Ares Commercial Real Estate Corp. ACRE is a mortgage real estate investment trust (mREIT) now going for just 78% of book value.
The Atlanta-based mREIT’s market capitalization comes to $586 million, a relatively small figure for a New York Stock Exchange-listed real estate investment trust. Funds from operations (FFO) are up by 115% this year and the past five-year FFO results increased by 9.3%. Bank of America Securities issued a Buy on Ares in October with a price target of $13. The mREIT pays a hefty 12.07% dividend.
New York-based Blackstone Mortgage Trust Inc. BXMT is a real estate finance company that, according to the firm’s website, “originates senior loans collateralized by commercial real estate in North America and Australia.” The market capitalization is $3.84 billion, and the REIT trades at 0.82% book. This year’s funds from operations increased by 184% and the past five-year record is 1.8%. Blackstone Mortgage Trust pays an 11.08% dividend.
Cousins Property Inc. CUZ is an office real estate investment trust now trading at 83% of book. The Atlanta-based company owns and operates properties in Atlanta; Dallas and Austin, Texas; Charlotte, North Carolina; and a number of similar Sun Belt cities. Funds from operations this year are up by 17.1%. The past five-year FFO increase is 14.8%. Cousins Property is paying a dividend of 5.04%.
Franklin Street Properties Corp. FSP trades at 37% book. That far below book value suggests investors should take a close look before sending money in that direction. Market capitalization for this American Stock Exchange-traded REIT is small for the sector at $283 million. Franklin Street trades with a price-earnings ratio of 3.45 and pays a 1.45% dividend. This year’s funds from operations grew by 186% and the past five-year FFO growth rate is 60.6%. Analysts do not expect that kind of growth over the next 12 months.
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