-  Retail      - shopping centres, cinemas, etc.
-  Commercial      - office buildings
-  Hotels and leisure complexes e.g. theme parks, and
-  Industrial      - warehouses, industrial parks and factories.

The three potential income streams are:-

-  Rental: income from the tenants of the property (yields are typically 6-10 per cent)
-  Asset: growth from real estate value
-  Income: from the sale of property developments.

Some property trusts have no exposure to development, which has a higher risk and leave that activity to the property developers, already in the market.

If the Reserve Bank were to lift interest rates tomorrow (which they almost certainly will not), the effect would be fairly immediate.  Consumer demand would almost certainly soften and bond yields would rise.

Property trusts are typically measured against bond yields when comparing their relative attractiveness for investors.  So in the short term property trusts unit prices probably fall.

However, higher interest rates create a barrier to new developments and therefore new projects are fewer and therefore less competition to existing sites in the medium to long term.  Lack of competition can and does lead to higher rental income.

The short term fall in unit price (which almost certainly would be overdone) would be followed by a realisation that the trusts are still suitable investments producing reasonable income yields and priced below their true market value.

Buyers return to the market, pushing prices higher.

As a rule, property trusts particularly suit passive investors who are looking for regular income, long-term moderate asset appreciation, stability and diversification, when the trust investment strategy focuses on portfolio rental properties.