Josh Arnold
Long/short equity

Silver Bay Realty Trust: A Disaster Waiting To Happen


Silver Bay Realty Trust (NYSE:SBY) is a newly-formed REIT that was recently spun out of Two Harbors (NYSE:TWO). The company seeks to buy distressed residential properties, rehabilitate them and then rent them out. The idea is that with housing prices still depressed in many parts of the country, SBY can use its managerial experience to identify the most distressed property markets and those that are most favorable for rental conditions. In essence, SBY buys up large blocks of nonperforming loans (or houses that are already in foreclosure) and remodels (or "stabilize") the properties in order to prepare them for renters. Then, the company collects monthly rent payments in order to provide revenue for ongoing operations,...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
IDEA GENERATORXExclusive access to 10 PRO ideas every day
INVESTING IDEAS LIBRARYXExclusive access to PRO library of more than 15,000 ideas
SECTOR EXPERT NETWORKXExclusive access to all sector experts for direct consultation
PERFORMANCE TRACKINGXTrack performance of all PRO stock ideas
PROFESSIONAL TOOLSXProfessional Idea Filters to zero-in based on industry, market cap and more
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO."Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else."Patrick Rice, Mainstay Capital Management
You may cancel at any time for any reason, and receive a prompt refund for membership on months paid and not used (max. 6 months). Details