To a certain extent, all of the headwinds confronting the asset class are still gusting against the bow of USS REITs but perhaps the 13% decline to start the new year was overdone. Retail REITs still comprise 18% of the Index but sentiment has certainly shifted in favor of the tenants and, by extension, the landlords. The message coming out of RECon, ICSC’s (International Council of Shopping Centers) annual convention, was one of optimism – attendance was lower but mood and deal making was better than in 2017. On June 3, Evercore ISI, a prominent sell-side firm, came out with a research piece titled The “Retailpocalypse” is Over suggesting that retailers are learning to adapt in the digital era, something

US equity investors spent most of Second Quarter wondering if the various indices would revisit the lows made in February. From a top down perspective, they had every reason to worry: (i) an activist FOMC, (ii) trade wars all around and (iii) mega-cap tech companies under regulatory threat; however, the balance or risk did seem more favorable within the US rather than without (political risk in Italy/EU, FX problems/bear markets for a number high profile emerging markets, etc.) and, buoyed by a strong earnings season (and subsequent share buy backs), risk assets saw a rebound in the US with domestically focused stocks (Russell 2000) outperforming companies which derive their revenues from overseas (S&P 500). The third estimate of First Quarter

As another 7.5% decline in the Wilshire REIT Index and numerous quarters of underperformance to the various private commercial real estate and equity market indices demonstrate, being relatively cheap is not reason enough for a positive outcome.  At the recent Citi CEO conference, REIT management teams quietly bemoaned their Net Asset Value discounts and analysts and investors cried out for strategic initiatives but, with a nod to Vladimir Lenin, “What is to be Done?” SL Green, the New York City landlord, is doing the most obvious thing, selling non-core assets in the private market and buying back shares in the public market (on a leverage neutral basis). As of March 1, the company has repurchased 11.9 million shares at an

After a start to the year where the equity markets moved close to hitting year-end targets in one month, volatility returned with a vengeance, spurred most likely by the release of the Employment Situation Summary on February 2nd reporting a 2.9% year-over-year increase in average hourly earnings. Everyone became a Philips Curve acolyte and fears of runaway inflation took hold, leading to a sharp correction in risk assets. For the rest of the quarter, financial markets were buffeted by the daily drama emanating from the White House and shaken by the specter of trade wars and untested leadership at the FOMC; as First Quarter drew to an end, investors were left eagerly awaiting earnings with risk assets trading near February

After nearly five months of behind-the-scenes negotiations, regional mall REIT GGP Inc. (GGP, formerly known as General Growth Properties) recently agreed to be acquired by its largest shareholder (34% owner, originated from its role as plan sponsor and cornerstone investor during GGP’s bankruptcy reorganization and recapitalization in 2010, including the receipt of 57.5 million warrants with an exercise price of $10.75/share for its $2.3 billion investment) Brookfield Property Partners (BPY) at a price that underwhelmed the investment community; the regional mall REIT sector declined 2.6% on the day of this news, with GGP falling even more at 5.3%. Source: FactSet. While the updated “headline” offer of $23.50/share in cash is slightly higher than the initial $23.00/share cash or BPY unit