In the U.S.:
- The March FOMC minutes suggested that the Fed would continue to stay on its current track. However, members were growing more concerned about the lackluster inflation figures.
Industrial Logistics Properties Trust (ILPT) announced that is has closed on the previously announced acquisition of a portfolio of 18 properties for $624.7 million from affiliates of Cole Office & Industrial REIT. This followed a portfolio acquisition of eight properties which had an aggregate purchase price of $280.0 million.
- March export data rebounded to 14.2% y/y from February’s 20.8% decline. The data followed other positive news from the region helping support a general stabilization theme as trade talks continue.
- Trade talks with the US are set to resume in Washington next week. Japan is looking to avoid tariffs on auto exports, while the US looks to crack open Japan’s agricultural market and reduce a $60B trade deficit.
The Business Times, citing an interview with CEO Lee Chee Koon, reported that CapitaLand Ltd. is looking to allocate 80% of capital to Singapore, China, India, and Vietnam following the purchase of Ascendas Pte. and Singbridge Pte. from Temasek Holdings Pte.
- The UK was rewarded another delay of the Brexit deadline through October 31st. The new deadline has raised the possibility of a new referendum if sitting Prime Minister Theresa May is toppled during Parliament’s May election
Unibail-Rodamco-Westfield (URW) announced this week that it had entered into an agreement with a consortium of institutional buyers for the sale of Tour Majunga, a 67,000 sq. m. office that it developed in the La Défense submarket of Paris and completed in 2014. The property is fully leased to AXA Investment Managers and Deloitte France under long term leases. URW indicated that the net disposal prices of €850 mn (€12,900/sq. m.) represented a premium to its December 31, 2018 book value. The estimated net initial yield is ≈ 4%. The sale is expected to close in July. Since the announced merger between Unibail-Rodamco and Westfield in December 2017, URW has closed ≈ €3.1 bn of disposals (including the pending Majunga sale) at an average net initial yield of 4.5% and an average premium above book value of 7.2%. Per management’s most recent disposal goals, URW is looking to sell ≈ €2.9 bn of additional assets over the next couple of years. While the large disposal program is a significant drag to earnings growth, investors may get some consolation to the extent URW can continue to sell assets above BV and reduce leverage.
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.