Since we began publishing the Chilton REIT Outlook, we have consistently been proponents of a US-focused, actively managed strategy. However, international REIT markets across both developed and emerging countries have made significant advancements in the ‘investability’ of their own publicly traded real estate securities as of late. We now believe such markets have matured and […]

On August 29, the US 10 year US Treasury yield was 1.5%, approximately one basis point (or bp) below the US 2 year Treasury yield. This ‘inverted’ yield curve has predicated each recession by an average of 19 months for the past 50 years. Figure 1 shows the past 20 years of the spread between […]

Another month, another retail bankruptcy, another ‘win’ for e-commerce, and a ‘loss’ for brick-and-mortar. Houston-based Charming Charlie’s filed for Chapter 11 bankruptcy on July 11, which will result in 261 store closings across the country. It is the second bankruptcy in as many years for Charming Charlie’s, which the media roundly blames on the impact […]

Equity REITs have become a ‘mirror’ of the US economy, and it’s increasingly difficult to make generalizations about all REITs since fundamental drivers vary among the 15 REIT sectors. But, as yield-oriented companies, they do benefit when interest rates move downward as we have seen recently. As of June 30, 2019, Equity REITs are up […]

What is a REIT? A REIT is a corporation that either owns interests in commercial real estate (Equity REITs) or acts as a lender (Mortgage REITs). All REITs are exempt from Federal income taxes provided they adhere to a number of regulations; most notably, they must payout at least 90% of net income as dividends. […]

On February 15, 2019, shares of XPO Logistics (NYSE: XPO) fell 14% after the company announced that it was losing some contracts with Amazon (NASDAQ: AMZN).  XPO is a third party logistics provider (or 3PL) that received $900 million in revenue from AMZN in 2018 for delivering packages to its customers.  Because of AMZN’s decision […]

In March, the Chilton REIT team participated in the Citi Global Real Estate Conference in Fort Lauderdale, FL, attended by over 185 CEOs of real estate companies from around the world. Perhaps slightly influenced by the +12.0% year to date total return of the MSCI US REIT Index as of March 1, 2019 (the day […]

Commercial real estate is one of the oldest industries in the world, thus making it one of the most mature.  As it has developed, transparency has increased, making it harder to find opportunities for significant wealth creation.  The single family residential real estate industry is even older, and therefore one would think it presents even […]

The data center REIT sector had a rough year in 2018.  For the first time ever, its total return, -16.1% on an equal-weighted basis and -13.7% on a market cap weighted basis, was more than 650 basis points (or bps) behind the -4.5% and -7.1% total returns of the MSCI US  REIT Index (Bloomberg: RMS […]

The retail REIT sector (Bloomberg: BBRERTL), which includes malls and shopping centers, underperformed the MSCI US REIT Index (Bloomberg: RMZ) in both 2016 and 2017 by an average of 870 basis points (bps) on a total return basis.  Year to date through November, retail REITs have continued the trend of underperformance, though the 110 bps […]