THINGS CAN’T BE ALL THAT BAD: OFFICE EDITION
Just like hotels and homebuilders, office parks are saying “things can’t be all that bad” right now…
This year, we’ve featured many charts that display how the U.S. economy, while not great, can’t be doing all that bad. For example, we’ve noted the solid price strength in high-end homebuilder Toll Brothers.
The profits and share prices of hotel operators rise and fall with America’s ability and desire to take business trips and vacations.
Wyndham’s share price is soaring right now.
The share price of Boston Properties (BXP) is saying the same thing. Boston Properties is one of America’s largest office landlords.
It’s a giant company that owns and operates choice office properties in places like Boston, New York, San Francisco, and Washington D.C.
If the economy is in the tank, businesses use less office space. When the economy is either not in the tank or flat out booming, office space demand picks up… and so do landlord profits.
As you can see from the chart below, the landlord business is doing well.
Boston Properties has advanced from $80 per share to $113 per share in the past two years. Just this week, the stock struck a new multi-year high.
We see this bull move and think, “Well, if Boston Properties is doing well, things can’t be all that bad!”
– Brian Hunt
Source: Market Notes