This paper analyzes the influence of information disclosure in the REIT IPO prospectus on IPO underpricing. It introduces a different approach for measuring information disclosure and then quantifies its effect on initial returns. The IPO prospectuses of 72 REIT companies are analyzed on key words and then tested on abnormal return patterns with regard to the frequent use of these key words. Moreover, future tense is taken as a proxy for the number of promises in an IPO prospectus and the paper tests a risk-based interpretation. Firms that make fewer promises put less information in the marketplace. Consequently, investors should be rewarded for having less information to correctly value the issue by underpricing. Generally, the paper analyzes the impact of the IPO prospectus on underpricing and examines the relationship between the use of key words as well as promises made by a firm in its IPO prospectus and its underpricing level.