The REIT sector is still a good place for value investors to find beaten down bargains. In this article, I’m focused on Broadmark Realty Capital (BRMK), whose share price has declined by 20% since the start of the year. I evaluate what makes Broadmark an attractive investment at the current valuation; so let’s get started.
(Source: Company website)
A Look Into Broadmark
Broadmark is a commercial mortgage REIT that is focused on construction, redevelopment, and land development loans. It was founded in 2010, and since then, it has funded over 1000 real estate loans with an aggregate face amount of approximately $2B. As seen below, Broadmark has seen a rapid growth in its active loan portfolio over the past 6 years.
(Source: Company Earnings Presentation)
What I like about Broadmark is that it is conservatively managed with zero debt and has strong liquidity, with $218M in cash on hand. Its