Mr. Marks: My coverage universe is split roughly evenly between real estate service companies, what I call property services companies, and hotel and resort companies. The property services companies generally provide services to owners and users of commercial real estate; these services include leasing, sales and management of properties, as well as janitorial and parking operations. My hotel coverage is easier to grasp. I cover companies that own and manage hotels and resorts.
TWST: Do you approach the group as one industry?
Mr. Marks: No, this would not do justice to either sector. These two
industries are completely different.
TWST: Looking at the property services side, how are you approaching the
group today?
Mr. Marks: This group is under-covered by Wall Street, and probably for
good reason. The market capitalization of the brokerage and property
management side is less than 2 billion. The group is represented by
only a handful of very thinly traded stocks, indicating a limited amount
of interest from institutional investors. Also, the performance of these
stocks has been poor over the last several years. However, most of the
companies are researched by zero to three analysts, which means that
there is value to be added by an analyst. I approach my research with a
background of working in the commercial real estate services field for
several years. I try to provide a basic understanding of the plethora of
different services that these companies provide and I delve deeply into
valuation.
Tickers included in this excerpt: ABM, CPC, FHR, FS, IDR, IFS, IPK, JLL, TCC
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