REITs Are Elites Of Real Estate, Says Analyst
Real estate as an opportunity for investors? Get real! Morningstar equity analyst Jeremy Glaser is making just such a recommendation, telling CNBC there are gems to be found in a sector that's taken such a beating.
Of course, it's important to note the distinction between commercial and residential real estate, and to appreciate the relative security of the real estate investment trust (REIT).
"You want to look at both your equity REITs, which own your traditional commercial properties like office buildings, or hotels, or apartments, and then also mortgage REITs, which are kind of a separate beast, that holds those residential mortgages," he explained.
Glaser likes Biomed Realty Trust. "Biomed Realty owns lab space in a lot of biotech research centers," he said. "One of the things that we really like about them is that their tenants spend a lot of money to outfit their spaces with very sophisticated lab equipment, and once they get in there, they tend to stay."
He finds a bargain in Mack-Cali Realty.
"We think that Mack-Cali has taken a pretty sharp decline in its share price, way beyond what is expected," he said. "They have a lot of great properties in the suburban New York area, and New York has been one of the hottest office markets; even though the're not in the best markets in Manhattan, they still have a lot of good things going for them."