Nareit's REIT Report Podcast

Conditions across the entire hotel industry are “very healthy,” said Ashford Inc. (NYSE American: AINC) Co-President and Chief Strategy Officer Rob Hays, who was a guest on the latest edition of Nareit’s REIT Report podcast.Ashford advises two REITs, Ashford Hospitality Trust, Inc., which focuses on the full-service segment, and Braemar Hotels & Resorts, which concentrates more on the luxury sector.Supply growth is holding firm at around two percent, while demand is staying ahead of that, Hays said. The industry has also seen some occupancy gains, combined with inflationary-type room rate increases, he added.

Jacques Gordon, global head of research and strategy at LaSalle Investment Management, was a recent guest on the Nareit REIT Report podcast.Gordon will be speaking on the economic outlook for real estate at Nareit’s SFO Forum 2018 on Sept. 24.In terms of the real estate cycle, “we’re in a good place,” Gordon said.“Fundamentals are healthy. There’s a lot of new supply but there’s also a lot of demand. Rent growth is steadily upward,” Gordon noted. “There’s a lot of good news already registered in 2018 and we expect steady as she goes, positive for the rest of the year,” he added.

In the latest edition of Nareit’s REIT Report podcast, Leslie Cook, ENERGY STAR program manager at the Environmental Protection Agency (EPA), discusses upcoming revisions to ENERGY STAR score calculations and steps that REITs can take to prepare for the changes.ENERGY STAR’s online tool, ENERGY STAR Portfolio Manager, is used to measure and track the energy performance of commercial buildings across the nation. For eligible buildings, the tool calculates a one to 100 ENERGY STAR score for rating a facility’s energy performance.Cook notes that the calculations for current ENERGY STAR performance metrics are based on 2003 data. Models are now being updated to reflect the 2012 Commercial Buildings Energy Consumption Survey (CBECS) from the Department of Energy. The updates will be released on August 27.

Scott Crowe, chief investment strategist at CenterSquare Investment Management, was a guest on the latest edition of Nareit’s REIT Report podcast.CenterSquare recently published a report, “The REIT vs. FAANG Valuation Showdown.” It notes that the current valuation of FAANG (Facebook, Apple, Amazon, Netflix, and Alphabet’s Google) stocks roughly equate to $3 trillion of total equity value, versus $5.8 trillion for the entire U.S. institutional real estate market.“Essentially the choice that the market is giving investors today is, would you rather own the five most popular tech stocks in America, or half of all the commercial real estate in this country?” Crowe said. While FAANG stocks are interesting and dynamic, the largest tech companies of today may not be at the top a decade from now. Real estate, however, is still going to be around to house the companies of the future, he noted.

Allan Swaringen, president & CEO of JLL Income Property Trust, was a guest on the latest edition of the Nareit REIT Report podcast.JLL Income Property Trust is a perpetual life, daily NAV REIT that is advised by LaSalle Investment Management and sponsored by JLL.Swaringen described the landscape of the non-listed REIT sector today. He pointed to three substantive changes that have occurred in the last five to six years. They include: a move to perpetual offerings; increased regulation and the adoption of an institutional valuation methodology; and a movement toward programs diversified by property type.

SBA Communications is a wireless infrastructure REIT active in North, Central, and South American markets. The company has been in operation for nearly 30 years. Today it owns and operates close to 30,000 towers across the Western Hemisphere—from the upper reaches of Canada to the tips of Argentina and Chile.Jeffrey Stoops, president and CEO, described the domestic leasing environment as “probably as good as it’s been in the last four or five years.” All four major wireless carriers are busy pursuing projects and enhancements that ultimately will advance their transition to 5G technology, he said. SBA benefits in terms of new leases and tenancies on towers where carriers may not have been before.

Brad Case, Nareit senior vice president for research and industry information, was a guest on the latest edition of Nareit’s REIT report podcast.Case highlighted the turnaround in REIT market performance seen since February. Prior to that, REITs had underperformed the broader stock market – particularly growth stocks - for about a year and a half.

Stacy Slater, senior vice president for investor relations at Brixmor Property Group Inc. (NYSE: BRX), joined Nareit for a special edition of Nareit’s REIT Report Podcast recorded in New York during Nareit’s REITweek: 2018 Investor Conference.Slater said some of the questions most frequently asked by investors focus on tenant demand at its shopping center properties and how that might have changed from last year. Investors are also interested in the disconnect between valuation levels and where Brixmor is selling its assets, she said. Other investor areas of interest include where Brixmor and other retail REIT stocks are trading on an implied cap, rate, and the impact of rising interest rates.Slater described competition for capital as “hard,” noting that there have been outflows out of the REIT industry.

Steven Brown, senior portfolio manager at American Century Investments, joined Nareit for a special edition of Nareit’s REIT Report Podcast recorded in New York during Nareit’s REITweek: 2018 Investor Conference.Brown commented on REIT fundamentals, noting that following a deceleration in the last couple of years, “we’re starting to see an inflection point in terms of same-store net operating income (NOI).” If the United States economy continues to improve, that could bode well for an acceleration in REIT fundamentals in 2019, he added.

Laurel Durkay, portfolio manager at Cohen & Steers, and J. Scott Craig, portfolio manager at Eaton Vance, were guests on a special edition of Nareit’s REIT Report Podcast recorded in New York during Nareit’s REITweek: 2018 Investor Conference.Durkay and Craig discussed several key topics, including the messages from REIT management teams that they are paying most attention to.