Property prices are rebounding from the crash that followed the credit crisis of 2008. We're finally starting to see more real estate being bought and sold, and price increases are accompanying that activity. This means opportunities are appearing for companies like real estate investment trusts (REITs).

For these trusts, higher real estate prices can mean two things: asset value increases and higher rents. You may have guessed this, but let me assure you: Both are good! With this tailwind, it could be a good idea to consider a position in a REIT.

But which REIT is worth buying?

Restructuring assets
First, we have one of the major owners and operators of neighborhood and community shopping centers in the U.S.: Kimco Realty (KIM 0.16%).

With a decent operating third-quarter portfolio performance, Kimco presented 6.5% year-over-year growth in funds from operations (FFO.) FFO growth basically shows higher cash flow coming from operations, and in this case, it's showing healthy growth. Kimco also announced a 7.1% increase in its quarterly dividend per share. Not bad.

The company's main focus is on owning and operating strategic North American retail assets while shedding its non-retail assets and investments. This portfolio restructuring, along with Kimco's easy access to capital, are good signs looking forward in a context of rising prices. Another positive is the company's significant geographic diversification and low dependence on individual large tenants. In fact, the largest three tenants -- TJX Companies, The Home Depot, and Wal-Mart -- represented 3%, 2.9%, and 2.4% of the company's annualized base rental revenues in 2012.

Recycling capital
Next up, we have another self-administered and self-managed real estate investment fund, DDR (SITC -0.95%).

The first thing we need to notice is that the company's FFO per diluted share increased 3.7% in the third quarter as compared to the prior-year quarter -- around half of Kimco's growth. In this period, DDR executed 443 new leases and renewals for 3 million square feet, and now its portfolio leased rate is at 94.8%.

Strategy-wise, DDR has been strategically managing its assets following an aggressive capital recycling program in order to upgrade the quality of its shopping centers while divesting non-prime assets. Capital recycling involves selling assets with low potential for capital gains, and moving it to undervalued investments with better perspectives. Following this strategy, DDR sold 11 consolidated operating shopping centers this quarter, totaling 1.1 million square feet, and invested $258.5 million in 1.4 million of leasable square feet located in two regional power centers in Orlando, Fla., and Atlanta, Ga.

A safer bet
Finally, we have an equity REIT focused on properties located in metropolitan markets, Federal Realty Investment Trust (FRT)

This company generated an FFO of $76.4 million in the third quarter, growing almost 6% year over year. Net income reached $62 million versus $38.5 million a year ago, and it is showing a great overall performance.

Federal Realty's strategic approach is to look at the top 20 U.S. markets and concentrate on densely populated prosperous communities. These selected properties are located in upscale areas, and that means there will be higher rentals with steady rent increases. That's not a minor thing. In fact, Federal Realty's FFO compound annual growth rate (CAGR) was north of 6% between 2007 and 2012, a period that coincided with a drop in property prices. This, combined with a diversified tenant base made up mostly of grocery stores and discount retailers, keeps Federal Realty away from being too exposed to the financial status of a few specific tenants.

Final thoughts
Though there are positive points for each of these companies, I think Federal Realty is the best bet of the trio.

Regarding Kimco, the diluting effect produced by the company's recent portfolio pruning could affect profits in the near term. It's a factor that could limit growth looking forward.

In the case of DDR, FFO should be showing higher levels to make it more attractive. Its capital recycling cycle will still need some to show improvements.

Federal Realty's asset specialization, in combination with a diversified tenant base, gives it more financial stability in the event of property price volatility. Plus, its strong presence in metropolitan areas will be beneficial if prices keep increasing. Hence, this is the stock to pick.