Reality vs. GIS (Gossip, Innuendo and Speculation)

Off-Balance Sheet Mysteries... Here's a recent (anonymous) post at the Motley Fool. "In light of the Enron crime, I'm surprised nobody has brought up the issue of off-balance-sheet accounting in the REIT world." To which another (anonymous) poster responded, "REITs have always invested in joint ventures which, if they do not control them, are not consolidated into their financial statements." OK. Is this true? Is it good? Is it bad?

Search me. One thing is crystal clear after poking around various message boards ... Google (search for REITs, but click the Group tab) ... Motley Fool (click Discussion Boards, then search for REITs) ... Yahoo Finance (select a stock, then the Msgs link). With very few exceptions, most of the contributors to online discussion boards trade in gossip, innuendo and speculation. Don't waste your time looking for real estate insight.

By contrast, I poked around the Wall Street Journal Online (annual subscription $29, with print subscription). If you look up, say, Equity Office (NYSE: EOP), you're provided with a huge amount of information, including valuation ratios, earnings estimates and salary information. Clicking under Research (left-hand column) takes you to three kinds of reports...Free reports of 3-4 pages (Merrill Lynch and Morgan Stanley)...For sale reports from brokerage firms ranging from $10 (Prudential Securities) to $300 (Deutsche Bank Alex Brown)...And, finally, for sale reports from independent research providers ranging from $10 (Morningstar) to $50 (Market Edge). Has anybody bought these reports? Do they mention off-balance-sheet items?

PikeNet Forum ... No speculation here, just the straight scoop from real estate market leaders. Register online for your Reality Check.

--Peter Pike