I received some data from a private equity firm this week that shows a lot of strength in retail, commercial, and industrial rents in San Diego. Even residential rents look to be on a steady rise. The reason REITs have not taken a beating is simply because they generally hold a lot of commercial, industrial, and retail properties. The strongest San Diego real estate market is retail.
As for poway’s comments about dividends being meaningless when principal is eroding, I agree. I even mentioned that there is some risk of a commodity bubble in copper. If Southern Copper’s price falls 25-40%, the dividend will not help too much. That said, if given an option of owning dividend-less equities or dividend-paying equities in this market, you have to choose dividends. I think Morningstar’s FDL product would be preferred today but Southern Copper is still an interesting play if copper prices stay high for another year.
