Thursday, September 08, 2005

REIT Investors Growing Selective

Looks like it's crunch time for new J-REITs. No longer are we seeing the frenzied purchasing of the new issues. The Nikkei reports that "three REITs have seen their initial trades fall short of their offer prices so far this year, with the latest example being eAsset Investment Corp. (8974) whose 490,000 yen first trade Wednesday on the Tokyo Stock Exchange was lower than its 500,000 yen offer price. "

But with asset acquisition competition intensifying, the gap between high- and low-performing REITs is growing. Those that have been listed longer are commanding an edge in acquisition of large properties. The widening of the gap is being accelerated by the growing trend among investment trusts to employ active portfolio management instead of index tracking.

So what's in store? "REITs will be ranked by the quality of the properties they own, and will be priced appropriately". Well, that sounds reasonable enough!

Full Story - Nikkei: REIT Investors Growing Selective

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