Listed Property Trusts Experience Comeback

After a period of shocking results, property securities are doing well again. In 2008, listed property trusts (AREITs) fell an average of 55.3 per cent, which was one of the worst results for an asset class ever. But the sector’s turnaround in the year to June is now encouraging those interested in property investment to take another look. According to Bianca Rose, Property Portfolio Manager at Ibbotson, AREIT managers have achieved a significant transformation during the past four years. She says they got into trouble previously for four main reasons: they took on too much debt, they moved into new areas like property development, they started buying assets in overseas markets and they paid out unsustainably high distributions, often funded with debt. Ms Rose believes the AREIT sector no longer exhibits the same risky characteristics as before and considers it likely to be one of the most attractive growth asset classes over the next five years.

Source:https://www.smh.com.au/money/investing/turnaround-rebuilds-trust-20120828-24xpo.html