Investing For The Long Run

W.P. Carey is one REIT that we consider to be attractive. Based upon our thorough fundamental research, we believe the company is a particularly compelling opportunity based on a number of reasons, all addressed in this article (below).

Summary

  • Bill Carey recognized decades ago that owning high-quality real estate would not produce outsized returns over short cycles.
  • Instead, the best way to create wealth is to own shares that would generate durable dividends by always "investing for the long run."
  • WPC is a leading global net lease REIT that provides long term, sale-leaseback and build-to-suit financing solutions for companies worldwide.
  • WPC is still trading at attractive levels, and I am maintaining a BUY rating on the shares.

Investing for the Long Run™ became the investment slogan for W.P. Carey's(NYSE:WPC) founder, Wm "Bill" Polk Carey.

In 1973, Bill Carey started W.P. Carey & Co. with a focus on putting shareholders first and by delivering sound risk management practices, Carey believed that "over the long run" investors would enjoy stable, risk-adjusted returns.

As a pioneer in sale/leaseback financing, Carey was one of the first companies to build a Net Lease vehicle to assist global companies to monetize free-standing real estate. Over the years, Carey has evolved into one of the largest Net Lease landlords in the world with a successful track record of investing through multiple economic cycles (since 2013).

In 2012, Carey converted from an MLP (W.P. Carey & Co. LLC) to a REIT (W.P. Carey, Inc.) to boost scale and to simplify tax reporting for shareholders (no longer used K1s). By merging W.P. Carey & Co. and Corporate Property Associates 15, Inc. (a non-traded REIT), the combined company (structured as a REIT) produced enhanced dividend payments and better flexibility to access capital.

Bill Carey passed away in 2012 and over his lifetime (and beyond), the real estate legend provided investors with very stable returns that led to philanthropic activities aimed to improve access to high-quality education.

By focusing on his "long run" investing mantra, Carey made sure that his vision, drive and passion would become lasting contributions - Carey made significant contributions to the W.P. Carey School of Business at Arizona State University ($50 million), The Carey Business School at Johns Hopkins University ($50 million) and the University of Maryland's Francis King Carey School of Law (named for Carey's grandfather and graduate of the school).

Beyond Bill Carey's philanthropic activities, it's clear that his vision and approach to "intelligent investing" have continued to thrive and to provide lasting results, specifically through the power of compounding. Carey recognized decades ago that owning high-quality real estate would not produce outsized returns over short cycles; but instead, the best way to create wealth is to own shares that would generate durable dividends by always "investing for the long run."

A Uniquely-Positioned Net Lease REIT

false