Net Lease Office Properties (NLOP) is Set to Return Capital

Alluvial Capital Management, an investment advisory firm, released its second-quarter 2025 investor letter. A copy of the same can be downloaded here. The fund rose 8.5% in the quarter, bringing the year-to-date returns to 15.6%. As of June 30, the comparable US benchmarks continued to be in negative territory for the year. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.

In its second-quarter 2025 investor letter, Alluvial Capital Management highlighted stocks such as Net Lease Office Properties (NYSE:NLOP). Net Lease Office Properties (NYSE:NLOP) is a publicly traded real estate investment trust. The one-month return of Net Lease Office Properties (NYSE:NLOP) was 0.74%, and its shares gained 14.39% of their value over the last 52 weeks. On August 12, 2025, Net Lease Office Properties (NYSE:NLOP) stock closed at $33.70 per share, with a market capitalization of $499.235 million.

Alluvial Capital Management stated the following regarding Net Lease Office Properties (NYSE:NLOP) in its second quarter 2025 investor letter:

“Out-of-favor commercial real estate continues to be a theme in our portfolio. Our biggest real estate holding, Net Lease Office Properties (NYSE:NLOP), has eliminated all corporate-level debt and is poised to begin returning capital soon. Net Lease Office Properties recently succeeded in selling a vacant Texas office property at an attractive valuation of $80 per square foot. The company is actively marketing several of its remaining higher-value properties. The company currently has distributable cash on hand of around $3, with more coming in each month. Excluding mortgaged properties, Net Lease is currently trading at a capitalization rate of around 18%. I continue to believe shares are worth $45-50.”

An aerial view of an office building, displaying the company’s commercial properties portfolio.

Net Lease Office Properties (NYSE:NLOP) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 15 hedge fund portfolios held Net Lease Office Properties (NYSE:NLOP) at the end of the first quarter, which was 18 in the previous quarter. While we acknowledge the risk and potential of Net Lease Office Properties (NYSE:NLOP) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Net Lease Office Properties (NYSE:NLOP) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Net Lease Office Properties (NYSE:NLOP) and shared Kingdom Capital Advisors’ views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.