could be a great discussion on this board for REIT corporate bonds that pay over 5% for the next 10 years. This maybe should be posted on the bond page, but perhaps the REIT tab is the way to go.
MAA, SUI, and EXR may be the best way to play some of these solid companies. Personally, I avoid any type of office REITs as I just find them too risky right now. These are not large holdings of mine (yet), but will likely be buying more in the next couple of months depending on market conditions.
Franchise Group FRG seems ready to file bankruptcy. I don’t know the split between franchised and owned units, but the likely result will be the closure of unprofitable stores through the bankruptcy process. I don’t follow Franchise Group any more but vitamin shops, furniture stores and pet stores are under its umbrella.
Tenant names in the most popular business categories for retail net-lease-type REITs keep showing up in news stories about bankruptcies, slowing development programs and mass store closings: convenience stores (7-Eleven), dollar stores (Dollar Tree, Dollar General a gung-ho expander quietly closing stores, Big Lots), restaurants (TGI Fridays, Red Lobster, Starbucks), drug stores (Walgreens, Rite Aid, CVS).
I now look at the brand names in retail REIT portfolios when I shop. While closings may not hit the income of diversified REITS, my thinking is that retail REITs will have a difficult time maintaining dividend growth in the face of headwinds from flagging tenants in top tenant categories. There may be more alt investments like casinos coming to retail REIT portfolios and more acquisitions .
As to FRG – not to worry. The Other Website is already touting its parent B Riley as a buy on the theory that the bad news is out and its all up from here. (Icahn also had a little issue with a portfolio position, but they’re still declaring a buck, right? ). Good luck to the traders. JMO. DYODD.
Thanks Bear, you’re always on top of this.
Latest news report is FRG’s entire American Freight operation will be closed down, 365 stores in 40 states and Puerto Rico. The AF chain includes about 135 former Sears Outlets. Management is spinning this as an opportunity “to de-lever our balance sheet.”
Store closing sales begin November 5. (No news yet but B Riley used to have a “Going Out Of Business Sale” service, making for an interesting opportunity to step ahead of other creditors. ) Store sizes average 20 to 30,000 sf. I have not seen any landlord or REIT news yet.
Sears Outlets, R.I.P. : You only lived twice.. Or so it seemed. “We’ve had some interesting times together. I’ll be sorry to go” – James Bond, 1967 JMO. DYODD.
Bear, back to B. Riley. Where there is smoke there is fire. I hope people trading their bonds don’t get burnt.
Bear – NNN took a pretty big hit over the past two weeks as they have a number of properties rented to FRG. NNN is a very high quality REIT, but even the best run operators get hit with tenant bankruptcies at times.
Currently I don’t own any NNN common stock, but do own some of their bonds, as they are rated BBB+/Baa1.
kaptain lou — whatever happened to your SEC complaint against Grid? Curious why you filed it (if you did) and what type of documentation you had. Also, i thought you had a problem with this site because people often talk about what they are buying or selling (with disclaimers). Is that correct or wrong? Just curiousl
kaptain pou – I was wondering as well. Please reply to Franklin’s comment. Many of us are curious.
I guess we’ve got kaptain lou posting here but not Gridbird…
As President-elect Trump once said, “This has been the worst trade deal in the history of trade deals”
Dick welcome back. Let’s just keep things civil. I like hearing from you on investments. The political stuff not.
Hi Franklin, thanks so much for checking in with me!
At least for right now, I am laser-focused on getting some great returns on REIT stocks by the end of the year. Have a few deals brewing right now and hopefully going to use some of proceeds for my local food/clothing pantry, so I just have to focus on the future and not the past. Please feel free to reach out to me if you have any questions on REIT stocks. NNN bonds are just a small holding of mine for me and some family members. Have a great day tomorrow!
Kaptain Lou, i think it’s great that you are donating to food and clothing. But my impression, which may be wrong, was that you had a problem with the site AND with Grid and since you are posting here I think an explanation is deserved. Great to focus on the future, but the past is what got you here. You can clear this up easily by just answering did you file a complaint against Grid? if so why and with what documentation? do u object to the site (if you do, it’s strange to see you posting here), and again why? I know a lot of people here wold like to hear what exactly happened because it affects the site. So I think it’s highly appropriate that you answer.
Franklin, Grid was an expert at obscure Illiquid preferred. We all know from recent experiences posted here of people having problems trading these at Fidelity and my experience with T Rowe.
I felt Lou was seeing manipulation when it may have been nothing more than the herd rushing into stocks that don’t see large volume trades normally because Grid was posting and sharing here on an open forum.
Charles,
Regarding “was an expert…” I think the only conclusion I can draw is you have killed Gridbird. Slingshot, most likely.
I’m calling the FBI, police, and DOJ right now and notifying my first cousin who was a federal prosecutor 25 years ago. I’m sure you’ll be arrested soon.
Too bad you couldn’t keep your mouth shut…well too bad for you. SEC is the least of your worries now.
LT, can I subscribe to your Reddit site for a daily dose of humor?
Investing is a serious business but I always need a break.
I hear you, Charles. And Grid excelled in the illiquid area where low trade volume is the norm. But simply posting issues he liked is hardly manipulating the market, IMO. He added a lot to the site and if Kaptain Lou is the one who chased him off I think many of us would like to read his explanation. Maybe there’s more to the story than most of us know. Maybe not. Either way, with KL back on the site I think it’s fair to ask him. Best.
Kaptain Lou get the Hell out of here you bird killer.
Martin G – I was only posting on this board to add to any type of discussion on REITs and their corporate bonds, as I have a fair amount of experience in the area and thought it may help other investors.
Wishing you the best in the future.
As far as I know Gridbird stopped posting here and other forums around the say date. Health issues?
Dan, someone said they had talked to him. I respect his privacy and haven’t tried to track him down.
Has anyone heard of this:
Private reit I am in has set up a Delaware Statutory Trust that bought one shopping center and put it in the trust .
The purpose is to allow people with 1031 proceeds to exchange them into the trust containing the shopping center . After one year the shopping center is transferred into the REIT via a tax free exchange and the individual receives
operating partnership units in the REIT on a tax -free basis . The reit is paying 5.5%.
It, I could be wrong but it sounds similar to what I think Kimco Realty did. I remember this and looked for it.
https://seekingalpha.com/news/3917604-kimco-realty-announces-reorganization-into-upreit-structure
I believe this is a way for a REIT to buy other properties and for the owners to sell the properties in exchange for shares of the REIT without having to be taxed on the sale.
I have been holding KIM-PM & KIM-PL for several years now. Others here I believe got in on KIM-PN back when it was $51.00 to $52.00 a share.
BTY, if you look in FINRA you will see Kimco’s bonds are listed Baa1 and most are selling over par. They have also been able to issue debt out to 25yrs so a well run REIT
Thanks, Charles, but the reit is already a UPREIT for the purpose you describe.
This would allow anyone with any proceeds from any type of real estate to 1031 it into operating units of the reit on a tax free basis.
My understanding is , say you retire from doing residential rentals, but don’t want to pay taxes on the sales of the homes,you could 1031 it into the reit.
It, sounds like you already knew the answer. I suspect you might be one of the holders of a private reit and are thinking of doing this. My friend’s father got in on a private equity Reit and he was unhappy as he told it the management company got paid and after the maintenance costs there was never anything left to pay out to the investors.
The dst is something new that the reit I’m in came up with as a way to issue more operating partnership units ( same effect as shares). It’s recent vintage for this reit but I’d never heard of using 1031 proceeds from any type of real estate to wind up with units of a dividend paying shopping center reit 12 months later.
I was just wondering if others had seen similar structure.
This is a post to add to what Tex posted very early today on commercial real estate. I’m working today and doing call outs to customers.
Salesman in Salt lake told me he is still sitting on inventory of my product he bought a year ago. Said sales for commercial roofing jobs have really slowed down. Same with residential building of new apartments. Said he is getting flyers in the mail offering 1 months free rent to sign a lease. He rents and his landlord offered a $200.00 drop in rent if he renewed his lease. He didn’t even have to ask.
There was an article in the real estate trade press about things getting back to normal in office leasing for “good” buildings anyway. Volume is up. A small mention in passing that large tenant concessions were being given, more free rent during the lease term and big tenant allowances. Got to love gullible lenders financing a 5 year lease on 3.7 years of income.
Lost the link, but stumbled across an article that SL Green, and friends ( SLG up 76% YTD and a favorite of The Other Website) had just defaulted on a 940 million NYC office mortgage. Even Jingle mail can hurt. Green reportedly put 525 million into the building. There was some speculation that a lender who thought they had a AAA credit might get burned. I would write more – like saying that 38B of CRE is on the edge of default – but I would again be accused of being a doomer and gloomer.
FWIW, one CRE website is selling Jerome Powell sweatshirts for Christmas emblazoned with “All I Want For Christmas is Lower Interest Rates ” — IMHO this pretty much sums up the CRE industry and its regional bank lenders right now, JMO. DYODD.
Whitestone REIT WSR is a smallish REIT that specializes in smaller retail and service tenants in the Sunbelt. It pays about 3.6% dividend. There was a lot not to like about WSR, ranging from conflicted management to too-small Mom-and-Pop tenants to a pandemic dividend cut to litigation. The big name REIT pundits and commenters on The Other Website were invariably negative on WSR, which offered buy ops for the deep value investor.
WSR changed management and resolved the resulting litigation. The Sunbelt is back in favor. The Mom and Pops are looking better than vacant store fronts left by failed famous-name retailers in the big malls. Lately it’s been a veritable Love Fest for WSR on TOWS. Confirming the value proposition: every now and then WSR gets an offer. JMO. DYODD.
FrontView REIT FVR just did an IPO which was priced at $19/share. Rumor is FVR expects to pay a 4.3% divvy but don’t quote me on that. They have an unusual niche: they specialize in outparcels with good visibility and street frontage in shopping centers (Front view – get it?)
FVR has about 278 tenants, mostly recognizable names. The tenants are spread over 31 states. The top 20 tenants pay about 40% of the rent with none particularly above or below the 2% average. The biggest business concentration is restaurants at 36%. That sounds scary, except, you know, that’s what outparcels are for.
https://www.frontviewreit.com/
JMO. DYODD.
Just trying to think about this a bit by reading some articles. 278 properties. A specific type. Wanting to raise about 277 million. Giving it a total valuation of 561 million.
So 561-277=284 million would be the current valuation while private? Now a lot of those properties I can fully imagine they don’t own the land right? Just the building? Not sure yet. These are often just called pad sites. I just see properties of this type go up for sale from time to time in my state and they don’t seem to come with the land in some cases. But with that said maybe they do own the pad site. This stuff can be confusing for me as I am not very familiar with it.
FFO for the first half of 2025 was 7.6 million.
https://www.sec.gov/Archives/edgar/data/1988494/000114036124040627/ny20009871x12_s11.htm
I guess I find this one a bit more complicated. I am not sure what they truly own when it comes to land.
There is more to this than meets the eye. It appears they acquired all of these properties from a company that FrontView CEO used to be associated with for 25 years, North American Development Group. Best I can tell it was a private, non-traded REIT. Not clear if the whole portfolio was shopped to the other existing publicly traded NNN reits, like O. If it was NOT shopped, that is bad because maybe it was sold for below market value, thereby shortchanging the seller. If it was shopped, that is also bad that O and others did NOT find it attractive enough to buy. First impressions are negative despite that fact that it is Texas based. . .
Link to part of the backstory:
https://www.costar.com/article/157011782/dallas-reit-with-hundreds-of-retail-properties-across-31-states-files-for-ipo
Tex,
I just get the feeling if I cannot tell who the sucker is in the room it has to be me. They are not going to use external mgmt and all of these guys are going to become full time employees from NADG. One can only imagine the salaries they will pay themselves… I can imagine there is a place for family too based on the NADG website with last names being seen 3 times in one situation and 2 times for another. I have no idea how much skin they have in the game.
Not really enough information to make a good decision. First blush is also negative.
Fills in some blanks thanks. Maybe they were trying to avoid a no-escape situation like those Blackstone private REITs with monthly withdrawal caps by creating liquidity with an IPO and a NYSE listing.
The IPO was ~$3.00 dilutive to new IPO buyers and slightly accretive to the existing sellers. (Ownership was said to be 73% NADG and 27% “convertible non-controlling preferred interests.” Was not able to determine how much NADG controls after the IPO.) More background on The Other Website
https://seekingalpha.com/article/4723764-frontview-reit-finalizes-ipo-plans-on-slowing-growth-rate
Starting to smell a little like Nick Schorsch’s American Realty Capital situation back in the 2010’s. IIRC, they moved assets from non-traded to traded and did some funny valuations in the process. I do not recall the details but somehow Nick got removed and they brought in a new CEO to run the place. IIRC, somebody went to jail over it. New CEO was a good guy and cleaned the mess up.
Then they changed the name to VEREIT before selling it to Realty Income (0) later on. . .
I also do NOT like the three Preston’s as the top managers of the predecessor company. Most of the nepotism REITS like CBL, RMR,WRI did not go well, SPG being an exception.
Not sure if this link will work, but if anyone got “Wheelered” over the past few years, they are making a tender offer for some of the old Cedar Realty shares now. I owned them for many years, but was fortunate to get out early from this terrible merger.
https://ir.cedarrealtytrust.com/news-events/press-releases/detail/215/cedar-realty-trust-announces-planned-tender-offer
Lou, I think J posted earlier on Reader Alerts
Hi Pig Pile, there was no reply button in Sandbox re your Postal Realty inquiry PSTL, so thought I should just post here in REIT chat. Also wanted to say thank you for all your ideas and posts always good stuff!
I was long PSTL and moved a 7% gain plus div into a pfd not sure what one more or just me moving into more pfds. Spodek CEO and Donahoe board Chair know the best properties to get into; Spodek been doing postal r/e for years and Donahoe of course was Postmaster General. Spodek was buying shares all thru the $13’s and is up to about 920k shares, Donahoe’s stable modest holding.
Is the 6.65% yield enough compared to a solid pfd now, of course some hope/room for cap appreciation and maybe some modest div increases but they cut it close on FFO/AFFO payouts so not sure how much they’d raise. They are putting 3.5% inflation riders into the new leases and again given their ‘insider’ knowledge of the biz and the locations probably pretty solid if ‘boring’ money. Insider trading; mostly positive again on CEO buying for sure. http://www.openinsider.com/screener?s=PSTL&o=&pl=&ph=&ll=&lh=&fd=1461&fdr=&td=0&tdr=&fdlyl=&fdlyh=&daysago=&xp=1&xs=1&vl=&vh=&ocl=&och=&sic1=-1&sicl=100&sich=9999&grp=0&nfl=&nfh=&nil=&nih=&nol=&noh=&v2l=&v2h=&oc2l=&oc2h=&sortcol=0&cnt=100&page=1
Hope this helps a little, take care thanx again PP!!
Bea, thanks for your rundown. Fitting the dividend in was my worry too, that and settling in on this after that nice run up recently, sounds like maybe you got in early enough to take the nice quick cash in and head out. I think I’ll be more interested if it were to head back down into lower 13’s.
The Medical Properties Trust saga continues. Bankrupt MPW Tenant Steward Health is asking the State Of PA for an immediate 1.5 million cash infusion or it will close a hospital. A bargain: Steward got 30 million from Massachusetts. Bloomberg reports that Steward just sued MPW which if I remember correctly gave Steward a 75 million cash infusion.
MPW has Strong Sell, Strong Buy and Hold ratings at The Other Website. MPW is up 20% in the last 6 months. MPW is down 33% in the last year. A split opinion there. One for the traders. Or those who like 13% dividends and believe that the safest dividend is the one that has been cut.
No interest in MPW. Does serves as a reminder to look at portfolio concentrations in the REIT quarterlies. JMO. DYODD
Bankrupt Steward Demands State Funds to Keep Hospital Open, Pennsylvania AG Says
https://finance.yahoo.com/news/bankrupt-steward-demands-state-funds-183502976.html
I travelled 60 miles for surgery because Seward was better than our crappy local hospital. Sad to see them go. Apparently it’s not cost effective to provide adequate service.
Looks like none of the pundits on the stock boards read all the way through the Reuters article or understood the possible implications for MPW. (MPT in the Reuters article is Medical Properties Trust, ticker MPW.)
“Steward’s other creditors intend to file a separate complaint challenging the transactions that led to MPT’s ownership of the hospital real estate, according to Steward. The creditors’ action would “raise a bona fide dispute as to whether MPT actually owns the underlying real property,” Steward said in Monday’s complaint.”
“Bankrupt Steward Health sues landlord over stymied hospital sales”
https://www.reuters.com/legal/litigation/bankrupt-steward-health-sues-landlord-over-stymied-hospital-sales-2024-08-19/
Nor did the subscription pundits read down in the Miami Herald article
“The health company also is asking the court to reject the master lease it has with the landlord for its hospitals in Florida and several other states, similar to how the master lease for its Massachusetts hospitals was rejected in July.”
These Florida hospitals are for sale. Will a dispute over land affect what’s next?
Read more at: https://www.miamiherald.com/news/health-care/article291177580.html#storylink=cpy
JMO. DYODD.
While this comment could be posted in the Bond Discussion area, I felt it applied to REITs as well. It does appear that later this year the Federal Reserve may decide to lower interest rates. CD rates are decent now, but hard to know where they will be in a year or two. In my retirement accounts, I’ve been trying to lock in rates of 5% + for the next 10 years and have been a heavy buyer of REIT corporate bonds this month.
Extra Space Storage (EXR) has just issued $400M of 5.35% bonds. These bonds are rated Baa2/BBB+ and are not callable until 1/15/2035. The CUSIP is 30225VAT4. Today they are trading at Vanguard at an ask price of 100.963 for a YTM of 5.229. The company has a market cap of $36B and feel pretty confident about their credit rating. They have about 3,800 locations spread across 42 states.
At least for me, these bonds are a perfect fit in the Fixed Income portion of my retirement portfolio.
Interesting readings in “The Real Deal” on Arbor. Facing shareholder suits, claims of fraud in a mobile home portfolio and risk of losing bank repo lines. The article continues “the investigation of Arbor opened by the Department of Justice and the Federal Bureau of Investigation in New York signals pressure is mounting for the multifamily lender.
Arbor reported $1 billion in multifamily delinquencies in a second-quarter earnings report Friday, a sign the firm is struggling to handle the volume of troubled loans on its balance sheets. ” https://therealdeal.com/national/2024/08/06/arbor-realty-trust-sued-by-investor-alleging-securities-fraud/
The Real Deal often has good articles. In addition to the Arbor piece, they have an article on Ready Capital, RC which just sold off some loans for 70 cents on the dollar. A more-or-less real time snapshot of how bad the CRE market still is.
The predictable reasons: the loans are secured by over-priced properties burdened with short tern floating rate debt that is rolling over at higher rates in a weak economy. Surprising to me: can’t-lose multi-family is weaker than can’t rent office. RC management seems optimistic. RC pays a fat dividend and is doing stock buy-backs. RC has notes and preferreds. I don’t own either Arbor or Ready JMO. DYODD.
Wasn’t going to do a REIT post, but Nasdaq had an in-your-face front pager tonight – “Hey You! There Is a Big New REIT IPO.” (Nasdaq screamed “largest” 3 times in just 35 words.)
It is called Lineage, ticker symbol LINE. The IPO raised $4.4B . LINE is in the cold storage warehouse business. They have ~500 facilities and use advanced technologies in what is a necessary but mundane business.
It seems like Americold COLD might be a competitor but don’t quote me on that. FWIW – Global Net Lease just unloaded 9 COLD warehouses as part of GNL’s debt reduction program, bringing in 170M. (Would rather GNL had dumped offices, but offices are the unwanted kittens of CRE. Everybody loves them but nobody wants to own one. )
LINE is up from 78 to 86 since the IPO. The REIT pumpers haven’t started touting LINE yet, so there is time to avoid the rush. JMO. DYODD.
Bear, Another one of those, “oh dear Jack, trade me some of your hard earned cash for some magic beans” I’m in a show me mood and no hurry to jump into a REIT IPO. Wake up old Rip Van Winkle in about a year after we see a year’s worth of operations.
I apologize Bear if I seem cynical, You have always had some good information and ideas regarding REITS always like hearing from you. Your suggestion on CALM was V. good even with the avian flu problem.
BFS earnings were great..as expected, happily one of my biggest positions in the D and E w$20 basis; I see earnings reported covering pfd divs 5x. Earnings after expenses etc. real money not FFO noise. REG was good to, have the P’s the old Urstadt, great REIT pfd anchors in my mix. Some buzz about Blackstone buying a shopping center REIT brought some attention to this ‘stable’ area of REITdom.
DYODD …not ‘pumping’ .. if you do anything after reading a ticker or cusip, it is so on you. Period. Illiquid, thinly traded, gold stock..whatever the case may be. And I know this would hold up in court or the SEC.. if you are being ‘advised’ by a brokerage or fiduciary – even w disclosure signed saying you knew what you were doing- you MAY have a case. MAY. Reading tickers, articles, et al on financial social media has NOTHING to do with the reality of legal financial actions. Period. So just stop. Stop. Bea
Bea, I have been in and out with this family for a decade at least. Bought on some drops and intend to keep this time unless they get bought out. Point in life I need the income now. Still will accumulate as I don’t think they are at my 3%max rule.
REIT and real estate –
– Blackstone Mortgage Trust – BXMT – Now paying a sustainable dividend of around 10%. Management sees the stock as undervalued and has announced a 150 million buyback program. Good timing by Mgmt. BXMT now even more undervalued after the 25% dividend cut announced on the same day. Stock off ~12% on the cut. The safest dividend is the one that just got cut.
Credit to Carson Block who predicted in December that BXMT would cut in the second half of the year. (Bloomberg video.) Bloomberg mentions Arbor, Apollo, KKR and TPG as competitors.
Until recently, Blackstone had been limiting withdrawals out of its private real estate funds, This change is either a sign of optimism about the recovery or an attempt to avoid panic. (Remember the movie scene where Jimmy Stewart hands cash to a depositor to stop a run on the bank.)
– Generation Income, GIPR, a net lease micro REIT, quietly omitted its dividend in a long and folksy shareholders letter. Its costly acquisitions didn’t work out.
– Deutsche Bank DB down ~9.5% on fears of commercial real estate losses (although you won’t hear much mention of real estate in the “things are fine” conf call. ) Pumpers are out on this one for those who like to buy the dip. (DB is the EU’s Wells Fargo: always a magnet for bad news. If there is a scandal, they will somehow find it. )
https://www.bloomberg.com/news/videos/2024-07-24/blackstone-mortgage-trust-cuts-dividend-by-24-video
JMO. DYODD.
A few real estate headlines, nothing new, from my faulty memory –
– Private real estate funds are limiting withdrawals due to lack of liquidity. (In other words, they have no money because they can’t sell empty office buildings.) Industry participants remain optimistic and urge patience, while using code words like “challenging” and “price discovery.” MarketWatch. Price discovery is downside asymmetric. You never hear it used when Nvidia goes up.
– Multifamily CRE is fine, very low default rates, but rates are edging up. Wolf St. Fears are that Sunbelt areas that got overbuilt with cheap money during the pandemic euphoria are facing high re-fi rates and weak rents. A lot of debt rolling over this year, anxious owners are waiting on the Fed rate cuts. NY Times This is a “don’t worry be happy” situation because Fannie and Freddie will backstop the market for shaky multifamily loans as part of their “mission.” I find this frightening in a “bugs on a bumper” 2008 sort of way.
– The WSJ ran an inconclusive article on big banks and real estate. Big Banks have real estate. But relatively less than the regionals. That might or might not be a problem. The article sounded like a philosophy term paper. I was glad I dropped my subscription.
The rush to exit commercial real-estate funds is going mainstream
https://www.marketwatch.com/story/the-rush-to-exit-commercial-real-estate-funds-is-going-mainstream-ae178260?mod=MW_article_top_stories
JMO. DYODD.
ARBOR REALTY TRUST MOST SHORTED STOCK. Great article in WSJ, I tried to gift it so hopefully not behind paywall.
Arborhttps://www.wsj.com/real-estate/commercial/propertys-big-short-isnt-going-to-plan-4559e8cb?st=rb6sa1vioypnfhi&reflink=desktopwebshare_permalink
I have avoided Arbor but know there is interest for some. Put my eggs in strong regional southern banks. And, given the expiration of Trump tax cuts slowly minimizing my REITS from taxable accounts.
If this doesn’t work remove “Arbor” in front of https
The preferred D and E offer some nice yields >8%, and the f/f F yielding ~18% to call date 10/26, and if not called, SOFR + 5.442%.
I buy ABR preferreds when the short sellers hysterically negative hit pieces drive the price down. Sell some when it bounces back.
TNT:
Here is an even better article from Bloomberg on 6/6/24 on Apartment Real Estate Syndicates where the equity investors are all getting wiped out.
In the article it states that ABR is one of the major lenders to these private syndicates. At some point one would think ABR is going to have to seriously ramp up the CECLs (Current Expected Credit Losses), no matter how many games they play. But this short does seem way too crowded.
“Real Estate Investors Are Wiped Out in Bets Fueled by Wall Street Loans
Syndicators made big purchases that are unraveling with high interest rates, adding distress to an already troubled US property market.
https://www.bloomberg.com/news/features/2024-06-06/real-estate-investors-face-crisis-as-big-wall-street-deals-unravel?srnd=homepage-americas
KT, I read that and other articles on syndicators. The low interest rates distorted the capital markets. I personally have had 4 calls from syndicators asking if I would take preferred return so they can finance rate caps and increased interest expense. My answer remains, “why would I want to take that risk for 8 to 9% when risk free is over 5%?
I invested in several deals. Thankfully, I had great GPs. The deals in Phoenix cashed out and the one remaining I invested solely because the developer took HUD financing so he has 20 + years under 3% (while others laughed at him going thru hoops when banks were giving it away free). A few others in TX are doing ok. No capital calls nor distress. I do feel sorry for some of these limited investors (and syndicators). The era of easy money made many folks rich that honestly didn’t have a clue!
One of my takes about regional banks is just this issue. I don’t think the banks will take big haircuts but the investors and syndicators may very well lose everything.
the two controversial I guess REITs I now find in my portfolio are EPR, the experiences REIT. Read thru their NAREIT transcript on SA and I had a position, will bring that to 2%. Yes theaters but the best ones in the country booming w concessions sales too and they get a % of those in some theaters they have renegotiated the terms with. About an 8.4% now on the monthly which was incr this year. Topgolf, ski resorts, Andretti ‘Karting’..slowly reducing dependence on theaters. I have the C pfds as well for a small holding.
next up in the ‘what Bea’ category is PSTL the USPS reit; about a 7.2% yield on the 13.30. Spodek the CEO has been buying shares as recently as late May and has added 80k since fall ’23. Chairman is former Postmaster General. They know the best properties to buy and build here, not expecting much div growth but navigating getting better cap rates well to adjust for higher int rates. Mail Order RX delivery, last mile small packages etc strong, local supermarkets still sending flyers ea wk, they tried to pullback and people complained! lol. Anyway like a pfd to me here.
DYODD, like Martin G but in a different way and other comments about not hanging out short end rate wise too long, while I still have 48% or so in SGOV/cash, I have been ‘moving’ out the curve w perp pfds and select income issues. Lot of work but if you are managing your own money you better do the work. GLTA. Bea
I just found and purchased PSTL the other day. Thanks for the additional info though on that one.