Category: REIT

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Fitch: REIT Share Buybacks Could Impair Credit Quality

As share buybacks are becoming more appealing for equity REITs, ratings firm Fitch Ratings is warning that they pose risks to the companies’ credit ratings.

Despite outperforming the broader market in the first quarter, shares of equity REITs in general continue to trade below net asset value (NAV), making share buybacks “an intriguing use of capital,” according to a report released by Fitch on April 29. As of the end of 2013, REITs traded at a 7.2 percent discount to NAV. In the previous year, pricing was essentially in line with NAV, according to Fitch.

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Analyst Says REITs’ Capital Structures Appropriately Leveraged

Luke Zubrod, director of risk and regulatory advisory services with Chatham Financial, joined REIT.com for a video interview during REITWise 2014: NAREIT’s Law, Accounting and Finance Conference held in Boca Raton, Fla.

Zubrod was asked about the dialogue surrounding the appropriate level of leverage for REITs and the stakes related to the decisions that REITs make regarding their interest rate exposure.

Luke Zubrod

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Compensia Analyst Says REITs Should Know Vulnerabilities in Say-on-Pay Vote

Mark Borges, principal at Compensia, joined REIT.com for a video interview during REITWise 2014: NAREIT’s Law, Accounting and Finance Conference held in Boca Raton, Fla.

Borges commented on the steps a REIT should take to win a say-on-pay vote.

“I think it’s important to plan ahead. In the past, you could simply file your proxy statement and attend your annual meeting and see what happened, but today you have to treat it more like a campaign,” Borges said.

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Credit Suisse Banker says REIT Debt Markets Healthy as Ever

Andy Richard, managing director of the Real Estate Group at Credit Suisse, joined REIT.com for a video interview during REITWise 2014: NAREIT’s Law, Accounting and Finance Conference held in Boca Raton, Fla.

Richard was asked about the state of REIT capital markets and the prospects they face going forward.

“On the equity side, stocks are trading at very healthy levels. It’s a very seasoned asset class with a broad range of investors who are interested,” Richard said. On the debt side, he added, “I have never seen the debt markets healthier than they are now.”

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Sternlicht Sees Strong Potential in Single-Family Housing Business

Starwood Capital Group Chairman and CEO Barry Sternlicht is expressing confidence that the single-family rental housing sector has the potential to become a major REIT asset class, but he acknowledges that investors remain skeptical.

Sternlicht, chairman of single-family home REIT Starwood Waypoint Residential Trust (NYSE: SWAY), spoke on April 23 at the Real Estate Luminaries Series at Georgetown University. He discussed the company’s foray into a new segment of the REIT market.

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Investor Hasn’t Seen Wave of Deals Anticipated in Europe

Sonny Kalsi, founder and partner of real estate investing and advisory firm GreenOak, joined REIT.com for a video interview before participating in a panel discussion at the 2014 Real Estate Luminaries Series event on April 23 at Georgetown University.

GreenOak, formed in 2010, has an investment portfolio that spans the United States, Japan, and the United Kingdom.

Kalsi was asked whether the size of  GreenOaks’s European portfolio reflects a lack of attractive opportunities in that region.

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Greenberg Traurig Lawyer Discusses Legislative Proposals

Sandy Presant, chair of the real estate fund practice at law firm Greenberg Traurig LLP, joined REIT.com for a video interview during REITWise 2014: NAREIT’s Law, Accounting and Finance Conference held in Boca Raton, Fla.

Presant was asked about current tax reform proposals being discussed on Capitol Hill and what they might mean for REITs.

Sandy Presant

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