Tickers in this Article: AKR, FRT, IRC, VNO, SPG
Many down-trodden real estate investment trusts (REITS) have been angling upward while the Dow Jones Industrial Average (DJIA) has been making itself comfortable above the 9,000 mark. Investments in real estate may be the last option on investors' minds these days, but by the rules of any contrarian: what better time than now to take a look at how a REIT would fit into an investment portfolio? Let's take a look at a couple of REIT options that individual investors might want to consider.

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Individual REIT

Acadia Realty Trust (NYSE:AKR) looks promising considering the frequent purchases of shares by insiders between January and May of this year. Investors also have the added bonus of buying in behind investments made by the Yale University Endowment, which made several purchases of Acadia stock early in 2008. Acadia's stock is trading in the $13 to $14 price range after falling below $9 per share in early March of this year. Acadia, with its market capitalization in the neighborhood of $580 million and revenues of $127 million, is another approach to take when considering REITs, if investors are already familiar with larger competitors like Simon Property Group (NYSE:SPG) and Vornado Realty Trust (NYSE:VNO).

Reasons to Pause
REITs like Acadia, including Federal Realty Investment Trust (NYSE:FRT) and Inland Real Estate Corp. (NYSE:IRC), which have major investments in retail and mixed-use properties, are exposed to the plight of retail consumers and retailers that fold. For example, Acadia attributed 1.3% of its 2.5% decrease in net operating income (NOI) for the six-month period ended June 30 to the bankruptcy of Circuit City. Acadia reported that same-store NOI decreased 0.2% and 2.5% for the second quarter and for the first half of the year, respectively.

Same Store Sales Snapshot
Federal Realty Investment Trust had slightly better results for its first quarter, with its same-store property operating income increasing 1.4% over the same quarter a year ago. FRT's second-quarter results came out August 4 with an increase of 1.6% in same-store operating income over the same quarter in 2008. When certain properties were excluded, however, it was actually a decrease of 1.4% in the second quarter.

Inland Real Estate Corp has also been the target of several insider purchases since the beginning of the year through June. Inland's same store NOI decreased by 2.42% for the first quarter of 2009 versus the same time frame one year ago. (UITs offer professional portfolio selection and a definitive investment objective. Are they right for you? Read Investing In A Unit Investment Trust.)

Bottom Line
For individual investors, it could pay dividends to pay attention to the number shoppers frequenting local shopping malls as a way to gauge just how much consumer spending has slowed. According to the Commerce Department's US Census Bureau June 2009, retail and food sales rose slightly by 0.6%. Nothing to get too excited about, but with provisions of the Recovery Act receiving recognition as a primary factor for the positive news, additional stimulus measures may further boost disposable income and reinvigorate consumer spending. This could, in turn, allow REITs to eventually return to an investment-worthy position.

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