I have always fantasised about buying into a midtown Manhattan office building portfolio since New York City is the nerve center of global finance, banking, digital media, fashion, art and the coolest, most creative yuppies, the best and brightest of mother earth. Now my fantasy has come true. I can now buy New York office buildings at $430 per square foot, lower than the price I could expect to pay in a Business Bay tower. I also get a 9.8% yield while I wait for the rate rises to end and the development pipeline opposite Penn Station to throw off paydirt. Value investing in real estate can be a money gusher if the location assets and price are aligned. I cannot reveal the name of the beauty, but I assure it exists and is all too real.

At this moment in time, I would only buy real estate trusts that generate cash flow with minimal financial leverage, since the cost of borrowing will rise sharply as the Powell Fed inflicts pain on the bold and the beautiful, especially if they are leveraged up the wazoo. Fed tight money and the onset of global recession are the twin macro bogeymen for real estate and 2022 has been a horror as the 30-year fixed rate mortgage yield has doubled to 7% and wiped out housing affordability metrics in America.