ST : Reits a good choice

Dec 12, 2009
Reits a good choice
By Joyce Teo, Property Correspondent

IF YOU want to invest in property but cannot bear the idea of borrowing hundreds of thousands of dollars to buy that fancy condominium unit or going through the hassle of being a landlord, real estate investment trusts (Reits) might be worth considering.

Reit prices have risen this year, but they are still worth a look as they offer investors a relatively liquid way to gain exposure to property, and in various sectors and markets too.

Potential investors, however, have to do their homework and tread cautiously.

Reits have survived the credit market squeeze triggered by the subprime crisis.

MacarthurCook Industrial Reit, for instance, recently managed to get shareholders to approve its recapitalisation plan to save itself. It has huge debts due by the end of the year and would have had to be liquidated had the plan been rejected.

Its plan includes a rights issue which diluted its share price.