RE:Macro vs. Micro Economics
Hey Frankie, hope all is well. I read your post as always. You know I am a fan of your work but I will give some slight push back here. Firstly, everything you are saying is of course correct, well almost! Given the rather rosy picture you correctly painted, one would have thought the stock would be easily chasing $8-$9 enroute to $10.00 plus. Have we seen a nice little lift upwards of late with the premise BOC will be cutting, yes we have. One could correctly also attribute this to the improved fundamentals of the stock, having said that, the entire space has enjoyed about the same lift so I would attribute this lift to the former moreso. To further emphasize, the market is now aware of most of the sales and improvement fundamentally but we have not seen a significant outpace per say of this stock over the sector (although I have not charted this, probably should). All is to say, given all the vast improvements we trade more or less inline with everyone else, the reason.........................well it IS actually the macro environment in my opinion holding us and others. Not just rates although they play a major factor. The head winds of office I believe is greater than you and others think, again hope I am wrong. I stated quite some time ago, I would shy from office and it seems selling off all the crown jewels leaving us with office plus for holdings isn't my estimation of something great, irregardless of how good our office is and how much better a pure(r) play may value. Perception and sentiment holds things in check irregardless unfortunately sometimes dispite improved micro fundementals and thus outlook.................and yes, to answer the question you just posed to yourself, this will change in time, how long is anybody's guess. I recognize you are a very long term holder and this of course will best suit the position as we both know. I hope this doesn't sound bearish because I am far from it, in fact quite bullish or I wouldn't have nearly doubled my position. This is just to emphasize my thoughts on the micro macro discussion ongoing here.
Of course the great thing is, Artis is a springed coil that is tightening almost by the day of late. WHEN this MACRO environment does start to favor us a bit, your MICRO fundamentals will pay off in spades, in the meant time hopefully we can hold our own and still grind a bit higher.
All the best,
DZ