Latest Stock Buy or Sell? Make More Informed Decisions!

This is the first year where we've seen publicly traded real estate really outperform the broader markets. The question is why?

There are some tailwinds to property fundamentals. Falling new supply, as new construction has really fallen off a cliff ever since interest rates spiked. They have access to capital, which is in stark contrast to the liquidity crunch in private credit markets. Offer resilient cashflows, meant to be beneficiaries of inflation. M&A is alive and well.

Finally, we came into the year with the widest historic earnings multiple spread between US REITs and the S&P 500. That setup was last seen after the dot-com bust. REITs then went on a 7-year run, outpacing the S&P. 

Tech is easy to own, and we're in one of the most exciting times with prospective growth in AI. It's easy to look at the real estate market and paint it as not exciting.

But we're definitely seeing a rotation from growth to value today. Not only do the US names present value, but they have a growth element as well. Think of the data centre space in REITs, poised to take advantage of growth in AI. Grocery-anchored shopping centres -- very defensive, but operating at record occupancy levels and record rental rate levels.

The REIT sector is made up of 16 different asset classes. Lots to choose from.

Not actually a REIT, but a corporation. Offers a nice blend of both capital appreciation and income. Half its portfolio is government-funded, long-term care; other half is private-pay retirement homes. Stability of government funding + tremendous growth from aging baby boomers. Well-covered, safe yield of 4.1%.

Sometimes investing is about keeping it simple. 

Also see his Top Picks.

Great grocery-anchored shopping centres nation-wide. Defensive. Banners:  Farm Boy, Empire, Sobeys, Longo's. Sweet spot today. Lack of distribution growth until last year, but thinks growth can continue because some brands are growing market share. Safe 5.3% yield.

Defensive, lower growth. About 25% of rents come from WMT. Don't expect much growth. Hiccup last year from tenant bankruptcies. Trades in a range, and it's at the higher end. Stock could consolidate after the run it's had. Yield is very safe.

Challenging story, balance sheet pressure. Question is were moves taken enough to right the ship? Answer is out of management's hands. Needs to sell assets to get leverage back to manageable levels (and investment-grade rating retained). 

Just raised equity at $10, which means market's saying that's fair value. Higher risk name. Really needs to execute. For those with higher risk tolerance, you can hold for now.

Not a REIT, doesn't pay a substantial yield. Management owns a large percentage. A store of value -- owns a lot of land that can be developed over many years, and becomes cash windfall. Large discount to NAV, perhaps 50%. 

Good hold for the long term. Accumulate on market weakness, be nimble enough to sell on appreciation.