Wed, Apr. 22, 10:02 AM
- Deals in the REIT space are picking up steam, with the latest being today's sale of Associated Estates to a Brookfield fund for $2.5B. Associated Estates has been under activist pressure for a number of months, and one wonders if any other apartment names might be next in line.
- Sector giants Equity Residential (EQR +1.3%), AvalonBay (AVB +1.2%), and Essex Property (ESS +1.2%) don't seem like likely targets, but are nicely higher on the session.
- Others: Post Properties (PPS +1.7%), UDR (UDR +1.6%), Aimco (AIV +1.3%), Camden Property (CPT +1.2%), Home Properties (HME +1.4%), Mid-America Apartments (MAA +1.1%), Investors Real Estate (IRET +0.8%).
- ETFs: IYR, VNQ, DRN, URE, SCHH, ICF, SRS, RWR, KBWY, DRV, REK, FRI, FTY, PSR, FREL, WREI
Tue, Apr. 21, 3:54 PM
- The REITs are down about 8% from their January highs while the homebuilders have posted gains, bringing the ratio of homebuilders to REITs to long-term resistance, says MKM Partners' Jonathan Krinsky, who suggests fading the move.
- Most vulnerable to tactical pullbacks are those homebuilders/suppliers showing the weakest relative strength: Beazer Homes (NYSE:BZH), Lennar (NYSE:LEN), Louisiana-Pacific (NYSE:LPX), Taylor Morrisn (NYSE:TMHC), Toll Brothers (NYSE:TOL), and TRI Pointe Homes (NYSE:TPH).
- The best long REIT ideas are those showing the best relative strength: AvalonBay (NYSE:AVB), Crown Castle (NYSE:CCI), Essex Property (NYSE:ESS), Extra Space Storage (NYSE:EXR), Federal Realty (NYSE:FRT), General Growth (NYSE:GGP), SL Green (NYSE:SLG), and UDR.
- Those REITs showing poor relative strength or to be avoided or sold: American Tower (NYSE:AMT), American Realty Capital (NASDAQ:ARCP), Brixmor (NYSE:BRX), Host Hotels (NYSE:HST), and Omega Healthcare (NYSE:OHI).
- Source: Barron's
Thu, Apr. 9, 10:30 AM
- "We expect apartment fundamentals to remain stronger for longer given favorable demographics, solid job and wage growth, little impact from for-sale housing, and lower gasoline costs," says analyst Robert Stevenson, anticipating renters will continue to absorb 5%+ rental rate hikes this year.
- His two favorite names in apartment REITs are Home Properties (HME -1.1%) and Mid-America Apartment Communities (MAA -1.5%) - they're the cheapest in the sector, he says, and he sees no reason to pay a premium price for others with similar growth characteristics.
- Risks: Spiking long-term bond yields and oversupply, but Stevenson believes the apartment companies are better-positioned to deal with both than the rest of the residential REIT sector.
- Bullish on HME and MAA, Stevenson gives Neutral ratings to Aimco (AIV -1.5%), AvalonBay (AVB -1.6%), Camden Property (CPT -1.5%), Equity Residential (EQR -1.7%), Essex Property (ESS -1.7%), Post Properties (PPS -1%), and UDR (UDR -1.7%).
- Source: Barron's
Wed, Apr. 8, 10:28 AM| Comment!
Thu, Mar. 26, 4:45 PM
Tue, Mar. 17, 9:56 AM
- Launching coverage on the multi-family sector, Baird starts UDR (UDR -0.1%), Camden Property (CPT -0.1%), Mid-America Apartment (MAA +0.5%), and Aimco (AIV) at Outperform.
- Started at Neural are AvalonBay (AVB -0.3%), Post Properties (PPS -0.7%), Essex Property (ESS -0.2%), and Equity Residential (EQR -0.7%).
- Manufactured housing community operator Sun Communities (SUI +0.2%) rates a Neutral, as do campus housing players American Campus Communities (ACC) and Education Realty (EDR -0.2%).
- Equity Lifestyle Properties (ELS -0.6%) is started at Outperform.
Thu, Mar. 5, 9:55 AM
- Alongside its upgrade of Equity Residential to Buy, Evercore ISI is taking its chips off the table on UDR, downgrading to Hold from Buy after a big run higher for the stock. Nevertheless, it's a bull market for apartment REIT names, and UDR is higher by 1% in early action.
- Previously: Equity Residential higher as Evercore ISI bets on continued move (March 5)
Wed, Feb. 18, 12:47 PM
- Including dividends, apartment REITs returned 39.7% in 2014, the best among all real estate sectors, according to Nareit, which says REITs overall returned a still-pleasing 28%.
- REITs in general have cooled of late - off 1.7% in February, with apartments off 1.1% as some analysts ring the register.
- Morgan Stanley's Haendel St. Juste says slowing growth combined with pricey stock prices isn't the best combination. He notes the names are trading at 10-15% premiums to NAV vs. 10-15% discounts one year ago.
- Then there's oversupply, especially in company towns like D.C. and in the Texas oil belt. Over the past six months, builders have broken ground on multifamily apartments at an average pace of 357K units per year - 26% more than the 30-year average.
- Names of interest: EQR, AVB, ESS, PPS, UDR, AIV, CPT. HME, MAA, TSRE, AEC, IRET
Mon, Feb. 2, 5:20 PM
- Q4 adjusted FFO per share of $0.34 vs. $0.30 one year ago. Quarterly dividend is $0.26 per share. 2015 annualized dividend of $1.11 per share is declared, up 7% from 2014.
- Same-store revenue growth of 4.2%; same-store NOI growth of 5.1%.
- 2015 Q1 outlook: AFFO per share of $0.35-$0.37. 2015 full-year outlook: AFFO per share of $1.41-$1.47 ($1.35 in 2014).
- Earnings call tomorrow at 1 ET
- Previously: UDR FFO in-line, beats on revenue (Feb. 2)
- UDR flat after hours.
Mon, Feb. 2, 4:09 PM
Mon, Feb. 2, 11:15 AM| 2 Comments
Sun, Feb. 1, 5:35 PM
Wed, Jan. 28, 12:23 PM
- Expect plenty of foreign capital to continue flowing into the sector, says MLV analyst Ryan Meliker. This will contribute to cap rate compression, making it more difficult for REITs to make accretive purchases.
- The West Coast should lead the country in job generation, and thus rent growth, making Essex Property Trust (ESS) - essentially a pure-play on major markets there - an interesting pick.
- The Northeast is split - with Boston and NYC expected to outperform on rent growth, but Philadelphia, Baltimore, and D.C. predicted to lag.
- Strength in the Southeast will be led by Atlanta, and Central and South Florida. Meliker's top pick, Preferred Apartments (APTS +0.6%) has a strong presence in Atlanta.
- "Conference participants agreed that Houston was in for difficult times ahead – there was no sugar coating how oil prices might affect job growth and therefore demand for multifamily housing."
- Others of interest: Aimco (AIV +0.6%), Associated Estates (AEC +3.1%), AvalonBay (AVB -0.2%), Post Properties (PPS +0.3%), UDR (UDR +0.3%), Camden Property (CPT -0.3%), Home Properties (HME +0.2%), Mid-America (MAA +0.1%), Trade Street Residential (TSRE -0.6%), Equity Residential (EQR +0.3%).
Wed, Jan. 14, 7:34 AM
- The hot sector is cut to Market Weight from Overweight at Wells Fargo amid a big reshuffling of ratings at the bank.
- Names of interest: EQR, AVB, ESS, PPS, UDR, AIV, CPT, HME, MAA, TSRE, AEC, IRET.
- Previously: Sell the net lease REIT sector says Wells Fargo (Jan. 14)
- Previously: Wells Fargo pulls the plug on mortgage REITs (Jan. 12)
Dec. 16, 2014, 4:18 PM
Dec. 16, 2014, 10:49 AM
- National annual effective rent growth of 4.7% in November is the strongest result since August 2011, reports Axiometrics.
- Axiometrics' Jay Denton: "The combination of an improving job market, and a growing percentage of the population that prefers renting to owning, continues to boost apartment demand."
- Year-to-date rent growth of 5% makes 2014 the strongest post-recession year. 2010 was the previous high at 4.6%.
- The occupancy rate continued a seasonal decline, but at 94.8% it's the strongest November read since Axiometrics started reporting monthly in 2008.
- Source: Press release
- Interested parties: EQR, AVB, ESS, PPS, UDR, AIV, CPT, HME, MAA, TSRE, AEC, IRET
UDR vs. ETF Alternatives
UDR Inc is a self-administered real estate investment trust that owns, acquires, renovates, develops, and manages apartment communitiesgenerally located in high barrier-to-entry markets located throughout the United States.
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