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REIT
Smith Group manages a diversified portfolio
of publicly traded Real Estate Investment
Trusts (REITs) for clients who want
income and long-term moderate price
appreciation. A REIT is a publicly
traded corporation dedicated to owning
and managing commercial rental property
such as apartments, office buildings
and shopping centers. Shareholders
benefit from a REIT’s legal requirement
to distribute 90% of its taxable
income — rental paid on commercial
real estate — as dividends. Clients
can easily diversify their personal
portfolios by holding REITs because
they have a low correlation to bonds
and equities. REITs also offer investors
liquidity in the real estate arena.
When we consider investing in a REIT, we focus on income yield, quality and stability, and business fundamentals. We screen the REIT universe for dividend stability, senior debt rating and price stability, eliminating those companies with undesirable current yields. Our team creates a diversified portfolio of premier, high-yield REITs that we expect will have positive funds from operations (FFO) growth.
The portfolio holds 30 REIT securities, diversified by geography and property type. Securities are equally weighted with a 4% maximum exposure.
- Property-type exposures maintained at 50% to 200% of the National Association of Real Estate Investment Trusts (NAREIT) Index property classification weightings
- Inception: July 1, 2001
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