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Strategies & Market Trends : Rande Is . . . HOME -- Ignore unavailable to you. Want to Upgrade?

To: Rande Is who wrote (6139)	5/3/1999 7:41:00 AM
From: Paullie	Read Replies (1) \| Respond to of 57584

Great - I await anxiously to see the summer long portfolio, and eventually someday to hear about that proprietary formula! paullie

To: Rande Is who wrote (6139)	5/3/1999 8:22:00 AM
From: Rande Is	Respond to of 57584

2 week old article worth a closer look today. . . could there be a Buffetmania starting? - - - - - - - - - - Warren Buffett REIT Investments Help Spark REIT Rally Dow Jones Newswires April 21, 1999 By Janet Morrissey NEW YORK -- Another foray into the real estate investment trust world by financier Warren Buffett as well as an investor shift into cyclical and value stocks appear to be sparking a long-awaited rally among REITs, market watchers said. REITs rose about 8% last week and another 2% Monday, according to Michael Grupe, vice president of the National Association of Real Estate Investment Trusts. The group outperformed the S&P 500, which slipped 2.2% last week and another 2.2% Monday, Grupe said. "We've been waiting for about a year for this," said NationsBanc Montgomery Securities Inc. analyst Will Marks. And a long year it has been for REIT investors. Although there were brief rallies in September and November, the recovery was never sustained, and REIT prices wound up plummeting 25% in 1998. Total returns, which include the dividend, were negative 18%. Analysts speculate that Buffett, the chairman of holding company Berkshire Hathaway Inc. (BRKA), may have been one of the catalysts in the current rally. The billionaire investor recently acquired stakes in MGI Properties (MGI), Tanger Factory Outlet Centers Inc. (SKT), and - late last week - a 5.1% interest in Town & Country Trust (TCT). "When Buffett invested (in REITs), it may have reminded people that there's this sector called REITs that are pretty cheap now," said Marks. Morgan Stanley analyst Steven Bloom concurred. "Sometimes it takes a major investor to step up" to make other investors take notice, he said. "Some were circling the (REIT) group and recognized the value but were waiting for the catalyst that would drive the stocks up." Bloom noted that a number of private investors have come forward in recent months to acquire MGI Properties, Berkshire Realty Co. (BRI) and Irvine Apartment Communities Inc. (IAC), indicating the value in the depressed REIT prices. "It shows the sharp mispricing between public and private" real estate markets, agreed NAREIT's Grupe. "And Buffett might have served as a wake-up call to investors that the train is about to leave the station." He added that he's noticed a significant shift in investor interest over the past six weeks during his weekly investor conference calls. "The level of interest has been picking up. Our question-and-answer part of the conference calls used to last about a half hour, but now we have to cut them off after 75 minutes," he said. Merrill Lynch & Co. analyst Eric Hemel believes Buffett is only one of several catalysts spurring the REIT rally. An even greater driver, he said, is the rotation out of high growth technology stocks in favor of value and cyclical stocks. Also, smaller cap companies are now outperforming large cap companies.<<