Amos Rogers, managing director with The Tuckerman Group, spoke with REIT.com for a video interview at REITWorld 2012: NAREIT’s Annual Convention for All Things REIT at the Manchester Grand Hyatt in San Diego.
The Tuckerman Group manages more than $8.9 billion in real estate assets. It is headquartered in New York with offices located in Boston and Chicago. It is a member of State Street Global Alliance LLC, a joint-owned arm of State Street Corp. and the Dutch pension fund ABP.
Rogers said the REITs have held up well in the current market against private forms of real estate investment.
“The stocks have done well. They represent the asset class very well. They are accepted in the broader equity community,” he said, adding that diversification, liquidity and income in this environment all bode well for REITs.
Target date funds and asset allocation products have taken notice of REITs, according to Rogers. He said that the REIT model gives those investors convenient access to real estate, which is more difficult to obtain in the private market.
Plan sponsors are hoping to build transparency, liquidity and income into their plans, he said. However, he explained that current REIT allocations in retirement plans are just “adequate” and could be higher.
“It’s always difficult for some of these plans to make dedicated sleeves to all of the various asset classes. There are too many options and too many components,” Rogers said. “But when REITs can be combined in target date funds as part of a glide path, it provides that diversification, but it also allows REITs to be built into a more comprehensive plan.”
In looking ahead to 2013, Rogers said he anticipates that the big story for REITs will be similar to 2012.
“REITs have held up again, despite the macro-economic environment. I think it’s going to be that investors continue to value the income and I think the underlying fundamentals in these stocks are going to support growth into the next year,” he said.