iREIT Daily

The State of the Union

Brad Thomas

467 postsMarch 2, 2022

Let’s start with the obvious: that stocks fell noticeably yesterday as the Russia-Ukraine war continues.

The S&P 500 lost 1.55%, or 67.68 points. The Dow gave up 597.65 points, or 1.76%. And the Nasdaq lost 218.94 points, or 1.59%.

The Russell 2000 dropped the most though percentage-wise, down 39.56 points, or 1.93%.

Gold, however, resumed its climb, as did crude oil. The latter jumped $8.97 per barrel, or 9.37%. And it gained again last night during Biden’s State of the Union address. At last check this morning (at 8:36 a.m.), crude was trading around $112.

Apparently, oil traders don’t put much “stock” (pun intended) in Biden’s SOTU statement that:

… the United States has worked with 30 other countries to release 60 million barrels of oil from reserves around the world. America will lead that effort, releasing 30 million barrels from our own Strategic Petroleum Reserve. And we stand ready to do more if necessary, unified with our allies. These steps will help blunt gas prices here at home.

As for inflation, he told the nation that his “top priority is getting prices under control,” adding:

One way to fight inflation is to drive down wages and make Americans poorer. I have a better plan to fight inflation: Lower your costs, not your wages.

As Yahoo Finance commented:

Biden outlined a four-point plan to fight inflation on Tuesday night. The bullet points included strengthening supply chains, reducing costs through government action, taking on corporate consolidation, and encouraging workers to find better jobs by providing resources like retraining.
In addition… Biden also needs the Senate to approve his five nominees for the Federal Reserve…

Speaking of such, Federal Reserve Chair Jerome Powell will be speaking on Capital Hill today. We’ll see what he says and whether the markets care.

More Non-REIT News to Know About

If this gathering had happened earlier this year, everyone would be speculating about Powell’s position. But we’re much more focused on Ukraine these days.

Today’s business news isn’t quite as filled with Russian-inspired headlines as Monday and Tuesday were. But they’re still definitely there on day 7 of the invasion.

On day 6 – or night 6, to be precise – Biden used the SOTU address to announce that America will close “off American airspace to all Russian flights, further isolating Russia and adding an additional squeeze on their economy.”

And according to the Federal Aviation Administration, “operations of all aircraft owned, certified, operated, registered, chartered, leased, or controlled by, for, or for the benefit of, a person who is a citizen of Russia” will be suspended.

Also being suspended are ExxonMobil’s (XOM) investment plans in Russia. Plus, its already existent Sakhalin-1 oil and gas production venture – one of the country’s largest foreign direct investments – will be shuttered in a “carefully managed” withdrawal.

Outside of Russia – but back to last night’s address – the feud continues between the White House and the world’s richest man. After Biden made a point to mention both Ford (F) and General Motors (GM) for their electric vehicle efforts… without mentioning Tesla (TSLA)…

Elon Musk immediately took to Twitter:

Tesla has created over 50,000 U.S. jobs building electric vehicles & is investing more than double GM + Ford combined.

The man definitely knows how to stay in the public eye. That’s for sure.

Speaking of entertainment, I’ll also quickly mention how Major League Baseball’s opening day is canceled after the players’ union turned down Commissioner Rob Manfred’s “best and final offer” to settle their differences.

Nobody seems to know when negotiations will pick up again.

The World According to REITs

One more bit of “regular” news I want to report on comes from Yelp (YELP). It just released some interesting data.

For instance, while so many local businesses had to close in 2020, “by October 2021, 85%… were able to reopen.” Plus, new business openings rose 14% last year to 521,926 – just 1% shy of 2019’s increase.

Also interestingly (though perhaps not surprisingly), new business openings decreased in nearly all of the country’s largest cities. “Boston, Seattle, Los Angeles, and New York City saw the largest decreases in new business openings during Delta and Omicron variant waves.”

Atlanta, Dallas, and Detroit, however, bucked the trend easily.

With that noted, let’s see about our real estate investment trusts (REITs)…

Apartment Investment and Management Company (AIV) announced Q4 earnings, including revenue that rose 9.7% year-over-year. Net operating income (NOI), meanwhile, rose 16.8%. Occupancy was up 180 basis points (bps) to 98.7%. And shareholder returns were 46.2% for the full year.
Whitestone REIT (WSR) reported Q4 core funds from operations (FFO) of $0.24 and set guidance at $0.98-$1.02. Occupancy ended at 91.3%, and same-property NOI rose 12.8%. The company signed 46 new leases during that period and renewed 65 others, with new lease rental rate growth jumping 11.2% and 15.7% on renewals.
CBL Properties (CBL) closed on the modification of its $134.1 million non-recourse loan secured by Fayette Mall in Lexington, Kentucky. It’s now extended for two years with three extra one-year extension options in play. The fixed-interest rate was also changed from 5.42% to 4.25%.

Also, as you can see, Seritage Growth Properties (SRG) remains elevated thanks to reports that it might be seeking a sale. And it’s looking up today too an hour before the bell opens.

(Source: The Daily REITBeat)

Happy Investing

Brad Thomas

467 posts

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Brad Thomas is Senior Research Analyst at iREIT and CEO of Wide Moat Research LLC. With over 30 years of real estate experience, he is also long-time Editor of Forbes Real Estate Investor, a monthly subscription-based newsletter that dives deep into the vast world of profitable properties, and since 2021, he has served as an adjunct professor at New York University.

Thomas has also been featured on or in Forbes magazine, Kiplinger's, U.S. News and World Report, Money, NPR, Institutional Investor, GlobeStreet, CNN, Newsmax, and Fox. And he was the #1 contributing analyst on Seeking Alpha in 2014, 2015, 2016, 2017, 2018, 2019, 2020 and 2021 based on both page views and number of followers.

Thomas is the recently-published author of The Intelligent REIT Investor Guide (2021), co-author of The Intelligent REIT Investor (2016), and he wrote The Trump Factor: Unlocking The Secrets Behind The Trump Empire (2016) - all available on Amazon.

Thomas received a bachelor of science in business/economics from Presbyterian College and is married with five wonderful kids.

Let’s Focus on the Federal Reserve for One Small Second

REIT Mutual Fund	Symbol
Alpine Realty Income and Growth Fund	AIGYX, AIAGX
American Century Real Estate Fund	REAIX, REACX, AREEX, AREWX, ARYCX, AREDX
Real Estate Securities Fund	MRESX
AR Capital Real Estate Income Fund	ARIAX, ARICX, ARIPX
AssetMark Real Estate Securities Fund	AFREX
Aston/Harrison Street Real Estate Fund	AARIX, ARFCX
Baron Real Estate Fund	BREIX, BREFX
BlackRock Real Estate Securities	BIREX, BAREX, BCREX
Brookfield U.S. Listed Real Estate Fund	BRUAX, BRUCX, BRUIX, BRUYX
CGM Realty Fund	CGMRX
West Loop Realty Fund	REIIX, REIAX, REICX
Cohen & Steers Institutional Realty Shares	CSRIX
Cohen & Steers Realty Income Fund	CSEIX, CSDIX, CSBIX, CSCIX
Cohen & Steers Realty Shares	CSRSX
Columbia Real Estate Equity Fund	CREAX, CREIX, CRRVX, CRERX, CREEX, CRRFX, CREWX, CRECX, CREBX
Compass EMP REC Enhanced Volatility Weighted Fund	CWRAX, CWRIX, CWRTX, CWRCX
Davis Real Estate Fund	RPFRX, DREYX, DRECX, DREBX
Delaware Real Estate Investment Trust Portfolio II	DPRTX, DPRBX
Delaware Real Estate Investment Trust Portfolio	DPREX, DPRSX, DPRRX, DPRCX
DFA Real Estate Securities Portfolio	DFREX
Dunham Real Estate Stock Fund	DAREX, DNREX, DCREX
DWS RREEF Real Estate Securities Fund	RRRRX, RRREX, RRRAX, RRRSX, RRRBX, RRRCX
DWS RREEF Real Estate Securities Income Fund	REFAX, REFCX, REFIX, REFSX
Eaton Vance Real Estate Fund	EAREX, EIREX
EII Realty Securities Fund	EIIRX
Fidelity Advisor Real Estate Fund	FHEIX, FHEAX, FHETX, FHECX, FHEBX
Fidelity Advisor Real Estate Income Fund	FRIRX, FRIQX, FRINX, FRIOX
Fidelity Real Estate Income Fund	FRIFX
Fidelity Real Estate Investment Portfolio	FRESX
Fidelity Spartan Real Estate Index Fund	FSRNX, FRXIX, FSRVX
Fidelity Series Real Estate Equity Fund	FREDX, FREFX
Fidelity Series Real Estate Income Fund	FSREX, FSRWX
Forward Real Estate Long/Short Fund	KSRYX, FRLSX, FFSRX, KSRAX, KSRCX, KSRBX
Forward Real Estate Fund	FPREX, FFREX, KREAX, KRECX
Forward Select Income Fund	KIFYX, FSIMX, FFSLX, KIFAX, KIFBX, KIFCX
Franklin Real Estate Securities Fund	FREEX, FRLAX, FRRSX, FSERX
GMO Real Estate Fund	GMORX
Goldman Sachs Real Estate Securities Fund	GREIX, GRETX, GREAX, GRESX, GRERX, GREBX, GRECX
Great-West Real Estate Fund	MXREX
Heitman REIT Fund	OARTX, OBRTX
ING Real Estate Fund	CRARX, IREWX, IDROX, CLARX, CRWRX, CRCRX, CRBCX
INVESCO Real Estate Fund	REINX, IARFX, IARIX, IARYX, IARAX, IARRX, IARCX, AARBX
Ivy Real Estate Securities Fund	IRSAX, IREIX, IRSYX, IRSRX, IREEX, IRSCX, IRSBX
John Hancock Real Estate Securities Fund	JIREX
Johnson Realty Fund	JRLTX
J.P.Morgan Realty Income Fund	URTLX, JRIRX, URTAX, URTBX, URTCX
J.P. Morgan Security Capital U.S. Core Real Estate Securities Fund	CEEAX, CEERX, CEEFX, CEESX, CEECX
J.P. Morgan U.S. Real Estate Fund	SUSIX
Lazard U.S. Realty Equity Portfolio	LREIX, LREOX
Lazard U.S. Realty Income Portfolio	LRIIX, LRIOX
Manning & Napier Real Estate Series	MNRIX, MNREX
Morgan Stanley Institutional U.S. Real Estate Portfolio	MSUSX, MUSDX, MSULX, MURSX
Natixis AEW Real Estate Fund	NRFAX, NRFYX, NRFBX, NRFCX, NRFNX
Neuberger Berman Real Estate Fund	NBRIX, NBRFX, NREAX, NRERX, NRECX, NRREX
Nuveen Real Estate Securities Fund	FREAX, FARCX, FRSSX, FREBX, FRLCX, FREGX
Oppenheimer Real Estate Fund	OREAX, OREIX, OREYX, ORENX, OREBX, ORECX
PHOCAS Real Estate Fund	PHREX
PIMCO RealEstateRealReturn Strategy Fund	PRRSX, PETPX, PETAX, PETDX, PETCX, PETBX
Pioneer Real Estate Shares	PWREX, PYREX, PCREX, PBREX
Principal Real Estate Securities Fund	PIREX, PIRPX, PREPX, PRETX, PREJX, PRRAX, PRERX, PRENX, PRAEX, PRCEX, PRLEX
ProFunds Real Estate UltraSector ProFund	REPIX
Prudential Select Real Estate Fund	SREAX
Prudential U.S. Real Estate Fund	PJEAX, PJEZX, PJECX, PJEBX
REMS Real Estate Income 50/50 Portfolio	RREIX
REMS Real Estate Value-Opportunity Fund	HLRRX, HLPPX
Rydex Real Estate Fund	RYREX, RYHRX, RYCRX
SA Real Estate Securities Fund	SAREX
SEI Institutional Mgd Real Estate Fund	SETAX, SEIRX
Spirit of America Real Estate Income & Growth Fund	SOAAX
SSgA Clarion Real Estate Fund	SSREX
Stratton Real Estate Fund	STMDX
T.Rowe Price Real Estate Fund	TRREX, PAREX
TIAA-CREF Real Estate Securities Fund	TIREX, TRRPX, TRRSX, TCREX
Vanguard REIT Index Fund	VGSNX, VGRSX, VGSLX, VGSIX
Virtus Real Estate Securities Fund	PHRAX, PHRIX, PHRCX, PHRBX

REIT ETF	Symbol
Flex Shares	ASET
Wisdom Tree Global Ex-US	DRW
S&P 500 Equal Weight	EWRE
iShares FTSE Industrial/Office	FNIO
MSCI Real Estate Index	FREL
S&P REIT Index	FRI
First Trust S&P REIT	FRI
iShares Real Estate 50	FTY
Flexshares Global	GQRE
iShares Cohen & Streers	ICF
iShares International Developed RE	IFGL
iShares US RE	IYR
Premium Yield Equity REIT	KBWY
ETRACS Monthly Pay 2x Leverage	MORL
Market Vector Mortgage	MORT
iShares Global REIT	REET
iShares FTSE Mortgage	REM
iShares Residential	REZ
IQ US Real Estate Small Cap	ROOF
iShares FTSE NAREIT Retail	RTL
DOW Jones Global RE	RWO
SPDR Dow Jones	RWR
Schwab US REIT	SCHH
Super Dividend REIT	SRET
ProShares Ultra RE	URE
Vanguard REIT	VNQ
Vanguard Global ex-US	VNQI
iShares International Developed	WPS
Wilshire US REIT	WREI
Pacer Benchmark Data & Infrastructure RE	SRVR
Pacer Benchmark Industrial RE	INDS
Pacer Benchmark Retail RE	RTL
Hoya Capital Housing	HOMZ
NetLease Corporate RE	NETL

REIT Name	Ticker	Annual Increases/yr
Federal Realty	FRT	51
Universal Health Realty	UHT	33
National Retail Properties	NNN	29
Realty Income	O	27
Tanger Outlets	SKT	26
Urstadt Biddle	UBA	25
Essex Property Trust	ESS	25
W.P.Carey	WPC	22
National Health Investors	NHI	17
Equity Lifestyle	ELS	15
Digital Realty	DLR	15

The State of the Union

Brad Thomas

467 postsMarch 2, 2022

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467 postsMarch 2, 2022

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