What are you buying today?

[frommi]

Not sure how SKT fits as a Graham stock.  Quality does matter as it affects liquidation value.  I see too many outlet malls as losing value by the day. Less consumer appeal. Lower quality leases.  Too much debt.

Tanger guided for flat NOI/AFFO for 2018, that is enough for me to conclude that the value is stable. Your opinion is the consensus and the reason i can buy at a discount.
*EDIT* It is maybe not in the original "Graham" sense (Price to book) to buy REIT`s below NAV, but why not? Since real estate is at least as liquid as inventory and has a private market with a private market price i see no reason not to. With a large enough margin of safety this should work equally good. And if the company sells assets and buys its own stock it widens this margin further.

[Spekulatius]

Not sure how SKT fits as a Graham stock.  Quality does matter as it affects liquidation value.  I see too many outlet malls as losing value by the day. Less consumer appeal. Lower quality leases.  Too much debt.

Tanger guided for flat NOI/AFFO for 2018, that is enough for me to conclude that the value is stable. Your opinion is the consensus and the reason i can buy at a discount.
*EDIT* It is maybe not in the original "Graham" sense (Price to book) to buy REIT`s below NAV, but why not? Since real estate is at least as liquid as inventory and has a private market with a private market price i see no reason not to. With a large enough margin of safety this should work equally good. And if the company sells assets and buys its own stock it widens this margin further.

NOI trends have been down and they had to keep their occupancy up by getting into a bunch of short term leases. This is not an indication of strength. If you look at liquidation value, I think KIM and SRG (which you also own, I think) are better plays and they also have better NOI trends.

The outlet malls tenants compete price and choice and price sensitive customers tend to go more and more online for bargains. Their outlets are very heavily into clothing, which helps regarding to online competition, but also gets less wallet share over time.

I think KIM and SRG have better opportunities to develop their existing retail for high returns nd trade equally cheap.

I have decided to exit this sector except a LT microcap holding, because I believe these are mostly melting ice cube cases.

[writser]

If you have a 30% allocation to retail REIT’s, would you call that a Graham type portfolio or a concentrated sector bet? I think it is an easy trap to fall into to convince yourself you are doing the first while actually doing the second. Not implying you do so

[frommi]

If you have a 30% allocation to retail REIT’s, would you call that a Graham type portfolio or a concentrated sector bet? I think it is an easy trap to fall into to convince yourself you are doing the first while actually doing the second. Not implying you do so

Maybe you are right, but thinking about it, isn`t it possible that this is both at the same time?

[frommi]

NOI trends have been down and they had to keep their occupancy up by getting into a bunch of short term leases. This is not an indication of strength. If you look at liquidation value, I think KIM and SRG (which you also own, I think) are better plays and they also have better NOI trends.

The outlet malls tenants compete price and choice and price sensitive customers tend to go more and more online for bargains. Their outlets are very heavily into clothing, which helps regarding to online competition, but also gets less wallet share over time.

I think KIM and SRG have better opportunities to develop their existing retail for high returns nd trade equally cheap.

I have decided to exit this sector except a LT microcap holding, because I believe these are mostly melting ice cube cases.

Thanks. I will look into KIM, it looks like i was too lazy to do that until now. I have nothing against melting ice cubes, i learned with netnets that these are sometimes the best investments.
*EDIT* If i have the numbers correct than KIM trades just at a discount of 30% to NAV if i use the same caprate as for SKT and KIM has a higher debt/NOI ratio. SKT and SRC have to go up by 50% to reach fair value/NAV. Btw. my position sizing is 16% SRG, 10% SRC and 4% SKT, so i wouldn`t see SKT as my absolute favorite.

[scorpioncapital]

I think retail is a tough business - and strangely enough , I even see softness in e-commerce retail. ALL retail, including e-commerce, seems to suffer from the same defects, namely very commoditized markets with just massive inventory and no distinctions. There's no loyalty online, offline, there is almost nowhere to hide.

[frommi]

I think retail is a tough business - and strangely enough , I even see softness in e-commerce retail. ALL retail, including e-commerce, seems to suffer from the same defects, namely very commoditized markets with just massive inventory and no distinctions. There's no loyalty online, offline, there is almost nowhere to hide.

I see it the same, but i also think that retail real estate is a different animal. If in doubt they can redevelop the properties to other uses. Look what SRG is doing with the old Sears boxes, at least if they own good locations. And i can`t imagine a world where everybody sits at home ordering stuff without going out. That will probably never happen.

[CorpRaider]

Yeah, get me some mobility as a service, so I don't have to park and get me some RFID automatic checkout so I don't have to wait in line to give you money to pay for my items and I could see it actually being pleasurable to shop/taking back share from online.

[zippy1]

Yeah, get me some mobility as a service, so I don't have to park and get me some RFID automatic checkout so I don't have to wait in line to give you money to pay for my items and I could see it actually being pleasurable to shop/taking back share from online.

My understanding is that many traditional Asian department stores are dying and new malls are built as places for having fun/spending time/hanging out with friends instead of just purely "shopping."  These malls seem to do rather well....

[BPCAP]

Asian malls are typically in dense cities, thus they have optionality (they are also loved for the air conditioning).  Mall outlet malls are often on cheap land you have to drive far to get to.