REIT Era Not Over, Exec Says

The era of publicly traded real estate is not over, as some have speculated following the privatization of a number of real estate investment trusts, and the REIT structure is likely to gain more favor as it catches on worldwide, according to Sam Zell, chairman of Equity Group Investments.Speaking at an annual REIT symposium in New York sponsored by New York University's Real Estate Institute, Mr. Zell said he expects U.S. real estate markets to be positive for the rest of 2007. The first quarter of 2009 is when he expects any negative developments, considering that a new president will be in office (and new presidents "tend to take medicine early") and that it will be the tail end of a very strong period of recovery. He noted that he did not sell Equity Office Properties in a bid to cash in at the top of the cycle and to "get out before they bring in the troops." At two different panel sessions at the symposium, eight of 11 panelists indicated that they expect the wave of mergers and acquisitions in the REIT world to continue.