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3 “Strong Buy” Stocks with Over 9% Dividend Yield

Yahoo Finance

Markets ended 2020 on a high note, and have started 2021 on a bullish trajectory. All three major indexes have recently surged to all-time highs as investors seemingly looked beyond the pandemic and hoped for signs of a rapid recovery.

Veteran strategist Edward Yardeni sees the economic recovery bringing its own slowdown with it. As the COVID vaccination program allows for further economic opening, with more people getting back to work, Yardeni predicts a wave of pent-up demand, increasing wages, and rising prices – in short, a recipe for inflation.

“In the second half of the year we may be on the lookout for some consumer price inflation which would not be good for overvalued assets,” Yardeni noted.

The warning sign to look for is higher yields in the Treasury bond market. If the Fed eases up on the low-rate policy, Yardeni sees Treasuries reflecting the change first.

A situation like this is tailor-made for defensive stock plays – and that will naturally bring investors to look at high-yield dividend stocks. Opening up the TipRanks database, we’ve found three stocks featuring a hat trick of positive signs: A Strong Buy rating, dividend yields starting at 9% or better – and a recent analyst review pointing toward double-digit upside.

CTO Realty Growth (CTO)

We’ll start with CTO Realty Growth, a Florida-based real estate company that, last year, made an exciting decision for dividend investors: the company announced that it would change its tax status to that of a real estate investment trust (REIT) for the tax year ending December 31, 2020. REITs have long been known for their high dividend yields, a product of tax code requirements that these companies return a high percentage of their profits directly to shareholders. Dividends are usual route of that return.

For background, CTO holds a varied portfolio of real estate investments. The holdings include 27 income properties in 11 states, totaling more than 2.4 million square feet, along with 18 leasable billboards in Florida. The income properties are mainly shopping centers and retail outlets.

During the third quarter, the most recent reported, CTO sold off some 3,300 acres of undeveloped land for $46 million, acquired two income properties for $47.9 million, and collected ~93% of contractual base rents due. The company also authorized a one-time special distribution, in connection with its shift to REIT status; its purpose was to put the company in compliance with income return regulation during tax year 2020. The one-time distribution was made in cash and stock, and totaled $11.83 per share.

The regular dividend paid in Q3 was 40 cents per common share. That was increased in Q4 to $1, a jump of 150%; again, this was done to put the company in compliance with REIT-status requirements. At the current dividend rate, the yield is 9.5%, far higher than the average among financial sector peer companies.

Analyst Craig Kucera, of B. Riley, believes that CTO has plenty of options going forward to expand its portfolio through acquisition: “CTO hit the high end of anticipated disposition guidance at $33M in 4Q20, bringing YTD dispositions to nearly $85M, with the largest disposition affiliated with the exercise of a tenant’s option to purchase a building from CTO in Aspen, CO. Post these dispositions, we estimate >$30M in cash and restricted cash for additional acquisitions, and we expect CTO to be active again in 1H21.”

To this end, Kucera rates CTO a Buy along with a $67 price target. At current levels, his target implies a 60% one-year upside potential. (To watch Kucera’s track record, click here)

Overall, CTO has 3 reviews on record from Wall Street’s analysts, and they all agree that this stock is a Buy, making the analyst consensus of Strong Buy unanimous. The shares are priced at $41.85, and their average price target of $59.33 suggests room for ~42% growth in the year ahead.

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55places.com Names Latitude Margaritaville Daytona Beach as Best 55+ Community of 2018

With island-inspired amenities, carefree luxury and a dreamy location, Latitude Margaritaville Daytona Beach is providing a new kind of ‘paradise’ when it comes to active adult communities. It’s no wonder, then, 55places.com, a leading resource for active adult communities across the country, named the Minto development as Best 55+ Community of 2018.

Like other awards bestowed from the company, website traffic, home sales, and offered amenities, are some of the factors considered before selecting a recipient. Latitude Margaritaville Daytona Beach, inspired by the music and lifestyle instilled from acclaimed musician Jimmy Buffett, is the first of its kind to take active adult communities to the mainstream, appealing to both “Parrotheads”—a nickname deemed for fans of the performer—as well as those who just appreciate they are growing older, but don’t have to grow up. This ingrained mindset is bringing the conversation about active adult communities to the forefront, and changing perceptions about retirement—and by extension senior living—by providing a new boat to sail on.

“There can be preconceived notions associated with aging, but Minto recognizes that today’s generation is different, and empowers its audience to redefine what living life to the fullest can mean,” said Bill Ness, CEO and founder of 55places.com. “The idyllic state painted by the Latitude Margaritaville brand is intentional, and to many of its residents, is depicted accurately.”

In addition to the engaging lifestyle and various collections of well-designed colorful homes, there is an abundance of social events, meaning camaraderie is alive and well.

“We’re focused on four pillars which is food, fun, music and escapism,” said William Bullock, president of Minto’s Latitude Margaritaville division. “Which, if you talk to our current residents, is what we’re already delivering. We’re attempting to offer as much fun and energy that you may want on any given day.”

Though doors opened in early 2018 and the 500th home was sold last October, the community is still in development, but will eventually offer unmatched access to impressive amenities, including the Latitude Town Square, Fins Up! Fitness Center, Latitude Bar & Chill Restaurant, Barkaritaville Pet Spa & Dog Park, and Paradise Pool, all of which is slated to open on schedule April of 2019.

Daytona Beach is just one of three current known Latitude Margaritaville locations—Hilton Head, South Carolina welcomed residents in November and Watersound in Florida, is slated to open in 2020. But that seems to be just the beginning. Bullock also shared there is intent to expand the brand’s footprint in 2019.

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Apartment boom in progress

The influx of newcomers to Volusia and Flagler counties is not only creating a need for more new homes.

It’s also creating increased demand for apartments.

And investors and developers have taken notice.

“Daytona Beach was one of the top rent growth markets in the country last year,” observes Michael Donaldson, senior vice president of investments for the commercial real estate brokerage Marcus & Millichap in Tampa.

The average rental rate for apartment units in Daytona Beach is just over $1,000 a month, a 5 percent increase compared to a year ago, according to Donaldson, who oversees his firm’s national multi-housing group.

The national average rental rate has increased 4 percent in the past year, he said.

The average occupancy rate for apartments locally has also risen to 96.4 percent, exceeding the state and national averages of 95.5 percent and 95.4 percent respectively, according to Donaldson.

“Developers are typically attracted to strong demographic trends and employment growth,” said Donaldson, noting the growth in apartment developments throughout Central Florida, especially in the bigger cities.

As the cost of building new apartment communities in Orlando and Tampa rises, “developers are migrating to secondary locations such as Daytona Beach as they can typically acquire land for much cheaper and there is less competition,” he said.

New commercial developments locally such as the One Daytona entertainment/retail/dining complex across from Daytona International Speedway and the Tanger Outlets and Tomoka Town Center malls next to the Interstate 95/LPGA Boulevard interchange are also spurring the increase in apartment projects here, according to McDonald.

Apartments under construction in Volusia County include the 276-unit Tomoka Pointe apartments rising up behind Tomoka Town Center in Daytona Beach, and in New Smyrna Beach, the 264-unit Messina by the Lake apartments in the Venetian Bay community.

Those projects are just the start of a surge in new apartment developments throughout Volusia and Flagler counties.

In Daytona Beach, multifamily housing projects in the works include developer Unicorp’s plans to build 340 apartment units as part of its Tomoka Village development just north of LPGA Boulevard, between Williamson and Clyde Morris boulevards, Indigo Development’s plans for the 301-unit East LPGA Apartments complex along LPGA Boulevard, east of Clyde Morris Boulevard, developer Next Chapter’s proposed 210-unit Dunn Avenue apartments on Halifax Health-owned land next to Volusia Mall, and Prime Group’s plans to build 276 apartment units on the east side of One Daytona.

In addition, Consolidated-Tomoka Land Co. recently acquired much of the downtown Daytona Beach block where the old First Baptist Church is located with plans for a mixed-use project that will include apartments.

The impetus for Consolidated-Tomoka’s project is national insurance giant Brown & Brown Inc.’s future headquarters campus two blocks away on North Beach Street.

The 11-story office building is expected to bring hundreds of white-collar professionals to downtown Daytona Beach when it opens in late 2020.

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Unicorp plans $200M mixed-use project in Daytona Beach

By Jack Witthaus
Staff Writer
Orlando Business Journal

Unicorp National Developments Inc., one of the most prominent Orlando-based developers, is eyeing Daytona Beach for its next project featuring shops, restaurants and residential.

The developer is under contract for about 150 acres in the area, referred to as Tomoka, for a three-phase development near Interstate 95 and LPGA Boulevard. The $200 million project is expected to feature roughly 200,000 square feet of retail, 300 luxury apartments and 200 homes. Construction is expected to start in the first-quarter 2019.

“It’s a great growth area,” said Chuck Whittall, president of Unicorp. “We think with our project and things happening now, there won’t be a lot left in that market. We think the timing is just right.”

The first phase will feature about 100,000 square feet of shops and restaurants. No tenants have been signed, but Whittall said his company is speaking with about 30 different tenants. The first phase will be called Shoppes at Williamson Crossing and will be built on about 23 acres. The second phase is another 100,000 square feet of construction and should feature shops, casual dining and restaurants on about 13 acres. Apartments and homes will be part of the third phase on about 111 acres.

Consolidated-Tomoka Land Co. (NYSE: CTO), the largest landowner in Daytona Beach, is the seller. Jorge Rodriguez, executive managing director in Colliers International Central Florida, represents Unicorp in the negotiation. Terrence Hart, a senior director with Franklin Street, represents the seller.

A general contractor and architect have not been picked yet. Interested parties can reach out to Brett Mulligan at brett@unicorp.com.

Consolidated-Tomoka President and CEO John Albright said the area is attractive to retailers in part because of the $1 billion Latitude Margaritaville — an active-adult, mixed-use community now under construction in partnership with the Jimmy Buffett flagship business. In addition, that mixed-use development is near the intersection of Interstate 95 and LPGA Boulevard.

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Revving Economic Engines: Daytona Beach

People are talking about Daytona Beach.

And what they’re saying is all good.

By Eleanore Osborne
Florida Trend Magazine

To toot your own horn might be considered a transgression.

So Daytona Beach and Volusia County will let others do the bragging for them. Because what others are saying is all good: for business, for quality of life, for the future.

Daytona Beach now ranks No. 7 nationally as the most popular place for people to move, according to U.S. News & World Report – up from No. 8 a few months ago.

Part of the Popularity is location, of course: On the Atlantic Ocean, with easy access for business and leisure in three directions via I-4 and I-95. Volusia County, with a comfortable urban/country vibe, puts Orlando and Jacksonville in easy reach, but without the traffic and higher prices.

US. News & World Report says: “Daytona Beach’s growth from net migration between 2012 and 2016 nearly hit 9%. The coastal metro area attracts plenty of tourists to NASCAR races and local beaches, but plenty of those visitors also appear happy enough to make the place their next home.”

Accolades are also coming in from other sources: Realtor.com ranks the Volusia-Flagler County area No. 8 in its report: “Next Urban Powerhouses” and No. 4 in its “America’s Top 10 Housing Markets to Watch.”

The Hard Rock Hotel opened recently, and ONE DAYTONA, the entertainment/shopping/lodging complex, is nearing completion of its first phase across from Daytona International Speedway. And recently, Chicago-based 55Places.com ranked Latitude Margaritaville the nation’s “Most Popular Active Adult Community” for 2018.

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Jimmy Buffett makes surprise visit to Daytona’s Margaritaville

DAYTONA BEACH — Latitude Margaritaville residents Kelley and Bill Sarantis were told last week to expect a visit from “some people from corporate.”

The couple assumed that meant the developers of the Jimmy Buffett-inspired 55-and-older community.

On Thursday morning, they were surprised to find out the guest knocking on their front door was none other than the singer-songwriter himself.

“I walked from the kitchen and saw out the window that it was Jimmy Buffett,” recalled Kelley Sarantis. “He said, ‘Hey, neighbor!’”

The Sarantises were one of several Latitude Margaritaville homeowners Buffett met with Thursday morning.

His visit included a tour of the active adult community’s model homes as well as having lunch at the new beachside Landshark Bar & Grill on State Road A1A.

Buffett, whose primary residence is in New York City, purchased a house in the gated Latitude Margaritaville community. That house is nearing completion, said Kelley Sarantis.

“His home is beautiful,” said Kelley Sarantis, who also works as a Realtor.

“He had a design team at his home on Thursday that was getting ready to decorate so I anticipate he’ll spend some time there,” she said.

The Sarantises gave Buffett a tour of their home and then sat down to chat with him for 20 minutes while munching on watermelon and berries.

Buffett also played with the couple’s two dogs and showed them photos of his dogs on his smart phone.

He asked the couple how they liked living at Latitude Margaritaville, the planned 6,600-home community that welcomed its first residents in March.

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Race Is On to Define ‘Opportunity Zones’

CTO owns 250 acres of land within the opportunity zones

A new Marriott hotel in the Phoenix area might seem a world apart from an affordable-housing complex in the Watts neighborhood of Los Angeles.

But both are poised to benefit from the new “opportunity zone” program created in last year’s federal tax overhaul, which gives tax breaks for investments in low-income neighborhoods.

Real-estate developers, wealthy investors, nonprofit groups and local officials are among those racing to put their mark on the program, which has few restrictions. The first ventures are likely to shape the direction the program takes and whether it has lasting political support.

Some investors are focused on reaping tax benefits from projects like the Phoenix area hotel. Other ventures, like the one under way in Watts, aim to use the tax break to provide housing and other benefits to residents of struggling communities.

“This is the biggest initiative of this type by the federal government with the least debate, the least staff support, the least research and still the least clarity,” said Eric Garcetti, the mayor of Los Angeles, who has been working on his own city’s zones and assisting governments in Louisville, Ky., Oklahoma City and South Bend, Ind. “It hasn’t really been fleshed out and that’s exciting for me.”

Unlike earlier federal efforts to spur economic development in poorer communities, the program takes a free-market approach and isn’t backed with federal spending. Being designated an “opportunity zone” doesn’t guarantee that a community will receive money for schools, health care or other services. Instead, private investors will decide whether to invest in designated areas and how to use those funds.

City and state officials are trying to determine how to attract funding and use their zoning rules, incentives and other tools to guide where and how money is spent. “There is going to be a lot of creativity,” said Louisville Mayor Greg Fischer, who heads a U.S. Conference of Mayors committee studying how cities can tap the new program.

Foundations are exploring how they can foster investments that create jobs or services needed by low-income communities and ensure that existing residents benefit without getting displaced.

“One of the concerns we have is that opportunity zone capital will most naturally flow to projects that have the highest return with the least amount of risk,” said Kimberlee Cornett, a managing director at the Kresge Foundation. “Investments most needed by these communities don’t necessarily have those characteristics.”

The opportunity-zone program is open-ended by design, said Sen. Tim Scott (R., S.C.), one of its authors, who drew on his experience growing up in a struggling area. “To transform a community, to have a paradigm-shifting experience, at least for me, came from the private sector,” he said.

Under the new law, governors designated up to 25% of qualifying low-income census tracts as opportunity zones. To claim tax benefits, investors must put capital gains into special funds, which must keep at least 90% of their investments in stock, partnership interests or business property in these qualifying areas. Investors get additional benefits for holding investments longer.

The Treasury Department hasn’t yet issued guidelines on how the program will operate and what rules investment funds must follow, but firms and investors are already positioning themselves to use the new benefit.

Bridge Housing, a nonprofit, is working on a $500 million opportunity zone fund to finance affordable housing in West Coast markets, such as the Watts neighborhood. The development includes housing and a community center with a swimming pool and offices for college-prep and job-training programs.

Virtua Partners, a Phoenix-based private-equity firm, is raising $200 million for an opportunity zone fund including three Phoenix-area projects: a 130-room Marriott hotel with furnishings by West Elm; 81 single-family townhomes with a swimming pool and clubhouse; and a 90-unit apartment complex near Arizona State University’s campus in Tempe.

All three projects would have been completed even without the tax break, said Virtua executive Derek Uldricks, who said the opportunity zone program will speed fundraising.

The program is expected to cost the government $7.7 billion between 2018 and 2022, and $1.6 billion over 10 years as deferred taxes are paid, according to the Joint Committee on Taxation.

There is no limit on the potential tax benefits for investors and, unless the Trump administration decides otherwise, no requirement for measuring the program’s effectiveness, such as examining which investments in each area use the new incentive.

The tax break is an easier fit for investing in real estate rather than in companies, some venture capitalists say. The legislation “was written by and for real-estate investors,” said Ross Baird, president of Village Capital Group, a Washington, D.C.-based venture capital firm exploring other ways to use the program.

Factory OS Inc., based in the San Francisco area, is one of the few manufacturers to express much interest so far. The builder of modular homes hopes to raise roughly $20 million to buy sophisticated tooling for its factory, which opened last year. “With less expensive capital, we can grow faster than we might otherwise,” said Rick Holliday, chief executive of the 75-person company.

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New housing starts surge in Volusia County

Builders in Volusia County picked up the pace in June, starting the most new homes in a single month since before the Great Recession.

In Volusia, builders were issued 295 permits for new homes last month, the most since March 2006.

The increase in housing starts is being driven by dozens of developments where new homes are being built.

Minto Communities received the next highest number of permits for new homes in June: 41, all at its planned 6,600-home 55-and-older Latitude Margaritaville community on the north side of LPGA Boulevard, just west of Interstate 95, in Daytona Beach.

As of July 3, Minto has now sold 385 new homes at Latitude Margaritaville Daytona Beach in only eight months, with 64 completed, said Bill Bullock, who oversees the company’s Latitude Margaritaville division. “Still at nine starts per week,” he said of the pace of new home construction at the community, which will stretch north to State Road 40 upon full buildout.

At Mosaic, the all-ages “full life” community going up immediately south of Latitude Margaritaville, west of LPGA Boulevard, between Champion Elementary School on the north and Father Lopez Catholic High School on the south, ICI Homes had more than two dozen homes under construction as of Monday.

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The 25 best places people are moving to in 2018

Devon Thorsby

These places have the highest net migration over five years.

In calculating the Best Places to Live, US News factors in each metro area’s growth due to net migration over a five-year period. For the 2018 ranking, we used net migration data from 2012 to 2016 from the US Census Bureau, the most recent complete data set at the time of our calculations. Places with the most growth might be attracting new residents thanks to a hot job market, affordable housing, a desirable location or some other factor. Read on for the 25 metro areas (out of the 125 most populous in the US) that have grown the most over this period.

7. Daytona Beach, Florida

Best Places to Live 2018 Rank: 94
Metro Population: 613,723
Median Home Price: $164,069
Median Annual Salary: $38,010
Net Migration Rate, 2012 to 2016: 8.95 percent

Daytona Beach’s growth from net migration between 2012 and 2016 nearly hit 9 percent. The coastal metro area attracts plenty of tourists to NASCAR races and local beaches, but plenty of these visitors also appear happy enough to make the place their next home.

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Volusia housing starts continue to sizzle in April

DAYTONA BEACH — After getting off to the strongest start to a new year since 2006 in the first quarter, homebuilders in Volusia County stepped up the pace even more last month.

A total of 241 permits were issued in April for new homes in the county, the second most in a single month since June 2007, behind only October 2017 when builders pulled 263 permits, according to the latest numbers reported by the Volusia Building Industry Association.

Year to date, permits for new homes are up 38 percent over 2017 which saw the most permits issued for new homes locally since the start of the Great Recession. April’s increase was an 18 percent jump over the same month last year.

National homebuilder D. R. Horton Inc. led the way, pulling permits for 63 new homes, followed by Minto Communities with 24 and Daytona Beach-based ICI Homes with 18, according to data compiled on the builders association’s behalf by DeBary-based HBW Inc.

“D.R. Horton may have pulled the most permits last month, but for a single community, we’re definitely leading the pack,” said Bill Bullock, president of Minto’s Latitude Margaritaville division.

Bullock said his company currently has 159 homes under construction at the planned 6,600-home Jimmy Buffett-themed Latitude Margaritaville Daytona Beach community along LPGA Boulevard, just west of Interstate 95.

Since kicking off sales for the amenities-laden 55-and-older community in November, Minto has completed 20 new homes as well as nine model homes, and has sold more than 330 of the 378 house lots in its initial phase, Bullock said. “The next batch (of available house lots) will be released soon,” he added.

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