Investment research/investment management firm Morningstar has released its latest (and quite thorough) analysis on REITs and commercial property valuations. REITs are currently in a stage of repositioning/deleveraging their portfolios and capital recycling, according to Morningstar, and there are still REITs trading at discount to fair-value estimates. However, political uncertainty and supply issues of select asset classes (such as office, multifamily, seniors housing) in gateway markets (like San Francisco and New York) are a growing concern, the firm says. Morningstar advises investors to “continue to be particularly discriminatory.” Another issue to watch, says Morningstar is “a wave of legacy, peak-market property debt maturing over the remainder of the year [that] may cause significant disruption in real estate property and capital markets.” (Via Morningstar)
The Canada Pension Plan Investment Board (CPPIB) will buy Parkway Inc. (PKY), a Houston office REIT, for $1.2B. PKY was the progeny of a 2016 merger between Cousins Properties and Parkway Properties, and formed to control the combined Houston assets. PKY’s 19-property office portfolio spans 8.7 million sq. ft. within Houston’s Greenway, Galleria and Westchase submarkets; as of the end of March, the portfolio was 87.6% leased. “Parkway fits well with CPPIB’s long-term real estate strategy to hold stable, high-quality assets in large U.S. markets. Through this investment, CPPIB gains additional scale in Houston,” CPPIB Managing Director Hilary Spann says of the deal. (Via CoStar News)
Lawyers for Deutsche Bank have denied requests by five Democratic legislators to see financial information related to loans the bank made to President Trump, saying they “respectfully disagree with the suggestion that Deutsche Bank freely may reveal confidential financial information in response to requests from individual members of Congress.” But the bank said it may turn over information should a formal congressional committee request be made. Bloomberg had earlier reported Deutsche Bank made about $300M in loans on Trump properties: on a Chicago tower, a Washington, D.C. hotel and a golf resort in Florida. (Via Bloomberg)
More News to Note:
Consumer Spending Rises ‘Modestly,’ But Confidence Falls
Samsung Signs On $380M South Carolina-Based Manufacturing Plant
California VA Ambulatory Care Facility Gets $128M Mortgage Loan
