ASIA
In China:
- CPI inflation also softened to a 1.7% rise vs consensus 1.8% and 2.4% in prior month.
- This comes after heightened tensions with the US regarding proprietary technology have reached new highs.
In Japan:
- Prime Minister Suga is expected to have specifics drawn up as early as next month
REIT Focus:
CapitaLand’s lodging business unit, The Ascott Limited, secured more than 2,100 new units across 12 properties in China over the past three months. In a press statement the company stated that revenue had almost recovered to pre pandemic levels.
Europe
In Europe:
- This was retaliatory as the US imposed tariffs worth $7.5B on EU products including scotch whisky and French wine and cheese.
REIT Focus:
Unibail-Rodamco-Westfield (URW) announced this week that it had entered into an agreement with a consortium of French institutional investors (Primonial REI, La Francaise and EDF Invest) for the sale of the SHiFT office building that is located in the Issy-les Moulineaux business district of the Paris region. The property is fully leased to Nestlé for its new French headquarters under a 12-year lease. The agreed upon price of €620 mn for the 47,200 sqm (508k sf) building represents a premium to the June 30, 2020 book value. URW recently announced a €9+ bn RESET plan to strengthen its balance sheet with a proposed €3.5 equity rights offering and €4 bn of disposals to be completed by year-end 2021. While the investment sales market for office and retail assets is experiencing a significant decline in volumes around the world as a result of the COVID-19 pandemic, assets such as SHiFT with long dated lease income remain in demand from investors in search of yield. Separately, but related, URW has received some feedback from a small consortium of investors that are opposed to the proposed dilutive rights offering and would prefer a plan focused on disposal’s to deleverage, with the disposal of the US portfolio over time and a refocus on Europe. Shareholders are expected to vote on the plan at an Extraordinary General Meeting for shareholders on November 10th.
North America
In the U.S.:
- The rise heightened fears that a widely expected renewed wave of infections this fall and winter has begun.
- Continuing claims ticked down to 10.02M.
REIT Focus
Jefferies reported that the “Great Migration of urban dwellers to the countryside” has helped boost sun belt apartment and self-storage REITs. The company specifically upgrading upgrading Mid-America Apartment Communities (MAA), Extra Space Storage (ESS) and CubeSmart (CUBE).
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.