I am pleased to have the opportunity to serve as NAREIT's chair for the coming year, and am eager to build upon the excellent work undertaken by the association's leadership over the past several years.
One of NAREIT's primary objectives is to position the publicly traded real estate industry as a vital sector of the stock market, and to make sure that both institutional and individual investors understand how the real estate industry has transformed itself into a leading generator of sustainable and attractive earnings.
That is why NAREIT's Investor Outreach program is high on my agenda. The program's mission is to broaden investor knowledge and create interest in the real estate sector as an investment alternative competitive with other leading industries.
As you well know, publicly traded real estate companies are solid operating companies characterized by very strong earning fundamentals, disciplined capital deployment, experienced management teams, and well-conceived and executed business strategies. Combined with real-time information and disclosure, this has brought a new era of prudent capital flow—both public and private—into the industry.
During the past decade, the industry has undergone a dramatic transformation. Today, there are 42 real estate companies that have an individual equity market capitalization of more than $1 billion. In 1990 there were none. This substantial growth is due in large part to the discipline imposed by the public market and the ways in which real estate operating companies have responded intelligently to this change.
As investors turn away from investments based on pure promise to a more rational approach based on tangible performance, real estate stocks will emerge as a core holding in every balanced portfolio. In order for this to happen, investors must view real estate companies as well-run and well-financed enterprises with strong balance sheets and intelligent business plans that rival those of the leading S&P companies.
Consequently, I am asking all members to help NAREIT get the word out and communicate the highly competitive return characteristics of public real estate companies.
As we continue to move through difficult and uncertain economic times, the strength of our industry's operating performance will become even more apparent—and more compelling. I'm looking forward to working with all of you to help NAREIT continue to spread our message.
William D. Sanders
NAREIT Chair
