REITs - Real Estate Investment Trusts - Info & Discussion: internet and the malls

» Oaktoad - internet and the malls

I don't think that the internet poses as much a threat to malls as people think. Shopping is very much a social experience and I don't think that will change that much.

I think the retailers that use catalogs will get hurt more. I also think that malls will have to be a bit more creative to keep people coming to visit them. The other long term issue is population. Well situated malls will have tremendous power. There may not be any new big malls in the Bay Area for example. The existing ones will have more people to draw from and that could increase their earnings substantially.

Strip malls are perhaps more of a problem, but a retailer that has a web presence will still need a retail site that people can visit as often they will want to see the product and pick it up. If they don't need a retail site they still will need
warehouse space so mini-whse type places should be good investments.

People will still buy lots of stuff and need places to store it (if they continue to be anal, which they no doubt will) so Public storage and shurgard should be good long term bets. Small companies often use them for inventory storage or whatever. People store their boats/rec vehicles there.

Apartments are a good long term bet. People will have to have places to live regardless of the internet. One with good growth potential (lower yield) is Archstone. They have a nice new facility going up in Dublin.

Hotels are some of the more speculative type of REITs, but still, if the economy does well people will travel and they can't stay in their computer.

Commercial office developments will continue to do well as long as the economy continues to do well. Look at all the building in the Bay Area. One guy built a fortune by owning/developing around Sand Hill Road, etc...

I personally don't have the mutual fund. Pick a sector that you feel comfortable with and do a bit of research. There are multiple companies in almost all areas.

Golf and prison REITs seem a bit out there for me, but I have a golfing friend that thinks golf ones are the wave of the future.

With luck we will stop putting so many people in jail so that the prison ones may lose their appeal. The pessimists might want to put money on them.

Have fun.

-- posted by Oaktoad