Thanks Kevin. I haven't made the move to options yet but it helps me understand. Although MREITs are not traded much there is one hell of a large option market on these things which is making the PPS go insane. Long term investors can either choose to ignore the PPS or freak out and sell.
One thing is for sure. Anybody calculating the present value of future cash flows from these Mreits (I.e. dividend discount model) has to be licking their chops right now.