Pennsylvania R.E.I.T. (PEI): Carlson Capital Trims Exposure to REIT

Clint Carlson‘s Carlson Capital has trimmed its exposure in Pennsylvania R.E.I.T. (NYSE:PEI), as a new filing with the SEC showed. The fund reported holding 3.37 million shares of the Real Estate Investment Trust, versus 4.79 million shares held earlier. The stake is activist by nature and following the decrease, amasses 4.9% of the Trust’s Common Shares.

Carlson Capital initiated the stake in Pennsylvania R.E.I.T. (NYSE:PEI) during the second quarter of 2013 and over the following months it has raised its stake from 832,200 shares held initially. Meanwhile, the stock gained around 13% since the second quarter of 2013, while since the beginning of the year, its return amounts to 19%. The trust is focused mainly on investing in retail shopping malls located in the eastern part of the United States. While Carlson is the largest shareholder of Pennsylvania R.E.I.T. among the funds that we track, other funds also reported holding shares in their latest 13F filings. Paul Orlin and Alex Porter’s Amici Capital hold 410,000 shares as of the end of September, followed by Eduardo Abush’s Waterfront Capital Partners. Both Amici and Waterfront raised their stakes by 10% and 25% on the quarter respectively, while Carlson cut its stake by 8% during the July-September period.

At the beginning of December, the trust sold several properties among which was a 50% interest in Whitehall Mall in Pennsylvania with an aggregate value of $25 million. Pennsylvania R.E.I.T. (NYSE:PEI) launched a disposition program in 2012 and since then it has sold 15 assets that generated proceeds of around $420 million.

Since REITs are usually dividend plays, Pennsylvania R.E.I.T. (NYSE:PEI) pays a dividend of $0.20 per quarter, which gives it a yield of 3.51%, close to the average among its peers.

However, while Carlson Capital has reduced its stake in Pennsylvania R.E.I.T. (NYSE:PEI), in the last couple of months we have seen an increased level of interest for REITs. At the end of November, David S. Winter and David J. Millstone‘s 40 North Management raised its stake in Columbia Property Trust Inc (NYSE:CXP) to 8.14 million shares from 4.01 million shares, while Ken Griffin‘s Citadel Investment Group upped its stake in Silver Bay Realty Trust Corp (NYSE:SBY) to 1.88 million shares from 1.71 million shares. Moreover, last week,  John Levin‘s Levin Capital Strategies reported a new stake in recently public New Senior Investment Group Inc (NYSE:SNR) that amasses 3.94 million shares.

Disclosure: none