As from April 2013 my Journey in Investing is to create Retirement Income for Life till 85 years old in 2041 for two persons over market cycles of Bull and Bear.

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"The market is not your mother. It consists of tough men and women who look for ways to take money away from you instead of pouring milk into your mouth." - Dr. Alexander Elder

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Saturday, 23 October 2010

Property Developers and their REITs

Growth and Income

Most big property developers have their own REITs. Why? May be they can see clearly the differences between growth and income.  Property developers are more willing to take higher risks for higher rate of returns so they themselves go for growth and pass the incomes to their REITs.

So when they see higher rate of returns are not possible in the future they will dump these assets into their REITs to recover as much capital as possible and to re-cycle these capitals back to higher risks higher returns projects.

Get it? By the same principles, do you still think that REITs can acquire under-valued assets?

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