AMC Just Got An Enormous Break
Let’s not rush right into commercial real estate and real estate investment trusts (REITs), focusing on residential opportunities instead.
Much has been said the last year+ about intensely rising home prices. People keep waiting for a crash – including the growing number of want-to-be owners now solidly priced out of the market.
Personally, I remain in the “this isn’t sustainable” category. But unsustainable can last quite a while, as we’re still seeing.
One of the latest jaw-dropping housing market moves just happened in San Francisco. That’s where a three-bedroom, two-bathroom home sold for $5.6 million – $2.1 million over the asking price.
The featured pictures are certainly attractive. But worth $2.1 million over the asking price in an already overinflated environment?
Yeah… I don’t think so.
Speaking of inflation, the Federal Reserve Bank of New York released its August Survey of Consumer Expectations report yesterday. It showed that the Fed itself might still be debating how “transitory” inflation will be.
Average Americans, however, are not.
Looking ahead one year, those surveyed are predicting a 5.2% inflation jump. That’s not only a three-tenths month-over-month increase, it also marks the tenth consecutive surge – AND the highest reading since 2013.
This larger issue has so many factors to it, but China is definitely one of them. Wolfpack Research founder and Chief Investment Officer Dan David told Yahoo Finance Live the other day:
“We really are not even in the beginning stages of the [Chinese tech] crackdown. China is going back to a policy of total control, and they don’t want people having the kind of addiction to gaming that maybe we have here.”
A policy of total control will affect U.S. consumers further.
That’s just one opinion, of course. But it’s worth keeping in mind as you consider your investments.
The World According to REITs
Now onto the headline news, which is a very big deal for more than one REIT.
Disney (DIS) suffered a lot last year considering its experiential-based model. But that global conglomeration is nothing but savvy.
So as theaters shuttered for months on end, Disney pushed its online services in unprecedented ways.
That sparked outrage from theaters and even high-profile actress Scarlett Johansson, who says her contract didn’t cover such things. But Disney didn’t care.
It had No. 1 in mind as it did dual theater and Disney+ releases for major movies (including Johansson’s Black Widow). And it no doubt had No. 1 in mind when it tested out Shang-Chi and the Legend of the Ten Rings as a theater-only debut.
That film ended up earning $100 million on its opening weekend.
So Disney has come to a new decision. The rest of its 2021 movies will follow that model – a conclusion that AMC Entertainment (AMC) and its competitors are no doubt sighing in relief over.
The same goes for their REIT landlords.
Speaking of REITs, we have another wave of public offering announcements, as I report at Intelligent REIT Daily. As for “Another Day in REIT Paradise,” here are your three insights for this Tuesday morning:
- Rexford Industrial Realty (REXR) acquired four industrial properties for $250.3 million. The buildings – three in Orange County, California; and one in Ontario, Canada – are 100% leased. And all were purchased in off-market transactions.
- Apple Hospitality REIT (APLE) bought Aloft Hotel in downtown Portland, Maine. The 157-room establishment cost $51.2 million.
- UDR (UDR) named Kevin C. Nickelberry to its board as an independent director, beginning September 10. This expands that body to 10 members.
If you want more than that, you know where to go!
(Source: The Daily REITBeat)
Brad Thomas is the Editor of the Forbes Real Estate Investor.
Disclaimer: This article is intended to provide information to interested parties. As ...
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