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Industry Discussions / Real Estate Inv. Trusts: REITs

URL:  http://boards.fool.com/i-dont-know-where-i-got-that-58-yield-30535440.aspx

Subject:  Re: Poll: Which PLD preferred to own? Date:  2/10/2013  9:05 PM
Author:  Reitnut Number:  73670 of 77105

I don't know where I got that 5.8% yield. Currently, PLDGP is yielding almost 6.7%... that would make me more comfortable owning it.

Jim and Yoda were no doubt referring to the yield to first call, which is always lower than current yield when a bond or pfd is trading at a premium over par value. With so many of these trading over par these days, we really need to look at yields to first call. I think there are probably a few threads on our board that discuss this.

Whether to go with a quality REIT pfd with a YTFC below 6% or a utility with a lower yield but with some modest growth prospects is a Big Issue for many of us these days. There are also some pretty good REITs with current yields of over 4% that may provide better total returns, over time, than REIT pfds with YTFCs in the high 5s. But, of course, they have different risk/reward profiles. As my Dad used to say, "Pick your poison."

Ralph
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