Append below an interesting table to reflect the difference in REITs’ yield versus risk free 10 Year Government Bond.

REITs’ seems to have lot more potential where the difference or spread over risk free is greater.

Country

Yield

10 Yr Govt Bond

Spread Over Risk Free (bps)

Japan

4%

1.6%

240

USA

4%

4.8%

-80

Australia

6.3%

5.7%

60

Singapore

4.1%

3.0%

110

Hong Kong

5.0%

4.2%

80

Malaysia

6.8%

3.9%

290

Korea

8.7%

5.3%

340

Taiwan

4.2%

2.1%

210

(Source: DBS Vickers & others)

The 2006 Market segmentation of the Global REITS in terms of :-
(a) Types of REITS:

Retail

24.30%

Office

21.40%

Residential

15.20%

Specialized

13.90%

Industralized

8.80%

Other

16.40%

Total

100.0%

(b) Geography Of REITS:-

Geography

% Share

United States

73.60%

Australia

16.40%

Japan

5.70%

Canada

4.40%

Total

100.00%

The compound annual growth rate of the market from 2002 to 2006 was 25.5%

Year

$ billion

% Growth

2002

205.8

2003

269.7

31.10%

2004

366.5

35.90%

2005

448.1

22.30

2006

509.8

13.80%

CAGR (2002-6)

25.5%

In the global arena, append below are some companies that are leading in terms of its market capitalization:

Company

% Share

Westfield Group

5.00%

Simon Property Group, Inc

4.00%

Equity Office Properties Trust

2.90%

ProLogis Trust

2.70%

Other

85.30%

Total

100.00%

An interesting report -Ernst&Young’s Global REIT Report 2006, prepared by Ernst&Young Australia and released through the Ernst&Young Global Real Estate Center, analyzes relative returns and performance among thirteen established REIT markets using criteria such as market size and depth, total return over one- and three-year periods, balance sheet measures, income measures, and volatility.
The countries […]