TSX:BPO.PR.A - Post by User
Post by
Carenaon Jan 13, 2025 10:56am
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Post# 36401245
A Few Tid Bits
A Few Tid BitsHi there,
Some tid bits to offer on a snowy Monday morning:
(i) I was reading an article in the WSJ over the weekend and the reasoning for the the spike in longer term rates is due to investors thinking that the hard landing scenario is not going to happen and therefore short term rates are going to stay above 3% for wahile and therefore the spike in longer rates since Sept is due to term premium which makes a ton of sense to me. I feel like there has not been any term premium for the last 15 years! Lol. The "higher or longer" scenario continues to play out.
(ii) CNBC reporting on the fires in California discussing the challenges for people to rebuild when replacement costs are up 40-50% in the last 5 years! Certainly explains the rising cost of insurance premiums in recent years.
BPY has exposure to like $100 billion in real estate....I would guess in every loan discussion BPY has with their banks, replacement cost is what keeps the banks comfortable in their financing. Would you rather finance a new build (if there are any) or just refinance existing stock with good leasing profiles? I think there will be lots of talk on replacement cost over the next few years.
(iii) I read somewhere last week that JP Morgan is requiring employees to come back to the office 5 days a week. This is a good sign for BPY when the biggest and best bank in the world is setting this precedent.
Have a great week,
Carena