COMMERCIAL REAL ESTATE : Many Developers, Including Irvine Co., Weigh Use of REITs to Raise Money

So much has been said about real estate investment trusts recently, you’d think the idea was new.

Many developers--including the Irvine Co.--are considering forming some sort of REIT, as they are often called, as a way to raise needed investment dollars. A REIT is a type of real estate investment in which ownership shares in real estate or mortgages are sold. Most of the income is passed on to shareholders, so is therefore not taxed at the corporate level.

Michael Meyer, managing partner of the Newport Beach office of Kenneth Leventhal & Co., said his office is working with more than a dozen developers on forming trusts with investments in everything from apartments to mobile home parks. The luster of these investment trusts has also improved on Wall Street, he said.

The Irvine Co., for its part, is considering the public market for funds, including a REIT, said spokesman Larry Thomas.

“We haven’t decided on a particular vehicle,” he said. “We’re several months away from any decision.”

Santa Anita Realty Enterprises Inc. of Newport Beach could have a leg up on all of them. The company, which is itself an investment trust and has been since 1980, plans to buy about an additional $50 million in Southern California property over the next 12 months, shifting its focus from apartment complexes and industrial complexes in Washington, Oregon and Texas. The company shares its trading symbol on the New York Stock Exchange with the Santa Anita Operating Co., which conducts thoroughbred racing at Santa Anita Park in Arcadia.