REITs

The greatest commercial real estate Kool Aid convention is currently in progress at the Waldorf-Astoria where NAREIT is holding its annual circlejerk week (oddly Zero Hedge was not invited), during which REITs try to convince other REITs how great the market is

The greatest commercial real estate Kool Aid convention is currently in progress at the Waldorf-Astoria where NAREIT is holding its annual circlejerk week (oddly Zero Hedge was not invited), during which REITs try to convince other REITs how great the market is

Moody's out with a piece, in which it joins the S&P chorus (well, not technically a chorus if just one is singing) Zero Hedge wrote about earlier, in which it seems the two major rating agencies are now taking both REITs and associated securitization conduits to the woodshed, and making it inevitable that Geithner adjusts the requirements for CMBS TALF participation. For once being a 1-10 year lagging indicator may actually be a market normalizing influence.

Moody's out with a piece, in which it joins the S&P chorus (well, not technically a chorus if just one is singing) Zero Hedge wrote about earlier, in which it seems the two major rating agencies are now taking both REITs and associated securitization conduits to the woodshed, and making it inevitable that Geithner adjusts the requirements for CMBS TALF participation. For once being a 1-10 year lagging indicator may actually be a market normalizing influence.

Jonathan Litt, formerly a top rated REIT analyst with Paine Webber and Solly, has some words of caution for all investors who can't wait to part with their cash and invest in ghost town malls, foreclosing multi-apartment buildings, unretnable offices with a 0.5x DSCR and 10%-full Vegas hotels. Ironically, this comes from a CNBC interview.

In the most recent example of taking from one pocket to pay another, Merrill and JPM underwrote 8.75 million shares at $20/share for Kilroy Realty Corp, a REIT that owns, operates, develops, and acquires Class-A suburban office and industrial real estate in bankrupt southern California.

In the most recent example of taking from one pocket to pay another, Merrill and JPM underwrote 8.75 million shares at $20/share for Kilroy Realty Corp, a REIT that owns, operates, develops, and acquires Class-A suburban office and industrial real estate in bankrupt southern California.

In the most recent example of taking from one pocket to pay another, Merrill and JPM underwrote 8.75 million shares at $20/share for Kilroy Realty Corp, a REIT that owns, operates, develops, and acquires Class-A suburban office and industrial real estate in bankrupt southern California.

• Obama to nominate Sonia Sotomayor for Supreme Court
• Lenders [BofA, Merrill] rewarded with "Bookrunner" hirings by firms in need [REITs] (FT)
• "Purchase accounting" lets FDIC/taxpayers eat JPM's loss, gives it full, one-time benefit for all gains (Bloomberg)
• North Korea is obviously very concerned about stern Obama condemnation,
  

In a research piece titled "REITs Cutting Residential Rents, Setting Stage for Further CPI Disinflation" Goldman Sachs analysts conclude that based on recent declining rent trends from residential REITs, the impact on price levels in the housing market (especially in major metropolitan centers where rent are only just now starting to unravel) will get progressively adverse, but will also feed ongoing general asset deflationary pressures, and by implication, added weakness to REIT cash flow. From Goldman:

• Must read on CNBC propaganda: "Immelt and NBC Uni CEO Jeff Zucker supposedly told top CNBC executives and talent to be less critical of President Obama and his policies" This explains why nobody with half a brain watches CNBC anymore (THR hat tip Guest)
• REITs advised to recap in equity market before rally is over (FT, hat tip IMA5U)
  

Zero Hedge is well aware that our regulatory friends at the SEC and FINRA enjoy going through our articles in search of the "next big scam." We are always happy to make their lives a little easier and not only connect the dots but give them everything they need on a silver platter so that even a green securities lawyer, 4 hours fresh out of law school, would be able to comprehend and litigate.

Zero Hedge is well aware that our regulatory friends at the SEC and FINRA enjoy going through our articles in search of the "next big scam." We are always happy to make their lives a little easier and not only connect the dots but give them everything they need on a silver platter so that even a green securities lawyer, 4 hours fresh out of law school, would be able to comprehend and litigate.

Credit markets are extending their widening trend form late Friday today as single-names are underperforming indices for the first time in over a week. The skew (the difference between index and fair-value) is at its tightest in recent times and we suggest that with equity still significantly rich to credit that we will see equity underperform IG credit in the short-term.

Yet another troubled REIT Duke Realty has jumped on the Kimco, ProLogis, etc.