IVT - Whitestone REIT: Undersupplied Submarkets Portend Growth

2024-04-22 14:47:39 ET

Summary

• Whitestone REIT has highly advantaged properties in 5 submarkets, leading to higher rents and potential property value of $20 per share.
• The tight occupancy and increasing demand in these markets have resulted in rental rates increasing by 20% and expected to continue growing.
• The ongoing proxy battle between activist investor Erez Asset Management and Whitestone may determine the future path of the company, either through a sale or continued operation.

The Whitestone Buy Thesis

Whitestone REIT ( WSR ) has the best located properties of any shopping center REIT. All 5 of their submarkets are highly advantaged from a demand and supply standpoint, which is facilitating substantially higher rents as leases get marked to current market rates. We spot property value at around $20 per share, yet the stock is trading below $11.00. WSR’s combination of property quality, growth and valuation provide ample upside to shareholders as the cycle plays out.

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