iREIT Daily

Billion-Dollar Buyer’s Remorse? The Musk vs. Twitter Takedown Continues…

Brad Thomas

467 postsMay 16, 2022

A few weeks ago, eccentric entrepreneur Elon Musk put in a $44 billion bid to acquire Twitter (TWTR). Talk of this takeover upended the news cycle for what seemed like days, with media outlet after media outlet discussing the offer’s impact.

It wasn’t just the business side of things that were analyzed either. The political implications were debated ad nauseum as well. Activists and employees alike either celebrated or panicked over Elon’s upcoming rule of the world’s digital town square.

Yet perhaps it was all for nothing, as said individual might be having second thoughts.

The potential Twitter owner expressed concerns late last week over the authenticity of the social media site’s user base. As Yahoo News explained:

“In a tweet sent early Friday morning, Musk said the Twitter deal was on hold until he could verify the site’s estimate that fake or spam accounts represent less than 5% of users…
“On Friday evening, Musk announced how his team would evaluate the estimate.
“‘To find out, my team will do a random sample of 100 followers of @twitter,’ Musk said in a tweet, referring to the platform’s own account, which has more than 61 million followers. ‘I invite others to repeat the same process and see what they discover.’”

For those who need the reminder, the company itself released its Q1 earnings last month. That’s where it estimated that fake or spam accounts made up fewer than 5% of its active users. These approximations, it said, were founded on a study of sample accounts and appeared “reasonable.”

While Elon made it clear he still has designs on acquiring the company regardless, his initial tweet was enough to send Twitter stocks down over 20% in Friday’s pre-market trading.

Yikes.

I should also mention that Musk has been accused of violating an NDA for that very public expression of doubt – including to his 93.3 million Twitter followers.

That’s why some people are speculating that he could be feeling the pangs of buyer’s remorse. What seems much more obvious is that he’s not going to let this acquisition get the better of him.

I suppose it shouldn’t come as any surprise that he’s being so showy about the whole thing (just look at his feud with Jeff Bezos). Again, it’s only in question whether this is some strange negotiation strategy…

Or genuine concern that Twitter isn’t all it’s cracked up to be?

More Non-REIT News to Know About

Speaking of Bezos…

The former Amazon (AMZN) CEO took to Twitter the other day to retweet President Biden’s criticism of big businesses not paying “their fair share.”

“The newly created Disinformation Board should review this tweet, or maybe they need to form a new Non Sequitur Board instead. Raising corp taxes is fine to discuss. Taming inflation is critical to discuss. Mushing them together is just misdirection.”

That’s an interesting criticism considering how it comes from someone who seemed very much onboard with Biden’s policies before. But he’s not the only one who’s turning coat (or at least appearing to).

There are plenty of people out there saying that it’s not only bad politics to lump these two issues together but also irrelevant. In this economy, they say, the last thing we want to do is overtax businesses that are struggling just to keep their doors open – no matter how big or wealthy you believe them to be.

As for me, I definitely think it’s fair to bring this issue up for discussion. However, I can’t see a correlation between a quick-fix for inflation and raising corporate taxes.

The World According to REITs

It’s Monday which means you’re back at the office, (hopefully) ready to rock after a restful weekend. Preparing for the work week ahead inspired me to investigate a couple of office REITs… ones that have shown significant results in this first quarter.

For those unfamiliar with them, office REITs are some of the most sound investments you can make in the real estate game. They offer excellent tax incentives and incredible dividend potential. And they usually boast decent occupancy rates.

So let’s check some out.

Slate Office

Slate Office (SOT.UN) is an owner and operator of high-quality workplace real estate out of Toronto. Aside from having a cool name, it closed the quarter with significant growth and a 23-property acquisition.

That naturally enhanced occupancy and weighted average lease terms, and increased its exposure to high-quality credit tenants from 61.3% to 67%.

With momentum from the global get-back-to-work attitude, Slate was able to operate opportunistically to develop a pipeline of portfolio enhancements and actionable opportunities for growth.

Its revenue for the quarter was up 10%, net operating income (NOI) rose 11%, and funds from operations (FFO) increased 2.3%.

Boston Properties

The REIT world was built on companies like Boston Properties (BXP). As the largest publicly listed developer, owner, and trader of Class A office properties in the U.S., BXP boasts a $19.5 billion market cap and assets all over the country.

In the first quarter of 2022, this powerhouse entity exceeded expectations with earnings per share of $0.91 and FFO per share of $1.82. Revenue was up nearly $8 million, and it just signed a 570,000 rentable square foot lease with AstraZeneca for a future life sciences development in Cambridge, Massachusetts.

Basically, it doesn’t get much bigger than Boston Properties.

Happy Investing

Brad Thomas

467 posts

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Brad Thomas is Senior Research Analyst at iREIT and CEO of Wide Moat Research LLC. With over 30 years of real estate experience, he is also long-time Editor of Forbes Real Estate Investor, a monthly subscription-based newsletter that dives deep into the vast world of profitable properties, and since 2021, he has served as an adjunct professor at New York University.

Thomas has also been featured on or in Forbes magazine, Kiplinger's, U.S. News and World Report, Money, NPR, Institutional Investor, GlobeStreet, CNN, Newsmax, and Fox. And he was the #1 contributing analyst on Seeking Alpha in 2014, 2015, 2016, 2017, 2018, 2019, 2020 and 2021 based on both page views and number of followers.

Thomas is the recently-published author of The Intelligent REIT Investor Guide (2021), co-author of The Intelligent REIT Investor (2016), and he wrote The Trump Factor: Unlocking The Secrets Behind The Trump Empire (2016) - all available on Amazon.

Thomas received a bachelor of science in business/economics from Presbyterian College and is married with five wonderful kids.

Dividend Growth Stock of the Week: Microchip Technology Incorporated

REIT Mutual Fund	Symbol
Alpine Realty Income and Growth Fund	AIGYX, AIAGX
American Century Real Estate Fund	REAIX, REACX, AREEX, AREWX, ARYCX, AREDX
Real Estate Securities Fund	MRESX
AR Capital Real Estate Income Fund	ARIAX, ARICX, ARIPX
AssetMark Real Estate Securities Fund	AFREX
Aston/Harrison Street Real Estate Fund	AARIX, ARFCX
Baron Real Estate Fund	BREIX, BREFX
BlackRock Real Estate Securities	BIREX, BAREX, BCREX
Brookfield U.S. Listed Real Estate Fund	BRUAX, BRUCX, BRUIX, BRUYX
CGM Realty Fund	CGMRX
West Loop Realty Fund	REIIX, REIAX, REICX
Cohen & Steers Institutional Realty Shares	CSRIX
Cohen & Steers Realty Income Fund	CSEIX, CSDIX, CSBIX, CSCIX
Cohen & Steers Realty Shares	CSRSX
Columbia Real Estate Equity Fund	CREAX, CREIX, CRRVX, CRERX, CREEX, CRRFX, CREWX, CRECX, CREBX
Compass EMP REC Enhanced Volatility Weighted Fund	CWRAX, CWRIX, CWRTX, CWRCX
Davis Real Estate Fund	RPFRX, DREYX, DRECX, DREBX
Delaware Real Estate Investment Trust Portfolio II	DPRTX, DPRBX
Delaware Real Estate Investment Trust Portfolio	DPREX, DPRSX, DPRRX, DPRCX
DFA Real Estate Securities Portfolio	DFREX
Dunham Real Estate Stock Fund	DAREX, DNREX, DCREX
DWS RREEF Real Estate Securities Fund	RRRRX, RRREX, RRRAX, RRRSX, RRRBX, RRRCX
DWS RREEF Real Estate Securities Income Fund	REFAX, REFCX, REFIX, REFSX
Eaton Vance Real Estate Fund	EAREX, EIREX
EII Realty Securities Fund	EIIRX
Fidelity Advisor Real Estate Fund	FHEIX, FHEAX, FHETX, FHECX, FHEBX
Fidelity Advisor Real Estate Income Fund	FRIRX, FRIQX, FRINX, FRIOX
Fidelity Real Estate Income Fund	FRIFX
Fidelity Real Estate Investment Portfolio	FRESX
Fidelity Spartan Real Estate Index Fund	FSRNX, FRXIX, FSRVX
Fidelity Series Real Estate Equity Fund	FREDX, FREFX
Fidelity Series Real Estate Income Fund	FSREX, FSRWX
Forward Real Estate Long/Short Fund	KSRYX, FRLSX, FFSRX, KSRAX, KSRCX, KSRBX
Forward Real Estate Fund	FPREX, FFREX, KREAX, KRECX
Forward Select Income Fund	KIFYX, FSIMX, FFSLX, KIFAX, KIFBX, KIFCX
Franklin Real Estate Securities Fund	FREEX, FRLAX, FRRSX, FSERX
GMO Real Estate Fund	GMORX
Goldman Sachs Real Estate Securities Fund	GREIX, GRETX, GREAX, GRESX, GRERX, GREBX, GRECX
Great-West Real Estate Fund	MXREX
Heitman REIT Fund	OARTX, OBRTX
ING Real Estate Fund	CRARX, IREWX, IDROX, CLARX, CRWRX, CRCRX, CRBCX
INVESCO Real Estate Fund	REINX, IARFX, IARIX, IARYX, IARAX, IARRX, IARCX, AARBX
Ivy Real Estate Securities Fund	IRSAX, IREIX, IRSYX, IRSRX, IREEX, IRSCX, IRSBX
John Hancock Real Estate Securities Fund	JIREX
Johnson Realty Fund	JRLTX
J.P.Morgan Realty Income Fund	URTLX, JRIRX, URTAX, URTBX, URTCX
J.P. Morgan Security Capital U.S. Core Real Estate Securities Fund	CEEAX, CEERX, CEEFX, CEESX, CEECX
J.P. Morgan U.S. Real Estate Fund	SUSIX
Lazard U.S. Realty Equity Portfolio	LREIX, LREOX
Lazard U.S. Realty Income Portfolio	LRIIX, LRIOX
Manning & Napier Real Estate Series	MNRIX, MNREX
Morgan Stanley Institutional U.S. Real Estate Portfolio	MSUSX, MUSDX, MSULX, MURSX
Natixis AEW Real Estate Fund	NRFAX, NRFYX, NRFBX, NRFCX, NRFNX
Neuberger Berman Real Estate Fund	NBRIX, NBRFX, NREAX, NRERX, NRECX, NRREX
Nuveen Real Estate Securities Fund	FREAX, FARCX, FRSSX, FREBX, FRLCX, FREGX
Oppenheimer Real Estate Fund	OREAX, OREIX, OREYX, ORENX, OREBX, ORECX
PHOCAS Real Estate Fund	PHREX
PIMCO RealEstateRealReturn Strategy Fund	PRRSX, PETPX, PETAX, PETDX, PETCX, PETBX
Pioneer Real Estate Shares	PWREX, PYREX, PCREX, PBREX
Principal Real Estate Securities Fund	PIREX, PIRPX, PREPX, PRETX, PREJX, PRRAX, PRERX, PRENX, PRAEX, PRCEX, PRLEX
ProFunds Real Estate UltraSector ProFund	REPIX
Prudential Select Real Estate Fund	SREAX
Prudential U.S. Real Estate Fund	PJEAX, PJEZX, PJECX, PJEBX
REMS Real Estate Income 50/50 Portfolio	RREIX
REMS Real Estate Value-Opportunity Fund	HLRRX, HLPPX
Rydex Real Estate Fund	RYREX, RYHRX, RYCRX
SA Real Estate Securities Fund	SAREX
SEI Institutional Mgd Real Estate Fund	SETAX, SEIRX
Spirit of America Real Estate Income & Growth Fund	SOAAX
SSgA Clarion Real Estate Fund	SSREX
Stratton Real Estate Fund	STMDX
T.Rowe Price Real Estate Fund	TRREX, PAREX
TIAA-CREF Real Estate Securities Fund	TIREX, TRRPX, TRRSX, TCREX
Vanguard REIT Index Fund	VGSNX, VGRSX, VGSLX, VGSIX
Virtus Real Estate Securities Fund	PHRAX, PHRIX, PHRCX, PHRBX

REIT ETF	Symbol
Flex Shares	ASET
Wisdom Tree Global Ex-US	DRW
S&P 500 Equal Weight	EWRE
iShares FTSE Industrial/Office	FNIO
MSCI Real Estate Index	FREL
S&P REIT Index	FRI
First Trust S&P REIT	FRI
iShares Real Estate 50	FTY
Flexshares Global	GQRE
iShares Cohen & Streers	ICF
iShares International Developed RE	IFGL
iShares US RE	IYR
Premium Yield Equity REIT	KBWY
ETRACS Monthly Pay 2x Leverage	MORL
Market Vector Mortgage	MORT
iShares Global REIT	REET
iShares FTSE Mortgage	REM
iShares Residential	REZ
IQ US Real Estate Small Cap	ROOF
iShares FTSE NAREIT Retail	RTL
DOW Jones Global RE	RWO
SPDR Dow Jones	RWR
Schwab US REIT	SCHH
Super Dividend REIT	SRET
ProShares Ultra RE	URE
Vanguard REIT	VNQ
Vanguard Global ex-US	VNQI
iShares International Developed	WPS
Wilshire US REIT	WREI
Pacer Benchmark Data & Infrastructure RE	SRVR
Pacer Benchmark Industrial RE	INDS
Pacer Benchmark Retail RE	RTL
Hoya Capital Housing	HOMZ
NetLease Corporate RE	NETL

REIT Name	Ticker	Annual Increases/yr
Federal Realty	FRT	51
Universal Health Realty	UHT	33
National Retail Properties	NNN	29
Realty Income	O	27
Tanger Outlets	SKT	26
Urstadt Biddle	UBA	25
Essex Property Trust	ESS	25
W.P.Carey	WPC	22
National Health Investors	NHI	17
Equity Lifestyle	ELS	15
Digital Realty	DLR	15

Billion-Dollar Buyer’s Remorse? The Musk vs. Twitter Takedown Continues…

Brad Thomas

467 postsMay 16, 2022

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Billion-Dollar Buyer’s Remorse? The Musk vs. Twitter Takedown Continues…

467 postsMay 16, 2022

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