Warren Buffett is making big bets on retail

Oracle of Omaha bought a major stake in REIT Store Capital

New York /
Jun.June 27, 2017 07:30 AM

Warren Buffett’s Berkshire Hathaway was revealed Monday as one of the largest shareholders in the real estate investment trust Store Capital Corp., the second big bet the investor made on commercial real estate in as many weeks.

Store Capital, which focuses on single-tenant properties like restaurants, veterinary offices and fitness centers, revealed that Berkshire paid $377 million for a 9.8 percent stake in the company, the Wall Street Journal reported. That makes Berkshire its third-largest investor.

The move is a bet that some sectors of the retail market can buck the broader headwinds the industry faces, according to the Journal.

Just a few days earlier, Berkshire invested about $302 million in the struggling Canadian mortgage lender Home Capital Group Inc.

Store Capital’s real estate portfolio spans 1,750 locations in 48 states, and is valued at $5.5 billion.

“We’re devoted to doing service-sector investments…where you can’t buy these services through the internet,” company CEO Christopher Volk said. Berkshire “saw an opportunity to invest at an attractive price, and they believe in us.”

Berkshire, which held $96.5 billion in cash as of March 31, is actively seeking new investments for its growing war chest.

Locally, the company is looking to establish itself as a major force in New York City residential real estate after opening its first Manhattan office earlier this year. [WSJ] Rich Bockmann


Related Articles

arrow_forward_ios
1333 South Congress Avenue in Austin, Texas and Tecovas CEO Paul Hedrick (Google Maps, Twitter)
These boots are made for lending
These boots are made for lending
Regent Properties buys Texas office building for $174M
Regent Properties buys Texas office building for $174M
Regent Properties buys Texas office building for $174M
Noam Ben-Zvi, chief executive officer, Placer.AI (Placer.AI, iStock)
Location data firm Placer.ai hits unicorn status with $100M Series C
Location data firm Placer.ai hits unicorn status with $100M Series C
Is “medtail” a cure for Manhattan’s vacant storefronts?
Is “medtail” a cure for Manhattan’s vacant storefronts?
Is “medtail” a cure for Manhattan’s vacant storefronts?
Sunshine Powers in her artisanal tie-dye shop, Love on Haight (Photo courtesy of Emily Landes)
How Haight-Ashbury got through the pandemic
How Haight-Ashbury got through the pandemic
CIM Real Estate Finance Trust selling retail portfolio for $1.3B
CIM Real Estate Finance Trust selling retail portfolio for $1.3B
CIM Real Estate Finance Trust selling retail portfolio for $1.3B
301 Norman Avenue in Brooklyn and 72 Mercer Street with Vornado's Steven Roth (Google Maps, Avison Young, Getty)
Vornado takes another retail loss as investors remain drawn to warehouses
Vornado takes another retail loss as investors remain drawn to warehouses
Charlie Munger with a proposed design for Munger Hall, which is projected to cost $1.5 billion. (Van Tilburg, Banvard & Soderbergh, AIA, Scott Morgan/Reuters; Photo illustration by Victoria Tuturice)
Charles in charge
Charles in charge
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...