Gregmal

Sorry to hear of your loss. I do actually recall, IIRC it was John Hjorth, probably back around this time a year ago, having significant concerns for India specifically. What puzzles me, is that considering how globally connected everything is, as far as information goes...how does a year pass and yet we still the level of pure chaos that is currently being seen in India? How dont we have adequate supplies? I am by no means an expert on India, but to think this has been around for over a year and the worst is still happening in places is bizarre. Brazil was another puzzling one although I think different factors were at work there. Conversely, we havent really heard all that much out of Asia anymore. Without getting into it too severely as I always feel Im treading on ice with respect to covid and Sanjeev's tolerance for politics, but is the issue with covid really the politics of it? Its seems(again not specific to red/blue) that many of the areas that have been outliers suffered from lack of flexibility in terms of adapting on the political front. In respect to the markets, I dont recall you being an obnoxious ass about it. Everyone is obviously entitled to their opinions. Some are more skilled in their ability to forecast than others, but there were a few folks here who went out of their way to viscously disparage, mock, and even attempt to bully people whom disagreed with them...and those are the people who happened to be hilariously wrong and quoted above. If you are going to behave like that, at the least, you better be right. There were lot of folks who underestimated the markets, but they were humble about it and generally cordial and didnt make total fools of themself. Others, not so much.

Just wanted to bump this on the one year anniversary of some of the greatest contrarian indicators of all time here of COBF. The genius authors of these can remain nameless however the March-June pages here were quite something! Third and fourth weeks of April last year there were folks making claims such as( some paraphrasing): "I hope you & your kind are active participants in the market for sure" April 26, 56% return had you listened! Better answer for him: "If you truly think the whole world is wrong and you are right, the futures market opens at 6 pm EST" March 15-basically the bottom "If you are as confident as you are that you are correct, the financial markets are providing you plentiful opportunities to profit handsomely. " Mid March....Yup, plentiful indeed. "President Cuomo"....this didnt age well! "I don't commit to numbers in the face of rapid compounding and wide uncertainty, but I do sell my stocks and go to cash when I sensed this disaster unfolding". Thats too bad On Michael Burry and Mr. Cuomo: "Well he went in big on Gamestop and Tailored Brands, so not surprising." "Galileo's investments in Gamestop and Tailored Brands need the Church to listen! Galileo may be suffering from an acute case of incentive caused bias (Even Newton wasn't immune to the whims of the South Sea Company)... But yes, what Pres Cuomo is already planning...a strategic reopening." "Presidential--with a capital 'P'. Somebody jelly of President Cuomo, wants to capture the political upside of Cuomo's stellar management". LMFAO! Ooops! "The market has provided ample opportunity for those who missed this in March to cash out with the S&P now where it was in October 2019. There should be no valid excuse for these people if they lose their shirts." Late April..sooo prescient "So Sam Zell, Buffett, and Icahn are cautious on the sidelines and on the other side you have folks like Bill Ackman. Take your pick..." Well...Ackman did 70%. Buffett barely broke even, Icahn sucked wind, and Zell...who cares? "and then they'll cry and talk about "who could have predicted this". Whelp....obviously some of us could have, but not all of us! S&P since then? One of the truly great, generational, perhaps even once in a lifetime buying opportunities... ~+56% over the next 12 months The cream eventually rises to the top and the turds get flushed down the toilet and go away. As they say, never in doubt! Nostradamus! Always certain! I hope you all were invested in the markets! If not, just remember, an ounce of prevention is worth a pound of cure! Just ask Taleb. Buffett and Icahn were both bearish. Only stooopid people buy stonks during a pandemic! Dumb aphorisms for the win! And yea, I 100% did flag these posts at the time to throw them in peoples faces down the road. When people run their mouths they deserve accountability. Cheers

As it stands now, assuming the sale goes thru and there is no further upside on Armour Yards(there definitely could be), what I have is roughly this. Office: ~$400M remaining, probably more, see below. But from here, you roughly reduce mortgages by $450M. Three Ravinia is minimum a $200M property. Theres a $115M mortgage on it. I think folks are severely underestimating this though. Check out the sale details on 1/2 Ravinia, both complete turds compared to 3. Combined occupancy rate in 70s. Three is a newer, massively bigger(bigger than one and two combined), has better credit tenants, and higher occupancy. The San Antonio property as well. There's another $100M. 100% leased. Major tenant USAA with more than 5 years remaining. Brookwood, again, 100% leased. Merrill, PWC, Kinder...Another $50M. If we're being real, thats your low end on office. $350M with net proceeds around $150M. So mortgages are 2.2B, and soon to be flat $2B. Cash once office is clear stands around $450M conservatively. Preferreds at $2B. Plus retail and MF. Retail, as Ive said before, I think a conservative FV is probably 6.25-6.75. Call it $1.2B. I think using 2020 NOI for any real estate company is a pretty safe and conservative base. So wiping office at sale value plus conservative estimates have you looking like this. Preferred+mortgages $4B Cash+loans $750M New Market $1.2B For simplicity sake $2B in assets against $4b in preferred+mortgages means the current MC implies $2.6B or so for the MF(on a $120M NOI implies like high 4s which is dumb). In this case you own a fairly valued entity with a pure play on the Sun Belt growth story, with a management group thats probably just as connected(see developer relationships and Publix) regionally, as anyone out there. Thats your conservative estimates. Which is fine for todays value. But if you want to use more reasonable marks, which again, arent crazy considering if nothing else, what these guys previously did 1000% right, was only buy trophies or cream of the crop assets....you could easily pull another $100M from the office. You could get another $200M on retail. And you could put MF at 4. $25 a share Want to get optimistic? Retail NOI bumps 5% from covid levels(which include non payments, deferrals, and vacancies,). MF grows 3% as roaring housing market keeps people on the sidelines as far as home buying goes but migration continues. As Tepper mentioned, foreign buyers with negative rates dont allow US spread to blow out all that much from here and rates stabilize. Market compresses further and spread narrow for both MF and New Market. None of the loans default and that by itself is basically another $1 per share in your pocket. This scenario? Mid $30s share price. So on a scrubbed and highly unrealistic conservative basis you paying FV. I own RYN, OK company, fairly valued, exposed to tailwinds. Should do OK. I recently added to NVR. GARPy maybe...but seems reasonably valued. I mean people are talking about rates ranging from negative to maybe 2-3%. Low future returns on S&P. Here, at worst, you have highly levered exposure to an unstoppable growth market at FV. At best you're buying a dollar at 50-60c and still getting the tailwind. Unless of course you think NY/NJ/MA/CT/CA reverse course, lower or eliminate taxes, (re)fund the police, and get a Hail Mary from global warming to produce 10 decent months of weather a year....then look at CLPR...

Isnt this kind of how it starts? They have trouble getting staff, cant meet pent up demand, and as a result wages must go up.

I guess to hammer it directly...is there a scenario where you see preferred redemption, in size, that pivots them from operating from a position of strength? What size do you think that is, and what tips the domino? I'd say probably a $700M number is where they seem to lose options? Anything under $500M I think they have the resources available to tackle. Now they seem to have the asset sale pipeline as well. The $700M sale should net lazily $250M...and then they've also got another $400M lets call it in dispositions wrt remaining office. Sans this, theyre kind of kicking ass and taking names and taking out big chunks on their own time, no?

Yea you're not wrong, I just dont think those issues become unnavigable now thats there is a clear commitment to selling assets and fixing it. I think your downside scenario is real, which I think can be loosely confirmed by last Q3s price action; Q2/3 Sun Belt started going nuts but the low share price IMO was more so indicating market fears about mass dilution from preferred conversion. To me indicating thats a cog that has weight and validity if things turn south. However I also think Murphy has a plan for this, which if nothing else was confirmed by the shareholder initiative to retract and replace the 10 year call with a 5...which as luck would have it, lines up perfectly with where the issuances started taking place. 2016-2018 is where I think the preferred really started getting out of hand and became viewed in a different, a highly negative light. So you're already ahead of the ball kind of, with the recent sale, more likely being on the table, and visibility into the next few years. I also think, much like with my half assed thesis on the banks....2020 was kind of your worst case scenario, chickens coming home to roost, stress test of sorts. Anything is possible, but if the preferred conversion didnt kill them last year, I have a hard time isolating a future catalyst that would exceed the effects of 2020 covid. And then from there, even trying to envision one, how does it occur in size that prohibits the company from acting in a non destructive way? So I guess what I'm trying to convey, is that yes bad things can happen, but they've gotten ahead of the ball and are focused in the right direction. If the things that can bring those risks about are simply scenarios that correlate with "wide scale market correction" then its really little different than most other investments, and two, I still think MF+grocery anchored retail holds its footing better than most. On the dividend(errr, piker payout) I think its just the result of the fact they've previously built the business off the backs of yield chasing retail investors. Catering to their crowd. Which I dont care for, but understand, because until the institutional support comes along, they still need to placate the shareholder base. If the previous institutional observations are an indicator, it'll probably be at $30 a share when the suits are talking about low cost of capital and 3-5% growth....just the way it works with the "smart"(cough) money.

Yea Ive got similar anecdotes. Almost all my immediate family(teenagers through retirees) moved about a decade ago. Then over the past few years even friends around my age. When down there, I was talking with a few cops who were originally from NY, and spent several years as NYPD. Same as above, "I cant believe I didnt do it sooner". One of my childhood friends moved to the Boca area. Half a year later his parents followed. A year later his wife's family followed. There is a very real network type effect. There's obvious covid fads, but there's also real underlying trends. IE a stationary bike the kills children is probably a fad. But hybrid work from home is real. Sun Belt migration; real. And in the case of the later, as they pick up, they pick up big time. Ive been in touch with a number of agents/brokers/etc in various places down there, and its getting to a point where the homes themselves arent even necessarily that much cheaper than many of the places up North. Which should be bullish for rentals. When looking at "how to play the Sun Belt growth story"....theres obviously many ways to get creative. But a big piece of how I view this, is simply that. It's the simplest(MF and retail), highest levered, and probably best directly positioned to do well, IF the thesis is correct. Its the right yo-yo so to speak. So again, the current fundamentals are definitely important, as is the direction management is going. But IMO the biggest driver, more so than all that, is just being in the right place. There's so much upside leverage here that its almost "equationized". If Sun Belt growth continues, then, PAC gives you alpha. Whereas conversely, I disagree with the wild, wipeout scenario downside projections. These are super high quality assets. Financed ideally with respect to the mortgages and IMO relative to the rest of the pie and the subsequent options, financed "manageably" with the preferreds. I have yet to see a credible(and realistic) case where you get anywhere near a total wipeout. So on the entire spectrum, IMO, you kind of have this incredibly levered call on a dominant theme, with safe assets, and plenty of time. Its just a bonus really that they are trading at such a discount to CURRENT value. My money though is on future value.

Exited modest sized, long held, fully margined positions in V, DPZ, ARE. Good time to be bolstering liquidity, IMO.

Once upon a time, like half a decade ago there was talk here about a REIT conversion. It was canned upon news of favorable changes to the tax code. I love this boring as paint drying company but think its an ideal heavy weight for event driven investing due to what I perceive as a hard asset floor. Should(which if you know management the answer seems obvious) this revisit REIT conversion I estimate you get a nice quick $10-15 per share or so pop. Low risk event driven trade here with some strongly positioned MF assets and a beast of a royalty biz.

Just a reminder today that as the Federal Pickpocket Program continues to be expanded(walloping the market and corporations alike) that it seems Americans, especially in high tax areas will continue to be faced with the stark reminder that in order to keep what they earn, they may have to look south. The Sun Belt growth story is powerful and will have a lot of momentum. Every roughly 10% appreciation in asset value here equals almost $10 per share of upside. I think this theme will ultimately be far more powerful than worrying about 50-100 basis point theoretical valuation on assets they arent selling anytime soon. Theres also the added benefit both on a corporate level and individual capital gains level that REITs will likely be favorable investment vehicles under a hostile and aggressive tax regime. Which leads me to...(find me at the FRPH thread)

Started a plain vanilla short on NFLX. ~1.5% position.

Im definitely looking forward to the Q1 details on 5/11. We should at least get a good scope of whats probably the first real, non covid era(covid life is basically over in GA/FL/etc) quarter, and subsequent figures. You had moving parts all over. The collection rates were sound last year, and I dont think they gave goosed figures with "Adjustments" like many companies did. But they also dont break out SH vs MF, at least to my knowledge. I dont believe student housing, anywhere, was clipping near 90% collections after March. You have a few tack on acquisitions as well. IIRC Blake and Menlo didnt factor in at all. So we'll see a lot of clean(er) figures here and gee golly, I guess this is probably the point of their "simplification strategy" lol. If you put a gun to my head and said put a cap on grocery/retail and if its outside of 25 bps up or down you're dead, I'd probably put New Market at 6.35. The point being to be realistic and not sensational up or down. Putting it at 8 cap is probably more sensational than putting it at a 5. You could also get cuter about break out non dev. and if you go $240 sq/ft and then run the spec stuff at $130 you get to a $1.3B-ish figure. Same thing with remaining office, I'd probably say 6.85. So in addition to the recent sale figure that reverts back to the original valuation being around the top end of the 1B-1.3B range. Loans at par. If you(again loosely, which is fun because $100M here or there gets zippy against $50M shares outstanding) net the above, which ignores MF entirely, you're getting mid $2B number plus the loans. If you have a whole lot of time and net mortgage to mortgage and preferred to excess capital and account for acquisition +/- I think you'll spend a ton of time and ultimately still be loosely at the same place as if you just ballpark shit in 10 minutes. But nonetheless the above mid $2B asset figure wipes most if not all the mortgage debt. And you're remaining pieces are MF vs preferred and from there you can also add in a few bucks a share for the remaining bunch of stuff on the b/s but Ive left that out because its not really material to me. Although again, every $100M is $2 per share. But thats the gist. Office sale number IMO should have everyone happy. From here, there's still a ton of levers to pull. If this wasn't a goofy microcap I am sure Murphy would haver his ears full from every RE investor with a minor or more sense of aggression/activist edge because there really are a lot of different ways this can get fixed. If you can pull $750M of preffereds over the next few years at the current coupon and replace it with something more becoming and "market rate", that will also do wonders. There's zero reason, if you look solely at the asset base and size here, that this cant be competitive with the big guys in terms of profile and desirability. The beauty here is that unlike the bigger guys, these guys exclusively own trophy/cream of the crop class A, which I think one also needs to factor into their estimates. If anything is going at a 4 cap(or who knows, maybe lower) in FL/GA its what PAC owns.

They'll likely be exploited. The irony in all the US/China drama is that the US basically created the monster that is China because we saw benefits to low wage labor, cheap products, and exploitation of their resources. So we incentivized and put the wheels in motion and now they just kind of figured out how to push us back/cut us out....and we're outraged.

picked up a few NVR

Haha yup. Perhaps in some ways we think alike. Earlier when you started commenting I said to myself, "he's not trolling, he's hammering out the things that bother him" because I often deal with the same things the same way. As I said much earlier(or maybe in another thread, IDK), I started dabbling with this late last year and early this year. Did some on the ground work on my FL trip. But it took a very good several weeks, maybe even months to really kind of get totally comfortable here. Maybe Im a bit too comfortable. But from first glance, up until probably the March release, it was just never ending risks and stuff that one after another jumped out as a deterrent and only after really kind of weighing out each and then collectively did I start to see things clearer(or at least I hope they are clear!). Or perhaps not "clearer" but just that the stuff that collectively jumps out at you creates an illusion of greater risk than there is likely to be. There's virtually no risk of 0. The mortgages won't do this., they're low rate, fixed, and in every case I am aware of, net out again the subject property with a positive carry. The preffereds are a "risk", but ultimately I think the terms, and levers that can be pulled make such dire outcome minimally likely. From there, well, if you realistically mark the assets to market you're way ahead of the game. And without even worrying about things possibly getting even rosier, the degree to which you need catastrophe to occur on a grand scale in order for property valuations to crush you here, is also pretty darn out there. Also keep in mind that as we've seen before, in RE, the property can be underwater be also held and carried through turbulence if you've been semi intelligent about your financing. Its like marking AAPL in BRK portfolio to $40 a share. Its possible, but also so extreme that you can probably hedge that into a windfall should it occur, or simply conclude its just a risk one takes being in the market. From there, you're basically at a spot where you need things fundamentally to just not fall apart severely, and a continued execution of whats already starting to be put in place. On the retail preferred holders, I'll echo Williams406 sentiment. These people are what we call "stupid risk averse". They like not seeing mark to market. They like the face yield. Their brokers/IA are likely directing them into all sorts of stuff like this...the incentives dont really point towards selling them at a loss because it undermines the investment objectives, even if the objectives are retarded.

Theres a few things that largely mitigate this. I'm about to run out so Ill try to find it later but there should be a selling agreement(I stumbled upon it a while ago not sure where) with Preferred Capital Securities that basically gives color on much of the mechanics of the preferred. They are still being issued/redeemed however the company is working on netting things out month to month..while blowing out chunks like last Q4 and presumably this Q3/4. But specifically, there are some very onerous redemption fees for the first 3 years IIRC. If you want to redeem within 12 months I think it is something like 12% or so. The company also has to option to settle in cash or stock. Further, the shareholder vote last fall allowed them to be called after 5 years instead of 10. So in order to really get wild you would need to see a glut of the year 4+ issuances come into play which I think is largely what the company is targeting now. They also have a moderately expensive line of credit. So in order for this above risk to really play out, you'd need a glut of older preferred holders to redeem. The company to be short on cash, with no liquidity, and generally I guess a lack of alternatives and no assets to sell. So its there, but ultimately like much of the other stuff, unlikely to really drive a material downside scenario.

As to the path for the shares....these traded 30% higher pre covid. Granted you have to reconfigure a bit with the internalization of the manager and associated adjustment...but they've exited student housing, sold more than 1/2 the office(or at least have a sale contract), reduced debt and preffered.....and Sun Belt assets have been in crazy mode. So all else equal its hard to make the case why the company is less valuable now. But its also not uncommon if you are familiar with this type of stuff and these sort of small cap situations. A few months/quarters ago people were harping on why Pure Cycle wasn't moving either at $8 or whatever. Turns out a few dumb money institutional tards were selling indiscriminately and fast forward now you have a double or so. Like Pure Cycle, PAC is extremely well positioned for most of the likely scenarios that play out going forward. And even in some less than desirable scenarios it still possibly does better than most.

I think you can use a liquidation value as a starting point but if the company gets liquidated today, you just had office go off at 6, retail w/ grocery gets you probably a 6.5/7 worst case, loans being asset backed typically and/or having buyout options should see par and multifamily is easily low 4. Except the company isnt being liquidated and won't any time soon. So its a starting point but not a fallback/put option type scenario. With that being said, again, there's stability in the fact that they could put the multifamily up and have $3B offers in the blink of an eye...if for whatever reason its needed. One scenario some folks have mentioned, although it doesnt appear likely, it offloading the office and MF and then having these guys who have spent a ton of their careers doing retail, focus on that. If its a catalyst for rerating I dont mind it, but if I'm looking at a long term growth story I'd prefer they just simplify and stay with MF. Sell a portion of the retail ideally too, keep maybe 15% or so of the NOI there. On the sale proceeds, the language is really no different than communicated prior. From the student housing portfolio sale there was a similar breakdown; clear the associated mortgage debt, retire preferreds, use a portion for corporate purpose and focus on multifamily investments. So I suppose it depends on what you are willing to give them credit for. My expectation would be that they use ~$150M to redeem preferred and then take ~$100M and buy $200M in MF mainly from the loan development pipeline. End result from just this aforementioned office asset sale is net reduction in balance sheet debt/liability of ~$400M(assuming they do the above). They didnt seem terribly hot on paying current market for MF assets on the March call. From there you can focus on the remaining office. Using just Ravinia, you could expect another $100M of net proceeds after the repayment of the ~$115M mortgage. So you take a lot of this from different angles and its hard exactly to see how receptive the market has been to the announced strategic focus since it overlaps with a lot of the vaccine/market rally, but it definitely liked the March news and from there, I think we couldn't have asked for more in terms of the speed of results obviously manifesting in the office sale. Its still largely ignored that Sun Belt can continue appreciating, which adds even more upside to the equation. Are we really that far away from talking 3 caps on MF? As pupil mentioned, you can draw lots of conclusions in terms of downside, but 1) it requires scenarios unfolding that won't....IE everything called at once.. while also 2) significant and major market deterioration, and 3) giving absurd multiples/valuations to best in class assets. To use the MF from pupils downside case above, you'd have to price class A MF worse than what they just got for office; thats insane and if you expect that to occur you can probably find an Ackman style fortune to be made in some sort of CMBS/credit product. So in a nutshell you are effectively betting those things won't happen and if thats the case you stand to do pretty well here.

I think its hard to read through too much about the assets in the sale. The properties selected fit in perfect with the focus at HIW. However they also represent about 10% to HIW EV so perhaps going larger or including more was too much to chew on at the moment. Per the prepared remarks HIW already needed to tap the credit facility and take out a bridge loan + accelerate some asset sales. The properties they bought are a good geographic fit. There still also may be upside from Armour Yards which is part of the deal but also allowed to be shopped. 150 Fayetteville was ~90% leased with ~5 years term so again, I am not sure the read through or assumption of a pass on Three Ravinia is there. All of the Ravinia vacancy was related to State Farm, which has been building a gargantuan 1.5M+ sq/ft campus in Dunwoody; something known for years and was certainly factored into the ~$220 sq/ft foot PAC paid about 5 years ago. Zillow recently grabbed a big chunk of this and named the location its Southeast HQ.(Yea I think Zillows pretty darn interesting all of a sudden too but thats another convo. Yea how's that AI driven, Sun Belt focused auto home buying program looking now?). Here's a lazy link to development going back to the time of purchase. https://atlanta.curbed.com/2017/9/7/16264644/state-farm-atlanta-perimeter-dunwoody-development-construction Remember, PAC is HQ in Atlanta, John Williams and his people were the biggest name developers in Georgia for 3 decades...no way he wasn't aware of this. Word is that the original 7 year SF lease at 3 Ravinia was meant to be transitory anyway. I think, much like with a lot else at PAC, its an issue that on the surface raises concerns but when you look in further its a nothing burger, if not actually a positive. https://www.bizjournals.com/atlanta/news/2020/08/12/zillow-atlanta-southeastern-hub.html As I mentioned before, inferior one and two Ravinia just sold for what I calculated to be around $270 sq/ft. Outside of this, "The Perimeter" is currently one of the hottest markets in the country as far as CRE goes. In addition to State Farm's massive new campus thats being built you have Mercedes Benz's US headquarter, and the aforementioned IHG USA HQ. Brookfield is also incredibly active here on the retail side. Not far away are also Microsoft's new Altantic Yards office, Delta HQ, and Deloitte. Personally, I wouldn't be upset if they just kept this location, and I absolutely hate office. It is the literal definition of a trophy property. I could see it alone going for $250M.

I think we'll all ultimately get a little bit(or more) of what we want here. It is funny though how these guys basically built a $5B+ company on the back of yield chasing retail investors. And now they're of admirable size and what to be loved be institutions. As long as they do what they say theyre going to do, I dont see how this doesnt work from here. If you back out the office sale number and put a 7 cap on the rest, you get a number a good bit higher than we needed for a $20+ NAV. Retail IMO is fine but could be refined. Same with non core MF. Frankly I would have thought yesterdays release would have added a $1-2 to the share price, but this is also not anywhere near the radars of most institutional investors. It'll be another INDT where the dopes sit there and make excuses at $35-40 about how its got too many issues and they wait around and ultimately rather pay $60-$70 because it checks more boxes or whatever. I like the loans and their purpose so if they can continue clipping 12-15% while their next class A MF is built, and then buy it out at a discount to market once completed, Im all for it...even if the suits dont like that kind of stuff.

I have both. S just seems relatively cheaper with much less risk. Just less of a catalyst/reopening play. Dolans done mighty fine in regards to creating shareholder value over the years, so Id expect that to continue. EDIT: also added a few JOE today

All I'll say is check out Three Ravinia. Big lease through 2031 with IHG representing over 50% of the building. 1 and 2 Ravinia recently sold for $270 a sq/ft. Definition of a trophy property.

So I'll preface this with the disclosure that I did my very best to be a good financial professional today... I briefly read the news release this AM and just now got back from playing 18 holes. But at first glance, you cant complain about this at all. I will definitely dig in deeper(not tonight because Ive got a night fishing trip). But, quick points... This size of a sale, this soon, is a huge positive in terms of validating what these guys are doing. And yes they still have a big chunk, over 1M sq/ft of office left. Its a great starting point, and also definitely not a Sears style, illusory hand waive as they seemed to indicate they will be exiting office entirely in the near term. On management, I think its not a question of whether theyre good at what they do; almost anyone in high level real estate is, good...the question is "are they aligned/willing to do what they need to do to create shareholder value"....and so far I think the answer is a resounding yes. That can change of course. But they internalized the manager. Exited student housing. Now quickly monetizing office. All positives. These guys are definitely proven in terms of what they can do deal wise. They can build an empire, many were associated with Williams and the Post crew. A decade ago this thing had like $5M in NOI. They just need to execute what they've communicated that they will, and they've already started in a very impressive way.

Yea I am not a huge fan of office but the locations and properties they have are fine. That said, if you can clear those at a 6 cap and then pay down the preferred I guess I am "ok" with some reinvestment in MF. Management gonna grow lol. That s just what they do. MF is the safest asset class IMO so if we get something like 25% of proceeds put back into that and the rest used to clean up the balance sheet and get out of less desirable stuff I'll take that all day. If I ran the company though I wouldnt be jumping to buy MF here at all, but nothing is perfect. This is definitely big for the story though. It shows a follow through and direct commitment to doing what they said they'd do. And it also shows they sandbagged their efforts in this regard on the previous call. Very coy about it when obviously this was something being discussed.

https://investors.pacapts.com/news/news-details/2021/Preferred-Apartment-Communities-Inc.-Continues-Simplification-Strategy-with-Agreement-for-Transformational-Office-Portfolio-Sale/default.aspx Getting out of office.