What is the Tea Party’s Position on Commercial Real Estate?

As a follow-up to my piece last week regarding the impending political season, I want to refine my position regarding Tea Party Impact. I’ll start by reiterating that the “Tea Party”, at this point, is not a cohesive entity. A google search for Tea Party yielded over 65 million results, including the following web sites:

http://www.teapartypatriots.org/

https://www.jointheteaparty.us/

http://www.teaparty.org/

http://teapartypatriots.ning.com/

Anyone who can find a consistent economic message (other than the generic “stop spending”), let alone a plank regarding commercial real estate, please write in and let me know.

What is clear, however, is a shift to the right in the republican center of gravity. I’m accounting for the typical republican playbook - run right during the primary, tack back for the general - and proposing the Dems might do better than expected.

In the recent primaries, the Tea Party showed strength. This means republicans will now have to guard their right flank throughout the entire cycle. This will leave the center open if the democrats can pull it together and cease the opportunity. Needless to say, we’ve see this sort of thing before i.e. Buchanan/Clinton and Nader/Bush (Perot is not included because he was not so clearly to the right of Bush). In 2010, there is an interesting dynamic regarding the economy, the government and markets.

Going forward, the worse the economy gets the worse things get for Obama/Dems, right? Well, there will also be more pressure for the government to “do something”. The more the feds “do” the stronger the Tea Party becomes. This draws the republicans further to the right, leaving more room for Obama to move right and take the middle.

Where can the Dems move right? Immigration: think Nixon going to China. For instance, McCain moved way right in Arizona to keep the republican bid, leaving Obama with the ability for force concessions from congressional Dems. I have to believe it will lead to both a beefed up border AND an easier harder for legal immigration. The net here would be a boost to corporate rental operations and companies that focus on starter homes.

Feel like taking an early bet? Try Equity Residential (NYSE: EQR) for the rental exposure and PoulteGroup, Inc. (NYSE: PHM) for the starter homes.