In the U.S.:
- The House of Representatives voted to pass USMCA agreement, receiving bipartisan support as expected. The agreement replaces NAFTA and according to Treasury Secretary Steven Mnuchin, the agreement will add 0.5% to GDP growth
Bloomberg reported that Brookfield Asset Management Inc. is considering bundling its commercial real estate assets in India into a real estate investment trust for a listing next year. The move follows the successful April debut of Embassy Office Parks REIT backed by Blackstone Group LP.
- Reuters noted that JCI, China’s top agriculture consultancy, stated that China can fulfill its pledge to purchase more than $40B of US ag products a year under the recently agreed phase one trade deal between the two countries. The announcement may had been prompted by increased skepticism over if China would be able to achieve the aggressive target set.
- As expected, the BOJ kept policy rates unchanged at -0.10%. The Japanese economy may get some reprieve as the US/China phase one trade deal eases tensions in the region, which may in turn lead to the BOJ tightening its policy during the next meeting.
- November core CPI rose 0.5% y/y versus October’s 0.4% y/y reading. Underlying inflation unexpectedly edged higher to 0.8%, marking the strongest since April 2016.
Link REIT has acquired a grade A office tower in Sydney for A$683m ($470m). The purchase is Link’s first acquisition outside of Hong Kong and China as it looks to diversify its portfolio.
- December Eurozone preliminary manufacturing PMI was 45.9 versus November’s 46.9 reading. Of note, the rate of decline seems to be slowing indicating a turnaround may be in the cards for 2020.
- Q3 UK GDP was revised upward to 0.4% versus the previously reported 0.3%. reading. The positive revision along with less uncertainty regarding Brexit is leading to renewed optimism of a rebound.
Blackstone has agreed to acquire UK-focused industrial REIT Hansteen for £500 mn. Blackstone will pay Hansteen shareholders 116.5 pence/sh, which represents a 10.3% premium to the prior day’s closing price and an 11.6% premium to the most recent reported EPRA NAV of 104.4 pence/sh. Hansteen owns smaller, light industrial warehouse buildings in primarily secondary UK cities with the portfolio totaling 256 properties and 13.6 mn sf. Blackstone plans to integrate Hansteen into its growing last mile Pan European logistics company Mileway, which it launched back in September. Mileway’s portfolio totals over 9 mn sqm (96.8 mn sf).
The views expressed in this update are as of the date of this blog entry. These views and any portfolio holdings discussed in the update are subject to change at any time based on market or other conditions. The adviser disclaims any duty to update these views, which may not be relied upon as investment advice. In addition, references to specific companies’ securities should not be regarded as investment recommendations or indicative of the Adelante products, strategies, or portfolios.