Sector Snap: Offices Get Cut, Hotels Look Good

NEW YORK (AP) — Citigroup is recommending that investors buy up more recovery-oriented real estate investment trusts.

Those include residential and self-storage REITs, as well as lodging operators — riskier stocks to hold in a recession precipitated by a housing crisis and drops in discretionary spending and business travel.

Analyst Michael Bilerman in a research note Friday upgraded two residential REITs. Despite weak employment and a slowly recovering housing sector, he said Equity Lifestyle Properties Inc., which operates common facilities such as clubhouses, swimming pools and golf courses in vacation areas, and UDR Inc., which develops apartment complexes, were appropriate for longterm investors as job losses slow and consumer spending stabilizes.

He upgraded Equity Lifestyle to "Buy" from "Hold" and UDR to "Hold" from "Sell."

Bilerman downgraded apartment property operator Apartment Investment & Management Co. to "Sell" from "Hold," however, saying its stock price is more expensive than other apartment REITs.

Equity Lifestyle rose $2.10, or 5.1 percent, to $43.70; UDR added 53 cents, or 3.6 percent, to $15.18; and Apartment Investment & Management gained 17 cents to $14.27.