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September 24, 2012
Message from the President
 A number of REIT industry observers, including the dean of REIT analysts, investors and writers, Ralph Block, have noted the spike in REIT preferred share offerings this year.
The market has responded positively to REIT preferred shares. Through just the first eight months of this year, publicly traded REITs have raised $8.2 billion in preferred share offerings. To provide perspective, that amount is twice the $4.1 billion raised in all of last year and significantly greater than the $6.9 billion raised in the industry's record year for preferred share offerings of 1998.
The investor demand for REIT preferreds this year is impressive, but it should be viewed in the broader context of market demand for REIT equities generally. Last year was the industry's record year for equity offerings; a total of $37.5 billion was raised. This year through August the amount raised had already reached $32.5 billion.
Right now, the central appeal of REIT preferred shares and REIT equity in general is essentially the same: In a financial environment in which 10-year U.S. Treasury notes at August 31 were yielding 1.57 percent and the dividend yield of the S&P 500 was 2.2 percent, the FTSE NAREIT All REITs Index was yielding 4.2 percent. Equity REITs were yielding 3.3 percent.
Along with the REIT dividend, investors also were seeking potential portfolio diversification, a possible hedge against inflation as the Federal Reserve begins its launch of QE3, and taking note of a record of total return performance that has outdistanced the S&P 500 over the past 1-, 3-, 5-, 10-, 15-, 20-, 25-, 30-, 35- and 40-year periods.
Steven A. Wechsler
President and CEO
Leadership Awards Nominations Now Open
 NAREIT is seeking nominations for its Leadership Awards. The Industry Leadership Award is presented traditionally to a REIT executive and the REIT Industry Achievement Award is presented to an individual member. A list of previous award recipients is available on REIT.com.
Guidelines for consideration of candidates for both awards are the following:
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Individuals should have a distinguished reputation within the business community at large;
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Individuals should have length and depth of service, both in the REIT and publicly traded real estate industry and as members of NAREIT;
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Individuals should be actively involved in community service;
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Individuals should have written and/or spoken on key industry issues; and,
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Individuals should have contributed to increasing understanding of REITs and publicly traded real estate by the public.
Both awards will be presented to the recipients during REITWorld 2012: NAREIT's Annual Convention for All Things REIT to be held Nov. 13-15 in San Diego.
Please forward the names of awards candidates with supporting information for consideration via mail to NAREIT, Attention: Laura Hawxhurst, 1875 I Street, NW, Suite 600, Washington, DC, 20006-5413; via fax at (202) 739-9405; or via email to lhawxhurst@nareit.com.
The deadline for receipt of nominations is Thursday, Oct. 4, 2012.
(Contact: Laura Hawxhurst at lhawxhurst@nareit.com)
NAREIT Welcomes Two New Members
 NAREIT welcomes EDENS and AmREIT as its newest corporate members. Privately held EDENS develops, owns and operates neighborhood shopping centers in primary markets throughout the east coast. Focusing on innovative development and redevelopment together with key acquisitions in urban areas, the company has built an institutional-quality portfolio of 130 retail centers. Based in Columbia, S.C., the company's chairman is Joe Edens, Jr., and its CEO is Terry Brown.
 AmREIT, Inc. (NYSE: AMRE) has one of the highest quality grocery and drugstore anchored retail portfolios in the REIT sector. AmREIT's 28-year-old platform has localized acquisition, operation and redevelopment expertise in the most densely populated and affluent submarkets of five of the top markets in the U.S. (Houston, Dallas, San Antonio, Austin and Atlanta). Based in Houston, the company's chairman, CEO and president is Kerr Taylor.
(Contact: Bonnie Gottlieb at bgottlieb@nareit.com)
REIT.com Video: Jeremy Banoff, FPL Associates
 More than 100 companies participated in the 2012 NAREIT Compensation Survey, marking the sixth consecutive year of record participation, according to Jeremy Banoff, senior managing director with FPL Associates, which conducted the survey.
"It's very robust. We have a lot of questions on benefits this year. We do that every other year," Banoff said in an interview with REIT.com at NAREIT's headquarters in Washington.
Additionally, the survey includes questions on the structure of compensation programs. There was significant discussion surrounding "say on pay," a term used for a rule in which a firm's shareholders have the right to vote on the compensation of executives.
"REITs have actually performed quite well in terms of 'say on pay,"' Banoff said.
He added that while there were a handful of REITs that didn't perform well on that particular issue, companies are putting a lot more thought into the process.
"So, I think that's causing a lot of companies in the boardroom to spend a lot more time dealing with compensation issues, thinking about performance, year over year, and really being thoughtful in terms of was it a good year or was it a not so good year, how is our performance on an absolute basis, how is our performance on a relative basis compared to others and really putting it into context," he said.
FPL also recently completed its 10th annual propriety analysis of compensation at REITs and had some interesting findings, particularly with respect to pay-for-performance. Nearly half of the top 100 REITs used for the analysis have some form of a multi-year program, according to Banoff. This implies that companies aren't just looking at performance on a year-to-year basis, but are interested in sustaining that performance, typically over a three-year time period, he explained.
In terms of what's happening in corporate boardrooms, Banoff pointed to the fact that companies are paying a lot more attention to strategies.
"Strategies are being evaluated, particularly since the downturn. So, they are looking at what are the right motivational metrics for what are we trying to accomplish going forward," he said.
(Contact: Matt Bechard at mbechard@nareit.com)
PIMCO Paper Outlines the "Great REIT Revival"
 The performance of REITs since the collapse of the financial markets in the late 2000s "has been nothing short of remarkable," write PIMCO's Jose Olazabal and Amit Arora in a paper assessing a period they dub the "Great REIT Revival."
In the paper, Olazabal and Arora praise what they term the "REIT model." The features of the model include a preference for high-quality assets, long-term leases and their debt covenants. The debt covenant aspect, in particular, helps hold down REITs' debt-to-market value ratios, they say.
"PIMCO continues to view the REIT model favorably especially property-owning REITs that issue unsecured debt," write Olazabal, a vice president with the firm, and Arora, a senior vice president.
(Contact: Michael Grupe at mgrupe@nareit.com)
Register Today for the HR Forum
The sixth-annual HR Forum, facilitated by NAREIT exclusively for its corporate members' senior human resources executives, will be held Oct. 15-16 at The Ritz-Carlton Tysons Corner in McLean, Va. The HR Forum is the only conference of its kind that presents a high-quality, broad-based educational program focused on a variety of human resources issues within the context of commercial real estate. In addition, the HR Forum provides its attendees with numerous opportunities to network and discuss best practices with senior HR executives from around the country.
You can register online today for this important event. Program directors for this year's event are Holly Edington with Corporate Office Properties Trust (NYSE: OFC), Nancy Hemmenway with Prologis (NYSE: PLD) and Larry Krema with Simon Property Group (NYSE: SPG).
(Contact: Megan Peichel at mpeichel@nareit.com)
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