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ORANGE COUNTY, CA-Dividend yield is not the only component to value in a net lease investment, points out Paul McDowell, CEO of CapLease. “You’re hoping for total return, and that’s based on REIT dividend and how much do you hope the shares will rise in the course of a given year. The two together produce your total return percentage.”

McDowell adds that the knockoff on net lease assets for years has been fixed cash flows, so portfolios have bond-like characteristics. “When the REIT atmosphere is too frothy, you can’t raise rents as tenants move out because you have long-term leases. But that said, long-term cash flows look very attractive. REITs have strong returns in the past 12 months. People look for safety in earnings, and they find that in net-lease REITs. Everyone values our shares more and more.”

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