Entering text into the input field will update the search result below

REITs: Own A Piece Of Hawaiian Paradise

Mar. 03, 2020 9:07 AM ETILPT, HST, HLT, PK, RLJ, SHO, WPGGQ, BPY, AAT, SPG, HHC, VNQ, ALEX, DEI9 Comments
Chilton REIT Team profile picture
Chilton REIT Team


  • We believe that some of the unique challenges for the market are exactly what makes Hawaii an attractive place to invest.
  • In particular, the difficulty of developing new commercial real estate and housing keeps a lid on new commercial real estate supply, thus giving an advantage to current landlords.
  • While tourism can present a level of unpredictability, the long term supply and demand dynamics present an attractive risk-adjusted return, especially relative to other mainland markets.

Since becoming a state in 1959, Hawaii has been portrayed as a sunny beach vacation spot with palm trees and a rich cultural history. As with most things, reality is much more complicated. While it does boast some of the most beautiful beaches in the world (with top notch surfing), the rich cultural ‘history’ is not all in the past. As the most recent state added to the union, native Hawaiians have the shortest history as part of the USA. Similarly, their culture was independent of American culture more recently than any other state, exacerbated even further by geographical distance. As such, investing in Hawaii presents some of the most unique opportunities and risks relative to the other 49 states.

We believe that some of the unique challenges for the market are exactly what makes Hawaii an attractive place to invest. In particular, the difficulty of developing new commercial real estate and housing keeps a lid on new commercial real estate supply, thus giving an advantage to current landlords. While the contribution of tourism to the local economy makes it slightly more difficult to predict short term demand growth, the relative stability to other ‘island destinations’, solid infrastructure, and temperate climate give us confidence in long term growth. The Chilton REIT Composite has an overweight position to Hawaii as of February 29, 2020.

Hawaii Economic Overview

With about 1.4 million residents as of 2018, Hawaii is the 39th most populous state. However, it has established itself as one of the top tourist destinations in the world, boasting almost 10.0 million visitors in 2018. These visitors spent $17.6 billion, which comprised about 18.5% of Hawaii’s gross domestic product (or GDP). This compares to the national average of 2.9%, and ranks Hawaii as the highest state for tourism spending as a percent of GDP. On the back of strong tourism, Hawaii’s GDP growth has outpaced

This article was written by

Chilton REIT Team profile picture
The REIT Team of Chilton Capital Management, a Houston-based investment adviser, is headed by co-portfolio managers Bruce Garrison, CFA, and Matt Werner, CFA. Mr. Garrison has over 40 years of experience analyzing public REITs both on the buy-side and the sell-side. Mr. Werner joined Mr. Garrison on the Chilton REIT Team in 2009. The REIT Team’s strategy primarily pursues investments in publicly traded real estate investment trusts (REITs) and real estate related entities based primarily in North America. The REIT Team believes public REITs are superior vehicles for investing in real estate due to their liquidity, transparency, and total return characteristics. Investing in public securities enhances the REIT Team’s ability to diversify by geography, sector, strategy, property, and tenant while maintaining portfolio liquidity. REIT property types include apartments, regional malls, shopping centers, lodging, office, industrial, self-storage, data centers/cell towers, and a variety of health care related facilities. The REIT Team focuses on traditional methods of security analysis; primarily research, critical thought and analytical depth, which are integral to their investment process. The REIT Team’s investment approach seeks to combine its real estate industry experience with traditional methods of security selection to make sound investment decisions in real estate companies. The Chilton REIT Team manages Separately Managed Accounts (SMAs) for high net worth individuals and institutions. Additionally, the REIT Team is the sub-advisor for an open-end investment company, the West Loop Realty Fund (tickers: REIIX, REIAX, and REICX). Before investing one should carefully consider the West Loop Realty Fund’s investment objectives, risks, charges and expenses. This and other information is in the prospectus and summary prospectus, a copy of which may be obtained by calling 800-207-7108. Please read the Fund’s prospectus or summary prospectus carefully before investing. The Fund may not be suitable for all investors. We encourage you to consult with appropriate financial professionals before considering an investment in the Fund. Liberty Street Advisors, Inc. is the advisor to the Fund. The Fund is part of the Liberty Street family of funds within the series of Investment Managers Series Trust. The Fund is Distributed by Foreside Fund Services, LLC. Chilton Capital Management, LLC is an independently owned and operated firm formed in 1996. Chilton provides investment advisory services for registered investment companies, private clients, family offices, endowments, foundations, retirement plans and trusts. For more information about Chilton Capital Management’s REIT Team, please visit www.chiltoncapital.com/reit/ or email info@chiltoncapital.com. Additional information about Chilton Capital Management LLC is also available on the United States Securities and Exchange Commission’s website at www.adviserinfo.sec.gov. The searchable IARD/CRD number for Chilton Capital Management LLC is 104592.

Analyst’s Disclosure: I am/we are long DEI, ALEX, HST, HLT, WPG, SPG.

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.

Recommended For You

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.