Changes in RE Ownership Mixed in '02

Changes in ownership of real estate through real estate investment trusts and real estate operating companies were mixed in 2002, rising for retail malls and non-mall retail properties and falling for hotels, apartments, and warehouses, according to Prudential Real Estate Investors, Parsippany, N.Y.The increases totaled 2.5% for retail malls and 0.5% for non-mall retail properties, and the declines ranged from 0.1% for apartments to 0.7% for warehouses and 1.6% for hotels, says the annual PREI study of public market penetration in commercial real estate. For offices, public ownership remained unchanged. PREI said capital inflows to public real estate firms rose from $18.8 billion in 2001 to $19.8 billion last year, still far below the $45.3 billion recorded in 1997. "New capital is critical in an industry that cannot rely heavily on retained earnings for rapid growth," said Youguo Liang, managing director of research at PREI. "Despite relatively strong stock price performance, limited new equity was raised because the lack of buying opportunities in the current property markets provided little incentive for companies to issue new stock." PREI can be found online at http://www.prudential.com/prei.