Real Estate Investment Trusts (REITs)
by AAII Staff
Real estate investment trusts) own income-producing real estate. They provide small investors with a way to add a real estate component to their portfolios.
REITs can invest in a variety of property types or specialize in one type, such as shopping centers, apartments, warehouses, office buildings and hotels.
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- MSN Money
- FitchRatings REITs Group
- REIT Wrecks
- Standard & Poor’s: S&P Global Property & REIT Report
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Around 130 REITs are publicly traded on the stock exchanges, so in many cases you can find data and news on REITs at the sites that offer stock and mutual fund quotes and fundamentals (such as Reuters and SmartMoney.com). The sites listed here offer more in-depth data, news, ratings, or analysis on individual REITs and the REIT industry.
REIT.com combines educational services for individual investors with the functions of NAREIT’s Web site for industry professionals. The home page highlights current REIT news, video analysis and interviews with industry professionals. It also features two free REIT publications: the bimonthly Real Estate Portfolio magazine and a Daily REIT Industry Performance Data update.
The Industry Data area provides statistics and reports on REIT indexes as well as sector performance data.
The Individual Investors area provides educational data about REIT investing. Novice investors can read a REIT investment guide (on-line or as a downloadable PDF brochure), explore the benefits of REIT investing, and find a glossary of commonly used words. The literature is thorough, but beware that at times it can read like a marketing brochure and carries no explicit warnings about risks.
Various lists show publicly traded REITs, REITs in the S&P indexes, REITs with dividend reinvestment and stock purchase plans, REIT mutual funds, real estate closed-end funds, REIT exchange-traded funds, and publicly registered but non-exchange-traded REITs. Listed REITs are hyperlinked to the REIT’s home page; however, only REITs that are NAREIT members are included.
An interactive map allows users to see which REITs have properties in a certain state, or all states where properties exist for one REIT. A world map lists REITs with investments in foreign countries.
The site is free.
Forbes offers market data, news, articles and commentary on various aspects of the stock market and economy. The site regularly posts articles that analyze REIT investing.
To find REIT articles, type “REITs” in the search box. For REIT ratings, type “REIT grades” in the search box, then click on the story “The REIT Stuff” from 2/25/2009, or go directly to www.forbes.com/reits.
Unique to Forbes is its annual grading of REITs. The 2009 list came out at the end of February. Grades are given to the largest publicly traded REITs using data from Green Street Advisors. Grades can range from A to F (including pluses and minuses) and are based on performance and value. In addition to the rating, the list shows dividend yield, five-year growth rate, and leverage ratio. You can rank the list by grade, yield, growth, or leverage ratio or sort alphabetically.
The list includes about 50 REITs and names are linked to current quotes and news.
Access to Forbes.com is free.
MSN Money’s Deluxe Stock Screener allows you to screen for REITs. Choose the Field “Industry Name” then choose Real Estate from the comparison value box. You can screen for REITs based on their holdings: diversified, office, healthcare, hotel/motel, industrial, residential and retail. You can then add additional criteria for performance, risk, dividends and more.
The Deluxe Screener is free, but works only with Internet Explorer browsers.
FitchRatings REITs Group
Fitch provides ratings on a number of REITs. To find ratings, choose Sectors, then Financial Institutions then REITs.
You will find an overview of the ratings process as well as some background on the REIT industry. You must register with the site to access additional information; however, registration is free.
You can view all content on one page or search by issuers and issues. The table is ordered by the most recent rating date and shows the current rating and the country the REIT is registered in. You can click the rating for more information and click the REIT name for detailed data on the investment.
The left-side menu bar offers a ratings guide that discusses each rating, the ratings process, a list of ratings criteria and more. You can also search the database by region, issuer, analyst name, ratings, actions and date.
Access to Fitch Ratings is free.
You must register with the site to view Moody’s ratings. To find REIT ratings, click Research & Ratings. Under Market Segment on the left, choose Real Estate, then refine by REITs & Property Companies, and finally refine by REITs.
There are over 1,700 REITs provided in the system. You can narrow the list by region and credit quality. The Ratings tab lists the current Moody’s rating and the most recent action taken on the REIT. You can also view the date of the latest action. For more information about a REIT, click the REIT name. You can view detailed data about the rating and its status, see a list of recent actions as well as a ratings history chart. A comparison between peer groups lists similar REITs and their respective ratings.
Ratings data is free but additional data reports cost extra.
REIT Wrecks is a blog that covers high-yield REITs and commercial real estate. The site offers analysis of market segments and discussions of individual REITs, as well as a REIT directory.
Blog entries are made a couple times a month and discuss issues that affect REIT investing such as new laws and regulations, interest rates, inflation, the economy and more.Each post is archived and archives can be searched by date and category.
You can search for REITs by type including apartment, healthcare, hotel, office and storage ETFs. Lists are updated regularly and include links to Yahoo! news and each individual REIT’s Web site for additional information.
The site is a bit cluttered with advertisements, but the content provided is well researched and helpful
REIT Wrecks is free.
REITcafe was set up to provide information and education about REIT investing mainly via podcasts that included interviews with REIT executives, analysts, institutional investors and more. The podcast area of the site has been discontinued, but other areas may still be of interest to REIT investors.
The home page provides charts showing REIT index correlations to other market segments over the last 12 months and over the long term, and charts based on the REITcafe Volatility index.
The REITnews segment is updated regularly and presents news items on individual REITs and the REIT industry.
REITcafe is a free Web site.
Standard & Poor’s: S&P Global Property & REIT Report
The Standard & Poor’s site offers access to ratings on various investments including REITs. Standard & Poor’s publishes a quarterly report on REITs and you can find the latest issue (and older ones) by entering REIT into the search box. The Global Property & REIT Report is available in PDF format.
The quarterly report highlights developments in the Property & REIT markets as measured by the S&P Global Property and REIT indexes. The report analyzes components of the current listed property and REIT markets, looks at the various investment vehicles available, highlights growth drivers, and identifies the latest regional and global trends in this asset class. The report also offers comparative performance, correlations, yields, volatility and fundamentals on REIT markets.
S&P’s REIT information is free.