Health Care REITs
Health care REITs build, acquire and lease specialty buildings such a hospitals, nursing homes, medical buildings and assisted-living facilities. This REIT sector is fairly immune to recession, although they are largely dependent upon the financial health of the lessee which, in turn, rely on the medical reimbursements provided by the U.S. Government. Federal changing in health policy would obviously have a significant affect on health care REITs.
Example of Health Care REIT - Health Care REIT, Inc.
“Health Care REIT, Inc. is an equity real estate investment trust (RIET) that invests in healthcare facilities, primarily skilled nursing and assisted living facilities in the United States. The Company also invests in specialty care facilities. During the year ended December 31, 2003, the Company had investments in 328 facilities located in 33 states and managed by 47 different operators. The portfolio included 219 assisted living facilities, 101 skilled nursing facilities and eight specialty care facilities. In October 2003, the Company sold its investment in Atlantic Healthcare Finance L.P.” – Reuter’s Business Summary
Self Storage REITs
The self storage REIT sector is somewhat recession resistant. More surprisingly is the fact that corporate customers make up a significant portion of storage rentals. Barriers of entry are significantly lower than other types of REITs due to the smaller amount of capital necessary to construct a storage facility.
Example of Self Storage REIT - Sovran Self Storage, Inc
“Sovran Self Storage, Inc. is a self-administered and self-managed real estate investment trust that acquires, owns and manages self-storage properties. As of March 1, 2004, it had 265 owned and/or managed self-storage properties consisting of approximately 15.5 million net rentable square feet, situated in 21 states in the eastern and midwestern United States, Arizona and Texas. Sovran Self Storage manages 11 of these properties for Locke Sovran I, LLC, an unconsolidated joint venture that is 45% owned by the Company. As of March 1, 2004, all but two of its properties conducted business under the trade name Uncle Bob's Self-Storage. The Company's self-storage facilities offer inexpensive, easily accessible, enclosed storage space to residential and commercial users on a month-to-month basis. All properties have a property manager on-site during business hours. Customers have access to their storage areas during business hours, and some commercial customers are provided 24-hour access.” – Reuter’s Business Summary
Hotel and Resort REITs
In the world of real estate investing, the hotel and resort sector is the one most closely tied to the overall economy. When times are bad, people travel less for business and pleasure, cutting right to the heart of these company’s bottom-lines. As a result, investors in hotel REITs have to concern themselves not only with overbuilding, but the economic outlook of both the geographic area in which the hotel or resort is located, as well as that of the entire country as well.
Example of Hotel and Resort REIT – LaSalle Hotel Properties
“LaSalle Hotel Properties is a self-managed and self-administered real estate investment trust that buys, owns and leases primarily upscale and luxury full-service hotels located in convention, resort and major urban business markets. As of December 31, 2003, the Company owned interests in 17 hotels with approximately 5,600 rooms/suites located in 10 states and the District of Columbia. Independent hotel operators manage the hotels. Substantially all of the Company's assets are held by, and all of its operations are conducted through, LaSalle Hotel Operating Partnership, L.P. The Company is the sole general partner of the operating partnership with an approximate 98.3% ownership as of the fiscal year ended October 31, 2003. The remaining 1.7% is held by other limited partners.” – Reuter’s Business Summary
