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REIT's Are the New Way to Buy Distress

It has been difficult for buyers to find property to purchase as many owners are holding out:

  • This has forced many groups to acquire shares in publicly-traded real estate companies and bonds.

  • Firms using this strategy include: Blackstone Group, Starwood Capital Group, and Oaktree Capital Management.

  • Their belief is the market is undervaluing the REIT's by being overly pessimistic about the pandemic’s impact on property owners.

  • In March and April, shares of REITs were down by 50% including Mack-Cali which is now up 18% from its May low.

  • Blackstone has purchased more than $2B in real estate stocks since the pandemic started including shares of Extended Stay America.

#REIT #COVID19 #Economy #CRE

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