EQC - Equity Commonwealth: Conservative Capital Structure With A 9-18% Upside

2024-06-04 11:07:21 ET

Summary

• Equity Commonwealth is an Office REIT owning just 4 office buildings but with a $2.17 billion cash pile.
• The company's portfolio has a leased rate of only 75.4%.
• Despite lower cash basis NOI, normalized FFO increased 13% Y/Y due to higher interest income.
• The company will either use the excess cash to grow its portfolio or alternatively sell the remainder of its properties.
• The value of the property portfolio varies between $400 and $213 million, depending on the cap rate used.

Introduction

Equity Commonwealth ( EQC ) has outperformed the Vanguard Real Estate Index Fund ETF ( VNQ ) in 2024, posting a 1% gain in the face of broad-based US real estate weakness, with the VNQ down some 6% so far this year....

For further details see: