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Participant ○

Zero Year

I see that TREA's AUV is now what it was a year ago.  I hope that the bottom is not far from here.  If you know, please tell us.

I have restarted TREA contributions in my working wife's retirement account based on the tentative expectation that over the next year it will do better than 3%.

John

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Participant ○○○

Re: Zero Year

Thanks for letting us know.  I value your opinion.  For now, I plan to remain in a waiting mode.  In my case, no more contributions since I am retired.  When I make the decision, I will move some money from Trad to TREA.  I may do this in pieces rather than all at once.

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Participant ○

Re: Zero Year

Waiting mode here, too. Once TREA is up around 0.5% in a month, approx 6% annualized, I'll start shuffling funds back into it. No rush...

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Re: Zero Year

NYT on Manhattan office space.  LA may not be different either.

https://www.nytimes.com/2020/09/08/business/economy/new-york-office-space-coronavirus.html

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Participant ○○○

Re: Zero Year

Maybe John is on to something.  TREA is up 0.74 (0.17%) today (9/9/20) like in the good old days.

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Explorer ○○

Re: Zero Year

With regard to office properties generally, Howard Marks has a contrarian, more optimistic view than the one that emerges from the NY Times article regarding Manhattan.

https://www.cnbc.com/2020/09/09/howard-marks-on-investments-in-low-rate-environment-sell-off-in-us-m...

The CNBC article begins with this list:

Key Points
  • Howard Marks, a widely followed billionaire investor said with yields on U.S. Treasurys close to zero, other asset classes look “very attractive” in comparison — but returns may still be lackluster.
  • But investments that have been “out of favor” such as retail and office real estate, as well as stocks in the entertainment and hospitality sectors could offer big returns, said Marks, a widely followed billionaire investor.
  • On the latest sell-off in U.S. markets led by tech stocks, Marks said many investors are focused on short-term fluctuations that may not mean much.
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Frequent Contributor

Re: Zero Year


@jjustice wrote:

I see that TREA's AUV is now what it was a year ago.  I hope that the bottom is not far from here.  If you know, please tell us.

I have restarted TREA contributions in my working wife's retirement account based on the tentative expectation that over the next year it will do better than 3%.

John


John

Congratulations for a great year with zero return. I assumed that it would be close to 2%.  In fact, I should extend this to all the folks in TIAA forum. However,  I do not expect commercial real estate to do well in the near future. Why? Look at all those tall buildings in Yogi's neighborhood - Chicago. They are all empty. Who is going to pay the rent? I have been loosing money from my rental condo because the guy quit and we have not had any replacement in three months. This is the longest period in which it has been empty in more than 9 years. When people switch, it has been empty for a month or less for them to clear other condo and move into this condo. It is a very bad situation now.

 

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Re: Zero Year


@ECEPROF wrote:

@jjustice wrote:

I see that TREA's AUV is now what it was a year ago.  I hope that the bottom is not far from here.  If you know, please tell us.

I have restarted TREA contributions in my working wife's retirement account based on the tentative expectation that over the next year it will do better than 3%.

John


John

Congratulations for a great year with zero return. I assumed that it would be close to 2%.  In fact, I should extend this to all the folks in TIAA forum. However,  I do not expect commercial real estate to do well in the near future. Why? Look at all those tall buildings in Yogi's neighborhood - Chicago. They are all empty. Who is going to pay the rent? I have been loosing money from my rental condo because the guy quit and we have not had any replacement in three months. This is the longest period in which it has been empty in more than 9 years. When people switch, it has been empty for a month or less for them to clear other condo and move into this condo. It is a very bad situation now.

 


With John's hoped-for permission...

@ECEPROF, you made many disparaging and mocking comments about TIAA investors in the past.  I have not said a word about it until now.  TIAA investors have not done anything bad to you; it has been one-sided.  I invite you to consider whether this is getting, what is the right word, boring... uninteresting... obsessive... banal.  However, I do not want any outside intervention on this.  I think we can resolve this in a friendly way.  I much prefer that you come to the right conclusion on your own after some soul searching.  Until then, I will defend your right to say anything you wish about "all the folks in TIAA forum." 

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Frequent Contributor

Re: Zero Year

Dede

I wish you the best for a great return from TIAA investments.

No offense taken from your comments. I am not trying to mock anyone When someone talks about zero return, I wanted to say something about commercial real estate. I do have some real knowledge about it with observation on the street as an investor not an annuitant.

https://news.google.com/articles/CAIiEEQGaVlSE9PRSZbdJiG6MLYqFwgEKg8IACoHCAowjuuKAzCWrzwwqIQY?hl=en-...

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Participant ○○○

Re: Zero Year

@ECEPROF, all is well.

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Frequent Contributor

Re: Zero Year

Nat wrote:

"No offense taken from your comments."

Say what?! There was nothing remotely offensive said by Learner.

It's YOU, Nat, who seem not to be self aware.

You are the one who takes cheap shots at anything associated with TIAA.

The only "reason" I can come up with is that you are under extreme stress for any number of possible reasons.

With regrets, Bob

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Explorer ○○

Re: Zero Year

Sometimes it's possible to piece together a financial and/or personal "picture" of someone from the comments they make here over the course of time.

In that context, it's my understanding that Nat/ECEPROF made the decision, some time ago, to end all of his investments at TIAA.

Whether or not that's the case, I, like Bob, get tired of posts from Nat which imply that TIAA itself is undesirable, or that people who continue investing with TIAA are not very bright.  We all have some occasional gripes about TIAA (lookin' at you, unhelpful website and carelessly handled specific transactions), but otherwise it's a very decent company, offers some things which can't be found elsewhere, and is a reasonable place for some or all of a person's retirement holdings.  Nat has chosen to go elsewhere, but other people also make a valid choice to stay.

I generally enjoy the information and perspectives that Nat brings to this forum.  But the unnecessary general swipes at TIAA, and/or the personal decisions of others here to stay-the-course with TIAA, are unfortunate exceptions to that pleasure.

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Explorer ○○○

Re: Zero Year

Hi,

First it is important for you all to understand that this post has nothing to do with any individual on this site except myself.

TIAA is an exceptional organization to be with and has allowed many of us if not all to be prepared financially to retire and enjoy our final years here on earth. It (TIAA) has been so good that it has made little difference if we allocated all our funds into TIAA Traditional, CREF Stock, TIAA Real Estate, or some arbitrary percent to each.

This has allowed myself the freedom to be almost 100% into one of the three listed above at any given time. At the start of this year I was mainly in TIAA Real Estate and now mainly in TIAA Traditional.

Any change in the performance not to my liking of one and I can switch to another with little worry. This has over time caused my asset allocation to be too concentrated in one of the three (TIAA Traditional) mostly (70%) in IRAs (TIAA Traditional IRA and Roth IRA) earning 1.24%. With a total return of 1.88% when including my RA (About 4% return) and GSRA (About 3.2% return).

I will never blame TIAA for this because it was all my doing. But you can see that even with this return (1.88%) TIAA is out doing most other safe options and still keeping up with inflation.

Yes, I wish TIAA IRAs would give me higher returns as the RA and GSRA do. But TIAA is most likely protecting the retired annuitants payouts. And I (plus wife) have two TIAA Traditional annuities with TIAA.

Yes, I will listen to all complaints about TIAA, but keep counting my benefits of being with TIAA.

S

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Frequent Contributor

Re: Zero Year

Amen, S.

Bob

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Participant ○○

Re: Zero Year

Ditto. I started to write a longer post but I think Skip says it all in much briefer form.

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Participant ○○○

Re: Zero Year

I believe in goal-based investing.  By goal, I do not mean high returns and then even higher returns.  By goal, I mean comfortable retirement, helping the education of the grandchildren, helping a relative when we deem it is a good idea, charity, etc.  We have been achieving our goals - easily, which has been one of the surprises in retirement.

For younger folks, my suggestion is this:  Have a healthy relationship with money, do your best to stay healthy, make yourself and your skills desirable to employers, save, save, save, learn investing basics, invest sensibly (do not try to be a hero), do not worry too much, and let time take care of the rest. 

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Frequent Contributor

Re: Zero Year

Well said, Learner.

Bob

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Explorer ○○

Re: Zero Year

Really appreciate the views so elegantly stated above by Learner and Skipper.

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Explorer ○○○

Re: Zero Year

Sometimes a Zero Year is a good thing. It could have been worse. I sold about 1/2 of my TREA earlier this year. So might be up a little year over year, so far. It went from about 10% of my holdings to about 5%. I'll probably just hang on to what I have. If it drops a bunch (say 10%) I might buy some more. Otherwise I'll probably just stick with what I have.

I like TREA. It gives me exposure to commercial real estate, in various markets, without doing any work. I assume it is professionally managed. I assume they do a better job of managing it than I ever could.

I have exposure to the local housing market by owning a house. I've lived in that house for 30+ years. It still has not doubled in value. Pretty poor from an investment standpoint, but it provides me with a place to live. I have no interest in investing more money in the local housing market, and, I have no interest in being a landlord.

Since Inception in 1995 TREA has returned about 6%. I'm happy enough with that. Better than my house has done, and a lot less work. I think there will always be a demand for real estate, and there is a limited supply.  I like TIAA approach to TREA. Think long term, limit leverage, slow and steady. That suits my personality and investing style. YMMV

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