- The Washington Times - Thursday, September 9, 2004

It’s been a great summer for anyone who’s invested in real estate stocks. Shares of most prominent real estate investment trusts, or REITs, have climbed an average of 20 percent in the past three months, as investors have turned to stocks they perceive as stable.

“Although the U.S. economy is exhibiting signs of a slowdown, investors continue to bid up REIT stocks while the broader market continues to languish,” said Merrill Lynch analyst Steve Sakwa. “What is interesting about the REIT rally is that it is occurring regardless of economic news, which is akin to ‘heads I win, tails I win.’”

REITs are usually companies that buy office, retail and industrial buildings and earn money off of their leases with tenants. Most REITs are permitted to pay out the majority of their income in the form of dividends, rather than pay income taxes. As a result, they pay some of the highest dividends on the market and are very popular when other investments aren’t producing big returns.

Since June 1, the Standard & Poor’s 500 Index has fallen about 1 percent. But the Morgan Stanley REIT Index, which tracks the performance of most major REITs, has risen more than 12 percent during the same period.

Washington-area REITs have been among the best performers of the whole group.

Shares of Federal Realty Investment Trust, a Rockville REIT specializing in shopping centers, have risen more than $5, or 14 percent, since June 1.

Office REIT CarrAmerica, based in the District, have climbed $4, or more than 13 percent, during the same period.

Library cleanup

Employees from Cleveland developer Forest City Enterprises today will clean up and improve the landscaping at the Southwest branch of the D.C. Public Library, as part of a companywide community service day.

Workers are expected to weed and plant flowers and shrubbery at the library and will donate school supplies.

Similar community service projects will take place in 21 other cities.

Forest City has become one of the District’s most prominent real estate companies since being selected to redevelop the Southeast Federal Center last year. The firm was also a finalist to redevelop the site of the old convention center.

In other news

• ING Clarion Partners, an Australian financial services firm, bought the 252,600-square-foot Mitretek headquarters building in Falls Church as part of a deal involving three buildings owned by Dallas developer Hines.

ING paid $186 million for the Mitretek building, plus a 215,000-square-foot office building in Dallas and a 218,000-square-foot property in Houston.

• Northrop Grumman Corp. signed a lease to fill 2691 Technology Drive in Annapolis, a 104,000-square-foot building under construction in the National Business Park.

Corporate Office Properties Trust (COPT) owns the park, which consists of 12 buildings with 1.3 million square feet. COPT has plans to add 1.5 million square feet.

• Last week’s Property Lines column incorrectly identified the location of the Fried Companies’ Metro Park office complex. The complex is located in Springfield.

Property Lines runs Fridays. Tim Lemke can be reached at 202/636-4836 or [email protected]

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