Real Estate Investment Trusts

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Industry
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As per the industry classification benchmark, this industry sector includes the following subsectors –

  • Industrial & Office REITs - Real estate investment trusts or corporations (REITs) or listed property trusts (LPTs) that primarily invest in office, industrial and flex properties.
  • Retail REITs - Real estate investment trusts or corporations (REITs) or listed property trusts (LPTs) that primarily invest in retail properties. Includes malls, shopping centers, strip centers and factory outlets.
  • Residential REITs - Real estate investment trusts or corporations (REITs) or listed property trusts (LPTs) that primarily invest in residential home properties. Includes apartment buildings and residential communities.
  • Diversified REITs - Real estate investment trusts or corporations (REITs) or listed property trusts (LPTs) that invest in a variety of property types without a concentration on any single type.
  • Specialty REITs - Real estate investment trusts or corporations (REITs) or listed property trusts (LPTs) that invest in self storage properties, properties in the health care industry such as hospitals, assisted living facilities and health care laboratories, and other specialized properties such as auto dealership facilities, timber properties and net lease properties.
  • Mortgage REITs - Real estate investment trusts or corporations (REITs) or listed property trusts (LPTs) that are directly involved in lending money to real estate owners and operators or indirectly through the purchase or mortgages or mortgage backed securities.
  • Hotel & Lodging REITs - Real estate investment trusts or corporations (REITs) or listed property trusts (LPTs) that primarily invest in hotels or lodging properties.
Case Study
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A top management professional at a UAE based firm, shares the potential he can foresee with Lean Six Sigma.
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  1. A leading Mortgage Corporation (one of the top servicer of non-prime residential mortgage loans in the United States) is a key player in mortgage servicing and has over $70 billion in assets under management. Around 1500 - 1800 loans get referred to foreclosure (FC) every month and every 90+ delinquent loan has a very high chance of going to FC. Each foreclosure not only results in revenue loss for ABC corp. but also adversely affects key metrics like Cure and Cash flow rate.

     

    This metric is very important from the rating agency standpoint as Loss Mitigation is rated on this metric by prominent rating agencies. It is therefore important for the business to improve the Cure and Cash flow rate% which will not only result in lesser loans going to foreclosure but will also improve ABC corp.’s standing in the industry.

     

    Monthly average Cure and Cash flow rate for a full year was 0.74%. This was much below the targeted monthly figure of 2.32% which Loss Mitigation needs to achieve to qualify for a “Strong” rating by prominent industry rating agencies A Six Sigma project addressed the issue and led to enhancement of company’s reputation.  

     

  2. A mortgage company found that at 18% kept to contact ratio, the average kept per associate is 47 payments per month with an average size of $1652. A six sigma project was initiated to payments per associate. As a result of this project, maintaining other important metrics at current levels, a 27% kept to contact ratio resulted in more than 66 payments per associate per month. This project led to more than 4 million dollars benefit every month.
Feed Back
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After an extensive research of six months I chose Benchmark to do the Green Belt training. All the fear that I had about six sigma vanished during the first hour of the training. The way in which the faculty took us through the course was really appreciable. - Mohamed Safir, BPR – Manager, Al - Futtaim