Ed Walter, president and CEO of Host Hotels & Resorts (NYSE: HST), joined REIT.com for a video interview at REITWorld 2012: NAREIT’s Annual Convention at the Manchester Grand Hyatt in San Diego.
Walter was installed as NAREIT chair at the convention. He offered his thoughts on the current state of the listed real estate market.
“I think we’re in great shape as an industry. After the tremendous downturn in 2008 and 2009, as an industry, we’ve restored our balance sheets. Now, when we’re issuing equity, we’re not doing it to improve a balance sheet, we’re doing because there are attractive acquisition candidates out there,” Walter said. “Across the board, the fundamentals in our industry all look good. I think as companies and as an industry, we’re very well-positioned for success.”
When asked about his top priority as NAREIT chair, Walter cited education and communication for both investors and policymakers.
“We have a tremendous story to tell. We were really almost a bedrock for the real estate industry in the recent downturn. It’s one of the reasons why we navigated through that so successfully,” he said. “But it’s not just about safety. It’s also about the fact that as an industry, our research demonstrates that we’ve had great returns. We’ve outperformed other asset classes. When I think about what is most important for us over 2013 and really beyond, it’s communicating that story.”
Walter discussed the state of the lodging sector of the REIT industry.
“The lodging industry is in good shape right now. We probably got hit harder than most of the real estate investment classes in the downturn because of the nature of our industry, but the reality is that the fundamentals in our sector are tremendous right now,” he said. “We’re back to roughly peak occupancy, so we’ve restored the occupancy that we’ve lost in the downturn. Supply is going to be incredibly low for the next couple of years. What that creates is the opportunity for very strong rate growth, which will translate into very strong bottom line growth.”