SEC Official Says Stakeholders Like REIT Reporting Practices

Sonia Barros, assistant director of the Division of Corporation Finance at the Securities and Exchange Commission (SEC), joined REIT.com for a video interview during REITWise 2015: NAREIT’s Law, Accounting and Finance Conference held in Phoenix.

Barros discussed how REITs are performing overall in terms of their SEC reporting. She noted that REITs differ from other industries with respect to their practice of providing information about property operating data in their supplemental packages.

“What we’ve heard from investors, market participants and analysts is that they really do like this information,” Barros said.

Meanwhile, REITs are responsible for a high volume of activity in the capital markets, according to Barros. Most of the activity is in the form of follow-on offerings, which the SEC typically doesn’t review because many companies are able to use the SEC’s automatic shelf-registration process, Barros explained.

At the same time, Barros noted that the SEC is still seeing a lot of initial public offerings (IPOs) of REITs, and all of those are reviewed. She also pointed out that offerings for large non-traded REITs are starting to include common stock offerings that have a deferred sales commission in addition to the traditional sales commission.

Asked what REITs should do to attract fewer SEC comments, Barros replied that companies should understand that SEC comments are a “dialogue.”

“Often, we are not asking for a revised disclosure. We’re just asking for the basis of the disclosure that they provide,” she said.