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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Spekulatius who wrote (34023)	4/2/2009 8:51:41 AM
From: Jurgis Bekepuris	Respond to of 78787

From my very limited understanding, Hancock Tower at 9.5% is great deal. Which means, either it is a great deal, or the rents are going to come down (a lot?) or there are intrinsic issues with the building, which is unlikely but possible. Of course, 9.5% is a bit of an accounting gimmick - it's not as if their cheap financing is a liquid asset that can be sold or transferred. It's just an opportunity number that can be valued using a model, but that's pretty much it. So realistically, the number is somewhere between 6.7 and 9.5%. 6.7% is not that great, IMO. But then I am no real estate expert. :)