REITs had a strong run last year, notching gains of nearly 28% as the sector began to recover from the real estate bust. But industry watchers are divided as to whether it is worth jumping on the bandwagon now, or waiting a few more years.

Paul Puryear, director of real estate research for Raymond James, thinks REITs will continue to turn in a solid performance this year, although he acknowledges they are unlikely to reprise their spectacular returns of 2010. "REITs were definitely helped in 2010 by lower interest rates, and that's going in the other direction now, but even so, I think we're in a period of fundamental recovery for commercial real estate and we should see more good returns in 2011," Puryear says.

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