REIT Industry Timeline: Celebrating 50 years of REITs and NAREIT

1960
REITs Are Created

Sept. 14, 1960 REITs are created when President Eisenhower signs into law the REIT Act title contained in the Cigar Excise Tax Extension of 1960. REITs were created by Congress in order to give all investors the opportunity to invest in large-scale, diversified portfolios of income-producing real estate.

CLICK HERE to watch a video with industry leaders discussing how REITs have changed the commercial real estate investment landscape.
CLICK HERE to visit the All About REITs section of REIT.com
NAREIT is Formed

Sept. 15, 1960 The National Association of Real Estate Investment Funds, NAREIT's predecessor, is incorporated. NAREIT, today, is the worldwide representative voice for REITs and publicly traded real estate companies with an interest in U.S. real estate and capital markets.

CLICK HERE to watch a video with some of NAREIT's chairs, past and present, discussing the association's importance.
CLICK HERE to visit the About NAREIT section of REIT.com.
Initial REITs Debut

1960-1961 The first REITs--Bradley Real Estate Investors, Continental Mortgage Investors, First Mortgage Investors, First Union Real Estate (now Winthrop Realty Trust, NYSE: FUR), Pennsylvania REIT (NYSE: PEI) and Washington REIT (NYSE: WRE)--are created. The latter three are still in existence today.

CLICK HERE to view a list of all publicly traded REITs.
CLICK HERE to visit Winthrop Realty Trust's website.
CLICK HERE to visit Pennsylvania REIT's website.
CLICK HERE to visit Washington REIT's website.
1965
First NYSE REIT

June 1965 Continental Mortgage Investors becomes the first REIT to be listed on the New York Stock Exchange.

CLICK HERE to watch a video with NYSE Euronext Director Ronald Bohlert talking about the benefits of REITs listing on public exchanges.
CLICK HERE to view a list of REITs listed on the NYSE.
1969
REIT Research Underway

August 1969 The first Wall Street research piece on REITs is published. The report is written by Michael Emmerman, an analyst at Arnhold and S. Bleichroeder Advisers, LLC at the behest of then-portfolio manager George Soros.

CLICK HERE to watch a video with Green Street Advisors chairman and co-founder Mike Kirby talk about the importance of research in the publicly traded REIT sector.
CLICK HERE to view a list of REIT analysts.
Mortgage REITs Fuel First REIT Expansion

1969-1974 The initial REIT expansion takes place as total industry assets increase from about $1 billion to more than $21 billion, primarily fueled by mortgage REITs engaged in land development and construction financing. REIT balance sheet leverage soars. This first high point ends when a severe recession begins after the 1973 oil embargo. Mortgage REITs are hit particularly hard and many companies enter bankruptcy proceedings, liquidate or are sold.

CLICK HERE to watch a video with William King, former partner with Goodwin Procter LLP, discussing the role mortgage REITs have played in the REIT industry.
REITs Around the World

1969 The first European REIT legislation is passed in The Netherlands. This marks the beginning of the global spread of the REIT model, with listed property trusts launching in Australia shortly after in 1971. Canadian REITs debut in 1993 but it isn't until the turn of the century that expansion takes off. REITs began to spread across Asia with the launch of Japanese REITs in 2001. REITs in Europe were buoyed by legislation in France (2003), Germany (2007) and the U.K. (2007). In total, about 40 countries now have REIT legislation.

CLICK HERE to watch a video with Goodwin Procter Partner Gil Menna discussing the global landscape for listed real estate.
CLICK HERE to read more about the global REIT market.
1970
REIT-Dedicated Publication Launches

March 1970 In another sign of the growth of the industry, Kenneth Campbell (currently a managing director with ING Clarion Real Estate Securities) launches Realty Trust Review as the first periodical devoted exclusively to public real estate securities. The publication exists today as an email newsletter called REITWrap .

CLICK HERE to listen to Kenneth Campbell, currently managing director with ING Clarion Real Estate Securities, talk about the publication's launch.
First Health Care REIT

First Health Care REIT
June 1970: Health Care Fund, founded by Bruce Thompson and Frederic Wolfe, becomes the first health care REIT. The company changed its name to Health Care REIT, Inc. (NYSE: HCN) in 1985.

CLICK HERE to visit Health Care REIT's website.
1972
NAREIT Unveils REIT Index

January 1972 NAREIT REIT Index debuts as the first REIT index available to investors for benchmarking the price and total return investment performance of REITs. The index originates the classification of Equity, Mortgage and Hybrid REITs.

CLICK HERE to watch a video with the author of "The Essential REIT," Ralph Block, discussing the importance of the launch of NAREIT's index and Chris Lucas, managing director and senior REIT analyst at Robert W. Baird & Co., discussing later enhancements to the index.
CLICK HERE for historical data on the NAREIT index.
1974
Foreclosure Property Rules Enacted

1974 First significant change to REIT tax rules. Congress enacts foreclosure property rules, which allow a REIT, after obtaining possession of a property after foreclosure proceedings or a default, to operate a property for 90 days and then to have it operated through an independent contractor.

CLICK HERE to visit the Federal Tax Legislation section on REIT.com.
1976
Tax Reform Act of 1976

November 1976 As part of the Tax Reform Act of 1976, President Ford signs into law the first package of REIT simplification amendments, most notably allowing REITs to be established as corporations in addition to business trusts.
1980
Competing For Capital

1980s During this time there is a proliferation of real estate tax-sheltered partnerships that raise billions of dollars in private placements. REITs find it hard to compete for capital since they were (and still are) structured so that tax losses cannot be "passed through" to REIT shareholders.

CLICK HERE to watch a video with Bill King, a former partner with Goodwin Procter, discussing the market landscape in the 1980s.
1985
Dedicated Real Estate Funds Developed

January 1985 The National Real Estate Stock Fund is formed as the first open-end mutual fund devoted to REITs and other real estate securities. Today, there are more than 200 dedicated real estate mutual funds tracked by Lipper. In 1986, Martin Cohen and Robert Steers found Cohen & Steers, which becomes the nation's largest REIT manager with more than $26 billion in assets under management.

CLICK HERE to watch a video with Martin Cohen discussing the launch of Cohen & Steers.
CLICK HERE to view a list of real estate mutual funds.
1986
Tax Reform Act of 1986

October 1986 President Reagan signs the Tax Reform Act of 1986. Among its real estate provisions, there are several new rules that prevent taxpayers from using partnerships to shelter earnings from other sources. Additionally, a number of REIT simplification changes take effect, including one that for the first time allows REITs to be internally advised and managed.

CLICK HERE to watch a video with Constance Moore, president and CEO of BRE Properties and former NAREIT chair, discussing this act.
1989
Dramatic Real Estate Downturn

1989-1991 The nation is beset by the worst real estate downturn since the Great Depression of the 1930s. REIT stock prices decrease well before prices of private real estate begin substantial decline. However, REIT share prices also begin to increase well before recovery in the private real estate market.

CLICK HERE to watch a video with Green Street Advisors Chairman Mike Kirby discussing the emergence of this performance trend.
1991
Funds From Operations (FFO) Defined

October 1991 NAREIT adopts the definition of funds from operations (FFO). Later, in January 2003, the Securities and Exchange Commission explicitly allows companies to use FFO per share in SEC filings.

CLICK HERE to watch a video with NAREIT Senior Vice President of Financial Standards George Yungmann discussing the adoption and use of FFO.
CLICK HERE for more information on FFO.
Kimco's IPO Launches the Modern REIT Era

November 1991 Kimco Realty Corporation (NYSE: KIM) concludes the first successful equity REIT IPO in many years. This step marks the beginning of the modern REIT era and sets the stage for the resurgence of the REIT industry.

CLICK HERE to watch a video with Kimco Realty Chairman Milton Cooper, former NAREIT chair, discussing his company's growth over the years and changes in the shopping center business.
CLICK HERE to watch a video with Equity Group Investments Chairman Samuel Zell, former NAREIT chair, discussing the onset of the Modern REIT Era.
CLICK HERE to visit Kimco's website.
First REIT Reaches $1 Billion Market Cap

December 1991 New Plan becomes the first publicly traded REIT to achieve $1 billion in equity market capitalization. In 2007, New Plan was acquired by Australia-based Centro Properties Group.

CLICK HERE to read an interview with New Plan founder Bill Newman.
1992
Taubman Completes First UPREIT IPO

November 1992 Taubman Centers, Inc. (NYSE: TCO) concludes the first IPO of an UPREIT. In an UPREIT, the parties of an existing partnership and a REIT become partners in a new "operating partnership." For their respective interests, the parties contribute the properties from the existing partnership and the REIT contributes cash. The REIT typically is the general partner and the majority owner of the operating partnership units, and the partners who contributed properties have the right to exchange their operating partnership units for REIT shares or cash.

CLICK HERE to watch a video with Taubman Centers Chairman, President and CEO Robert Taubman discussing his company's IPO.
CLICK HERE to watch a video with Equity Group Investments Chairman Samuel Zell, former NAREIT chair, discussing the importance of the creation of the UPREIT structure.
CLICK HERE to visit Taubman's website.
1993
"Five or Fewer" Rule Opens Door For Pension Plans

August 1993 As part of the Omnibus Budget Reconciliation Act of 1993, President Clinton signs into law a change to the "Five or Fewer" rule that makes it easier for pension plans to invest in REITs.

CLICK HERE to watch a video with KPMG LLP National Director of REIT Services David Brandon discussing the "Five or Fewer" rule.
Simon Property Goes Public

December 1993 Setting the stage for super-sized offerings to come, Simon Property Group (NYSE: SPG) concludes what was then the biggest REIT IPO to date, raising $839.9 million. Simon has gone on to become the largest U.S. REIT and a growing global player, with an equity market capitalization of $23 billion.

CLICK HERE to watch a video with Simon Property Group Chairman and CEO David Simon discussing the growth of the REIT industry.
CLICK HERE to visit Simon Property Group's website.
1996
IRS Ruling Expands REIT Services

June 1996 After a three-year NAREIT effort, the IRS issues the first private letter ruling allowing a REIT to provide cable television to a residential REIT's tenants as part of providing qualifying real estate rental services. This ruling was the first of a series of IRS rulings expanding the type of services a REIT can offer to its tenants as part of generating qualifying real estate rental income.

CLICK HERE to view the IRS Issues section of REIT.com.
1997
Sizable REIT Offerings

June 1997 In response to escalating investor demand for REITs, Boston Properties, Inc. (NYSE: BXP) concludes the largest equity REIT IPO at the time, raising $902.8 million. The company's equity market cap is now nearly $10 billion, making it the fifth-largest U.S. REIT. The largest equity REIT IPO was completed by Douglas Emmett (NYSE: DEI) in October 2006 for $1.6 billion. The largest mortgage REIT IPO belongs to KKR Financial (NYSE: KFN), now a subsidiary of KKR Financial Holdings LLC, raising $910 million in June 2005.

CLICK HERE to watch a video with Martin Cohen and Robert Steers of Cohen & Steers discussing the current IPO market.
CLICK HERE to view a list of REIT IPO activity.
CLICK HERE to visit Boston Properties' website.
REIT Simplification Act of 1997

August 1997 As part of the Taxpayer Relief Act of 1997, President Clinton signs into law the REIT Simplification Act of 1997. Among other items, this allows a REIT to provide a small amount of non-customary services to its tenants without disqualifying the other rents collected from them. Also, changes were made permitting the creation of timber REITs.

CLICK HERE to watch a video with NAREIT Executive Vice President and General Counsel Tony Edwards discussing the REIT Simplification Act.
CLICK HERE for more information on the REIT Simplification Act.
Increase In Foreign Capital

October 1997 The Treasury Department updates its U.S. model tax treaty position to ensure most non-U.S. shareholders pay 15 percent in taxes on REIT ordinary dividends. This opens the door to an increase in foreign capital coming into U.S. REITs.

CLICK HERE for more information on the treaty.
AMB Introduces Private Fund Model

November 1997 AMB Property Corporation (NYSE: AMB) completes the first successful roll-up of a group of separately managed private portfolios into a single, publicly traded REIT and introduces the private fund model to the industry.

CLICK HERE to visit AMB's website.
1999
NAREIT Index Adds Real-Time Pricing

January 1999 NAREIT introduces real-time pricing as a major enhancement of the NAREIT Real-Time REIT Index.

CLICK HERE to watch a video with NAREIT Vice President of Investment Affairs and Investor Education Abby McCarthy discussing this development.
CLICK HERE to view FTSE NAREIT U.S. Real Estate Index real-time data.
Plum Creek Becomes First Timber REIT

1999 Plum Creek Timber Company (NYSE: PCL) becomes the first timber REIT.

CLICK HERE to watch a video with Plum Creek Timber Company President and CEO Rick Holley discussing his company and the timber market.
CLICK HERE to visit Plum Creek's website.
EPRA Formed

October 1999 As a sign of the growing interest in publicly traded real estate, the European Public Real Estate Association (EPRA) is formed. NAREIT and EPRA have consistently maintained a close working relationship in promoting the global expansion of publicly traded real estate and their member companies.

CLICK HERE to listen to an interview with EPRA CEO Philip Charls discussing the emergence of European REITs.
CLICK HERE to visit EPRA's website.
REIT Modernization Act

December 1999 As part of the Ticket to Work and Work Incentives Improvement Act of 1999, President Clinton signs into law provisions of the REIT Modernization Act of 1999. Among other items is the ability of a REIT to form one or more taxable REIT subsidiaries (TRS) that can perform services to REIT tenants and others.

CLICK HERE to watch a video with Kimco Realty Chairman Milton Cooper and Ventas Chairman, President and CEO Debra Cafaro, both past NAREIT chairs, discussing the REIT Modernization Act.
CLICK HERE to read more about the REIT Modernization Act.
2000
REIT ETFs Hit The Market

June 2000 The iShares Dow Jones U.S. Real Estate Index Fund launches, becoming the first real estate exchange traded fund. Within less than a year, it is joined by the streetTRACKS Wilshire REIT Index Fund and iShares Cohen & Steers Realty Majors Index Fund. Today, there are more than 20 REIT ETFs.

CLICK HERE to listen to an interview with REIT Wrap Publisher Barry Vincour discussing the rise of REIT ETFs.
CLICK HERE to view a list of REIT ETFs.
2001
Ibbotson Research Highlights REIT Benefits

August 2001 Ibbotson Associates (now Morningstar), a leading authority on asset allocation, releases results of its landmark research clarifying the benefits of REITs in a diversified investment portfolio. The results, which were a driving force in the industry's investor outreach efforts, show that exposure to REITs not only improves portfolio returns but also lowers portfolio risk.

CLICK HERE to watch a video with NAREIT Executive Vice President of Research and Investor Outreach Michael Grupe discussing Ibbotson's work and the REIT investment opportunity set.
Global Real Estate Index Launches

October 2001 In a joint venture, NAREIT, EPRA and Euronext launch the EPRA/NAREIT Global Real Estate Index. In February 2005, FTSE Group assumes responsibility for calculating and distributing the renamed FTSE EPRA/NAREIT Global Real Estate Index Series. FTSE's involvement enhances the exposure and credibility of the global index as FTSE indexes are used extensively by investors worldwide for investment analysis, performance measurement, asset allocation, portfolio hedging and for creating a wide range of index-tracking funds.

CLICK HERE to watch a video with NAREIT Vice President of Investment Affairs and Investor Education Abby McCarthy discussing the launch of the global index.
CLICK HERE to view more information on the FTSE EPRA/NAREIT Global Real Estate Index Series.
REITs Added To S&P Indexes

October 2001 Standard & Poor's opens its indexes to REITs. Equity Office Properties Trust is the first REIT named to the S&P 500 Index, and a month later Equity Residential (NYSE: EQR) follows. As of June 30, 2010, there are 14 REITs in the S&P 500, 25 REITs in the S&P 400 Mid Cap Index, and 27 REITs in the S&P 600 Small Cap Index.

CLICK HERE to watch a video with Simon Property Group Chairman and CEO David Simon discussing the impact of the S&P's decision.
CLICK HERE for a list of REITs in the S&P indexes.
2003
U.S.-U.K. Tax Treaty Ratified

March 2003 The U.S. and U.K. ratify a new reciprocal tax treaty that allows U.K. pension funds to invest in U.S. REITs without any taxes withheld on REIT dividends. This zero withholding tax treaty provision is later replicated in other U.S. tax treaties such as that with Japan.

CLICK HERE to read more about this treaty.
Research Identifies Complementary Nature of Public and Private Real Estate Investment

June 2003 Ibbotson Associates releases results of its pioneering research with respect to the comparative performance of REIT and direct real estate investment in diversified investment portfolios. Ibbotson's analysis clearly demonstrates the complementary nature of both public and private forms of commercial real estate investment in long-term institutional portfolios.

CLICK HERE to watch a video with NAREIT Vice President of Research and Industry Information Brad Case discussing the complementary role of public and private real estate investment.
2004
IBM Adds A REIT Option

May 2004 IBM, the country's largest 401(k) plan sponsor, introduces a REIT index fund as a distinct investment choice to its plan. An IBM spokesperson is quoted as saying that the new REIT index fund gives its plan participants "the opportunity to invest in what we consider to be a separate asset class which increasingly seems to have a low correlation to other more traditional asset classes."

CLICK HERE to watch a video with NAREIT Senior Vice President of Investment Affairs and Investor Education Kurt Walten discussing REITs in retirement plans.
CLICK HERE to read more about the role of REITs in target-date funds.
Major Acquisitions

August 2004 General Growth Properties Inc. (NYSE: GGP) acquires The Rouse Company in a $12.6 billion deal, the largest public-to-public acquisition in REIT history. In November 2007, private equity giant Blackstone takes over Equity Office Properties in a $22.9 billion buyout.

CLICK HERE to visit General Growth's website.
CLICK HERE to visit Blackstone's website.
REIT Improvement Act

October 2004 President Bush signs into law the American Jobs Creation Act, including all three titles of the REIT Improvement Act. Two of the primary provisions eliminate a discriminatory barrier to foreign investors buying publicly listed REIT stock and allow a REIT to either fix a mistake or pay monetary penalties for most violations of the REIT tax rules, instead of facing possible loss of REIT status as under prior law.

CLICK HERE to watch a video with NAREIT Senior Tax Counsel Dara Bernstein discussing the REIT Improvement Act.
CLICK HERE to read more about the REIT Improvement Act.
2005
APREA Founded

June 2005 The Asia Pacific Real Estate Association (APREA) is founded. Similar to its peers in the U.S. (NAREIT) and Europe (EPRA), APREA is established to represent and raise awareness of Asia-Pacific public real estate companies on the global property investment market.

CLICK HERE to visit APREA's website.
2006
REESA Holds First Meeting

November 2006 The first meeting of the Real Estate Equity Securitization Alliance (REESA) is held during NAREIT's Annual Convention. REESA members include APREA, the Association for Real Estate Securitization (Japan), the British Property Federation, EPRA, NAREIT, the Property Council of Australia, and the Real Property Association of Canada. Its mission is to further the interests of REITs and income-producing real estate around the world.

CLICK HERE to view contact information for REESA members.
Research Highlights Benefits of Global Diversification

November 2006 Ibbotson Associates releases results of its landmark research clarifying the benefits of global REIT and listed property company allocations in diversified investment portfolios. The results demonstrated for the first time to investors worldwide the diversification benefits available from investing in U.S. REITs as well as REITs and listed property companies in their home countries.

CLICK HERE to watch a video with NAREIT Vice President of Research and Industry Information Brad Case discussing global diversification.
CLICK HERE to read more about global real estate investing.
2008
REIT Investment and Diversification Act

July 2008 REIT Investment and Diversification Act (RIDEA) becomes law, allowing REITs to buy and sell assets more efficiently, increasing the size of taxable REIT subsidiaries and allowing health care REITs to use taxable REIT subsidiaries in the same manner as hotel REITs.

CLICK HERE to watch a video with Ventas Chairman, President and CEO Debra Cafaro, former NAREIT chair, discussing the impact of RIDEA and expansion of taxable REIT subsidiaries.
CLICK HERE to read more about RIDEA.
Research Shows REITs Assist With Liability Relative Optimization

September 2008 Ibbotson Associates releases results of its pioneering research with respect to the benefits of including publicly traded REITs and property companies in long-term, diversified investment portfolios using liability relative optimization. Geared toward the unique challenges and investment risks of pension funds seeking to manage their assets to support their long-term pension liabilities, the analysis demonstrates how an appreciable allocation to REITs and listed property companies can reduce the future variability of the funding surplus while achieving optimal portfolio performance.

CLICK HERE to watch a video with NAREIT Vice President of Investment Affairs and Investor Education Meredith Despins discussing liability relative optimization and REITs.
CLICK HERE for more on liability relative investing and REITs.
OECD Model Tax Treaty Modified

2008 NAREIT led an international effort with its REESA partners that successfully modified the Organization for Economic Cooperation and Development's model tax treaty to achieve uniform tax treatment for cross-border REIT investments around the world.

CLICK HERE to watch a video with NAREIT Executive Vice President and General Counsel Tony Edwards talking about the modification.
CLICK HERE for more on this issue.
2009
Emerging Markets Added To Global Index

January 2009 FTSE, NAREIT and EPRA announce the addition of REITs and listed property companies in emerging markets to the FTSE EPRA/NAREIT Global Real Estate Index.

CLICK HERE to watch a video with NAREIT Vice President of Investment Affairs and Investor Education Abby McCarthy discussing the addition of emerging markets.
REITs Prove Resilient In Great Recession

2009 In response to the global credit crisis, listed REITs respond by deleveraging and re-equitizing their balance sheets. Listed REITs and REOCs raised $37.5 billion in 91 secondary equity offerings, nine IPOs, and 37 unsecured debt offerings as investors continued to act favorably to companies strengthening their balance sheets following the credit crisis.

CLICK HERE to watch a video discussing how the listed REIT industry navigated the credit crisis.
CLICK HERE for a list of REIT capital offering activity.
REIT.com And REIT Magazine Extend Brand

June 2009 NAREIT launches REIT.com, the website for all things REIT. Further embracing the REIT brand identity, NAREIT later in the year announces that its flagship magazine, Real Estate Portfolio , will be renamed REIT: Real Estate Investment Today .

CLICK HERE to visit REIT.com.
CLICK HERE to visit REIT magazine.
2010
REITs At 50

Sept. 14, 2010 REITs and NAREIT celebrate their 50th anniversaries, as recognized by a U.S. Congressional Resolution.

CLICK HERE to watch a video with REIT leaders sharing their expectations for the industry going forward.