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Strategies & Market Trends : Value Investing
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To: Grommit who wrote (33514)2/12/2009 9:24:33 PM
From: Spekulatius  Read Replies (1) of 78740
 
DFT -

And these assets are not distressed or idle. They are worth full book value.

Commercial RE is not worth what it was in Y2007. Even if it's rented out it is worth less due to higher cap rates. Across the board CRE is down 30%. now pack in a 50% leverage (conservative) and you see why most REIT's are down 50%+.

Now I agree on DFT being different but i think the higher CAP rate trend applies to them as well. A 9X EBITDA/EV is indeed reasonably cheap but not dirt cheap.
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