Federal Realty CEO Interviewed by Jim Cramer

Jim Cramer wanted to take a step beyond the deal of Simon Property Group (NYSE: SPG); this is why he interviewed Federal Realty Investment Trust CEO Don Wood.

The interview started off by Jim stating that every day he picks up the paper, and sees only bad news about commercial real estate. Why is it that on the conference call for FRT that the company stated that occupancy rates were going up and that FRT was thinking of raising rates on the remainder of the vacant properties? Mr. Wood said he is trying to be bullish, but his company is all about protecting the downside. They try to invest in only the highest quality of real estate. Viewers know that they are value conscious, are shopping less and are most likely jobless.

Jim asked him about the Simon Property Group buyout of GGP. Mr. Wood said that Simon Property Group is a very smart company, and that he isn’t really interested in fighting for GGP as it doesn’t fit with what Federal Realty does.

Jim brought up the FDIC taking banks and that some of these banks have commercial property that could be bought. He said he may not be interested in these properties as his company is a long term holder. He further aked why would he want to invest in property that was recently built near new home construction that is in an area of distress? His company tends to like to invest in denser areas that are more stable.

Mr. Wood said that if your view is to get a gain in 30 to 60 days, then his company is not what you want, but if you want exposure to real estate in your portfolio than their company is what you want.