Below we present the list of Top 5 Real Estate Stocks to Own According to LDR Capital. If you want to read our comprehensive analysis of the real estate industry, as well as Lawrence Raiman’s history, investment philosophy, and hedge fund performance, go directly to Top 10 Real Estate Stocks to Own According to LDR Capital.
5. Global Net Lease, Inc. (NYSE:GNL)
Global Net Lease, Inc. (NYSE:GNL) leads off the second half of our list of the top real estate stocks to own heading into 2022. Real estate investment gurus LDR Capital owned 542,419 shares of the stock on September 30, valued at $8.69 million at that time. Hedge fund ownership of the REIT has rebounded in 2021 after falling heavily in 2020.
Global Net Lease, Inc. (NYSE:GNL) impressed investors with its tenant profile after collecting 100% of its rents due during the months of April and May. However, the company’s slightly high leverage and externally managed structure have some hedge funds worried that the company will continue to face headwinds going forward.
4. Playa Hotels & Resorts N.V. (NASDAQ:PLYA)
LDR Capital owns just under 1.2 million shares of Playa Hotels & Resorts N.V. (NASDAQ:PLYA) as of September 30, a position worth $9.95 million at that time. Unlike other names in the sector, hedge funds have actually become more bullish on PLYA since the beginning of the pandemic and particularly in 2021, with ownership of the stock up by 44% during that time.
The builder and operator of resorts have rewarded investors with a strong showing this year, as Playa Hotels & Resorts N.V. (NASDAQ:PLYA)’s revenue surged by 426.4% during the third quarter, to $151.28 million, easily beating estimates. The company enjoyed higher rates during the quarter which is expected to continue into the fourth quarter and beyond thanks to burgeoning flight capacity into some of its most important locations.
3. MGM Growth Properties LLC (NYSE:MGP)
MGM Growth Properties LLC (NYSE:MGP) was one of three new stock positions added to LDR Capital’s 13F portfolio during Q3 and instantly became one of the fund’s most bullish bets as it bought 277,528 MGP shares which were worth $10.63 million on September 30. Other hedge funds have been selling out of MGP after shares rose by more than 50% between the middle of 2020 and the end of September 2021.
In December, MGM Growth Properties LLC (NYSE:MGP) announced another $0.02 per share increase to its quarterly dividend, to $2.10, the 15th such increase in less than six years following the company’s IPO in April 2016. The company’s Q3 revenue of $188.3 million did miss estimates by over $7 million, while its FFO of $0.65 was in line with the consensus.
2. Blackstone Mortgage Trust Inc. (NYSE:BXMT)
Coming in at the penultimate position, is Blackstone Mortgage Trust Inc (NYSE:BXMT), which LDR Capital made a further bet on in Q3 by raising its position in the REIT by 46% to 867,325 shares valued at $26.3 million. That makes its stake in BXMT more than twice as valuable as its third-largest holding MGP, showing the fund’s conviction in BXMT and its top stock pick SLG.
Blackstone Mortgage Trust Inc (NYSE:BXMT) ranks as one of 5 REIT Dividend Stocks with Over 5% Yields, boasting a current yield of 7.93%. BXMT underperformed its peers by double digits in 2021, a circumstance that some hedge funds believe was unwarranted and which leaves the firm trading at a severe historical discount to rivals like Starwood Property Trust, Inc. (NYSE:STWD). Blackstone’s large exposure to the struggling New York property market is likely one reason for the stock’s recent underperformance, as well as its recent 10 million shares secondary offering.
1. SL Green Realty Corp. (NYSE:SLG)
Topping the list of top real estate stocks to buy now is SL Green Realty Corp (NYSE:SLG), which has ranked as LDR Capital’s top stock pick dating all the way back to when the fund first added SLG to its 13F portfolio in the third quarter of 2019. The size of LDR’s holding has more than doubled since then, hitting 598,758 shares as of September 30. The position was valued at $42.42 million, representing 24% of the value of LDR’s 13F portfolio.
Like Blackstone, SL Green Realty Corp (NYSE:SLG) also has a large presence in New York City, being the largest office REIT in Manhattan, perhaps representing LDR’s conviction in the long-term prospects for one of the world’s greatest cities. Also like Blackstone, the company has an attractive dividend that yields 4.78% annually, with the company being one of the rare monthly dividend payers. SL Green Realty delivered FFO of $1.78 in the third quarter, trouncing estimates by $0.20.
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