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The Essential REIT:
No Pain, No Gain.

Chalk it up to human nature. Or, perhaps, a failure of imagination. Or even laziness. We humans share a natural tendency to think that what's happening now, or in the recent past, will continue forever. Do you remember when Japan Inc. was killing off all the competition, and everyone was convinced that it would soon dominate the world? Alas! – it fell into a deep hole from which it's just now emerging. The USSR, beginning from the end of WW2, was regarded as a mortal danger to the US – until it collapsed virtually overnight. SUVs and light trucks, comprising 50% of the US auto market, were Kings of the Road – until gasoline crossed the $4 barrier.

In the investment world, few predicted that those investment darlings of a decade ago – the Internet rocket-ships – would enter into a tailspin that would make even the Blue Angels envious; those urging caution were roundly booed and/or ignored. More recently, only a few lonely curmudgeons predicted that housing prices would decline, and even Professor Robert Shiller himself expected only a slow and modest annual deflation. The violence of the housing market decline has surprised even Mr. Shiller. In our bailiwick, real estate cap rates were, and always would be, 8% — until they abruptly cratered, in some cases to even below 4%.

Today we've got big problems here in the US, which are causing consumer anguish, businessmen's worries and investor panic. Year to date, through July 15, the NAREIT Equity REIT total return index had fallen 10.3%, while the S&P 500 index was in the red by 16.3%. Banks, even those with ample capital, have been seeing their stocks priced as though they were just a few weeks away from the bankruptcy window at the Federal courthouse. And we are not alone; foreign stock markets have been performing even worse. Of course, we all expect these problems to continue forever, and we make investment decisions accordingly…

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Rolling REIT Correlations

Note: Effective June 16, 2008, REITcafe has replaced the MSCI REIT Index with the GPR 250 REIT Index in calculating the correlation between REITs and the broader market indices. This change will provide a better measure of the correlation of global REITs to the broad market indices.

Correlations – Past Twelve Months

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Correlations – Long Term History

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REITtalk

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Episode 146
"Lexington Realty Trust"

Recorded: August 13, 2008

Guest:
T. Wilson Eglin
President, CEO & COO
Lexington Realty Trust (NYSE: LXP)

Topic:
Will Eglin, president, CEO and COO of Lexington, joins host Anatole Pevnev to discuss his company's strategy and the impact of debt market problems.

Topics discussed include:

• How is dislocation in the debt markets affecting tenant demand for space?
• How has LXP's access to capital been affected by the pull-back in the debt markets?
• How has LXP's weighted cost of capital changed in the past year?
• How much have cap rates moved this year?
• How has the current state of the markets impacted deal flow at LXP?
• What opportunities does today's marketplace present?

Program Length: 26:51 minutes

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REITtalk Transcripts available on Pods In Print.

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Inside the Cafe

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Sometimes, Volatility Can Be Good…

Jan. 24 – An incredible (and record) one day gain of 8.81% in the MSCI REIT Index has pushed the REITcafe Volatility Index (RVI) to a new record high of 426.11. This represents a one-day jump in the RVI of nearly 130 points. The RVI had moderated in recent weeks as the REITs followed the broader markets into a steady decline to open the New Year. By the end of trading this past Friday (January 18th), the MSCI REIT Index had already registered a decline of 10.69% for 2008. After the close of trading yesterday (January 23rd), only two trading days later, the MSCI REIT Index is actually up 0.45% for 2008. As can be seen on the "Relative Volatility" graph below, REITs have been consistently more volatile over the past twelve months than either the Dow Jones Industrial Index, NASDAQ Composite Index, or the S&P 500 Index.

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REITtalk Transcripts Now Available

Transcripts of REITtalk will now be available on Pods In Print (www.podsinprint.com). Pods In Print is a new website providing transcripts of podcasts from numerous websites. The transcripts are available through a monthly or annual subscription ($12.95 per month/$120 per year). The first transcript of REITtalk to be made available is Episode 109: "Capital Flows Update Q2 2007". For anyone interested in trying Pods In Print, a 14-day free trial is available.

The REIT Report®

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Episode 10
"2007 Executive Compensation Survey Results"

Recorded: August 21, 2007

Hosts:
Anatole Pevnev, REITcafe.com
Matt Bechard, NAREIT

Guests:
Kevin Christenson
Senior Managing Director & CEO
FPL Associates L.P.
and
Jeremy Banoff
Senior Director
FPL Associates

Topic:
With the steady decline in REIT share prices this year executive compensation will no doubt be a hot topic as we approach the end of 2007. Kevin Christenson and Jeremy Banoff join Matt Bechard and Anatole Pevnev to discuss the results of this year's executive compensation survey

Topics discussed include:

• What was the focus of this year's study?
• What were the more interesting findings from the survey?
• What are the more significant changes in compensation practice?
• How will the sharp declines in REIT valuations affect compensation in the coming year?
• What changes are we seeing in the board room?
• How do the REITs stack up to other public companies in terms of compensation policy?
• What policy changes can we expect to see in the coming year?

Program Length: 29:26 minutes

To order a copy of the study click here.

The REIT Report® is the exclusive registered trademark of the National Association of Real Estate Investment Trusts.

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REITcafe Volatility Index Goes Global

Note: Effective June 16, 2008, REITcafe has replaced the MSCI REIT Index with the GPR 250 REIT Index as the base index used to calculate the REITcafe Volatility Index (RVI). This change allows the RVI to better reflect the ever expanding global nature of REIT investment.

The index begins with the standard deviation of daily changes in the GPR 250 REIT Index over the previous four weeks on a rolling basis. The baseline (Baseline=100) for the index is the average of standard deviations of daily changes in the GPR 250 Index between January 1, 2001 and December 31, 2005. This means that an index value of 100 represents the average volatility between January 1, 2001 and December 31, 2005.

Recent REIT Volatility Levels

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REIT Volatility – Past Twelve Months

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REIT Volatility – Broad Market Comparables

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Ten Most Popular Podcast Downloads
Week Ending: Sunday, August 17, 2008

1. REITtalk: Home Properties
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2. REITtalk: Pepper Hamilton
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3. REITtalk: Advantus Capital Management
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4. REITtalk: Ashford Hospitality Trust
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5. REITtalk: Inland Real Estate
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6. REITtalk: The Hotel Market Forecast
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7. REITtalk: Washington Real Estate Investment Trust
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8. REITtalk: RFID Lessons Learned
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9. REITtalk: American Campus Communities
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10. REITtalk: Outlook 2007 - Jay Leupp
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REITnews:
REIT News Updated Throughout The Day

Visit REITcafe's REITnews page now to see the latest REIT and real estate news. Our news feeds from PRNewswire, Business Wire, Market Wire, and American City Business Journals are updated every five minutes, giving you the latest in industry and company news throughout the day.

If getting the latest REIT news is important to you, just make REITnews your home page and everytime you turn on your computer you'll have the latest news at your fingertips. So visit the REITnews page now, and see what's happening in your world.

Goto REITnews Page

REITcalls:
Searchable REIT Earnings Conference Call Podcasts on REITcafe

Click here to subscribe to REITcalls through iTunes.

REITcalls provides visitors to REITcafe with podcast versions of individual company quarterly earnings conference calls. So if you can't make the call, or simply prefer to listen to the call at your own convenience, check out REITcalls.

With REITcalls you can listen to REIT earnings conference calls on your computer, or on your MP3 player, at home, the office, the gym, on your way to work, or on that long flight. You can view a complete list of the companies whose conference call are available on REITcalls on the REITcalls page.

Full Text Search Tool
Maybe you're interested in finding out what the REITs have to say about "cap rates" or "operating expenses". With the PodZinger toolbar on REITcalls you can do full text searches of the audio of the conference call. So visit REITcalls and find out why podcasts are a great way to listen to conference calls

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"Around The Block"

Ralph Block on REITs and Investing

URL: www.REITcafe.com/block

Ralph Block, respected author and investor, shares his unique perspective on REITs, investments, and the economy at large.

Visit Ralph's blog today and see what he has to say about the news and issues impacting REITs and REIT investors. Whether you agree with his views or not, you can always count on Ralph to provide an interesting take on the markets.

REITcafe Goes Mobile

For those of you that want to stay on top of the REIT industry when you're away from your computer, REITcafe has gone mobile. You can now now get the latest REIT news right on your Blackberry, Treo, or any other mobile internet device. Just go to www.REITcafe.com/mobile and the latest in REIT news will be immediately available right on your mobile device.

If knowing what is happening in the REIT industry is important to you or your business, don't let another day go by without REITcafe Mobile.