The Daily REITBeat | Friday, October 11th, 2024

"Soothing Sentiment"

Author

David Auerbach
October 11, 2024

Good Morning!

Dow futures down around 25 points at the time of this writing as talking heads set the stage for today’s PPI report along with bank earnings season getting underway.

From Bloomberg

  • "S&P 500 futures steadied Friday, as big US banks including JPMorgan Chase & Co. and Wells Fargo & Co. soothed sentiment with forecast-topping third-quarter earnings. 

  • Bank of New York Mellon Corp. kicked off banks’ third-quarter earnings with profit topping expectations, lifting its shares in premarket trading. JPMorgan rose about 2% premarket as it reported a surprise gain in net interest income, while Wells Fargo & Co rose about 3% as it too surpassed profit forecasts.

  • Contracts for S&P 500 were steady, while Nasdaq 100 futures slipped 0.3%, dragged down by a 6% premarket drop in Tesla Inc. shares, after its robotaxi Cybercab launch was seen as light on detail. 

  • Investors will now monitor producer-price numbers later on Friday, after Thursday’s data showed a strong inflation print but a sharp rise in jobless claims, underscoring the challenge facing the Federal Reserve. 

  • Swaps markets price a roughly 80% chance of a 25 basis-point cut in November. 

  • “The data is mixed and it’s probably confusing markets,” said Justin Onuekwusi, CIO at UK wealth manager St. James’s Place. “It’s a key period when the Fed is going to be be data dependent, and the data is maybe not making the most most sense.”"

In REIT News

  • Jefferies initiates CPT with a Hold rating ($123 price target)

  • CBL announced that it completed the repurchase of 500,000 shares of stock for $12.525 million, in a privately negotiated block trade from a single shareholder and noted that the block repurchase was completed separately from its existing stock repurchase program and as of September 20, 2024, the Company had completed all repurchase activity under its stock repurchase program where a total of 1,074,826 shares were repurchased at a weighted average share price of $23.259/share

  • SHO provided an update on recent operating activity for the third quarter and the estimated resulting impact on its previously provided full-year 2024 outlook commenting that 1) The Company's operations for July and August 2024 were consistent with its prior expectations and reflect continued strength in group activity, an acceleration in business travel and an anticipated market-wide moderation in leisure demand in Maui. During the first two months of the quarter, the Company generated growth in total portfolio RevPAR and Total RevPAR, excluding The Confidante Miami Beach, of 2.4% and 6.3%, respectively, and Adjusted EBITDAre of approximately $37 million, which was in-line with the full-year 2024 outlook as presented in the Company's second quarter earnings release provided on August 7, 2024; 2) Based on the business that has been disrupted at the Hilton San Diego Bayfront as a result of the labor activity, the Company anticipates that full-year 2024 total portfolio RevPAR growth will be 125 to 150 basis points lower, Adjusted EBITDAre will be $11 million to $13 million lower and Adjusted FFO Attributable to Common Stockholders per Diluted Share will be approximately $0.06 lower than the 2024 outlook as presented in the Company's second quarter earnings release; 3) Sunstone remains well positioned to deliver significant earnings growth into 2025 and beyond driven by the contribution from the Company's recent brand conversions, including the full-year contribution and recapture of displacement at the recently converted Marriott Long Beach Downtown, the continued ramp-up of multiple assets in the portfolio, the full-year contribution from its recently completed acquisition of the Hyatt Regency San Antonio Riverwalk and the debut of Andaz Miami Beach; 4) The Company's Renaissance Orlando at SeaWorld® and Oceans Edge Resort & Marina in Key West remained open and operational during Hurricane Milton which impacted the state of Florida. Based on preliminary assessments, neither property incurred any meaningful physical damage from the storm; 5) Since the beginning of the third quarter, the Company repurchased 2.3 million shares of its common stock at an average purchase price of $9.79 per share for a total repurchase amount before expenses of $22.8 million

  • PDM announced that its property management team, after reviewing detailed property reports for all of the Company’s Orlando assets, has reported virtually no damage to any of its properties from Hurricane Milton and that all personnel in the affected areas are reported safe

  • Yesterday, Moody’s affirmed IRM’s “Ba3” Corporate Family Rating and Senior Unsecured rating with a stable outlook

  • Yesterday, AMT announced with Nextlink Internet, an Internet Service Provider (ISP) focused on rural communities across the Central U.S., the expansion of their multi-year agreement which was signed in 2021 and with the extended agreement, Nextlink Internet can collocate on additional American Tower sites, facilitating the rapid deployment of fixed wireless broadband services to residents, businesses, and anchor institutions across the region

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Have a great day!

David Auerbach & Mary Jensen