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Strategies & Market Trends : Value Investing

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To: Spekulatius who wrote (45252)	11/1/2011 10:26:56 AM
From: E_K_S	Read Replies (2) of 78673

What would consider a fair value PE to pay for something like GOV that yields 7%? I would think they would be a better payer than other REIT companies that lease buildings to the public retail and/or office space sector. My portfolio has about 5% exposure to REITs. GOV and data centers are my biggest positions. finance.yahoo.com My biggest concern with all the REITs is their use of leverage LT debt financing and these positions are vulnerable to any type of credit lock up. This comes at the benefit of being good dividend payers, Most of the REITs I own have properties exclusively located in the U.S. but any issues in Europe would probably spill over to the U.S. debt markets. Good point regarding the reduction of USPS properties. I would think that the State & Federal government sector would be doing more lease back deals with somebody like GOV being the operator. Many of the Cities (ie San Francisco) are doing these lease back transactions to generate upfront cash to meet their immediate cash flow needs. Personally, I see it as just a short term solution and in the long run the City ends up paying more for their office space. EKS

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