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August 19, 2013
Message from the President
 A long-running issue that has created headaches for REITs’ financial teams and complicated investors’ efforts to assess REITs’ performance may be coming to a successful resolution. As the story below reports, NAREIT last week submitted a comment letter on the latest Financial Accounting Standards Board (FASB) exposure draft of a revised standard for reporting discontinued operations.
NAREIT’s efforts to achieve a more realistic standard for reporting discontinued operations have been ongoing since 2001 when we first advocated to the FASB that a discontinued operation should be defined not as the sale of a single property or group of properties, but as a real change in the company’s strategic direction.
Earlier this year, FASB released the proposed revised standard, which is consistent with NAREIT’s and REESA’s recommendations. In our letter to the FASB last week, we fully endorsed the proposed reporting and recommended that REITs should be allowed to choose early adoption of the standard when it is issued – hopefully this fall.
Persistence does pay, and we will continue to persist on this issue until the ball is across the goal line.
Steven A. Wechsler
President and CEO
NAREIT Comments on Reporting Discontinued Operations Standard
 NAREIT last week submitted comments to the Financial Accounting Standards Board (FASB) regarding a proposed update to the Reporting Discontinued Operations accounting standard.
NAREIT said it agrees with the board’s proposed definition of a discontinued operation. Additionally, NAREIT noted that it approves of the board’s decision to ultimately converge the reporting implications of its definition of a discontinued operation with the definition set forth in International Financial Reporting Standard 5, Non-current Assets Held for Sale and Discontinued Operations.
NAREIT’s comment letter was sent by George Yungmann, senior vice president for financial standards, and Chris Drula, vice president for financial standards, to Susan Cosper, technical director with the FASB.
Financial accounting standards require all public companies that discontinue a line of business to re-state financial reports for the prior three years, showing the company’s performance without the discontinued operation as a means of providing a fairer comparison with the company’s performance going forward. FASB’s definition of a discontinued operation, however, was so broad that, for REITs, it included the sale of individual properties. As a result, REITs have had to re-state their financial results going back three years every time they sold an asset in their portfolios. The standard has made REIT financial reports less rather than more useful for investors and securities analysts, who actually have to spend time adding the contributions of the sold properties back into their financial models for the companies.
The reform effort got a boost in 2007 when FASB and the International Accounting Standards Board (IASB) decided the standard should be changed as part of their strategy of converging U.S. and international accounting standards. In 2009, it appeared the matter was settled when FASB and IASB seemed to agree on NAREIT’s approach, which was supported by NAREIT's international partner organizations in the Real Estate Equity Securitization Alliance (REESA). However, in 2010, FASB put the project on hold pending the completion of other related work.
(Contact: George Yungmann at gyungmann@nareit.com)
Andre Dimitriadis, Founder of LTC Properties, Dies at 72
 Andre C. Dimitriadis, the commercial real estate industry veteran who founded health care REIT LTC Properties, Inc. (NYSE: LTC) more than 20 years ago, died last week at the age of 72.
After launching LTC Properties in 1992, Dimitriadis served as the company’s chairman and CEO until 2007. Dimitriadis transitioned in March 2007 to the position of executive chairman of the company’s board of directors.
Dimitriadis held the position of executive vice president and chief financial officer of Beverly Enterprises for the three years immediately prior to founding LTC Properties. Prior to that he served as executive vice president and chief financial officer of American Medical International from 1984 to 1989 and CFO of Western Airlines from 1982 to 1984.
“Andre’s vision of filling an unmet financing need in the long-term care industry over 20 years ago was realized in the birth of LTC,” said Wendy Simpson, the firm’s president, chairman and CEO, in a statement. “Andre was an incredible problem solver and had an amazing aptitude for analyzing complex financial structures. He worked tirelessly to meet the needs of LTC’s customers and create value for LTC’s shareholders.”
Dimitriadis held a bachelor’s degree in electrical engineering from Robert College, a master’s degree in computer science from Princeton University, and a master’s degree in finance and doctorate in economics from the New York University Stern School of Business.
(Contact: Ron Kuykendall at rkuykendall@nareit.com)
CMBS Delinquencies Continue Downward
 The number of commercial mortgage-backed securities (CMBS) delinquencies in the United States declined in July 2013 to the lowest level since the end of the recession, according to the latest monthly index data from Fitch Ratings.
Late payments from CMBS declined 40 basis points in July, going down to 6.78 percent from 7.18 percent in June. After peaking two years earlier at 9.01 percent in July 2011, the CMBS delinquency rate is currently 2.23 percentage points below that high.
Mary McNeill, managing director at Fitch Ratings noted that the numbers for July were primarily driven by one transaction involving Orix, a financial corporation. The Orix deal accounted for $759 million of dispositions. Delinquency rates for all major property types were down in July thanks to the Orix sales, according to the Fitch report.
Delinquencies on office loans, which have been underperforming recently, showed the most improvement in July. They fell nearly 60 basis points from the previous month.
(Contact: Carisa Chappell at cchappell@nareit.com)
NAREIT Podcast: Ted Rollins, Campus Crest Communities
 In the latest edition of the NAREIT Podcast, Ted Rollins, CEO, co-chairman and co-founder of Campus Crest Communities, Inc. (NYSE: CCG), discusses some of the latest news from his company and the student housing sector.
CLICK HERE to download the latest edition of the NAREIT Podcast. You can also subscribe to the podcast via iTunes.
(Contact: Allen Kenney at akenny@nareit.com)
REITs in the Community
Aug. 13, 2013: Sen. Tom Carper (D-DE), right, visited Tanger Outlets in Rehoboth Beach, Del. Carper toured the property, met with several store managers and greeted constituents. General manager Amy Norgate, left, briefed Carper on the economic impact of the property and described opportunities for its future. Norgate also thanked the Senator for his support of the Marketplace Fairness Act and the Real Estate Investment and Jobs Act.
(Contact: Kate Smith at ksmith@nareit.com)
Happy Birthday to Margaret Solaqua
Aug. 14, 2013: NAREIT celebrated the 75th birthday of Margaret Solaqua, director of office support, with a surprise party at NAREIT headquarters in Washington. Many who interact with NAREIT no doubt know Margaret and the valuable role that she plays in our organization. NAREIT is very happy to have her as part of our team and would like to send her our warmest birthday wishes.
(Contact: Steve Wechsler at swechsler@nareit.com)
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