REITs@50: Industry Reflections, Debra Cafaro of Ventas

As part of our REITs@50 Anniversary celebration, sat down with 2010 NAREIT Chair Debra Cafaro, chairman, president and CEO of Ventas, Inc. (NYSE: VTR), to talk about the growth of the REIT industry and where things go from here.

When asked about what she felt was NAREIT's biggest contribution to the REIT industry, Cafaro spoke about the importance of reaching out to potential investors.  

"NAREIT's biggest contribution has been in the area of investor outreach. Educating investors, both dedicated as well as non-dedicated investors, pension funds, plan sponsors, etc., about the benefits of investing in commercial real estate through the REIT model," Cafaro says. 

In addition to the investor outreach NAREIT performs, Cafaro believes that the organization is an essential resource for the industry.

"The research that NAREIT has sponsored as well as that which it has undertaken on its own has been absolutely compelling in showing that the REIT model is the best way to invest in real estate. NAREIT continues to deliver the message broadly to drive capital to the REIT model," she says.

When it came to NAREIT's impact on her company specifically, Cafaro spoke about NAREIT's role in getting the REIT Investment & Diversification Act (RIDEA) passed, as it served as a very important element in the restructuring of many health care REITs, including Ventas. Cafaro said that RIDEA helped put her company on equal footing with other types of REITs and has allowed for additional avenues of growth for Ventas.

Cafaro also spoke about the overall impact listed REITs have had on the commercial real estate landscape.

"Listed REITs have been a very important product in allowing investors to invest in commercial real estate in a cash-flowing, liquid, dividend-paying way. REITs provide transparency, accountability and alignment with shareholders," Cafaro says. 

Because of the advantages that REITs bring to a portfolio, she expects the industry's future to be as strong as its past.

"I think the REIT industry will continue to grow. Ten percent of the commercial real estate market is owned by REITs, and I'm very hopeful that percentage will continue to grow and perhaps double over the coming years. I also hope that more capital will flow to the REIT model as a superior model of investing in commercial real estate," Cafaro says.