Commercial Mortgage REITs Demonstrated Surprising Resilience in 2020

Average book value return of +1% in 9M20Avoided disorderly portfolio liquidation. Flexibility with borrowers and lenders preserved valueSome bargains remain with 5 CM REITs at discounts of over 20% to 9/30 book valueA longer recession would be a greater challenge to these business models Commercial mortgage REITs have passed through the COVID crisis without large … Continue reading Commercial Mortgage REITs Demonstrated Surprising Resilience in 2020

Residential Mortgage REITs: Poor Total Return, High Volatility, and Uncertain Dividends … As Usual

Residential mortgage securities performed well this year due to massive government support and a strong housing market in most of the country.Residential mortgage REITs produced an average year-to-date total NAV return of -25% to 9/30 and a ytd total price return of -28% to 12/23.Deeply discounted valuations created short-term opportunities earlier this year, but the … Continue reading Residential Mortgage REITs: Poor Total Return, High Volatility, and Uncertain Dividends … As Usual

H&R REIT: Fading Risk Should Be Reflected In A Higher Price

Unit Price has sharply underperformed the sector since the onset of COVID Trading at a 44% discount to IFRS Net Asset Value (C$22.11) and less than 9X 2020 AFFO which has been temporarily depressed by COVIDRetail and energy tenants are performing better than feared H&R REIT (TSX:HR/UN)(HRUFF) units have fallen sharply this year due to … Continue reading H&R REIT: Fading Risk Should Be Reflected In A Higher Price

Artis REIT: Break-Up Will Deliver Value, But Who Will Wield The Hammer?

Artis delivered strong 3Q20 operating results with high rent collection and rising FFOCOVID impact has been limited due to portfolio of industrial assets, secondary office markets, and essential retailActivist Sandpiper Group launched a proxy fight to replace 5 of the 7 directorsThe proposed Retail spinoff was postponedOut-of-favor diversified business model has suppressed the market value. … Continue reading Artis REIT: Break-Up Will Deliver Value, But Who Will Wield The Hammer?

Nam Tai Property: Complicated Plots

Nam Tai Property (NTP) has generated a 10 year return of about zero despite consistently bullish online commentary I resisted buying NTP due to flaws in the bullish arguments, but took a fresh look due to recent involvement of an activist shareholder, ISZO Capital. Here's a brief recap of some underappreciated aspects of the story … Continue reading Nam Tai Property: Complicated Plots

SINA Privatization Proxy – It’s An Unfair Deal And There’s Nothing You Can Do About It

Chinese internet holding company SINA released the preliminary proxy statement for its $43.30/share privatization. The price is well below the company's 6/30 asset value of approximately $68/share, but the buyout will certainly be approved because SINA's Chairman Chao controls 61% of the voting rights. The deal process and transaction terms illustrate some risks that investors … Continue reading SINA Privatization Proxy – It’s An Unfair Deal And There’s Nothing You Can Do About It

Artis REIT: Spin Spin Sugar

Artis will spin off its Retail assets to unitholders through a new listed REITArtis will separate its Industrial assets into a wholly owned structure to facilitate a future spinoff or saleArtis attributes $2.55/unit value to the Retail business. The remaining $12.85 of NAV is about $7 for Industrial and $6 for Office.Management accepts that diversification … Continue reading Artis REIT: Spin Spin Sugar

H&R REIT: Keep Calm And Call HR

Unit price has fallen 47% since 2/28, much worse than peers Trading at a 53% discount to its IFRS Net Asset Value (C$21.80) and  8 X 2020 AFFO (C$1.30) which has been temporarily depressed by COVID Diversified business model is unpopular with investors, but heavy COVID impact on retail assets has been balanced by stable … Continue reading H&R REIT: Keep Calm And Call HR

Artis REIT: Not For Sale, But Not Forsaken

Artis 8/10 unit price is a 45% discount to IFRS Net Asset Value of C$15.40/unit Artis trades at 6X 2020 FFO, well below the 12X average for all Canadian REITs Artis price has underperformed the sector since 2/28 despite a favorable business mix and strong rent collections The company’s Strategic Review concluded without a transaction, … Continue reading Artis REIT: Not For Sale, But Not Forsaken

Phoenix New Media: China Market Rally Increases Likelihood Of a 2020 Special Dividend

Currently has $3.48/ADS in net Cash + Short-Term Investments August closing of the second stage of the Yidian sale will bring an additional $2.12/ADS A special dividend is likely (possibly similar to the $1.35/ADS paid in 2019) Group Chairman recently purchased shares of Phoenix New Media's parent company Phoenix New Media (FENG) closed the first … Continue reading Phoenix New Media: China Market Rally Increases Likelihood Of a 2020 Special Dividend