Mad Money Spotlight: Macerich, Federal Realty

It's far from shocking that Jim Cramer would be advising investors to steer clear of REITs. Retail sales are taking a beating and chains are being shuttered, leaving an abundance of empty store-fronts in malls and strip centers.

For this reason, Cramer raised a red flag on Macerich(MAC Quote) during the Lightning Round on his "Mad Money" segment on Tuesday.

"I think the dividend is pretty small," he said. "I'm suspicious of the whole group."

Earlier in the month, Macerich, a shopping center developer, reported a 10% jump in its first-quarter funds from operations, but said sales and occupancy levels were weighed down by the weakening retail environment.

Shares of the company are significantly off its high of $74.07 from spring last year. On Tuesday, Macerich closed down 1% to %17.07.

If you are going to pick up a real-estate investment trust, opt instead for Federal Realty Investment Trust(FRT Quote), Cramer said.

Federal Realty posted phenomenal first-quarter results and, unlike its competitors in the space, has been able to borrow money relatively cheaply.

During the first quarter, the company closed a new $372 million unsecured term loan facility, nearly double the financing it initially sought.