In September, the MSCI US REIT Index (RMZ) produced a total return of -12.1%. The Chilton REIT Composite underperformed the benchmark for the month by producing a total return of -12.5%, both gross and net of fees. In the third quarter, the Chilton REIT Composite underperformed the benchmark by producing a total return of -11.0% gross of fees and -11.1% net of fees, which compared to -10.0% for the RMZ. Year to date, the Chilton REIT Composite has outperformed the RMZ by producing a total return of -26.4% gross of fees and -26.8% net of fees, which compares to the RMZ total return of -28.3%.
Positive contributors to relative performance included an overweight to the residential sector, an underweight to the data center sector, and an underweight to the specialty sector. Conversely, an overweight to the cell tower sector, an underweight to the office sector, and stock selection within the shopping center sector detracted from relative performance.
Year to Date (YTD) Attribution
Year to date, positive contributors to relative performance included stock selection within the residential and healthcare sectors, as well as an underweight to the regional malls sector. Underweight allocations to the triple net, lodging, and specialty sectors detracted from relative performance.
YTD Contributors Summary
YTD Detractors Summary
In the October 2022 REIT Outlook titled, “Residential REITs: The Property Type You Can Actually Afford,” we highlight why we believe that residential REITs, both multifamily and single family rentals, are in a favorable position. Specifically, housing affordability is at its worst levels since 1989, the Federal Reserve is showing no signs of slowing down its historically fast pace of spiking interest rates to combat the rampant inflation, and a subdued new supply of single family homes all contribute to the favorable supply and demand dynamics seen throughout the sector.
The information contained herein should be considered to be current only as of the date indicated, and we do not undertake any obligation to update the information contained herein in light of later circumstances or events. This publication may contain forward looking statements and projections that are based on the current beliefs and assumptions of Chilton Capital Management and on information currently available that we believe to be reasonable, however, such statements necessarily involve risks, uncertainties and assumptions, and prospective investors may not put undue reliance on any of these statements. This communication is provided for informational purposes only and does not constitute an offer or a solicitation to buy, hold, or sell an interest in any Chilton Capital Management investment or any other security.
Past performance is not indicative of future results. Investment returns and principal value will fluctuate so that an investor’s account, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted.
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