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Episode 91: REITs and Income Trusts (The Depreciation Illusion)
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Episode Summary
This episode deconstructs real estate investment trusts (REITs) and why traditional equity valuation metrics completely break down when applied to them. We examine a common paradox: a REIT reports earnings of forty cents a unit yet pays out a monthly distribution of a dollar ten. Under standard corporate analysis, a two hundred and seventy-five percent payout ratio would signal a dividend on the verge of an immediate cut. However, in real estate, this payout is entirely…
The skinny
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