by David Bodamer November 17th, 2008
“Each day seems to bring more bad news as real estate share prices head south in earnest,” RBC noted.
Some of the hardest-hit companies have exposure to the retail sector on signs that consumer spending is tumbling as a result of the financial crisis.
“We believe the biggest issue facing REIT investors today, however, is determining just how bad things are and how bad they might get for commercial real estate,” the RBC analysts wrote. “The stocks have clearly already discounted the potentially devastating impact of a closed credit market and the inability of real estate companies to access capital in the near term.”
REITs have been slashing their dividends to conserve capital, and companies with the highest leverage ratios are seen as most vulnerable.
The sector’s woes are highlighted by General Growth Properties Inc. (GGP), the mall owner that has seen its shares lose 99% this year. The stock was recently booted from the S&P 500 Index (SPX) after it warned it may seek bankruptcy protection if it can’t refinance or extend its debt.
The sell-off clearly shows that investors see more tough times for the sector.
“Commercial real estate stock prices also appear to have discounted significant drops in fundamentals over the coming year,” RBC said.
Link.
Related Topics: News, REITs, Trends |
by David Bodamer November 17th, 2008
Dillard’s to close more stores in 2009.
Sear’s has announced seven more store closings.
Kohl’s isn’t closing stores, but its third quarter profit fell 17 percent.
Related Topics: News, Retail |
by David Bodamer November 17th, 2008
CB Richard Ellis stock initially dropped after the company canceled a private offering, but then surged massively after it completed a public offering instead.
Related Topics: News |
by David Bodamer November 17th, 2008
Some quick news bites to start the day.
Moody’s downgraded General Growth.
Moody’s Investors Service downgraded the ratings of senior secured bank debt and senior unsecured debt three notches to ‘Caa2′ from ‘B3,’ which affects $5.9 billion of debt. Both ratings are non-investment level, or “junk” grade. The downgrades include debt at Rouse Co. LP.
Moody’s said the ratings remain on review for possible downgrade.
Moody’s said it has “deepening concerns” about the company’s liquidity position in a tight credit market as earnings continue to be pressured by weak economic condition.
Feldman Mall Properties has a tenative deal to sell three malls. It also will stop filing public reports.
Feldman said also that as a cost-cutting move, its board has voted to stop filing reports required by the Securities and Exchange Commission. As a result, the company said, its shares will no longer be traded on the Over-the-Counter Bulletin Board. They will, however, continue to be quoted on the Pink OTC Markets, a privately owned company formerly known as Pink Sheets.
Feldman said it will continue to provide quarterly and annual financial information to shareholders.
Related Topics: Finance, Investment, News, REITs, Retail Real Estate |
