WASHINGTON — Real estate executives are pushing a federal bill that would add a real estate investment trust investment option to the $186 billion Federal Thrift Plan.
The addition of a REIT investment option to the plan — the largest in the nation — could cause other defined contribution plan sponsors to follow its lead, industry executives expect. "It's visible. It's significant," said Abby McCarthy, senior director at NAREIT. "People tend to look at the bigger plans."
The addition of another group of investors also would broaden and increase the liquidity in the entire REIT market, investment managers say. This would help overcome a recent complaint that the REIT market is not large or liquid enough to accommodate large institutional investors.
"More investors are a good thing for the market because it increases liquidity across the whole spectrum," said Amy Schioldager, managing director for Barclays Global Investors, San Francisco, in an interview. The firm manages $7 billion in REIT assets.
Ms. Schioldager testified before Congress last year in support of a REIT option.
Currently, a bill that would add a REIT option is in the Subcommittee on the Federal Workforce and Agency Organization of the Senate Committee on Homeland Security and Governmental Affairs. The subcommittee is expected to take up the bill in the fall when Congress returns from its summer recess, said LeRoy Coleman, press secretary to Sen. Norm Coleman, R.-Minn, sponsor of the Senate bill.
An identical bill in the House had a hearing in April before the Subcommittee on the Federal Workforce and Agency Organization. The House bill, which has 180 co-sponsors, is waiting for input from Federal Thrift Investment Board officials, who promised to study the issue and report to the subcommittee, said Chad Bungaard, chief counsel and deputy staff director of the subcommittee.