In this article, we discuss 10 best real estate stocks to buy in 2022 according to Eduardo Abush’s Waterfront Capital Partners.
Eduardo Abush, an MBA graduate from Stanford Graduate School of Business, established Waterfront Capital Partners in January 2010 as a long/short equities hedge fund. The fund’s consulting and financial services are available to small and medium-sized businesses. In the latest round of 13F filings, Waterfront Capital Partners revealed a $1.60 billion Q1 equity portfolio. According to the filings, the fund invested heavily in the real estate sector, which accounted for 80.27% of the portfolio’s holdings. Eduardo Abush’s hedge fund purchased 19 new stocks in the first quarter of 2022, while making additional purchases in 13 securities.
In this article, we’ll look at Eduardo Abush’s Waterfront Capital Partners’ holdings in the real estate industry, with the most significant stakes being represented by Equinix, Inc. (NASDAQ:EQIX), VICI Properties Inc. (NYSE:VICI), and Host Hotels & Resorts, Inc. (NASDAQ:HST).
Eduardo Abush is bullish on Equinix, Inc. (NASDAQ:EQIX), according to his hedge fund’s disclosed holdings data as of the end of Q1 2022. The fund increased its position in Equinix, Inc. (NASDAQ:EQIX) by 35% in the first quarter, ending the period with 58,500 shares of the company. BMO Capital analyst Ari Klein decreased his Equinix, Inc. (NASDAQ:EQIX) price objective to $770 from $825 on May 26 and maintained a Market Perform rating on the stock.
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Another notable stock in Eduardo Abush’s portfolio is VICI Properties Inc. (NYSE:VICI). The investor owns a $19.72 million stake in the company. Following a period of limitation, JPMorgan analyst Anthony Paolone restored coverage of VICI Properties Inc. (NYSE:VICI), maintaining an Overweight rating and a $35 price target on May 3.
Host Hotels & Resorts, Inc. (NASDAQ:HST) is one of the real estate companies in Waterfront Capital Partners’ portfolio. Following the Q1 results, Deutsche Bank analyst Chris Woronka boosted his price objective on Host Hotels & Resorts, Inc. (NASDAQ:HST) to $26 from $23 and reiterated a Buy rating on the stock.
Our Methodology
Here is a list of 10 best real estate stocks to buy in 2022 according to Eduardo Abush’s Waterfront Capital Partners. We used Abush’s 13F portfolio for Q1 2022 for this analysis.
Data from about 912 top hedge funds tracked by Insider Monkey at the end of the first quarter of 2022 was used to calculate the number of hedge funds that own shares in each firm.
Best Real Estate Stocks to Buy in 2022 According to Eduardo Abush’s Waterfront Capital Partners
10. Equity Residential (NYSE:EQR)
Waterfront Capital Partners’ Stake Value: $60,168,000
Percentage of Waterfront Capital Partners’ 13F Portfolio: 3.75%
Number of Hedge Fund Holders: 34
Equity Residential (NYSE:EQR) is a real estate investment trust that focuses on the acquisition, development, and administration of rental apartment complexes. Equity Residential (NYSE:EQR) owns or has assets in 305 properties in Boston, New York, Washington, D.C., Seattle, San Francisco, Southern California, and Denver, totaling 78,568 apartment units.
On May 19, Scotiabank analyst Nicholas Yulico cut his price objective on Equity Residential (NYSE:EQR) from $92 to $90 while maintaining a Sector Perform rating. Despite rising 15.2% year over year in April, multi-family rentals in the United States are beginning to fall. In addition, according to Yulico, coastal rents rose in April but are still lagging behind the Sunbelt in terms of year-over-year increases.
According to Insider Monkey’s Q1 data, 34 hedge funds were bullish on Equity Residential (NYSE:EQR), compared to 32 funds in the earlier quarter. Jean-Marie Eveillard’s First Eagle Investment Management is the leading shareholder of Equity Residential (NYSE:EQR), with 5.47 million shares worth $491.62 million.
Eduardo Abush loaded up on Equity Residential (NYSE:EQR) in the first quarter, increasing his hold on the company by a whopping 114%. Waterfront Capital Partners owned 669,127 shares of Equity Residential (NYSE:EQR), worth $60.17 million.
In addition to Equinix, Inc. (NASDAQ:EQIX), VICI Properties Inc. (NYSE:VICI), and Host Hotels & Resorts, Inc. (NASDAQ:HST), Equity Residential (NYSE:EQR) is a notable real estate stock in Eduardo Abush’s Waterfront Capital Partners portfolio.
9. Regency Centers Corporation (NASDAQ:REG)
Waterfront Capital Partners’ Stake Value: $63,279,000
Percentage of Waterfront Capital Partners’ 13F Portfolio: 3.94%
Number of Hedge Fund Holders: 18
Regency Centers Corporation (NASDAQ:REG) is a real estate investment trust specializing in the ownership, operations, and development of shopping malls. In the first quarter of 2022, Zimmer Partners held the most significant stake in Regency Centers Corporation (NASDAQ:REG), worth $167.65 million.
On March 31, Deutsche Bank analyst Derek Johnston decreased his price objective on Regency Centers Corporation (NASDAQ:REG) from $92 to $83 and reiterated a Buy rating on the stock. Outsized demand, backed by solid retailer leasing, boosted volumes ahead of estimates in 2022, lifting applicable cap rates for his retail coverage somewhat, according to the analyst.
In Q1 2022, Waterfront Capital Partners increased its stake by 177% in Regency Centers Corporation (NASDAQ:REG). The hedge fund held shares worth over $63.28 million in the company, representing 3.94% of its 13F portfolio. As per Insider Monkey’s Q1 data, the number of hedge funds holding stakes in Regency Centers Corporation (NASDAQ:REG) stood at 18 in Q1, compared to 22 in the previous quarter. The consolidated value of these stakes is over $361.95 million.
8. Hudson Pacific Properties, Inc. (NYSE:HPP)
Waterfront Capital Partners’ Stake Value: $74,666,000
Percentage of Waterfront Capital Partners’ 13F Portfolio: 4.65%
Number of Hedge Fund Holders: 14
Waterfront Capital Partners elevated its position in Hudson Pacific Properties, Inc. (NYSE:HPP) by 196% in Q1 2022, holding more than 2.69 million shares worth over $74.67 million. The stock accounts for 4.65% of the fund’s total 13F portfolio. Hudson Pacific Properties, Inc. (NYSE:HPP) is a real estate investment trust with a portfolio of almost 19 million square feet of office and studio assets and development properties.
On May 25, Goldman Sachs analyst Caitlin Burrows decreased Hudson Pacific Properties, Inc. (NYSE:HPP)’s price objective to $27 from $30 and reiterated a Buy rating on the stock. According to the analyst, long-term demand for freshly constructed/renovated office space is projected to be high.
Out of the 912 hedge funds tracked by Insider Monkey, 14 held stakes in Hudson Pacific Properties, Inc. (NYSE:HPP) in the first quarter. The total value of their stakes was $172.05 million. In the previous quarter, 15 hedge funds held stakes in the company, worth $96.69 million.
7. Duke Realty Corporation (NYSE:DRE)
Waterfront Capital Partners’ Stake Value: $78,532,000
Percentage of Waterfront Capital Partners’ 13F Portfolio: 4.89%
Number of Hedge Fund Holders: 18
Duke Realty Corporation (NYSE:DRE) is a real estate development business that engages in industrial and medical office property ownership, management, and development. Securities filings for Q1 2022 disclose that Eduardo Abush added Duke Realty Corporation (NYSE:DRE) to his portfolio by purchasing 1.35 million shares worth $78.53 million. The hedge fund is the most significant shareholder of Duke Realty Corporation (NYSE:DRE).
On May 17, Mizuho analyst Vikram Malhotra lowered his Duke Realty Corporation (NYSE:DRE) price objective from $65 to $58 while maintaining a Buy rating. The risk/reward ratio for stocks, according to Malhotra, is still unfavorable.
In Q1 2022, 18 hedge funds tracked by Insider Monkey held stakes in Duke Realty Corporation (NYSE:DRE), worth $191.23 million. In comparison, 14 hedge funds held positions in Duke Realty Corporation (NYSE:DRE) in the previous quarter, with stakes valued at roughly $148.63 million.
6. Extra Space Storage Inc. (NYSE:EXR)
Waterfront Capital Partners’ Stake Value: $79,156,000
Percentage of Waterfront Capital Partners’ 13F Portfolio: 4.93%
Number of Hedge Fund Holders: 29
Extra Space Storage Inc. (NYSE:EXR) is a real estate investment trust that owns and operates storage facilities. Self-Storage Operations and Tenant Reinsurance are two of the company’s segments. Extra Space Storage Inc. (NYSE:EXR) issued a quarterly dividend of $1.50 per share on May 26, in line with the previous. The forward yield was 3.44%.
The number of hedge funds holding stakes in Extra Space Storage Inc. (NYSE:EXR) grew to 29 at the end of first quarter of 2022 from 27 in the preceding quarter. These stakes are collectively worth over $327.69 million. Among these shareholders, Jeffrey Furber’s AEW Capital Management held the largest stake in Extra Space Storage Inc. (NYSE:EXR), worth more than $123.54 million.
Morgan Stanley analyst Ronald Kamdem decreased his price target on Extra Space Storage Inc. (NYSE:EXR) from $172 to $156 on May 25 while keeping an Underweight rating. COVID helped storage REITs, but Kamdem was afraid that demand benefits might revert since he believed rents were too high and supply was restricting growth.
In Q1 2022, Waterfront Capital Partners increased its position in Extra Space Storage Inc. (NYSE:EXR) by 508% and held shares worth over $79.16 million. The company accounted for 4.93% of the hedge fund’s 13F portfolio.
Like Equinix, Inc. (NASDAQ:EQIX), VICI Properties Inc. (NYSE:VICI), and Host Hotels & Resorts, Inc. (NASDAQ:HST), Extra Space Storage Inc. (NYSE:EXR) is gaining the attention of Eduardo Abush’s Waterfront Capital Partners.
5. Apartment Income REIT Corp. (NYSE:AIRC)
Waterfront Capital Partners’ Stake Value: $85,238,000
Percentage of Waterfront Capital Partners’ 13F Portfolio: 5.31%
Number of Hedge Fund Holders: 26
Apartment Income REIT Corp. (NYSE:AIRC) is a real estate investment trust that offers a simple business strategy and a diverse portfolio of stable apartment complexes to participate in multi-family real estate. With combined stakes worth $411.50 million, 26 hedge funds tracked by Insider Monkey held positions in Apartment Income REIT Corp. (NYSE:AIRC) in Q1 2022. In the previous quarter, 18 hedge funds held positions in the company.
Waterfront Capital Partners started investing in Apartment Income REIT Corp. (NYSE:AIRC) during the second quarter of 2021, with a stake worth roughly $9.33 million. In Q1 2022, the hedge fund held shares worth $85.24 million, after increasing its position in the company by 12%. Apartment Income REIT Corp. (NYSE:AIRC) constituted 5.31% of the hedge fund’s 13F portfolio.
On May 25, Truist analyst Michael Lewis cut his price objective on Apartment Income REIT Corp. (NYSE:AIRC) from $58 to $49 while maintaining a Hold recommendation. Over the next several years, the analyst expects that the REIT’s profits would rise at a slower pace than its peers.
In the first quarter earnings reported on May 2 by Apartment Income REIT Corp. (NYSE:AIRC), the Funds from Operations (FFO) totaled $0.57 per share, in line with the estimates. However, the $181.5 million revenue was below the estimated revenue by $4.09 million.
4. Sun Communities, Inc. (NYSE:SUI)
Waterfront Capital Partners’ Stake Value: $85,956,000
Percentage of Waterfront Capital Partners’ 13F Portfolio: 5.35%
Number of Hedge Fund Holders: 36
Sun Communities, Inc. (NYSE:SUI) specializes in property management. In Q1 2022, Waterfront Capital Partners increased its stake in Sun Communities, Inc. (NYSE:SUI) by 20% to $85.96 million, representing 5.35% of its 13F portfolio.
At the end of the first quarter of 2022, 36 hedge funds tracked by Insider Monkey held stakes worth over $798.82 million in Sun Communities, Inc. (NYSE:SUI). In comparison, 37 hedge funds held positions in the company in the preceding quarter. Among these hedge funds, Echo Street Capital Management was Sun Communities, Inc. (NYSE:SUI)’s largest shareholder in Q1, owning shares worth over $221.73 million.
Sun Communities, Inc. (NYSE:SUI), which owns prefabricated housing communities, RV resorts, marinas, and holiday parks, has purchased approximately $6 billion in assets since 2019, according to Truist analyst Anthony Hau, expanding the company’s entire potential market and allowing for outsized growth at a reasonable price. Therefore, on May 10, the analyst reiterated a Buy rating on Sun Communities, Inc. (NYSE:SUI) and a price target of $185.
ClearBridge Investments, an investment management firm, in its Q3 2021 investor letter, mentioned Sun Communities, Inc. (NYSE:SUI) and discussed its stance on the firm. Here is what the fund said:
“Our commitment to constantly improve the risk/reward of the portfolio kept us active during the third quarter in repositioning to capitalize on opportunities we have previously sourced and derisked. We initiated a position in Sun Communities, a U.S. real estate investment trust (REIT) that specializes in investing in manufactured housing communities, recreational vehicle (RV) resorts and marinas. As the economy works through housing supply constraints, Sun’s manufactured housing communities are increasingly appealing to younger, lower income populations in prime growth locations through the Sun Belt. Additionally, Sun’s expanded RV park offerings have seen healthy demand from increasing numbers of retiring baby boomers purchasing RVs as well as greater numbers of road trips in the wake of COVID-19.”
3. Federal Realty Investment Trust (NYSE:FRT)
Waterfront Capital Partners’ Stake Value: $86,168,000
Percentage of Waterfront Capital Partners’ 13F Portfolio: 5.37%
Number of Hedge Fund Holders: 23
Federal Realty Investment Trust (NYSE:FRT) is a real estate investment trust that owns, operates, and redevelops retail and mixed-use assets. On May 5, Federal Realty Investment Trust (NYSE:FRT) issued a quarterly dividend of $1.07 per share, in line with the previous.
RJ Milligan, a Raymond James analyst, upgraded Federal Realty Investment Trust (NYSE:FRT) from Market Perform to Strong Buy on May 12 with a $140 price target. Federal Realty Investment Trust (NYSE:FRT) is one of the newest acquisitions of Waterfront Capital Partners in Q1 2022. The hedge fund bought shares worth over $86.17 million in Federal Realty Investment Trust (NYSE:FRT), representing 5.37% of its 13F portfolio.
Insider Monkey’s data showed that the hedge fund interest spiked in Federal Realty Investment Trust (NYSE:FRT), as 23 hedge funds held stakes worth $306.37 million in the company in Q1, up from 19 funds in the previous quarter.
2. Camden Property Trust (NYSE:CPT)
Waterfront Capital Partners’ Stake Value: $88,003,000
Percentage of Waterfront Capital Partners’ 13F Portfolio: 5.48%
Number of Hedge Fund Holders: 30
Camden Property Trust (NYSE:CPT) is a REIT that specializes in multi-family apartment community ownership, management, development, repositioning, redevelopment, acquisition, and construction. Waterfront Capital Partners upped its position in Camden Property Trust (NYSE:CPT) by 42%. The hedge fund’s total holdings were worth $88 million as of Q1 2022.
Higher interest rates, broader economic uncertainty, and resulting multiple contraction, as well as the fact that the return to historical stock valuation has happened faster and sooner than expected, prompted Truist analyst Michael Lewis to lower his price target on Camden Property from $186 to $160 on May 25. However, he maintained a Buy rating on the stock.
The number of hedge funds tracked by Insider Monkey holding stakes in Camden Property Trust (NYSE:CPT) grew to 30 in Q1 from 26 in the previous quarter. These stakes hold a consolidated value of over $517.96 million, showing considerable growth from $349.19 million in Q4.
1. STAG Industrial, Inc. (NYSE:STAG)
Waterfront Capital Partners’ Stake Value: $92,553,000
Percentage of Waterfront Capital Partners’ 13F Portfolio: 5.76%
Number of Hedge Fund Holders: 21
STAG Industrial, Inc. (NYSE:STAG) is a real estate investment trust that specializes in acquiring, owning, and operating single-tenant industrial buildings across the United States. In Q1 2022, STAG Industrial, Inc. (NYSE:STAG) accounted for 5.76% of Waterfront Capital Partners’ portfolio, and the hedge fund increased its position in the company by 28% during the quarter.
On May 3, STAG Industrial, Inc. (NYSE:STAG) posted earnings for the first quarter of 2022, reporting Funds From Operations (FFO) of $0.53 per share, beating market estimates by $0.01. In addition, revenue for the quarter was $159.21 million, up 18.8% from the previous year’s first-quarter revenue.
Zimmer Partners held a stake worth $169.54 million in STAG Industrial, Inc. (NYSE:STAG), becoming its largest shareholder in Q1. Along with this, 21 hedge funds tracked by Insider Monkey reported owning stakes in the company in Q1, down from 22 in the previous quarter. The aggregate value of these stakes is over $528.63 million.
You can also take a peek at 9 Stocks to Buy in 2022 According to Mark Massey’s AltaRock Partners and Top 10 Stock Picks of Eli Cohen’s Crescent Park Management.
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Disclosure: None. 10 Best Real Estate Stocks to Buy in 2022 According to Eduardo Abush’s Waterfront Capital Partners is originally published on Insider Monkey.
