Mon, Nov. 28, 10:02 AM
- Evercore boosts its estimate for the 10-year Treasury yield to 3% to end next year. While REITs are in "the crosshairs" of higher rates, the improving economy should help offset that in areas like apartments and hotels, says analyst Steve Sakwa.
- He also notes the sectors have struggled of late, meaning they've discounted plenty of bad news.
- Upgraded to Buy from Hold are AvalonBay (AVB +1.9%), Essex Property (ESS +1.8%), and UDR (UDR +1.8%), with Sakwa noting supply growth on the coasts becoming less of a concern beginning in the second half of 2017.
- He's also got a valuation-related downgrade in the office space to Hold from Buy: Kilroy Realty (KRC -0.4%).
- Source: Bloomberg
Mon, Nov. 14, 3:07 PM
- With interest rates shooting higher today, the REIT selloff resumed this morning, but there's been a major reversal, with the VNQ now up 2.5% and IYR +2% vs, the S&P 500's flat performance.
- Among the movers: Vereit (VER +1.4%), Omega Healthcare (OHI +3.5%), HCP (HCP +4.7%), Lexington Realty (LXP +4.8%), UDR (UDR +3.4%), General Growth (GGP +3.6%), CubeSmart (CUBE +1%), Host Hotels (HST +5.1%), Gramercy Property (GPT +3.2%).
Tue, Oct. 25, 4:28 PM
Tue, Oct. 25, 10:12 AM
Mon, Oct. 24, 5:35 PM
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Fri, Sep. 30, 10:22 AM
Thu, Sep. 22, 4:26 PM
Thu, Sep. 8, 10:14 AM
- May-August is typically peak apartment-leasing season in Manhattan, but landlords were unable to push up rents, as a report pegs the median monthly rent last month at $3,399, flat from one year ago. This comes as 6,285 new leases were signed, the most in any month dating back to January 2008.
- At issue, according to Jonathan Miller of property appraiser Miller Samuel, is excess supply - and it's likely to remain a challenge for the next year or two.
- According to Citi Habitats, 19% of new leases signed last month came with some form of landlord concession such as a free month, or payment of the broker's fee. One year ago in August, such sweeteners were seen on just 7% of deals.
- Interested parties: AvalonBay (AVB -1.2%), Equity Residential (EQR -1.6%), UDR (UDR -1%), Aimco (AIV -1%)
Thu, Aug. 25, 7:58 AM
- Analyst James Sullivan moves over the BTIG from Cowen & Co. Checking apartment REITs:
- AvalonBay (NYSE:AVB) is started at Buy and $208 price target after being rated only a Hold with $192 price target at Cowen, with Sullivan saying the company is the sector's best external growth story.
- Also a Hold at Cowen, UDR is initiated at Buy with $42 price target, with Sullivan saying the portfolio mix of primary and secondary markets and moderate price points has outperformed in a decelerating market.
- Essex Property Trust (NYSE:ESS) also merits an upgrade - now a Buy at BTIG.
- A Buy at Cowen, MAA is now only Neutral at BTIG.
- Monogram Residential (NYSE:MORE) is a Buy at BTIG after being rated the same at Cowen.
- See also: More new REIT coverage at BTIG (Aug. 25)
Tue, Jul. 26, 4:55 PM
Tue, Jul. 26, 3:01 PM
- Concessions of $300K in Q2 were four times higher than in Q2 one year ago, with sweeteners the greatest in NYC, NoCal, and New England, according to COO Sean Breslin.
- Higher competition from the surge in newly built apartment buildings will drive revenue in communities open at least 12 months down by about 0.4%, says the company. Also at work: Job growth in the areas where AvalonBay (AVB -1.9%) owns properties was weaker than expected in Q2.
- "We did not see the same seasonal lift we’ve seen in prior years,” says CEO Timothy Naughton. "There's just not enough high-paying jobs being created to absorb al the new supply," says Breslin.
- Equity Residential (EQR -0.6%), Essex Property (ESS -1.8%), UDR (UDR -1.1%), Camden Property (CPT -1.3%)
Mon, Jul. 25, 5:35 PM
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Thu, Jun. 23, 4:17 PM
Thu, Jun. 16, 10:20 AM
- Inside May's CPI report was a monthly rent increase of 0.4%, the strongest monthly increase sine 2007. The year-over-year rise was 3.8%, the highest since 2008.
- That far outpaces the average hourly wage increase of 1.4%.
- Associated tickers: EQR, AVB, ESS, PPS, UDR, AIV, CPT, MAA, IRET, IRT, MORE, APTS
Thu, Jun. 9, 11:52 AM
- The team hosted meetings with 29 companies over two days across six subsectors. Some highlights:
- Lodging: Business travel remains soft and most are operating defensively by grouping up and reducing leverage. NYC is flooded with hotels available for sale which should pressure pricing.
- Apartments: The slowdown in NoCal is concentrated in Soma and San Jose, but expected to be temporary. The NYC slowdown is expected to endure through 2017. Merchant builders in Houston with deliveries in 2017 are in trouble - an opportunity for Camden Property Trust (NYSE:CPT) to pick up assets on the cheap.
- Malls: Concerns over department stores are overblown. Simon Property (NYSE:SPG) expects spreads to top mid-teens in the next five years. Omni-channel retail strategy is growing increasingly important as the WSJ reports 80% of online sales touch brick and mortar in some way.
- CS's Ian Weissman is ranked #1,134 out of #3,990 analysts on TipRanks.com.
- Tickers of interest: HPT, SHO, LHO, PEB, CHSP, INN, RLJ, EQR, AVB, ESS, PPS, UDR, AIV, GGP, BRX, KIM, WRI, MAC
Wed, Jun. 8, 9:49 AM
- Equity Residential (EQR -1%), AvalonBay Communities (AVB -1.1%), and Essex Property Trust (ESS -0.5%) are all downgraded to Hold from Buy at Jefferies.
- With market caps of $13B-$23B, these three are the apartment sector giants by a wide margin. They tend to play in the high-priced markets on the coasts (Essex is all West Coast).
- Equity Residential made big news late last year when it sold a big chunk of its portfolio - and when Sam Zell sells, it's worth paying attention to. The company made more news last week when it cut guidance thanks to weakness in San Francisco and New York (though management played this down at a conference yesterday).
- Other sector names: Post Properties (PPS +0.1%), UDR (UDR -0.8%), Aimco (AIV -0.5%), Camden Property (CPT -1%), Mid-America (MAA -0.3%), Investors Real Estate (IRET +1.6%), Independence Realty (IRT +0.4%), Monogram Residential (MORE -0.5%), NexPoint (NXRT), Preferred Apartment (APTS +0.6%), Bluerock Residential (BRG -0.2%)