ASIA

In China:

• New orders rose as domestic demand firmed though external demand remained sluggish with new export orders contracting further.

In Japan:

• Even with the uptick in cases, the BoJ’s Kuroda remained optimistic that the Japanese economy is recovering. The optimistic view reinforced expectations that the BOJ will hold off on boosting stimulus for the time being

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:

• Berlin, Frankfurt, Paris and Brussels put curfews in places on bars, restaurants and cafes.

• One of the main sticking points continues to be fishing quotas.

REIT Focus:

The student accommodation sector has experienced significant disruptions and uncertainty since the start of the pandemic earlier this year. This week UK student accommodation REIT Unite Group Plc provided an update on its business activity now that the 2020/21 academic year is starting to commence at many universities. Unite reported that thus far they have leased 88% of the beds across its entire portfolio for the 2020/21 academic year. This compares with 98% for the 2019/20 academic year at the same time last year and also is slightly short of the 90% target indicated with their half year results. The company noted that while they have been seeing healthy letting activity, new lettings have been partially offset by a higher than usual volume of cancellations, particularly following the recent increase in UK cases of COVID-19. Management noted that the reduced occupancy and rents achieved should translate into a 10%-20% reduction in rental income for the 2020/21 academic year versus the 2019/20 academic year (prior to the impact of cancellations in 2019/20 due to COVID-19), which is in line with expectations set out in their half year results. As a result, management reiterated their guidance for EPRA EPS of 22-25 pence/sh for FY2020.  This compares with EPRA EPS of 39.1 pence/sh achieved in FY2019.

North America

In the U.S.:

• The lack of any positive outcomes has increased the chances that a stimulus deal will not be reached till after the November presidential election.

• The slight downtick continued the theme that the recovery is slowing down.

REIT Focus

Rexford Industrial Realty, Inc. (REXR), through its operating partnership, Rexford Industrial Realty, L.P., entered into an acquisition agreement with an unaffiliated third-party seller to acquire an industrial park with four buildings for approximately $296.6M, exclusive of closing costs. The company expects to fund the acquisition through a combination of available cash on hand and the company’s unsecured revolving credit facility.

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.