Get Some REIT Bling, For Nearly Nothing

I am upgrading Taubman from a BUY to a STRONG BUY. Although we all know what happened to CBL Properties (CBL) last week, it’s critical to understand the difference between a high performance (traffic) REIT and a low performance (traffic) REIT.

Summary

  • "Your premium brand had better be delivering something wonderful, or it’s not going to get the business" - Warren Buffett.
  • I am upgrading Taubman from a BUY to a STRONG BUY.
  • “I think the older I get, the more I realize that the ultimate luxury is time” - Michael Kors.

Last week, I was in West Palm Beach walking down Worth Avenue, an upscale stretch of four blocks lined with luxury brands coveted by many. The avenue’s oldest store, Kassatly's, has been in business since 1923.

Reflecting the lifestyle of the deluxe Palm Beach market, the street has approximately 250 high-end shops, boutiques, restaurants, and art galleries that include Trillion, Giorgio Armani, Neiman Marcus, Cartier, Louis Vuitton, Tiffany & Co., Tourneau, Hermès, Ralph Lauren, Gucci, Chanel, Vineyard Vines, Brooks Brothers, Salvatore Ferragamo, Island Company, St. John, Valentino, and many more. (Source: Wikipedia)

An open-air mall, 150 Worth (formerly The Esplanade, and built by Murray H. Goodman), and lies at the eastern end of Worth Avenue, and offers a variety of upscale shops anchored by department stores Saks Fifth Avenue.

As I was heading over to the Starbucks store (at 150 Worth Avenue), I thought to myself, wouldn’t it be nice if I could own all of these luxury brands at a discount.

Then, a light went off!

In the words of Warren Buffett, “your premium brand had better be delivering something wonderful, or it’s not going to get the business”.

I thought to myself, I already own a REIT that invests in premium brand real estate, and unlike the expensive valuations in Palm Beach, I can enhance my portfolio by adding more shares in this wonderful REIT. Imagine buying the entire four blocks of Worth Avenue at a tremendous discount… no need to imagine it… it’s happening now…

Why Taubman?

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