ALAMEDA, Calif., Sept. 15, 2021 /PRNewswire/ -- Phocas Financial ("Phocas"), an employee-owned asset management firm specializing in REIT and small-cap value investing, today issued its Q4 investment outlook, including detailed commentary and insight into the REIT investment market.
Phocas has approximately $900 million in AUM, and has managed REIT, Small Cap Value, and Equity Income investment strategies since its founding in 2005. Phocas' Q4 REIT strategy highlights follow.
- WFH / RTO: As firms continue to delay return to office dates, many employers are worried that the longer employees are away from the office, the harder it will be to convince them to return, let alone the landlords leasing spaces to those employers.
- COVID has been an accelerator of trends, including e-commerce, employment shifts and population migration patterns favoring Sun Belt markets. That said, NYC is not going away, and the return to the office will drive demand significantly for central business district residential properties in coastal gateway markets.
- Healthcare sector returns could be lower than expected. The benefits of rebounding occupancy levels for senior homes and skilled nursing facilities may be offset by expenses.
- Retail real estate may benefit from increased openings of medical office facilities like dialysis centers in malls.
- Portfolio positioning/rebalancing remains stable for Phocas versus more traditional yearend practices for other equity sectors.
James Murray, Portfolio Manager, commented on the outlook, "Entering the final quarter of 2021, investors should be seeking to position their portfolios to address looming interest rate increases, the continued geographic shift of workforces, and significant tax policy changes on the horizon that may impact returns materially. All told, we believe REITs offer attractive growth potential, and therefore deserve investor consideration. Many now expect a steepening rate curve soon, an environment in which investors often find small cap REITs attractive.
"We believe that the real estate under cell towers, data centers, and retail also deserve specific investor attention, even when the FTSE NAREIT All Equity REIT Index, a prominent all-equity REIT index, is up more than 29% for the year through 8/31. We also continue to believe that Healthcare deserves attention due to impacts of the Pandemic, including increased openings of medical office facilities. For example, dialysis centers in shopping centers can boost valuations of retail real estate. The question investors should be asking is who thinks that any of those sectors is going to be shrinking soon?"
About Phocas Financial
Phocas Financial Corporation was founded in 2005 and is based in Alameda, California. The firm is 100% employee-owned. Phocas' partners are William Schaff, James Murray, Steve Block, and Kevin Granger. The firm manages separate accounts and mutual funds for institutional investors, investment advisors, and individual investors. Phocas' client roster also includes several managers of managers working on behalf of large investors including significant U.S. public pension plans.
The firm currently manages three strategies: U.S. Small Cap Value equities; U.S. Equity Real Estate Investment Trusts; and U.S. Equity Income which invests in equities, fixed income instruments and preferred securities. The investment strategies at Phocas are designed to deliver attractive long-term returns with moderate risk and low turnover. Capacity constraint is a core value of Phocas. The team will cap assets under management in each strategy at levels designed to protect their ability to generate alpha for investors. For further information about Phocas Financial please go to www.phocasfinancial.com.
Contact Information
Investors
Yolanda Foreman
510-523-5800
Media
Steve Bruce / Taylor Ingraham
ASC Advisors
[email protected] / [email protected]
203-992-1230
SOURCE Phocas Financial Corporation
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