REITs Today -- New Concepts -- New Uses -- New Issues
Statistical data evidences an overwhelming interest in real estate investment trusts ("REITs"). During the first eight months of 1994 thirty-seven REIT IPOs raised more than $6 billion and during the last nine months more than twelve new real estate funds have been initiated to invest in REITs. .1
In early September, Bankers Trust revealed that it is developing a derivative financial product based on an index of publicly traded REITs. The objective is to isolate the real estate element in REIT shares from the stock market element through a technique that involves buying a broad portfolio of REIT shares and taking a short position on a broad range of non-real estate stocks having similar capitalizations. The result is a derivative product that should trace the real estate market but stand independent of stock market trends. This product would, among other things, give investors the opportunity to better diversify their
