U.S. REITs: A matured asset class

Real estate investment trusts (REITs) have grown tremendously over the past two decades, to the point at which they should no longer be considered an "alternative" asset class. Bob Zenouzi discusses REITs' evolution over time.

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Bob Zenouzi
Chief Investment Officer — Real Estate Securities and Income Solutions (RESIS)

U.S. REITs: A matured asset class

U.S. REITs are in a great position today. But to understand why we’re in a great position today, we have to go back and look at the 20-year track record. REITs have grown tremendously in terms of number of names in the public markets, the market cap, and today, the REITs are in multiple equity indices, namely the S&P 500. In August of 2016, we’re going to have our own global industry classification. So, the REITs have now arrived. It’s a great milestone, a great achievement for the industry.

Today, the real estate industry is very strong. You have very high-quality properties owned by REITs, great management teams with high insider ownership, superior corporate governance. And when we compare the U.S. REITs relative to European, Japanese, or emerging markets, we think we have high-quality companies here. And so, we think the REITs will continue to grow and as that growth and performance continues, you’ll see institutional and retail investors continue to add to their REIT allocation.


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