Historically, following periods of rising interest rates, REITs have outperformed the S&P 500 over the subsequent 90-, 180-, and 365-day periods as shown in Figure 1 below. We discussed this phenomenon in great detail in our May 2024 REIT Outlook titled An Interesting Time to Invest in REITs. From its May 1st release through September […]
Commercial real estate fills many roles in society and, arguably, none is more essential than feeding the population. The first thought might be grocery stores, but today’s report dives deeper into the extensive infrastructure and logistics existing between food producers and consumers. Not only are frozen food sales growing rapidly (estimated 5% compound annual growth […]
Originally created in 1960, the REIT structure’s purpose was to democratize real estate for the masses. In addition to managing properties, reporting and complying with SEC requirements, and paying dividends from cash flow, they also employ finance, investment, development, and strategic personnel to make decisions that can grow value beyond a steady state portfolio. In […]
Quarter to date, the Chilton REIT Composite has outperformed the RMZ by producing a total return of +1.8% gross of fees and +1.6% net of fees, which compares to the RMZ’s total return of +0.1%. Year to date, the Chilton REIT Composite has underperformed the RMZ by producing a total return of -0.3% gross of […]
In March 2024, the MSCI US REIT Index (RMZ) produced a total return of +2.0%. The Chilton REIT Composite underperformed the benchmark for the month by producing a total return of +1.7% both gross and net of fees. Year to date, the Chilton REIT Composite has underperformed the RMZ by producing a total return of […]
2023 could be described as nothing short of a rollercoaster, as shown in Figure 1. Our 2023 total return forecast of +8% to +12% ended up being too low relative to the actual calendar year total return of +13.7%, in spite of mid-year prices on the MSCI US REIT Index (Bloomberg: RMZ) falling to levels […]
Public REIT pricing has declined in a steep fashion over the past 22 months. Although this is not the first time they have had a significant pullback, it is quite rare, as shown in Figure 1. As recently as March 2020, the drawdown in the FTSE NAREIT All Equity REITs Index (Bloomberg: FNER)* was nearly […]
In October 2023, the MSCI US REIT Index (RMZ) produced a total return of -4.4%. The Chilton REIT Composite outperformed the benchmark for the month by producing a total return of -3.6% gross of fees and -3.7% net of fees. Year to date, the Chilton REIT Composite has outperformed the RMZ by producing a total […]
The capital window for commercial real estate has substantially lessened if not virtually closed for all but the best borrowers, just like in the early 1990’s. In this cycle, property owners that financed with floating rate debt are seeing reduced cash flows, and many have negative cash flow after rising interest expense and other operating […]
Although the change in public REIT equity prices over the past 12 months would not suggest it, 2022 actually saw earnings growth arrive above our initial expectations. Specifically, occupancy continued its positive trajectory, leading to further upward pressure on rents across nearly every property type. Additionally, the inflationary pressures helped to slow new construction, creating […]