Real estate tops ISS industry governance rankings.Investors eyeing the impressive returns of REIT REIT
See: Real Estate Investment Trust
See real estate investment trust (REIT). stocks may not also realize that a fifth consecutive year of strong performance coincides with data showing that real estate industry corporate governance Corporate Governance
The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. is now second to none.
Through Sept. 15, the NAREIT NAREIT National Association of Real Estate Investment Trusts Equity REIT Index posted a year-to-date total return of 12.6 percent. The impressive performance of real estate stocks coincides with data provided by Institutional Shareholder Services (ISS ISS
See Institutional Shareholder Services (ISS). ) which show that real estate had the best average corporate governance ranking of any U.S. industry as of Sept. 15, as measured by ISS' Corporate Governance Quotient (CGQ CGQ Corporate Governance Quotient ) database.
ISS is the world's leading provider of proxy voting and corporate governance services. CGQ is a ranking system designed to assist institutional investors in evaluating the quality of corporate boards and the impact its governance practices may have on performance.
"REITs are providing good governance along with good returns," according to NAREIT President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Steven A. Wechsler.
"Investors increasingly are interested in building dividends and diversification into their portfolios through the inclusion of real estate stocks.
"Now they can do so in the knowledge that the industry's governance is as good as, if not better than, that of the rest of corporate America."
REIT stocks have posted a cumulative total return of 134 percent since the beginning of 2000, well ahead of other major market benchmarks.
In fact, the NAREIT Equity REIT Index has outpaced the Dow Jones Industrial Average Dow Jones Industrial Average
The best known U.S. index of stocks. A price-weighted average of 30 actively traded blue-chip stocks, primarily industrials including stocks that trade on the New York Stock Exchange. , S&P 500, Russell 2000 and Nasdaq Composite for most time periods over the course of three decades.
In a column written for the July/August edition of Real Estate Portfolio magazine, ISS analysts noted that, "Research has established that companies with a higher degree of board independence, especially in conjunction with a certain level of stock ownership, are more likely to outperform their peers."
The National Association of Real Estate Investment Trustsa (NAREIT) is the trade association for REITs and publicly traded real estate companies.
Members are real estate investment trusts (REITs) and other businesses that own, operate and finance income-producing real estate, as well as those firms and individuals who advise, study and service those businesses.
Visit their web site at www.nareit.com