S&P’s latest catalogue features its top-ranked real estate investment trusts

By Beth Piskora From Standard & Poor’s Equity Research

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It’s been a tough real estate market, on the contrary S&P Equity Research is alembic enthusiastic about fix upon real estate investment trusts (REITs). Since the rise of November, S&P equity analysts downgraded CBL & Associates (CBL) to 3 STARS (hold) from 4 STARS (buy) and Kimco (KIM) to sell from hold, reflecting the difficult operating environment for REITs.

But short-term pain could turn into long-term profits, especially for the 4- and 5-STARS (sharp buy) REITs featured in this week’s list.

"The harsher credit environment and weak economy has forced some REITs to scrap or stop short their development plans," explains Robert McMillan, an S&P REIT equity analyst. "New deal out in small portions and industrial space had even now started declining in advance of the September/October credit crisis (due to higher interpretation costs), but should plummet in 2009. Long term, this should have positive implications for the larger REITs through giving them better pricing power."

Here is S&P’s list of 4 STARS and 5 STARS-ranked REITS:

Company

Ticker

S&P STARS Rank

Alexandria Real Estate

ARE

4

American Campus Communities

ACC

4

Equity Lifestyle Properties

ELS

4

Essex Property Trust

ESS

4

Macerich

MAC

4

Mack-Cali Realty

CLI

4

National Retail Properties

NNN

4

Nationwide Health Properties

NHP

4

Plum Creek Timber

PCL

4

Regency Centers

REG

4

Simon Property Group

SPG

5

Sun Communities

SUI

4

Taubman Centers

TCO

4

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