Fidelity Portfolio Manager says REIT NAV Discount Generating Activity
12/07/2015 | by Sarah Borchersen-Keto

Steve Buller, portfolio manager at Fidelity Investments, joined REIT.com for a video interview at REITWorld 2015: NAREIT’s Annual Convention for All Things REIT at the Wynn Las Vegas.

Buller said 2015 has lived up to his initial expectations of being a year with a high level of transaction activity within the REIT industry.  A major reason behind that has been the fact that REITs have been trading at a discount to net asset value (NAV) throughout the year.

“We’ve seen companies and boards start to take advantage of that,” Buller said, as he pointed to the proliferation of spin-offs, asset sales, share buybacks and privatizations. Buller said he expects the trend to continue as long as the disconnect remains in place.

Meanwhile, Buller stressed that having a REIT structure does not automatically mean that a company is following the REIT approach to real estate.

“For a REIT to do things right, or to be a good REIT, you need good properties, good management team, and good capital allocation by those management teams,” he said.

Turning to interest rates, Buller expressed the hope that the Federal Reserve would move quickly so that the focus would shift to the more important fundamentals of the REIT sector.