KBWY - Prison REITs: The End Is Near

• Prison REITs - the "darkest corner" of the REIT sector - have been slammed in 2020 as pandemic-related operational struggles have clashed with ever-intensifying political headwinds.
• Undoubtedly, the most controversial real estate sector, Prison REITs have been under assault from the hardline "cancel culture" that views private prisons as conspirators in a powerful "prison industrial complex".
• While the hard evidence debunks the core claims, prison REITs have faced mounting difficulty in accessing capital from an "ESG-focused" institutional investment community, compelling both REITs to slash dividends.
• Private prisons are facing an existential crisis if Democrats sweep the 2020 Elections, who have pledged to abolish the Federal use of private prisons, which comprise 50% of industry revenues.
• CoreCivic announced it is abandoning the REIT structure, and GEO Group likely isn't far behind. While intrinsic value exists, these companies will likely face continued difficulty operating as public entities.

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