"Of Mutual Interest"-Sam Lieber, Portfolio Manager of the Alpine International Real Estate Equity Fund
Tuesday, September 04, 2007PAUL KANGAS: It wasn't long ago that mutual funds specializing in real estate were among the hottest performers. With the current slump in domestic real estate, that group has now cooled off. But in tonight's "Of Mutual Interest" segment, we focus on a fund that's ahead of the pack: Alpine International Real Estate Equity Fund. So far this year, it's up 8.7 percent and in each of the past three years, it returned better than 30 percent. Sam Lieber has been the fund's manager since 1989 and Sam, welcome back to NIGHTLY BUSINESS REPORT.
SAMUEL LIEBER, CEO, PORTFOLIO MGR., ALPINE MANAGEMENT & RESEARCH: Great to be with you, Paul.
KANGAS: First, with all the turmoil that's occurring in the U.S. markets as a result of the sub-prime lending mess, is it just a matter of time before that spills over to foreign real estate?
LIEBER: Well, it's impacted foreign investors, but not the foreign real estate markets themselves. So I think they're relatively insulated from this problem.
KANGAS: Emerging markets have been the best performers in the equity markets for the past few years. You also like the emerging markets in terms of their real estate potential.
LIEBER: Well, absolutely. Fundamentally the so-called brick countries have a much more dynamic growth rates, population growth, job growth, lower falling interest rates in many cases and greater long-term infrastructure needs. All this is very positive for real estate growth and values and rents.
KANGAS: Which countries are at the top of your list?
LIEBER: We're very keen on Brazil, with falling interest rates there, they didn't even have mortgages four years ago. Now they have decreasing borrowing costs on mortgages. We think that India has great infrastructure needs, fast-growing tech industry. And, of course, China is growing at a very quick pace. But beyond that, we think there are some very good values even in more traditional markets such as Europe.
KANGAS: In terms of stocks, can you list a few from your portfolio that you think are well positioned to benefit from strength in overseas real estate?
LIEBER: Well, one country we like -- we like energy producing countries, we think that's a fundamental growth dynamic that will stay in place. We like Norwegian Properties (NPRO)which is an office landlord primarily in Scandinavia, based in Norway, in Oslo (INAUDIBLE), very strong play, nice dividend yield and a great entry price in the mid-60s down from 90. So we're very much intrigued with that. We think Technisa (TCSA3) in Brazil is also very interesting, a home builder, very cheap relative to other home builders with a great long-term land bank. And then finally we think that even coming back to the U.S., a company like Orient Express hotels has a very attractive portfolio of very high end exclusive small boutique hotels and we think that that will be relatively untouched even if the economies were going to slow and 80 percent of their revenue comes from abroad even though the company is listed in the New York Stock Exchange.
KANGAS: Very interesting information, Sam. Do you personally own the stocks of any of the companies you've recommended?
LIEBER: All of these companies I own through the fund.
KANGAS: OK. Through the -- so indirectly you own them all. All right, very interesting stuff. We appreciate it very much for your being with us once again.
LIEBER: Great to be with you folks. Thanks.
KANGAS: Thanks so much for your insights. My guest, Sam Lieber, portfolio manager of the Alpine International Real Estate Equity Fund.
