Subject: File No. S7-35-11
From: Stanley J. McKinney
Affiliation: IEEE, Electrical Engineer

September 22, 2011

I am currently heavily invested in two REITs. I have the following concerns with the possible rules:

1) If REITs are more regulated, will they still be able to offer the high dividend rates they are currently offering? Since they are highly leveraged in order to offer those returns, I propose that the test be the underlying morgage-backed securities which retain their base value by virtue of the real estate. This loss of value recently was due to factors outside the control of the REIT, and due to looser lending practices. I consider this an anomolous event, not typical. However stocks and bonds do not have a relatively fixed value in their underlying company which may vary widely typically.

2) I do agree that specific rules making the business of REITs more understandable to the investor would be a good idea. I recently read a REIT annual report and didn't truly understand much of it. I have read other company reports with a better understanding of the company's overall status.