Finding Upside in Real Estate’s Downturn

By Ben Steverman - 2011-09-27T18:19:45Z

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Going Global

While Ballentine Partners' Gregory Peterson warns U.S. domestic REITs are "richly valued," he's still buying international real estate stocks. Sometimes these are companies that, like REITs in the U.S., directly own real estate and pay hefty dividends. Other times they're companies that operate but don't own properties--so may not be a "direct play" on real estate, he says. "When you invest in an international real estate fund, you need to be careful what you're investing in." He uses Fidelity International Real Estate Fund (FIREX). Sullivan, of Palisades Hudson, recommends the Morgan Stanley Institutional International Real Estate Fund (MSUAX).

Photograph by Kevin Lee/Bloomberg News