September 2024 Returns and Asset Performance
October 2, 2024
The MasterClass on Real Estate Investment Trusts (REITs) was taught October 7, 2024 at the Magrath Library, UofM St. Paul campus. The focus on REITs is part of an ongoing series of classes on retirement planning that looks at the building blocks for income generation.
For example, a REIT is a company that owns and operates income generating properties such as physical real estate assets and mortgage debt. REITs allow individuals to invest in large-scale, income producing real estate without direct management responsibility. The class material covers the structure, the benefits, and the drawbacks of REIT investing, the types available, as well as sector opportunities.
REIT investing requires care with respect to valuation. The class covered 4 valuation models unique to real estate. Opportunity screening then applied the valuation models, as well as 40 income statement and balance sheet metrics. The aim was to define a systematic and repeatable process for real estate investment analysis.
Course highlights include:
- Overview of real estate markets, REIT types, and market sectors
- REITs: purpose and structuring alternatives
- The role of real estate in a portfolio and different investment strategies
- Fundamental features of real estate and pricing
- Understanding property-related income statements and balance sheets
- Comparing yields on structured real estate transactions
- Market exercise: opportunity screening
- Understanding the risk of real estate investment trusts
- Risk management strategies
You can download the slides here. You can also learn more about real estate trusts here.
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