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- January 1, 2015: Vol. 9, Number 1

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The glories of liquidity: Institutional investors can be in the REIT place at the REIT time

by Benjamin Cole

The real estate investment trust, or REIT, was until recently dismissed as the retail stock investor’s friend, a relatively predictable vehicle to earn some steady dividends and own the kind of properties that non-billionaires cannot. But with trillions of capital pouring into the vaults of institutional property investors (you pick the currency, it doesn’t seem to matter much), the prosaic REIT is getting a long second look from big-league real estate buyers — and is looking more royal with each passing day.

The primary reason for the increasing institutional investor attention to REITs is a “problem” that many would like to have: too much money. With large amounts of money comes the need to diversify. But diversification requires time-consuming due diligence, and investing in actual property requires due diligence in spades, often in connection with partnerships and deal-making.

Although the pockets of investors may appear bottomless, the time of institutio

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