Investing July 1, 2003

Equity REITs Edge Out S&P In First Half

July 1, 2003 (PLANSPONSOR.com) - Equity REITs bested the S&P 500 during the first two quarters of 2003 with a 14.4% return, compared to the S&P's 11.8% first-half performance, according to a report.
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During the April to June period, however, equity REITs slightly lagged the broader equity index posting total returns of 13.1% versus the S&P’s 15.4%, according to a REIT performance report by SNL Financial.

Among the REIT sectors, according to SNL, manufactured housing REITs returned a total of 27.4%, the top performer of any property type. Health care REITs returned a total of 26.5%. The most dramatic story was the turnaround of hotel REITs in the second quarter, SNL said. Although the group posted a total return of -2.1% in the first half of the year, it turned in a very strong 19.7% for the second quarter.

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Investors are returning to hotel REITs earlier than many analysts would have recommended, with most analysts predicting a turnaround in fundamentals in 2005 at the earliest, according to the report, which also noted that recent good economic news bodes well for the business travel market.

Among the other major property sectors, office and retail continued to post strong, though not record, quarterly total returns, at 13.3% and 11.6%, respectively. Multifamily and industrial REITs posted single-digit total returns of 9.9% and 8.5%, respectively, for the second quarter.

Compliance June 30, 2003

Court: Intel Spammer Didn't Trespass

June 30, 2003 (PLANSPONSOR.com) - The California Supreme Court handed an ex-Intel worker a victory in his six-year legal dispute with the technology giant over 30,000 e-mails he sent critical of his former employer to staffers at work.
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>In a four to three decision, the state high court found that California’s trespass law requires evidence of damages, which wasn’t present in the case against former Intel employee Ken Hamidi, according to a report on CNET News.com.

“After reviewing the decisions analyzing unauthorized electronic contact with computer systems as potential trespasses to chattels, we conclude that under California law the tort does not encompass, and should not be extended to encompass, an electronic communication that neither damages the recipient computer system nor impairs its functioning,” the court wrote.

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>In March, Intel had asked the California Supreme Court to uphold an earlier legal ruling that found Hamidi had trespassed on its servers by sending thousands of unwanted e-mails to staff at work, dating back to 1996. The servers were private property, the company argued.   Hamidi, who charged unfair labor practices at the chip giant in the e-mails after his 1995 dismissal, contended that he had the right to express his opinions based on the First Amendment (See  CA Supreme Court Deciding E-mail Spam Free Speech Case). 

>Chuck Mulloy, an Intel spokesman, said the company was “disappointed in the court’s decision. We’re studying the opinion to assess our options in the event that Hamidi resumes spamming against Intel,” according to CNET News.com.

As with many free speech issues, the case generated widespread interest.  On the side of Intel, eight friend of the court petitions were filed, including the US Chamber of Commerce and eBay Inc.  However, to Hamidi’s support have come the American Civil Liberties Union and the Service Employees International Union.

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