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
Mortgage REITs Are Bad Long-Term Investments
The average annualized NAV return since inception for 15 residential mortgage REITs is 3.5% The average annualized NAV return since inception for 10 commercial mortgage REITs is 2.7% Mortgage REITs have complexity, volatility, and high overhead, but many fail to outperform unlevered bond portfolios. Large discounts may provide opportunities for short-term outperformance New Residential, AGNC, … Continue reading Mortgage REITs Are Bad Long-Term Investments
Ladder Capital: Well Positioned For A Distressed Market
Ladder is a commercial mortgage REIT with a diversified portfolio designed to preserve capital and flexibility to take advantage of period market disruptions. A few weeks ago CEO Brian Harris said (4Q19 conference call transcript): Having just raised $750 million a few weeks ago, we have plenty of dry powder and we were deploying it … Continue reading Ladder Capital: Well Positioned For A Distressed Market
Colony Collapse Disorder: Will CLNS 1Q Results Provide A Cure?
Colony Northstar shares fell sharply over the past 6 months due to poor operating results and an unclear strategy for improvement 1Q18 earnings are unlikely to hold any surprises. Healthcare peers have been weak, Industrial and Hospitality have been strong. "Unallocated" corporate costs are the biggest uncertainty. With little conviction I estimate $0.74/share of FFO … Continue reading Colony Collapse Disorder: Will CLNS 1Q Results Provide A Cure?
Colony Northstar Credit Real Estate Might Not Be A Disaster
Several things could go right for Colony Northstar Credit Real Estate (CLNC) in coming months: Release of year-end results and conference call will provide an opportunity for the company to introduce itself to investors. $300mm share repurchase plan can begin after results are out. At a price of $20/share, the plan could acquire over 18% … Continue reading Colony Northstar Credit Real Estate Might Not Be A Disaster