What are those Real Estate Trailblazers recommendations?

Checking out another Motley Fool pitch

The Motley Fool got into real estate investing last year with a service called MillionAcres, which largely focuses on buying into real estate more directly, but they’re now building on that service with some newsletters and portfolios. The one they launched recently is called Real Estate Trailblazers, with a focus on investing in real estate stocks… and over the weekend they had a teaser pitch about some of their ideas, and, of course, about the huge growth potential.

Real Estate Trailblazers is set up more or less like the various Discovery services at the Fool, you buy in for a premium-priced subscription ($999 in this case), there are no refunds, and you get access to a portfolio of stocks that they recommend for that sector, with allocation suggestions and updated coverage as things change.

I’ve also started seeing ads for a new service within MillionAcres called Real Estate Winners, which seems less growth-focused and probably looks more at REITs and dividend payers, though that’s a guess at this point (that one’s starting at $249)… no big teasers yet from that service.

So let’s take a look and see if we can get you started with a little perspective on this Trailblazers service… and perhaps a stock idea or two.

The “name” guy for this promo is Eric Bleeker, who has been pretty visible in the Fool’s tech-related promos in the past, and they’re pitching their ideas as a “reopening trade” — here’s a little taste of the ad:

“At long last, The Motley Fool’s No. 1 trade on the full reopening of the American economy has arrived…

“As the technology stocks that fueled our portfolios throughout 2020 get hammered, it’s time for us to turn toward the new reality of a full U.S. economic reopening.”

And there’s a “catalyst” date they can drop on us, too, to increase the urgency:

“Discover why a rapidly approaching June 15th ‘tipping point’ signaling the full reopening of America could trigger an explosive windfall for well positioned early investors!”

So yes, the general “reopening” trade is that people are going to swarm into real estate, with retail and offices reopening and people continuing to want to upgrade their homes… and the “tipping point” that they talk about as being June 15th is just tied to the largest economy in the US, California, because that’s when Governor Gavin Newsom will remove most of the pandemic restrictions (on capacity and masks and the like, even Disneyland reopens to out-of-staters on June 15), and that will send a signal to other states that it’s OK to take those steps.

And real estate is a huge sector, of course, and is responsible for a ton of economic activity (building, leasing, renovating, moving, buying and selling, etc.), so they make the point that this is a far larger market to be “disrupted” and impact the economy than other “tipping point” industries they’ve looked at before and that have created some huge investing wins, like Telehealth or 5G or e-commerce. This is how they get the hyperbole going…

“… the market we’re discussing today has a $52 trillion estimated total value.

“To put that into perspective again, that’s:

“66X eCommerce sales
“174X telehealth market
“78X the 5G market

“Perhaps most amazingly, 10X the value of all technology combined!”

Lots of apples to oranges comparisons being made there, but yes, “real estate” is a huge sector of the economy, and presumably there are plenty of interesting investment ideas in that space. What is it the Foolies are looking for?

They focus a lot on the housing part of the real estate market, and indicate it’s both likely to be a play on inflation and on reopening, with a historic shortage of housing availability helping to drive up prices because not enough homes have been built in the past decade or so…

“And now, we’re seeing the exact same pattern unfolding during the COVID-19 recession – immediate drop in housing starts, and I think every reason to anticipate the same pattern as we exit this recession with the June 15th economic “tipping point” as America begins to fully reopen.”

That’s a little disingenuous, housign starts had a brief blip in the second quarter thanks to COVID last year, but have roared back and all the builders have been going flat out trying to build as fast as they can (with some challenges, as building supplies and appliances have been facing rolling shortages thanks to the COVID shutdowns last year and other supply bottlenecks… and as labor has been hard to come by).

More from Bleeker:

“… it’s obvious to me that tech was where to invest throughout the pandemic. That’s when we hit the “tipping points” in eCommerce, telehealth, 5G, and many, many others.

“But now the economic realities have turned, and we face a widely predicted economic boom with the reopening of America that frankly looks like a once-in-a-lifetime opportunity.

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“And I want to help investors get full exposure to this estimated $52 trillion industry, because I’m confident this massive market is central to the unprecedented opportunity we’re seeing.”

And he points out that real estate has quietly performed very well for investors…

“… when you look at rolling 20-year returns over the last decade, real estate investment trusts (or REITs) have outperformed stocks 100% of the time.”

A lot of that is because of 40 years of gradually falling interest rates, but yes, REITs in general have been a solid bulwark for a lot of portfolios (including mine).

The pitch isn’t “real estate in general,” though, it’s a particular p