In the U.S.:
- August US Manufacturing PMI ticked up to 55.6 versus July’s 54.7 reading. The uptick was led by stronger output, and new order growth.
- The US imposed sanctions on China following a military purchase of fighter jets and missile systems from Russia. China expressed strong indignation to the sanctions and stated that the US should rescind them immediately or “bear responsibility for the consequences”.
Seritage Growth Properties Class A (SRG) announced that construction was underway to transform the former Sears site in Santa Monica into The Mark 302. The property, an iconic creative office and retail destination, will be co-owned via a JV partnership with Invesco Real Estate.
- As the trade war with the US intensifies, Bloomberg reported that Beijing is looking to cut tariff rates on imports from some of its major trading partners as early as October. The move is aimed at boosting economic growth by increasing imports and opening its economy.
- August Core CPI rose 0.9% y/y versus July’s 0.8% y/y reading. The main contributors were an acceleration in overseas travel packages, and a notably slower decline in mobile telecommunications.
CapitaLand Ltd. purchased a portfolio of 16 freehold multifamily properties for $835M in the United States, marking its entry into the US multifamily asset class. The portfolio comprises of 3,787 apartment units located in the suburban communities of Seattle, Portland, Greater Los Angeles, and Denver.
- UK Prime Minister May stated that Brexit talks with the EU had reached an “impasse”. The main sticking points remained trade and the border with Northern Ireland.
- September Eurozone flash manufacturing PMI fell to 53.3 from 54.4 and services PMI improved to 54.7 from 54.4. Of note, was that manufacturing PMI fell to its second-weakest level of growth since late 2016 on subdued export orders.
UK listed self-storage operator Safestore Holdings Plc reported a favorable third quarter trading update this week. Like-for-like revenues increased 5.6% YOY on a constant exchange rate (CER) basis with strong performance in its two markets – UK up 5.9% and Paris up 4.3%. Occupancy gains were the primary driver of revenue growth with the closing occupancy in the like-for-like portfolio increasing 330 bps, while the average store rate was up 0.5% on a CER basis. Meanwhile, UK peer Big Yellow Plc issued new shares this week to raise ≈ £67M of gross proceeds to partially fund its development pipeline and for other general corporate purposes. In conjunction with the placement, Big Yellow provided a brief update of operations for August that confirmed relatively healthy operating conditions as well.
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.