The JPMorgan U.S. Real Estate Fund is beating the Standard & Poor's 500 Index for a seventh straight year because mergers and acquisitions in the property industry have reached a record.
The takeovers of real estate investment trusts, including Chicago-based Trizec Properties Inc. and Shurgard Storage Centers Inc. in Seattle, propelled the JPMorgan fund to a 30 percent gain in 2006, topping the S&P 500's 13.5 percent advance. The fund avoids homebuilders, whose shares fell 27 percent this year as the inventory of unsold houses climbed to an all-time high. "Wall Street has been reluctant to recognize'' the value of REITs, said Kevin Bedell, 50, a money manager at Chicago-based Security Capital Research & Management Inc., who oversees the $917 million mutual fund for JPMorgan Chase & Co." We got in the way of a lot of those undervalued securities.
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