REIT P/FFO query

[jsush190]

Hi, Can someone please explain how REITA is the answer here.
[question removed by moderator]

 

[S2000magician]

Price = NOI / cap rate
NOI = price × cap rate
REIT A’s cap rate is 75% of REIT B’s, REIT A’s NOI is about 75% of REIT B’s, so REIT A’s FFO is lower than REIT B’s, so REIT A’s P/FFO is greater than REIT B’s.

 

[jsush190]

Understand now. Thanks so much s2000magician

 

[S2000magician]

You’re quite welcome.