BSR REIT Property Tours

I was recently in Dallas, Texas, and had the chance to visit most apartment communities owned by BSR REIT in the region.

We rarely do such boots-on-ground research, touring individual assets, because the reality is that it does not really give you much insight.

Most REITs own 100s or even 1,000s of properties, often located all over the place, making it impractical to visit enough properties to really get a good sense of what the REIT is buying.

Moreover, even if you visited all assets, you will still miss critical information such as what they paid for the property, what was the cap rate, how high are the rents, what's their long-term plan for this individual asset, etc.

Therefore, we generally stick to portfolio-level data and will just check a few of their biggest properties with Google Street View.

But BSR is an exception.

It is very heavily concentrated on three specific markets, and Dallas alone represents 44% of their total apartment units.

Moreover, it focuses on apartment communities, which can be relatively easily compared to those of their peers. You can easily find their rent level online; you can look at how well the properties are maintained, how satisfied the tenants are, and what's happening in the direct surroundings of the property.

BSR is also a large position for us, representing 9% of our Core Portfolio, and I felt that seeing the properties in person could help me reaffirm my conviction and give me further courage to keep buying the dips if and when the market crashes down further.

So, I took an afternoon to visit BSR's properties in Dallas and compare them to those of close competitors.

My findings were positive. Here are my main takeaways: