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Carey Means Clarity


  • To put it in simple terms, Net Lease investing should be simple, there’s really no reason to get “too cute” and try to outthink Mr. Market.
  • Like Buffett buying into STOR, catalysts can be pleasant surprises, especially when you are correct with the overall assessment of the company.
  • If there’s ever a Net Lease REIT that deserves a STRONG BUY recommendation, it’s W.P. Carey.

It was great to see one of my previously referenced catalysts playing out last week in the Net Lease REIT sector, and while I was not expecting such a big spark with Berkshire Hathaway’s (BRK.A) (BRK.B) investment in STORE Capital (STOR), it proved to be a textbook example of an undervalued REIT flying under the radar. Back in February, I explained:

STOR is trading at a margin of safety, and I expect that valuation gap to close in 2017… I believe there's a margin of safety that represents an outsized opportunity in which returns could fetch 20% per year…

STOR closed the week at $22.45, up around 10%, and in an article last week I added:

…it's clear that Berkshire Hathaway is now holding a Net Lease gem that offers investors a reliable source of dividend income with shares priced at a sizable margin of safety. The latest move also validates the importance of owning Net Lease REITs in an investment portfolio and the high fragmentation that will result in further consolidation.

I pointed out to someone last week that BRK’s investment in STOR was like its much larger stake in Wells Fargo (WFC) and Bank of America (BAC). For the same reasons that Buffett has amassed outsized positions in the two largest banks, I view the move (to owns shares in STOR) as more of a bet on Net Lease REIT consolidation and a validation that Berkshire Hathaway sees value in being a stakeholder in the highly fragmented Net Lease financing sector.

I have been preaching this for some time on Seeking Alpha, that is, being a low-cost consolidator means that investors benefit from stable dividends and steady share price appreciation. No other property sector has demonstrated such resiliency through multiple economic conditions, and Net Lease REITs remain the most favored method for

This article was written by

Brad Thomas profile picture
Leader of iREIT on Alpha
The #1 Service For Safe and Reliable REIT Income

Brad Thomas is the CEO of Wide Moat Research ("WMR"), a subscription-based publisher of financial information, serving over 100,000 investors around the world. WMR has a team of experienced multi-disciplined analysts covering all dividend categories, including REITs, MLPs, BDCs, and traditional C-Corps.

The WMR brands include: (1) iREIT on Alpha (Seeking Alpha), and (2) The Dividend Kings (Seeking Alpha), and (3) Wide Moat Research. He is also the editor of The Forbes Real Estate Investor

Thomas has also been featured in Barron's, Forbes Magazine, Kiplinger’s, US News & World Report, Money, NPR, Institutional Investor, GlobeStreet, CNN, Newsmax, and Fox. 

He is the #1 contributing analyst on Seeking Alpha in 2014, 2015, 2016, 2017, 2018, 2019, 2020, 2021, and 2022 (based on page views) and has over 108,000 followers (on Seeking Alpha). Thomas is also the author of The Intelligent REIT Investor Guide (Wiley) and is writing a new book, REITs For Dummies. 

Thomas received a Bachelor of Science degree in Business/Economics from Presbyterian College and he is married with 5 wonderful kids. He has over 30 years of real estate investing experience and is one of the most prolific writers on Seeking Alpha. To learn more about Brad visit HERE.

Analyst’s Disclosure: I am/we are long AHP, APTS, ARI, BRX, BXMT, CCI, CCP, CHCT, CLDT, CONE, CORR, CUBE, DLR, DOC, EXR, FPI, GMRE, GPT, HASI, HTA, IRET, IRM, JCAP, KIM, LADR, LTC, LXP, NXRT, O, OHI, PEB, PEI, PK, QTS, ROIC, SKT, SNR, SPG, STAG, STOR, STWD, TCO, WPC. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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