Alexandria Real Estate: My Plan To Wait It Out Fell Apart

REITer's Digest4.4K FollowersFollow5ShareSavePlay(10min)Comments(3)SummaryAlexandria Real Estate still faces severe headwinds as life science real estate demand remains weak and development oversupply persists.ARE’s aggressive development pipeline and capital commitments have led to declining occupancy, a shrinking portfolio, and a nearly 30% projected FFO per share drop year-over-year.Management has slashed the dividend, cut development spending by 40% from post-pandemic peaks, and is selling noncore assets to stabilize leverage.With no clear catalyst for recovery and deteriorating fundamentals, I assign ARE a Hold rating as shares remain cheap for a reason. Liliya Filakhtova/iStock via Getty Images Over the past several years, a major theme in commercial real estate has been to sit it out and wait. Following the pandemic, trouble in the commercial mortgage sector gave birth to the phrase extend and pretend. TheThis article was written byREITer's Digest4.4K FollowersFollowREITer's DigestAnalyst’s Disclosure: I/we have a beneficial long position in the shares of ARE either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.