On the face of it, REITS seem to pay a decent Dividend yield, and It looks like a reasonably safe investment backed up by property values. I appreciate anything exposed to the high street looks like quite high risk at the minute, and London property values have looked a bit shaky. But after a bit of digging around there seems to be a whole host of these trading below book value.

Why is this? Is it a general lack of confidence in the true value of their property values?

Would I be right in saying that 'Long Term Investments' on their balance sheet is the book value of what they have paid for their properties?

I appreciate holding these could be a risky play if their general LTV is high and they very exposed to sudden interest changes on the huge amounts of debt they take on.

What would be a acceptable ballpark figure for LTV, considering where interest rates are at the minute?

My current outlook is that, there is a lot of noise about investors coming out of equities and moving into cash. which is perfectly sensible. But would it be more efficient to find a REIT paying a decent dividend and trading below book value to give some degree in confidence protecting the underlying value?

Its not a topic or an area I know much about at all, so please excuse the questions if they seem daft! if anybody in particular knows this area well, I would appreciate your insight also if they point me towards any articles on the subject, that would be most appreciated.


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