Market Commentary

Charting the change in REIT earnings, represented as funds from operations over the course of the pandemic.

REITs underperformed broader markets for the month of May but outperformed on a year-to-date basis as equity markets continued to be buffeted by heightened volatility.

REIT earnings, as measured by funds from operations, increased 30.9% from the previous year to a record high of over $18 billion in the first quarter of 2022, according to the Nareit T-Tracker®.

Commercial real estate fundamentals continue to point to strong performance in the retail, multifamily, and industrial sectors.

The Bureau of Labor Statistics released the April 2022 Consumer Price Index data showing a much smaller monthly increase in prices in April than in March.

The FTSE EPRA/Nareit Global Real Estate Index Series outperformed broader markets in April.

March marked 23 straight months with hires greater than separations and the March JOLTs report showed private job openings are in excess of 10.5 million, the highest level ever recorded.

Disappointing earnings from the some of the largest companies outside of the REIT space weighed heavily on REITs at the close of the month.

U.S. REITs raised $25.4 billion from IPOs and secondary debt and equity offerings in the first quarter of 2022.

Despite continuing high inflation, REIT returns continue to outpace returns for the S&P 500 on an annualized basis and REIT operating performance growth has exceeded price growth in 2021.

March returns total 7.4% for the FTSE Nareit All Equity REITs Index and 6.5% for the FTSE Nareit Equity REITs Index.

REITs average higher returns over multi-year time horizons compared to private real estate with a broader allocation across innovative property sectors, according to Nareit analysis of past performance.