2024-06-20 04:59:59 ET
Summary
- Industrial REITs face challenges due to high supply and low demand, leading to increased vacancy rates and disparity between buyers' and sellers' expectations.
- However, the market conditions will shift due to significantly decreased new construction starts.
- FR is well-positioned to benefit from the improvement in market conditions, with no debt maturities until 2026, vast land bank, and solid business metrics.
- Moreover, the Company offers well-covered, dynamically growing dividends and has an upside potential resulting from the multiple appreciation.
Investment thesis
I believe that the recent drop in First Industrial Realty Trust ( FR ) left the valuation detached from its business fundamentals and long-term ability to generate cash flows. The Company has clear growth drivers resulting from:
- ability to significantly bump its rents upon termination
- strategically located, large land bank
- expected improvements in the supply-to-demand relationship
Read the full article on Seeking Alpha
For further details see:
First Industrial Looks Buyable As Market Conditions Improve