Rayonier is Out of the Woods
This month's (July '07) Smart Money has a good article about Rayonier. I like southern REITs, and I don't think we have enough REITs based in the South. Anyway, this positive article details how Rayonier is selling land once used for timber production.
According the article, Rayonier sold 6,600 acres for eight times the purchase price. As a result of these one-time sales, analysts think the Rayonier share price has the potential to surge.
I disagree that this approach to profit generation is a good decision. No only is the approach short-term, I feel that we are sacrificing timber production that our country needs. I’m much more confident with US based companies like Rayonier and International Paper managing forests than shifting this service and likewise our dependency to other countries such as Brazil or China.
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Jul.07.2007. 21:23
Independence Day
I've personally only owned one REIT acquired by private equity which was BNP Residential. BNP was a mid-market apartment REIT located in Charlotte, NC. Short-term the private equity acquisition was pretty good for my small investment in BNP. However, as an advocate of REITs, I'm concerned about the long-term investment options available to the public as more REITs are taken private.
On this July 4th, I would like to reflect and take a break from the private equity frenzy. As a result of this frenzy, we are sacrificing long-term capital appreciation and reliable long-term income for short-term gains. Our founding fathers took the long-view, and I would like to encourage REIT management to consider the long-view as well. Let's be completely forthcoming, when a REIT goes private the only long-term losers are the former investors.
Have a great 4th of July!
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Comments (0) Jul.04.2007. 13:04
Forbes Prints Mixed Signals on the REIT Market
The July 2nd edition of Forbes continues the excellent REIT coverage, even if the analysis is mixed. One of the cover stories is “Shorting Skyscrapers.” This article features the founder of REIT advisors Green Street, Jon Fosheim. Fosheim has left Green Street Advisors, and he now is a partner at Oak Hill REIT Management where he is shorting REITs.
In another Forbes story by Laszlo Birinyi, Jr, Vornado Realty Trust is mentioned in a positive light. This mixed analysis from Forbes is proof that the REIT market could go either way. My opinion is that investors must focus on quality and not invest in REITs that have become to popular and therefore unreal market valuations.
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Comments (0) Jun.28.2007. 21:58
Winthrop REIT Makes News and $9 Million 
I don't know why, but I've always been interested in REITs that own other REIT securities. Likewise, Winthrop REIT is interesting because they own approximately 5% of Lexington Realty Trust.
Winthrop REIT is also a scrappy REIT. They were formerly called First Union Real Estate, or was it First Union REIT? Either way their old name explains their symbol, FUR. Today Winthrop announced a gain of just over $9 million on the sale of their securities in America First Apartment Investors.
So what will Winthrop do with this $9 million dollar windfall? The company didn't make any indication in their press release. The $9 million would be a good start at decreasing their $271 million in long term debt.
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Comments (0) Jun.26.2007. 23:17
REIT Index Down and Another REIT Taken Private
The Dow Jones Composite All REIT Index was down 1.55% today. This continues the slide, but it is still 13 points shy of the 52 week low hit on July 21, 2006.
The big news today came from America First Apartment Investors. They annouced they were being acquired by Sentinel Omaha LLC for $532 million which represents a 12% premium over Friday's closing price. Not a bad weekend return.
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Comments (0) Jun.25.2007. 21:44