Steven R. Marks, Managing Director at Fitch Ratings, Interviews with The Wall Street Transcript: Stable Outlook for REIT Fundamentals in 2013

Wall Street Transcript

67 WALL STREET, New York - June 25, 2013 - The Wall Street Transcript has just published its REITs Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Acquisition and Financing Costs - Pricing Power Outlook - Residential and Commercial REITs - Inexpensive Access to Capital - Apartment, Lodging, Self-Storage and Office REITs

Companies include: Public Storage (PSA), Simon Property Group Inc. (SPG), Federal Realty Investment Trus (FRT), iStar Financial Inc. (SFI) and many more.

In the following excerpt from the REITs Report, an expert analyst discusses the outlook for the sector for investors:

TWST: What is your overall outlook for the sector for the rest of the year?

Mr. Marks: We published our 2013 outlook at the end of December, at which point we noted a stable outlook. We will be publishing a 2013 midyear outlook in early June. Our views in terms of what might be driving the outlook are similar to what we discussed in December of 2012, which was our expectation that companies would have strong access to capital; good liquidity; fundamentals are beginning to improve as well fairly consistently across most of the asset classes; but the leverage levels are still slightly elevated, and we are concerned about the tepid recovery in the overall economy to which commercial real estate cannot delink itself.

TWST: In terms of different property type and geographic market focus, what's looking the strongest and healthiest these days?

Mr. Marks: In terms of fundamentals, the multifamily sector continues to be strong. We expect that it will have the strongest fundamentals for 2013, and that's primarily driven by strong demand drivers, whether it be household formation, which is beginning to pick up, and job growth is beginning to pick up as well.

In addition, there is the psychological factor of people probably looking at their homes more as homes and not as investments, and so even though the single-family affordability measurements have never been stronger relative to multifamily, it's unclear if that's going to drive a tremendous push into the single-family space, particularly because single-family financing is still pretty hard to get. These elements all drive our positive outlook on multifamily fundamentals, with the one caveat that we are seeing a pickup in development in some select markets, particularly the Sun Belt and Washington, D.C...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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