Thursday, March 18, 2010

MIPIM 2010: REIT review

Wisconsin Real Estate MBAs report from MIPIM 2010:

Panel: Recovery Positions: Listed Property- Advanced Positions?

Many investors look at REITs and other real estate securities as a liquid path into real estate investment. However, the fast paced investing has led to the need for constant guidance on the value of the underlying assets. This mark-to-market valuation mind set has led to a much more volatile market and a great deal of stress for the retail investors who purchased the securities with the intent to hold. While listed securities offer retail investors an opportunity to invest in real estate with ease, it is unclear whether these unsophisticated investors are able to handle the volatility of these securities. The current system is likely here to stay, but real estate is ill-suited for the current world obsessed with instant information. Companies that focus to property fundamentals and seeking sustainable returns from quality assets are one most likely to survive going forward.

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