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A Goldilocks Environment for REITs with Rates Expected to Stay Low and Limited New Supply of Real Estate: An Exclusive Wall Street Transcript Interview with Senior REIT Analyst Alexander D. Goldfarb

67 WALL STREET, New York - June 27, 2014 - 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: Apartment, Lodging, Self-Storage and Office REITs - Consolidation Activity - REIT Access to Capital - Residential and Commercial REITs - Correlation Between Macroeconomy and Real Estate - Agency Mortgage REITs - Supply and Demand Dynamics - Favorable REIT Fundamentals

Companies include: Boston Properties Inc. (BXP), Salesforce.com (CRM), Vornado Realty Trust (VNO), Parkway Properties Inc. (PKY), Essex Property Trust Inc. (ESS), Kimco Realty Corporation (KIM), Developers Diversified Realty (DDR), Simon Property Group Inc. (SPG) and many more.

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

TWST: How are the real estate market fundamentals faring? Anything new in that regard?

Mr. Goldfarb: Real estate continues to do well. Office is one sector where you are seeing fundamentals accelerating, and that's typical; it's a late-cycle play. That's what we expected toward the end of last year, and that's been playing out.

The apartments have certainly benefited this year as finally people have realized that they are not going to be overwhelmed by supply, and that not everyone was going to move out to buy or rent homes. So you see the apartments really lead the REITs this year.

And the supply picture, which is always a concern - let's face it, real estate folks are pretty good at overbuilding - it looks pretty much in control this time. Even in multifamily, where you are seeing the most amount of supply, D.C. is really the only market where you have the confluence of weak jobs with too much building. If you look at Seattle or Houston or Austin or Northern California, as long as job growth remains, those markets will be fine, they should be able to power through it.

Banks are still demanding on the financing front, so they still want developers to put in 25%, 30% equity. Land costs are elevated, construction costs are elevated. Even in apartments, if you look at wood frames for just your generic garden-style apartment or any apartment that involves 2x4s, that's gotten very expensive. So there are some natural limiters.

If you look at multifamily over time, you'd have to go back to either the early 1970s, when the Baby Boomers hit the work force, or the mid-1980s, when people just built real estate for tax losses, to see multifamily starts well into the 500,000, 600,000 range. If you look today, it hit 400,000. Starts have bounced around over the past 20 years, but even during the condo boom they always basically remained a long trend line - 263,000 is the 20-year multifamily starts average...

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.