Warren Buffett's Berkshire Hathaway just made a big bet on real estate
That amounted to 9.8% of outstanding shares purchased at $20.25 apiece, Store Capital said in a statement. Its shares gained by as much as 11% to $23.10 in premarket trading.
Store Capital invests in single-tenant real estate for profit.
"An investment in our company from one of history's most admired investors represents a vote of confidence in our experienced leadership team and an affirmation of our profit-center real estate investment and management approach," said Christopher Holk, Store Capital's CEO. He was referring to Berkshire Hathaway Chairman Warren Buffett.
Buffett has said real estate was a solid investment that was less volatile than stock prices and likely to produce gains. In 2016, he said he didn't believe that US real estate was in a bubble.
This investment follows Berkshire Hathaway's provision last week of a 2 billion Canadian dollar ($1.51 billion) credit line to Home Capital, Canada's largest non-bank lender that accepted responsibility for misleading investors about problems with how it underwrote mortgages.