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5 at 5: Your Daily Digest for Real Estate Investing, 1/4/21


Jan 04, 2021 by Marc Rapport
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The future of offices, construction spending inches up, Brookfield eyes a major stock move, Realty Income revisited, and who's shoveling the snow?

In Today's News

The Future of Offices When Workers Have a Choice

Some workspaces in central employment districts may become housing, and some housing in residential areas may become workspaces, The New York Times says today in a piece of particular interest to office space investors.

Why it matters: The article succinctly states: "The defining characteristic of this new version of the creative class may not be where it lives, but its ability to live anywhere it wants." Knowing what's driving such a major trend can help investors respond to it.

Construction Spending Continues to Rise

The first business day of the new year brings with it the first report on business activity from the Census Bureau: that overall construction spending was up 3.8% year over year in November.

Why it matters: The gains varied by sector, but they were all gains, except for a slight dip in public construction spending. A lot of new construction is underway, including a lot of buildings that will soon be for sale and rent, including houses, apartments, offices, and retail. That seems like a good sign.

Brookfield Asset Management Offers to Take Brookfield Property Private

Brookfield Asset Management (NYSE: BAM) said today it has made an offer to take its commercial real estate arm Brookfield Property Partners (NASDAQ: BPY) private in a $5.9 billion deal involving one of CRE's largest portfolios.

Why it matters: Brookfield Property Partners has a subsidiary: Brookfield Property REIT (NASDAQ: BPYU), that offers identical dividends exchangeable on a one-for-one basis with BPY stock. How this will all play out remains to be seen. Either way, as CNBC points out, this involves roughly $88 billion in total assets, including office buildings, malls, self-storage facilities, and logistics hubs.

Today on Millionacres

Realty Income Is Starting to Look Expensive Again

Realty Income (NYSE: O) is a bellwether name in the net lease niche, and the coronavirus bear market opened up a huge opportunity for long-term investors to buy into this well-run real estate investment trust (REIT). But that was then. This is now.

Why it matters: Millionacres' Reuben Gregg Brewer explains why this most reliable of dividend payers is no longer a bargain and what investors should consider before plunking down some cash for some shares.

How to Manage Snow on Your Rental Property

In many parts of the country, it's now time for freezing-cold temperatures and blankets of snow. It also means hours of shoveling, plowing, and de-icing. Or does it?

Why it matters: Millionacres' Aly Yale takes a look at this seasonal question: Who's responsible for snow removal at rental properties? It depends. Aly explains.

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Marc Rapport owns shares of Realty Income. The Motley Fool owns shares of and recommends Brookfield Asset Management. The Motley Fool has a disclosure policy.