REITs raising cash by selling properties

Publicly traded REITs are selling assets to raise cash, to buy back shares and to refurbish core properties. Disposals topped acquisitions in 2017 and 2016 — $60.9 billion versus $56.1 billion, and $71.4 billion versus $48.4 billion, respectively, reports Real Capital Analytics.

Expect to see REITs engage in more asset sales and joint ventures with pension plans, private equity firms and other institutional investors in 2018, said Gil Menna, a partner at law firm Goodwin Procter, speaking to The Wall Street Journal. But the increase in properties for sale will not cause prices to drop drastically, because the REITs have low debt levels and can afford to drive hard bargains, observers say.

Nevertheless, private firms smell deals. Philadelphia-based CenterSquare Investment Management, for one, plans to snap up assets from retail REITs this year, including neighborhood and power centers with redevelopment potential, according to Scott Crowe, the company's chief investment strategist. “They want to get rid of assets that we want to buy," Crowe said. "It’s a buyers’ market."