As some real estate investment trusts try and go public and regulators push for more disclosures from REITs, some non-traded REITs are proving to have far lower values than anticipated, the Wall Street Journal reported. For instance, Retail Properties of America, a very large retail REIT based in Oak Brook, Ill., saw shares valued at $3.20 at it’s initial public offering last month, the Journal said. A year prior the firm was valued at about $6.95 a share. A number of other REITs are in the same boat, the Journal said. [more]

From left: Area Property Partners founder William Mack and Equity Investments Chairman Sam Zell

Real estate investment trusts are better off focusing on a single expertise than they are growing to all-encompassing behemoths. That was the consensus among a whole host of industry experts speaking today at the annual New York University Schack Institute of Real Estate REIT Symposium held at the Pierre hotel. [more]

From left: Anthony Malkin, president of Malkin Holdings, and the Empire State Building

Empire State Realty Trust, which controls the Empire State Building, has been sued over its plan to become a real estate investment trust, Bloomberg News reported.

Today, investor Leon Meyers filed suit in New York State Supreme Court, accusing the entity, in which he has an equity interest, of breach of fiduciary duty. [more]

Cantor Fitzgerald & Co. has established a dedicated real estate investment trust research team, it said today, and will start coverage of REITs this month as part of a larger expansion of the firm’s equity-research division.

According to the Wall Street Journal, David Toti, who previously headed a team covering FBR capital markets research at Cantor, will be a part of the new division, as well as Sri Nagarajan, Cantor’s senior research analyst. [more]

Real estate investment trusts that invest outside of the four major categories of office, retail, residential and industrial property have been especially successful, according to the New York Times.

REITs have outperformed other investment areas in general, but those pouring money into cell phone towers, cold storage warehouses, or transportation and energy infrastructure have thrived. The Dow Jones U.S. Specialty REIT index has returned 7.94 percent compared to the 3.32 percent returns posted by the overall REIT index.

Many of the properties that fall under specialty REITs run countercyclical [more]

Higher than anticipated sales on Black Friday have mall owners hoping that the coming holiday season will cure some of the persistent retail vacancy, the Wall Street Journal reported.

Last week’s Black Friday sales totaled $52.2 billion, a record, according to research from the National Retail Federation. Meanwhile in the third quarter malls overall had a 9.4 percent vacancy rate — the highest since numbers began being recorded — according to Reis, a real estate analytics firm.

While mall operators do not rely hugely on holiday sales, the period is a useful bellwether for retail tenants and landlords about what outlets are ready to expand and when and if rents can go up, according to Jay Leupp, a portfolio manager at Lazard Asset Management, an investment manager for institutional clients.

“It’s a better sign and predictor of what retail tenant renewal and expansion activity is going to be going forward, particularly if retail sales are meaningfully stronger than expected,” Leupp said. [more]

From left: UDR CEO Thomas Toomey, the Rivergate, 10 Hanover Square and 21 Chelsea (building credits: PropertyShark)

The recession helped deep-pocketed national real estate investment trusts find their way into the New York market, Crain’s reported, and they are now aggressively picking up existing properties and building new developments all over the city.

Previously inhibited by the high costs and hard-to-navigate public approval process for construction in the city, New York development used to be an almost an entirely private enterprise, ruled by local developers such as the Related Companies and the Rudins.

“Highly leveraged private guys got caught in the downturn and were forced to sell assets,” said Haendel St. Juste, an analyst at Keefe Bruyette & Woods. “Publicly traded REITs continued to have a competitive advantage.”
[more]

Nine real estate investment trusts have filed to sell approximately $2.5 billion in shares since the beginning of the year, the most significant volume of deals since 2009, the Wall Street Journal reported, and the sales aren’t over yet. A $600 million offering from Pacific Investment Management and a $500 million deal by a unit of hedge fund Fortress Investment Group are both slated for the coming months.

Once one of the most desirable commodities on the stock market, reviews by the Securities and Exchange Commission could turn the tide for REITS, meaning they’ll be less likely to go public in the future.

The SEC is distinguishing between REITs that manage and operate real estate and those that invest in real estate securities, the Journal said. [more]

Retail real estate investment trusts will drop up to five cents a share in the first quarter, thanks mostly to retailer bankruptices, according to a Jefferies & Co. analysis cited by Crain’s. Shopping center vacancies are expected to rise to 11.1 percent this year, the highest mark in two decades, and liquidations of retailers like Borders and closings of Harry & David and AnchorBlue are adding to shopping center woes. The safest bets, according to the analysis, are upscale malls like those owned by Simon Property Group and Taubman Centers. [Crain's]

Real estate finance company Capital Trust has reached a deal to restructure its outstanding debt, thanks in part to an $83 million mezzanine loan by an affiliate of Five Mile Capital Partners that will finance a new subsidiary holding the bulk of Capital’s interest-earning assets. According to an announcement yesterday, Capital will extinguish its $98.1 million senior credit facility and $143.8 million in junior subordinated notes while spinning off its $339.6 million in legacy repurchase obligations with JPMorgan, Morgan Stanley and Citigroup into the new CT Legacy REIT. TRD [more]