NAREIT: Despite October Declines, REITs Continue to Offer Strong Value Opportunity for Long-Term Investors

Following a volatile October, the 31 percent decline in REIT total returns so far in 2008 is in line with declines seen across the broader market, according to the National Association of Real Estate Investment Trusts (NAREIT).

Washington, D.C. (PRWEB) November 12, 2008 -- Following a volatile October, the 31 percent decline in REIT total returns so far in 2008 is in line with declines seen across the broader market, according to the National Association of Real Estate Investment Trusts (http://reit.com/) (NAREIT).

The FTSE NAREIT All REIT Index is down 31.1 percent for the year, through Oct. 31. The FTSE NAREIT Equity REIT Index is down 30.5 percent for the year. By comparison, the NASDAQ Composite is down 35.1 percent, the S&P 500 is down 32.8 percent, the Dow Jones Industrials is down 29.7 percent, and the Russell 2000 is down 29.0 percent.

While the broader market has struggled all year, REITs had been trending upward since March through September. Brought down by the decline in the overall equity market, the FTSE NAREIT All REIT Index was down 30 percent in October.

REITs, however, continue to offer a strong value opportunity for long-term investors. Consider the following points:

* Some real estate industry analysts are pointing to the likelihood of a 20 percent drop in direct commercial real estate values from the 2007 peak.

* Yet, REIT stocks currently are down approximately 47 percent from their peak in February 2007.

* REITs led the private commercial property market on the way into this down-cycle as they traditionally have done and they now are trading at a deep discount to the level the direct property market is projected to reach.

* Because REITs also traditionally have led the private commercial property market in recoveries, REITs today are an exceptional value opportunity.

In addition, REITs provide strong and reliable dividends. There are very few income investments today delivering yields that even come close to matching the rate of inflation much less yields that match those of REITs.

* Over the long-term, REIT dividends constitute two-thirds of the stocks' total return.

* Dividend yields for the FTSE NAREIT All REIT and Equity REIT indexes now are in the neighborhood of 8 percent. To put that in perspective, the diviend yield for the S&P 500 is about 2 percent.

The National Association of Real Estate Investment Trusts® (NAREIT) is the representative voice for U.S. REITs and publicly traded real estate companies worldwide. Members are real estate investment trusts (REITs) and other businesses that own, operate and finance income-producing real estate, as well as those firms and individuals who advise, study and service those businesses. Visit our Web site at REIT.com (http://reit.com/).

NAREIT does not intend this press release to be a solicitation related to any particular company, nor does it intend to provide investment, legal or tax advice. Investors should consult with their own investment, legal or tax advisers regarding the appropriateness of investing in any of the securities or investment strategies discussed in this publication. Nothing herein should be construed to be an endorsement by NAREIT of any specific company or products or as an offer to sell or a solicitation to buy any security or other financial instrument or to participate in any trading strategy. NAREIT expressly disclaims any liability for the accuracy, timeliness or completeness of data in this publication. Unless otherwise indicated, all data are derived from, and apply only to, publicly traded securities. Any investment returns or performance data (past, hypothetical, or otherwise) are not necessarily indicative of future returns or performance.

Contact:

Ron Kuykendall or Matt Bechard

(202) 739-9400

1-800-3NAREIT

http://reit.com/

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