REITs the preferred option in uncertain investment market.

In a world where stock market growth can be slow or uncertain, two real estate investment trust specialists explained why REITs are the better investment at a recent B'nai B'rith luncheon at the Cornell Club on 44th Street.

Gerard Nocera, executive vice president and director of real estate at S.L. Green Realty Corp., said his best commercial REIT investments are near public transportation.

In an effort to recycle and upgrade its portfolio, S.L. Green recently has sold properties such as 469 Seventh Ave. and 1370 Broadway.

The company also has procured a contract on 321 W. 44th St., all a significant distance from Grand Central Station and Penn Station--major public transportation to the suburbs.

These buildings are called "recycled deals" and are part of S.L. Green upgrading its portfolio.

Meanwhile, Nocera added, REITs are outperforming the S&P 500 by growing almost seven percent to two percent.

"You get constant growth," he said, adding in the dividend factor.

Not to mention diversity. In addition to commercial REITs and residential REITs, one can invest in specialty REITS, too, including hospitals and even prisons. Although S.L. Green was one of the bidders for the General Motors building, sold earlier this year, the company is not a bidding specialist, Nocera said. "Where we are most successful is in sourcing deals before they hit the market."

This is accomplished by sticking exclusively to New York and knowing one's marketplace, Nocera said.

While Nocera deals mainly with commercial REITS, Dan Margulies, a new senior vice president at Malone and Co., recently joined a company that is the exclusive representative for AIMCO, a $14-billion apartment REIT listed on the New York Stock Exchange. AIMCO owns 380,000 apartments nationwide.

Margulies also recommended investing in REITs because they are exempt from corporate taxes, as long as at least 90% of investments are returned to shareholders.

While Manhattan apartments have maintained a 95 percent occupancy rate, they are not recession-proof, Margulies said.

In fact AIMCO is buying older rent-regulated buildings in the city.

"Some of the highest prices being paid lately are not warranted," Margulies said, reccomending investors place their focus on cap rates and value income over cash-out refinancing.