Carmela Soprano The Sopranos

Is Now the Time to Buy?... "If Carmela Soprano is talking about REITs, the story is out." That's according to David Shulman at Lehman Bros. after she suggested that her husband invest in REITs in a recent episode of "The Sopranos." (San Francisco Chronicle, Nov 8, 2003)

The National Association of Real Estate Investment Trusts (NAREIT) also wants you to invest in REITs (naturally). And to spur retail demand, NAREIT recently launched a web site aimed at individual investors -- Invest In REITs.

The performance of REITs looks very respectable over the past 20 years (1981-2001). Here are the comparative annual returns: Long Term Government Bonds (12.1%), REITS (12.8%), US Small Stocks (13.8%), S&P 500 (15.2%). Full Disclosure: My personal IRA is partially invested in a REIT mutual fund.

But coverage of NAREIT's recent conference in San Francisco didn't exactly stoke the fires of investor enthusiasm -- given a weak US economy and sluggish job growth. "There are no property types that have positive outlooks right now. There are just different levels of deterioration," said Gregory Whyte, of Morgan Stanley. Even Sam Zell is quoted as saying, "I don't remember a period when there's been so much pessimism." (Quotes from Chronicle article above).

Hey, this sounds like the time to buy. So I'm sticking with REITs. Check out the Diversification Benefits page at Invest In REITs. You'll see that a stock and bond portfolio with 20% invested in REIT shares reduces your risk and increases your returns. That's magic.

Building Your Brand... Thanks to our new sponsor this week, LseMod, which helps corporate real estate managers and tenant rep brokers make better decisions. Would you like to sponsor the PikeNet Dispatch? Dates available starting in January 2003. Send e-mail or call me at 415-485-6700. Thanks!

--Peter Pike