Editor’s Note: Today is our final conversation with Brad for 2025. In this prediction series, we’ll check in on Brad’s predictions from last year and make some final forecasts for 2026. That includes an unusual crypto prediction from Brad, a self-professed “brick and mortar” guy.
Van Bryan (VB): Brad, I have just a few more questions before we wrap up the year, I wanted to check in on some of the predictions you made in 2024.
Brad Thomas (BT): Of course.
VB: When we spoke in December 2024, you predicted we’d see a surge of new mergers and acquisitions (M&A) activity in 2025. Has that happened?
BT: I would say so. My daughter covers M&A at The Wall Street Journal. And she’s been busy all year. It’s also shown up in some analyst work I’ve reviewed on the topic. According to McKinsey, M&A activity in the first half of the year was up 22% over the same period in 2024.
What’s interesting is that so-called “mega deals,” or those exceeding $10 billion, also took a big jump. They’re up about 44% over last year.
I think a lot of this has to do with interest rates which, while still on the higher side, have trended down this year. That tends to be more conducive for deal making. The new Trump administration is also taking a more accommodative view to dealmaking. For comparison, the Biden regulatory agencies were almost combative on the topic of M&A, which really put a chill on the industry.
By the way, one of my predictions was that we’d find a way for readers to take advantage of this new boom in M&A. And we’ve done that.
I recommended shares of Denny’s (DENN) to readers of Wide Moat Confidential, my small-cap research service. I know, it seems like a boring business. But, at the time, Denny’s was just such an obvious takeout target for a private equity shop – it was dirt cheap with a recognizable brand. Sure enough, that’s what happened. We walked away with about a 45% return in a few months.
VB: You also made a prediction around the new Trump administration. You said a priority would be to make the tax cuts from the first Trump administration permanent.
BT: Yes, that was an easy one. The economic benefits of that first tax legislation were too obvious to ignore. And, knowing Trump, I figured he’d move to make those cuts permanent. And that’s what happened with the signing of the Big, Beautiful Bill.
If history is any guide, investors will likely see the fruits of that legislation next year. Remember, after the 2017 Tax Cuts and Jobs Act, many public companies used the capital they saved on share buybacks and special dividends. So, I wouldn’t be surprised if we see a similar spike next year.
VB: Shifting gears a bit to real estate, you predicted an emerging trend would be a rise in sale-leasebacks, predominantly from triple-net lease real estate investment trusts (“REITs”).
BT: We touched on that earlier. But, yes, that one panned out well, too. In fact, SLB Capital Advisors reports that year-to-date sale-leasebacks are 24% above the same period from last year. The third quarter of 2025 was the second-highest quarterly total in 10 years.
Again, it’s probably obvious in hindsight. But what I saw in late 2024 was an alternative financing method – which is what sale-leasebacks really are. And with rates still on the higher side, it only made sense that companies would look to monetize the real estate on their balance sheets.
I’ll try to stay humble, but I think I nailed those three major predictions from last year.
VB: Would you like to make any new predictions for 2026?
BT: I actually have a prediction around crypto assets if you’re interested to hear it.
VB: Really?
BT: I know, it’s probably a little surprising. I’m typically a brick-and-mortar guy. And I’ve been very open about my skepticism toward crypto. But I have to give credit to my son. He’s become very involved in this space. And what I really appreciate is that he treats it as a serious asset class, and he understands all the risks that are involved.
One of the things he taught me was to look beyond just bitcoin or Ethereum and to focus on the underlying technology. And one of the really interesting potential applications is the tokenization of real estate.
So, what does that mean?
I’ve been working in real estate – as a developer, investor, and analyst – my entire life. And I can tell you that one of the great weaknesses of real estate is its illiquidity. Or, to put it another way, it can be difficult to realize a return on a real estate investment.
By comparison, you could buy most any stock one day and, if you really wanted to, sell it the next. That’s a liquid asset. You can’t do that with real estate. If you’ve ever tried to sell a home, you know what I mean.
Tokenization would essentially solve this problem. It would allow you to securitize and trade fractional ownership of a piece of property.
VB: What would that look like in practice?
BT: Let’s assume you own a piece of real estate. It could be your home, a warehouse, a self-storage facility – anything. These properties can generate income in the form of rent. They can also appreciate in value over time. But, if you wanted to realize that capital gains return, you basically have no choice but to sell the entire property. Again, that’s difficult, it’s time consuming, it’s expensive.
But imagine if there was another option… You “tokenize” the property.
Hypothetically, let’s say you issue 100,000 tokens – you could also think of them as “shares” – representing proportional ownership of your building. You could then sell these token/shares on an exchange and allow investors to invest directly in the property. It’s almost like an IPO… but for a single piece of property.
So, if an investor wanted exposure to, say, the South Florida residential real estate market, they don’t have to go buy an entire house. They just invest in a token offering for a home in that area. And, of course, if the value of that home increases, the value of the tokens would increase as well.
You solve the real estate illiquidity issue that way. And it can be a bit of a win-win. The property owner gets to realize a partial return on the capital gains, and investors could build a curated property portfolio where they hand-pick which assets they’d like to be partial owners of.
VB: And you think that’s something we could see happen in 2026?
BT: That probably isn’t a 2026 story. More than likely, it’s something that will play out over several years. It’s worth mentioning that there’s also sorts of question marks around this concept.
Would there be a regulatory agency that oversees these offerings? Presumably there’d have to be. Would majority owners of these tokens be required to make regular statements the way public companies do? I’m not sure. It’s possible.
So, this isn’t something that’s going to happen overnight. But, again, I’ve been working in real estate a long time. And the benefits of something like this are enormous. And they’re too big to ignore.
You watch. Somebody, somewhere, somehow will figure it out. Maybe by 2030 Wide Moat Research will be recommending fractional ownerships in individual properties. Stranger things have happened.
VB: We’ll be sure to keep an eye out for that. I just have two more questions for you Brad. What are you most excited about and what worries you most as we go into 2026?
BT: I’ll be excited to see some of the policy decisions from the Trump administration start to bear fruit. Now, I know the president is divisive. Even I don’t agree with everything he does. But just looking at his economic policies, I see more good than bad.
Making the tax cuts permanent, the 100% bonus depreciation, a more accommodative M&A environment, throwing support behind energy and AI infrastructure – all of these are good things. All these, with time, should help reinvigorate the American economy and help make the country more industrious.
Who knows, maybe we’ll see Trump’s “Golden Age” after all.
I’m also excited to finally see a revival in REITs. I know that real estate investors have been patient for years. But finally, all the pieces are lining up – rates are falling, the best REITs are dirt cheap, dealmaking has come back. It’s all the ingredients for a boom in the property sectors we cover. I wouldn’t be shocked if several of the REITs we recommend end up surprising investors by this time next year.
VB: And what worries you?
BT: You know, I actually don’t worry about the markets as much as I used to. Could stocks fall? Sure, it’s always possible. But maybe it was the experience of losing almost everything in the housing crisis. It was horrible. But I learned you can always pick yourself up. There’s always time to start again.
But one of the things that does worry me is the ongoing affordability crisis for many people, especially as it relates to buying a home.
Real estate has been very good to me. That experience in that market has taught me a lot. And I’ve seen great returns from real estate.
But how many people – especially young people – can say that now?
You know, I saw the other day that the median age for a homebuyer in the U.S. is now 59 years old. In the 1980s and 1990s, it was mostly people in their late 20s and early 30s. These would mostly be young families. And buying that home was a big life step. And, of course, it set them up to build equity over time and have capital later in life.
Is that happening today? I just don’t see as much of it.
That’s really disheartening. And I’m sure it’s discouraging to all these younger people who just feel locked out, like they can’t get on that same ladder their parents got on.
I don’t have a crystal ball for where mortgage rates will be next year. But if we could see some relief there, it would be a good thing. Like I said, real estate has been good to me. I hope the younger generations also get that chance.
VB: Thank you for your time, Brad.
BT: Happy to do it.
Editor’s Note: That concludes our prediction series with Brad Thomas for 2025. But be on the lookout for special insights from our own Wide Moat analysts in the days ahead. And be sure to check back in with Wide Moat Daily in the new year. We will resume our regular publishing on January 5.
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