The Daily REITBeat | Wednesday, November 13th, 2024

"Sticky Inflation?"

Good Morning!

Futures in the red at the time of this writing as talking heads focus on today’s big economic calendar along with chatter regarding President-Elect Trump’s cabinet appointments and the potential impact on inflation.

From Bloomberg

"US equity futures posted modest declines Wednesday as investors awaited key US inflation data amid concerns that President-elect Donald Trump’s proposed ‘America-First’ policies will reignite price growth.
Contracts on the Nasdaq 100 futures slipped 0.2% while Treasuries steadied after a renewed selloff Tuesday. With Elon Musk and Vivek Ramaswamy picked to lead the new Department of Government Efficiency, Musk’s EV maker Tesla Inc. rallied in premarket trading, as did biotech firm Roivant Sciences Ltd. which was founded by Ramaswamy.
Traders are adding inflation hedges and pricing in fewer interest-rate cuts next year amid the threat that Trump’s pro-growth agenda could unleash price pressures. Today’s US data is expected to show the overall consumer price index rose by 0.2% for a fourth month.
“We’ve been pouring our way into long-dated inflation linked bonds in the US where I see the inflation risk as the highest,” Freddie Lait, managing partner at Latitude Investment Management in London, said in an interview with Bloomberg TV. “I would look at the Trump win and think that became more likely.”
US yields were stable across the curve after jumping about 10 basis points on Tuesday. Treasuries have been pummeled by the prospect that Trump’s vowed policies, like tax cuts and tariffs, could fuel price pressures and force the Federal Reserve to keep rates elevated. Traders are pricing in just over a 50% chance of another quarter-point cut in December, after yields on two- and five-year Treasuries surged to their highest levels since July."

In REIT News

Stifel upgrades EQR to Buy from Hold (raise price target by $3.75 to $81.50)
Stifel downgrades CPT to hold from Buy (raise price target by $1 to $121)
Yesterday, BofA upgraded VRE to Buy from Neutral (raised price target by $3 to $23)
Yesterday, Capital One initiated FVR with an Overweight rating ($22 price target)
AHR and HPP announced quarterly earnings
XHR announced that its operating partnership upsized and priced $400 million aggregate principal amount of 6.625% senior notes due 2030 and intends to use the net proceeds of the offering, together with borrowings under the Company’s amended and restated credit agreement, to redeem in full its outstanding 6.375% senior notes due 2025 and to pay certain fees and expenses in connection with, or otherwise related to, the offering of the Notes and the use of proceeds therefrom and from the Credit Agreement
SAFE priced a public offering of $400 million of 5.65% senior notes due 2035 on behalf of its operating company and intends to use the net proceeds for general corporate purposes, which may include repaying borrowings under its unsecured revolver, making additional investments in ground leases, providing for working capital and funding obligations under existing commitments
WPC priced €600 million of 3.70% senior unsecured notes due 2034 and intends to use the net proceeds for general corporate purposes, including to fund potential future investments (including acquisitions and development and redevelopment activities) and to repay certain indebtedness, including amounts outstanding under the Company’s $2b unsecured RCF and all or a portion of the $450m in aggregate principal amount outstanding of their 4% Senior Notes due Feb. 1, 2025
PINE announced updated fourth quarter and year-to-date 2024 investment and disposition activities noting that 1) In November 2024, the Company completed a $28 million purchase of a portfolio of 5 single-tenant properties anchored by BJ’s Wholesale Club, all of which are located in the greater Charlotte, North Carolina area. The portfolio is located near the 1.4 million square foot Concord Mills mall. With the addition of this investment, Charlotte, North Carolina now enters PINE’s top 5 markets based on annual ABR; 2) The Company’s year-to-date total investment activity, including acquisitions and structured investment activity, now totals $112.2 million at a weighted average initial investment yield of 9.3%, exceeding the high end of investment activity given with the third quarter reporting; 3) In October 2024, the Company sold two former Mountain Express convenience stores for a total of $1.4 million; and 4) The Company’s year-to-date disposition volume, inclusive of property and structured investment sales, now totals $70.2 million at a weighted average exit cash cap rate of 7.1%
EQC held a special meeting of shareholders where shareholders (i) approved the Plan of Sale and Dissolution of the Company, including the wind-down and complete liquidation of the Company, and the dissolution and termination of the Company, including the establishment of a Liquidating Entity, as defined in the definitive proxy statement filed with the U.S. Securities and Exchange Commission on October 2, 2024, and (ii) approved, on a non-binding advisory basis, the compensation that may become payable by the Company to its named executive officers in connection with the Plan of Sale plus announced that its Board of Trustees authorized payment of the liquidation preference to the holders of shares of the Company’s 6.50% Series D Cumulative Convertible Preferred Shares for $25.08576/share
Bellevue Capital Partners announced the acquisition of an additional 100,000 shares of GNL noting that this strategic investment reemphasizes their confidence in the company’s management and its execution of its previously announced strategic plan

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David Auerbach & Mary Jensen

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David Auerbach
dauerbach@irrealized.com
214.492.3777

David Auerbach boasts over two decades of experience in the securities industry, specializing as an institutional trader with a focus on Real Estate Investment Trusts (REITs), Equity and Preferred stocks, MLPs, ETFs, and Closed End Funds.

Based in Dallas, TX throughout his entire career, David currently serves as the Chief Investment Officer for Hoya Capital, managing the Hoya Housing 100 ETF (Ticker: HOMZ) and The High Yield Dividend ETF (Ticker: RIET).

Previously, David held the position of Managing Director at Armada ETF Advisors, the sub-advisor for the Residential REIT ETF (Ticker: HAUS) and The Private Real Estate Strategy via Liquid REITs ETF (Ticker: PRVT). Additionally, he acts as a consultant with IRRealized, LLC, focusing on corporate access in the REIT industry.

David's industry journey includes roles at World Equity Group, Esposito Securities, and Green Street Advisors where he got his start in the REIT industry. At Esposito Securities, he played a crucial role in building the REIT/Real Estate platform and worked extensively with institutional investors, Equity REITs, and ETF issuers.

Throughout his career, David has been quoted by reputable publications such as Bloomberg, WSJ, Financial Times, REIT.com, and GlobeSt.com. He has also made notable appearances as a featured guest on networks like Yahoo Finance, TD Ameritrade, and Bloomberg.

David holds a BBA in Finance from the University of Texas at Austin (May 1999) and an MBA in Finance from Southern Methodist University (May 2005). He maintains FINRA Series 7, 24, 55, and 63 registrations.

In his leisure time, David is an avid traveler, often found crisscrossing the country in pursuit of attending as many Phish concerts as possible.

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