Investing in REITs: Real Estate Investment Trusts, 4th Edition

Summary

• Buy-and-hold investors desire to own REITs for portfolio diversification and attractive total returns over time, and should have relatively less concern regarding quarter-to-quarter data such as FFO growth rates, occupancy and rental rates, or even asset values.
• Performance-oriented REIT investors will need to spend a fair amount of time analyzing and applying historical and prospective valuation methodologies in an effort to achieve maximum investment performance for their portfolios.
• There are a number of tools to help us evaluate REIT stocks. These include NAV-based models, P/FFO or P/AFFO models, and discounted cash flow and dividend growth models—all of which have their strengths and limitations.
• Because REITs own liquid–and often ...