As part of its efforts to diversify and expand its commercial
real estate business,
Annaly Capital Management, Inc.
) recently announced its net lease initiative with Inland Real
Estate Group. Annaly's shares were up 0.96% in Friday's regular
trading session on the NYSE.
In particular, the company's subsidiary, Annaly Commercial Real
Estate Group, will purchase net leased commercial real estate
assets spanning a broad range of markets and industries. These
properties would comprise industrial, office, retail and restaurant
assets and would be of a specific size and profile sourced and
managed solely for Annaly by The Inland Real Estate Group of
Through this initiative Annaly can leverage Inland's expertise in
this business as it tries to expand its commercial platform into
ownership of real property. Inland has aquired over $35 billion of
commercial properties including $11 billion of net leased
acquisitions since 2002 and the company has more than $20 billion
in commercial real estate assets under management.
As a matter of fact, amid the continued Fed tapering of bond
purchases and anticipation of rising interest rates in the long
term, Annaly is making concerted efforts to lower its leverage
level. However, the US Treasury 10-year note yield fell in the
first quarter and spread compression in the quarter affected its
Amid this volatility, the company's diversifying efforts and
expansion of its commercial real estate portfolio is a strategic
fit. The company, which owned $1.0 billion in commercial real
estate assets as of Jun 30, 2013, has grown its business and owned
around $1.7 billion of such assets as of Mar 31, 2014. Going
forward, we believe that the diversification of Annaly into the
commercial assets space would help enhance the company's top line.
Annaly currently has a Zacks Rank #3 (Hold). Some better-ranked
stocks in the same industry include
AG Mortgage Investment Trust, Inc.
Arbor Realty Trust Inc.
Anworth Mortgage Asset Corporation
). All these stocks hold a Zacks Rank #2 (Buy).
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