Housing slump or not, real estate investment trusts have outperformed stocks over the past three years and are once again benefitting from low rates.
The first days of the New Year bring Citigroup's Citi Investment Research Top Picks: The bank polled each of its fundamental analysts on a single best money-making idea for 2008, with the option of an additional small-cap pick. Citi says its 2007 list produced an average share price return of 16.7 percent, well ahead of the Standard and Poor's 500 average of 4.2 percent.
Forget subprime -- there are still solid real estate investments out there, says Jonathan Litt, real estate investment trust (REIT) analyst at Citigroup
Investors should not confuse the housing slowdown and subprime mortgage woes with the performance of equity real estate investment trust companies (REITs), two analysts told CNBC’s Melissa Francis on “Closing Bell.” “The mortgage REITs can be pretty dicey, but the commercial REITs that own the properties directly are really facing a very different set of dynamics than what you’re seeing on the homebuilding and single family side of the market,” said Louis Taylor, senior REIT analyst at Deutsche Bank.
REITs have been on a tear. Although glamorous properties are attracting attention from private equity, warehouse properties have been the standouts for investors. The world's largest industrial REIT is Prologis and today--the company announced an expansion of 3.3 million square feet of warehouse space in China, where it is already something of a trailblazer in the sector.