iREIT Daily

What the…?!!?!!?

Brad Thomas

467 postsJanuary 25, 2022

I’ve called previous market movements bewildering before. But I’m going to have to drastically revise those evaluations.

Those directionless actions of yester-week and yester-month were shining examples of clarity compared to what we saw on Monday, January 24. I’d love to be able to provide an insightful commentary about what the… heck… happened there.

But I’m still trying to analyze the data. All I’m prepared to say at this time is that was either a flat-out miracle or one of the most savvy sets of opportunistic moves the financial world has ever seen.

The major indexes were down for most of the day. Massively down, with the Dow hitting the -1,000 mark at one point and the S&P off by 4%…

They still managed to end in the green. The S&P 500 rose 12.19 points, or 0.28%. The Dow gained 99.13 points, or 0.29%. And the Nasdaq added 86.21 points, or 0.63%.

I think Reuters summed it up well enough around 3:00 a.m. when it wrote how “sentiment turned on a dime.” It then added the contradictory commentary:

Clearly, dip-buyers haven’t entirely fled equity markets. Or was it a function of all those short Nasdaq positions, which suddenly found themselves in the money?

In other words, there’s nothing clear about what happened yesterday. It was quite possibly mere insanity at work.

What’s much more understandable is Unilever’s (UL) decision to cut approximately 1,500 jobs worldwide. This comes after it failed to buy Glaxo-Smith-Kline’s (GSK) consumer health division. So now it’s trying to cut costs in order to bulk up its finances and appease investors.

Investor appeasement really does seem to be the name of the game these days. Which reminds me that I also have a Peloton (PTON) story to cover…

More Non-REIT News to Know About

It’s easy to kick a company when it’s down. Even so, I don’t blame gym chain OrangeTheory CEO David Long for gloating a bit over Peloton’s broken and bloodied corporate body.

He told Yahoo Finance Live that:

At-home fitness has been around for decades. But it was in the limelight during the pandemic because that was the only option. They just can’t replace the in-studio experience or the coaching, the accountability, the motivation, and the feeling of accomplishment of going to an on-premise studio.

There’s also the affordability issue. It’s simply much cheaper to pay a monthly fee to use a wide range of equipment.

So, contrary to the naysayers of 2020 – including Peloton and, yes, me too – OrangeTheory added 500,000 new members last year.

Clearly, this is good news for the re-opened trade. Unlike the case with our next story, this one from Reuters:

U.S. consumers expect their monthly spending to grow above pre-pandemic levels this year. But people are becoming less likely to spend big on vacations and other non-essential items – a sign that more households may be more concerned about rising prices, according to a survey released Monday by the New York Federal Reserve.

Unlike yesterday’s market movements, I’d put that news in the “patently obvious” category. But here’s a bit more of it anyway:

The survey showed that consumers expect to spend more on daily living expenses in the coming year. But it also showed [they’re] becoming less likely to spend large amounts of money on home repairs, vacations, appliances, and other expensive purchases.
“… households report a lower likelihood of making large purchases over the next four months, which points to the likely contribution of elevated inflation expectations,” researchers wrote.

At least some things are predictable, I suppose.

The World According to REITs

That’s one of the beautiful things about real estate investment trusts (REITs): their predictability. Not always when it comes to stock market prices, I know. They’re subject to volatility too (though oftentimes less so than other asset types).

But when it comes to earnings, projecting their quarter-to-quarter and year-to-year prospects can be quite uncomplicated.

REITs tend to report later on in the earnings season. So we only have the random release here and there so far.

But Equity Lifestyle Properties (ELS) did just come out with normalized Q4 funds from operations (FFO) of $0.64 per share. And it says it expects full-year 2022 figures to be between $2.64 and $2.74.

Meanwhile, Q4 core property operating revenue – minus deferrals – rose about 7.8% year-over-year and 8.3% for 2021. And core income from property operations – minus deferrals and property management – increased 8.2% for the quarter and 8.8% for the year.

In other REIT news, we’ve got:

Armada Hoffler Properties (AHH) has a slew of committed tenants for its public-private partnership Town Center of Virginia Beach. The property is now 97% leased.
Empire State Realty Trust (ESRT) appointed Jordan Berger as VP of leasing.
Acadia Realty Trust (AKR) promoted John Gottfried to executive VP and CFO, and Jason Blacksberg to senior VP and chief legal officer. A.J. Levine has also been promoted to senior VP of leasing and development. And current executive VP and COO Christopher Conlon will be leaving in February to pursue other opportunities.

Looking at the chart below, I’d love to see an evaluation of where each of these companies were at before that late-day massive turnaround. Just for curiosity’s sake.

But here’s the much more practical end numbers anyway…

(Source: The Daily REITBeat)

Happy Investing

Brad Thomas

467 posts

View all my Posts

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.

Two 90-Year-Olds Announce an In-Person Event in the Midst of Covid

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

What the…?!!?!!?

Brad Thomas

467 postsJanuary 25, 2022

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What the…?!!?!!?

467 postsJanuary 25, 2022

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