Single-Family Housing REITs: Investors Will Be Deeply Disappointed With Income And Returns [View article]
Omer, regarding your comment "Who cares about over paying if appreciation is huge?" I had colleagues who said the same thing in 1999 about buying dotcom stocks, and they lost everything. An investor should always care about over paying for a stock, and wait until it corrects to a reasonable level if it is over valued.
Will This REIT Grow Too Big, Too Fast And Will It Last? [View article]
Brad, as one who like to place a limit order for a REIT at a great buy point (like I did for this week's DLR purchase at $60), and patiently wait for the market to hit the price (if it does), at what price (assuming there is one) would you recommend buying ARCP?
A New High Dividend REIT With Insider Buying And Institutional Support [View article]
Plainpaper, FYI I do not live in the Lone Star State, I live in the Golden State. However, I know about the Texas prison situation because California use to house some of its prisoners in Texas jails which helped Texas take up some of it's empty cells, but California has now brought them back to California to save money. I think you are smart to stay away from prison investments (as well as away from prisons!).
Thank Uncle Ben For Serendipity In REIT-Dom [View article]
Thanks for this article Brad. Regarding your statement "Now before you get excited, I have not seen any "blue chip" bargains," it seems to me that this is not correct, since don't you consider DLR at $60 a blue chip REIT bargain? I today initiated a position in DLR when it hit $60.00 (I have been waiting since January for that limit order to trigger).
A New High Dividend REIT With Insider Buying And Institutional Support [View article]
There is a lot of risk in correction and detention facilities:
1. Lack of diversification in asset types 2. Relatively few potential customers (only governments) 3. Dependence on the condition of local and state finances 4. Dependence on rising crime rates and focus on incarceration. To mention just one example, thanks to falling crime rates and new-found success in rehabilitation, in Texas there aren’t enough convicts to fill all the cells built by the state, counties and private contractors who thought the flow of inmates would never end. The state corrections system now has more than 11,000 empty bunks. One state prison has closed, and two more are on the chopping block. County jails have more than 21,000 empty beds of their own. And those once-flourishing private lockups? Several stand empty, as do at least four of the six former state juvenile prisons that were shuttered two years ago. Research by the American-Statesman shows that in Texas nearly two dozen county and private lockups are now vacant or almost so, as are thousands of bunks in state adult and juvenile prisons. 5. Many are in economically depressed or remote rural locations 6. The difficulty of repurposing a facility if the tenant is lost. The cells are too small for offices, and the bars and concrete aren’t aesthetically adaptable for much of anything other than holding prisoners. 7. The loss of principal when the property is deemed functionally obsolete
There are much more promising REITs to "lock up" your money in!
How Hannon Armstrong Got The IRS To Approve Its Renewable REIT [View article]
Thanks for this article Greentech Media. Eckel said, "yet what we are doing is offering investors an attractive risk-adjusted yield." Since a critical part of the overall yield is the dividend, what is the dividend going to be for HASI?
Shopping For REITs As We Enter A New Wealth Creation Cycle [View article]
Brad, I think what confuses a lot of us is that if, as you comment, "As interest rates begin to rise, cap rates (net income dividend by purchase price) will go up...In other words, I am feeling like we are at the bottom of the cycle and prices will begin to move down" then won't REITs current properties also be worth less, which will decrease NAV, and presumably be reflected in decreasing REIT share prices? If this is correct, then how can you justify, in the face of declining share prices, "REIT investors are in the stages of new cycle of wealth creation"?
Picking An All-Star REIT Team To Defend Against Interest Rate Risk [View article]
I completely agree. I think the subscription price is very reasonable given how much I have profited so far following his advice. It should be noted that I am also subscribing for a very selfish reason, which is I want to have access to his timeliest and most detailed research before the masses get it from his articles!
This REIT Is Approaching Bubble Territory [View article]
Tim, good article, but you have a typo. You write: "If you bought $107/,000 worth of General Electric stock on June 15, 2000, you would have $675 today, and that is assuming optimal tax strategy." Wait $107,000 went to $675? Not the General Electric I follow!
Silver Bay Realty Trust: A Disaster Waiting To Happen [View article]
Josh, thanks for this very detailed and thoughtful analysis. It clearly elucidates why SBY is not a good investment at this price. I hope you will analyze other REITs in a similar fashion. One factor that you did not mention is that in the not too far distant future population growth in Phoenix may be limited by inadequate fresh water supplies.
I do have a question for you, which is if we assume that SBY's primary markets bounce back substantially, as many believe is going to happen, wouldn't that in turn be reflected in its share price in the form of appreciation? For example, if the value of its homes, in aggregate, grow 50% in the next three years, wouldn't you expect the share price to grow roughly 50%, thereby (in terms of total return) more than making up for SBY's lack of dividend?
Picking An All-Star REIT Team To Defend Against Interest Rate Risk [View article]
CE Cassel, fo what it is worth, I tend to look at BDCs as well diversified junk bond firms for smaller companies. This is because the loans tend to be to smaller to midsize companies (in terms of market cap) without sterling credit ratings, that banks do not want to give loans to now. These stocks could suffer when interest rates rise or if the economy slumps. I do not see either happening anytime soon, but I suggest that you be vigilant and prepared to sell your BDCs if either scenario looks like it is imminent. Personally, I like REITs better, but I can see a reasonable argument for owning both. I am interested in why you think BDCs are a better diversifier than traditional junk bond funds?
Single-Family Housing REITs: Investors Will Be Deeply Disappointed With Income And Returns [View article]
Single-Family Housing REITs: Investors Will Be Deeply Disappointed With Income And Returns [View article]
Will This REIT Grow Too Big, Too Fast And Will It Last? [View article]
A New High Dividend REIT With Insider Buying And Institutional Support [View article]
Thank Uncle Ben For Serendipity In REIT-Dom [View article]
A New High Dividend REIT With Insider Buying And Institutional Support [View article]
1. Lack of diversification in asset types
2. Relatively few potential customers (only governments)
3. Dependence on the condition of local and state finances
4. Dependence on rising crime rates and focus on incarceration. To mention just one example, thanks to falling crime rates and new-found success in rehabilitation, in Texas there aren’t enough convicts to fill all the cells built by the state, counties and private contractors who thought the flow of inmates would never end. The state corrections system now has more than 11,000 empty bunks. One state prison has closed, and two more are on the chopping block. County jails have more than 21,000 empty beds of their own. And those once-flourishing private lockups? Several stand empty, as do at least four of the six former state juvenile prisons that were shuttered two years ago. Research by the American-Statesman shows that in Texas nearly two dozen county and private lockups are now vacant or almost so, as are thousands of bunks in state adult and juvenile prisons.
5. Many are in economically depressed or remote rural locations
6. The difficulty of repurposing a facility if the tenant is lost. The cells are too small for offices, and the bars and concrete aren’t aesthetically adaptable for much of anything other than holding prisoners.
7. The loss of principal when the property is deemed functionally obsolete
There are much more promising REITs to "lock up" your money in!
How Hannon Armstrong Got The IRS To Approve Its Renewable REIT [View article]
Shopping For REITs As We Enter A New Wealth Creation Cycle [View article]
Shopping For REITs As We Enter A New Wealth Creation Cycle [View article]
Chambers Street: More Liquidity Magic On The Way In REIT-Dom [View article]
Picking An All-Star REIT Team To Defend Against Interest Rate Risk [View article]
This REIT Is Approaching Bubble Territory [View article]
Silver Bay Realty Trust: A Disaster Waiting To Happen [View article]
I do have a question for you, which is if we assume that SBY's primary markets bounce back substantially, as many believe is going to happen, wouldn't that in turn be reflected in its share price in the form of appreciation? For example, if the value of its homes, in aggregate, grow 50% in the next three years, wouldn't you expect the share price to grow roughly 50%, thereby (in terms of total return) more than making up for SBY's lack of dividend?
If You Are Going To Be A Successful REIT Investor, You Must Go Where The REITs Are [View article]
Picking An All-Star REIT Team To Defend Against Interest Rate Risk [View article]