Here’s Why Alluvial Capital Management Believes Net Lease Office Properties (NLOP) Shares are Attractive

Alluvial Capital Management, an investment advisory firm, released its fourth-quarter 2025 investor letter. A copy of the same can be downloaded here. The Fund delivered an exceptional quarter, returning 41.2%, making 2025 the best year since inception. The supportive market environment drove the performance of the Fund. The gains are highly concentrated in a small set of companies in the AI value chain. The Fund is confident in its portfolio of good-quality, deeply undervalued companies. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.

In its fourth-quarter 2025 investor letter, Alluvial Capital Management highlighted stocks such as Net Lease Office Properties (NYSE:NLOP). Net Lease Office Properties (NYSE:NLOP) is a publicly traded real estate investment trust focuses on acquiring and managing high-quality, single-tenant properties. The one-month return of Net Lease Office Properties (NYSE:NLOP) was -22.76%, and its shares lost 53.29% of their value over the last 52 weeks. On March 11, 2026, Net Lease Office Properties (NYSE:NLOP) stock closed at $14.05 per share, with a market capitalization of $208.138 million.

Alluvial Capital Management stated the following regarding Net Lease Office Properties (NYSE:NLOP) in its fourth quarter 2025 investor letter:

"Our largest holding in the “unpopular real estate” category, Net Lease Office Properties (NYSE:NLOP), has been active, selling several properties in recent months and making multiple large distributions to shareholders. The increased pace of dispositions gives me confidence that the liquidation process will be substantially complete by the end of 2026. However, there is no denying that the prices achieved in recent property sales have been underwhelming. The current price represents a large discount to the value of the company’s remaining properties, so I continue to believe shares are attractive here. It is likely that the total distributions we receive from our Net Lease Office Properties investment will be toward the bottom of the range I had projected at the time of investment, but we will almost certainly achieve a handsome rate of return when all is concluded. With the company’s February cash distribution of $6.75 per share, we will have received our entire cost basis back. That’s the power of buying really, really cheap real estate."

Net Lease Office Properties (NYSE:NLOP) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 12 hedge fund portfolios held Net Lease Office Properties (NYSE:NLOP) at the end of the fourth quarter, compared to 14 in the previous quarter. While we acknowledge the potential of Net Lease Office Properties (NYSE:NLOP) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

Story Continues

In another article, we covered Net Lease Office Properties (NYSE:NLOP) and shared Kingdom Capital Advisors' views on the company. In Q3 2025 investor letter Alluvial Capital Management noted that Net Lease Office Properties (NYSE:NLOP) is positioned to begin returning the capital shortly. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.

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