by Genia Turanova, editor Leeb Income Performance
We are adding to our exposure in the mortgage REIT sector, which overall
continues to hold promise of high dividends as the housing market
Starwood Property Trust (STWD),
our new pick, focuses primarily on originating, investing in, financing
and managing commercial mortgage loans and other commercial and
residential real estate-related debt investments.
With a portfolio concentrated mostly in mortgage securities issued by
federally chartered corporations and U.S. government agencies, Starwood
Property Trust's investment portfolio focuses on commercial real estate
Also Starwood has
lately beaten analysts' estimates. Plus, while Starwood hasn't increased
its dividend (excepting a special one-time 10 cent per share payout),
the company also did not have to resort to dividend cuts.
is the largest commercial mortgage REIT in the U.S. with approximately
230 employees. But its investments are not strictly limited to the U.S.
company has eleven offices in six countries with $3.1 billion of
diversified gross core target investments. Its size and investment
diversification helps both reduce credit and rollover risk while
facilitating share liquidity.
The company has a strong 20-year
track record and, presented with a wealth of opportunities in the
commercial real estate sector here in the U.S. and Europe, is expected
to grow at a better than 4.5 percent rate annually.
risk may be one reason for the caution on Starwood's European positions,
but that risk is counterbalanced by significant opportunity overseas.
Yielding 7.3 percent, Starwood joins our High-Yield Income portfolio