The Daily REITBeat | Tuesday, February 4th, 2025

"Tariff Turmoil"

Author

David Auerbach
February 04, 2025

Good Morning!

Futures mixed at the time of this writing as talking heads focus on economic impact of tariffs imposed and on the table by President Trump. Corporate earnings also in focus as the 10-year treasury hovers around 4.59%.

From Bloomberg

  • "Stocks struggled for traction as traders worried about the economic implications of tariffs while parsing the latest batch of earnings. The dollar weakened and bond yields rose.

  • S&P 500 futures and European equities were little changed after China’s restrained response to US tariffs and a last-minute reprieve for Canada and Mexico. The dollar index slid 0.2% as some traders flagged relief that the worst-case scenarios seem to be avoided.

  • A mixed bag of corporate results, meanwhile, did little to give the market direction. Palantir Technologies Inc. shares soared as much as 20% in US premarket trading after the software company gave a forecast that is stronger than expected, citing demand for its AI products. But Merck & Co. Inc., PepsiCo Inc. and Estée Lauder Cos. declined on disappointing outlooks.

  • “The tariff issue is not going away as fast as one could have hoped for,” said Andrea Tueni, head of sales trading at Saxo Banque France SAS. “Sure, earnings are providing some oxygen but there’s a bigger game at play here. We’re only at the beginning of a long process so my advice is to proceed cautiously.”

  • Traders are also awaiting results Tuesday from Google parent Alphabet Inc., as well as data on US factory- and durable-goods orders."

In REIT News

  • BMO initiates TRNO with a Market Perform rating ($71 price target)

  • Evercore ISI upgrades MAR to Outperform from Inline (raise price target by $55 to $330)

  • DOC and EQR announced earnings while AAT, BDN, DEI, ESS and SPG announce earnings after the close of trading

  • HIW announced investment and financing transactions that closed during the fourth quarter of 2024 and to date in early 2025 whereby 1) the Company has sold in a series of transactions non-core buildings in Raleigh and Tampa for combined gross proceeds of $166.4 million and gross proceeds from dispositions closed in the fourth quarter of 2024 totaled $21.4 million with the remainder closing early in the first quarter of 2025; 2) in the fourth quarter of 2024, the Company acquired fee simple title to the land underneath its Century Center assets for $50.6 million; 3) in the fourth quarter of 2024, the Company sold 1.59 million shares of its common stock at an average gross sales price of $32.71 per share, raising net proceeds of $51.3 million

  • STAG completed the sale of a building in Nashua, NH on January 31st for gross proceeds of $67.0 million, representing a Cash Capitalization Rate of 4.9% as the 337,391 sf building was acquired in 2014 at an 8.2% Cash Capitalization Rate for a purchase price of approximately $11.7 million and the sale resulted in a 20.8% unlevered internal rate of return over the hold period

  • VICI announced the effectiveness of its new $2.5 billion multicurrency unsecured revolving credit facility that replaced its existing, and now terminated, unsecured revolving credit facility of the same size noting that the Revolving Credit Facility matures on February 3, 2029 and can be extended for two successive six-month terms or one twelve-month term plus the Company has an option to increase the Revolving Credit Facility by up to $1.0 billion, to the extent that any one or more lenders (from the syndicate or otherwise) agree to provide such additional credit extensions

  • OUT announced the appointment of Nick Brien as Interim Chief Executive Officer effective February 10, 2025 which follows the previously announced retirement of Jeremy Male

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Welcome your comments and feedback.

Have a great day!

David Auerbach