Quarterly Updates

Lessons from Wars, Office Buildings, and Inverted Thinking

Jan 27, 2023

2022 was a brutal year for most investors as this headline conveys. And when bond returns are factored in, the loss of market value is even more dramatic. This table shows how unusual 2022 was in terms of both stocks and bonds losing money. Bonds typically provide a hedge against stock market losses, but not in the inflationary carnage of 2022. The negative returns fed off each other and kept dragging the other one down like a person trying to help rescue someone drowning at sea. Read More

An Anti-Curious Jay Powell and His Kamikaze Fed

Oct 28, 2022

I’ve been wrestling with the outlook for 2023 for our apartment portfolio because of the highly unusual global economy as we come out of Covid, overlayed with the geopolitical situation with the war in Ukraine, its impact on energy prices, and China’s increasingly authoritarian governance and draconian economic and social policies. Inflation has obviously broken out in ways we haven’t seen since the 1970s and it has caught the Fed flatfooted and now it is playing catch up in a big way. Read More

Sun Showers

Jul 29, 2022

If the tremendous demand for apartments is an economic indicator, then the weather conditions are quite pleasant and favorable to remain that way. This graph from Witten Advisors shows the huge demand for apartments and how it has greatly exceeded any other time frame in the last 20 years. Read More

Stress for Success

Apr 29, 2022

In last quarter’s article I discussed how the operational trends we were experiencing were quite positive and that higher revenues should help offset rising interest rates that would impact our variable-rate loans. And while the operational performance continues to be quite strong as evidenced by our first quarter portfolio generating a 16.8% increase in rents for units that have been vacated and re-leased and 12% for renewed leases, interest rates have shot up Read More