Getting this out a bit early because everything’s closed up for the Good Friday holiday tomorrow. What’s up with the Real Money Portfolio?

We did get a few final 2023 reports… and that led to some investment decisions on my part.

The Boston Omaha (BOC) annual report came in a little later than last year, just before the deadline (which would have been next Monday)… and it was mostly “steady as she goes” for their core businesses. Billboards and Broadband are still growing well and are spitting out some cash flow, though their CapEx is also heavy in Broadband as they try to invest to reach more homes and lock up those long-term fiber subscribers. Their asset management business, Boston Omaha Asset Management, showed huge growth last year, but that’s only because it’s new… and they’re essentially abandoning it now. The disclosure in the 10K is essentially that they realized they didn’t have the scale or outside capital to build up a meaningful “build to rent” business as they had planned, and that their idea to raise outside funds to fuel their broadband expansion was not going to work. That’s OK with me, better to abandon it now, when it’s clearly not as good a strategy as they expected a year or two ago, than to keep throwing good money after bad. Here’s how they put it:

“In recent years, BOAM has been staffed and equipped to support the growth of the fiber and real estate businesses. We have determined that the high costs and significant risks associated with ‘fund financing’ based on current market conditions leads us to conclude that it would be more appropriate to pursue self-funding, bank debt, and other funding options for our fiber business at this time. As a result, we are winding down BOAM’s operations and implementing cost cutting measures since it will now only manage real estate funds. For our funds under management (the 24th Street Funds and the BFR Fund), we plan to sell the assets at the highest price the market will bear while maintaining the business plans for these assets.”

BOC’s total revenue came in at $96 million for the year, which is 19% growth from 2022. Net income doesn’t mean much for these guys at the moment, because it also includes investment gains or losses and the pass-through of Sky Harbour’s losses, but for 2023 ...