Market Commentary
REITWatch
REITWatch is a monthly statistical publication intended to provide a snapshot of the REIT industry. It includes data derived from the FTSE Nareit U.S. Real Estate Index Series and the FTSE/EPRA Nareit Global Real Estate Index Series in addition to tracking the performance of individual REITs.
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REIT Capital Market Update: December 2022
U.S. REITs raised $2.5 billion from secondary debt and equity offerings in the fourth quarter of 2022, down from $8.6 billion raised in Q3.
REITs Have Lower Share of Floating Rate Debt Compared to Other Commercial Property Owners
REITs have low exposure to floating rate debt, with over 87% of the debt held by the industry at fixed rates.
REITs Underperformed Broader Markets in 2022
REITs underperformed broader markets in 2022, as the FTSE Nareit All Equity REITs Index posted a total return of -24.9% and the FTSE Nareit Equity REITs Index returned -24.4%.
In 2023 Institutional Investors Will Increasingly Use REITs in Portfolio Completion Strategies
REITs offer sector diversification by giving investors better access to property sectors that house the modern economy, such as cell towers, data centers, self-storage, health care, industrial, and logistics.
In 2023, REITs Are Likely to Remain Resilient to Higher Interest Rates
REITs have a long runway to manage leverage in the higher interest rate environment because they have used fixed rate debt to lock in low interest rates for long terms.
Job Growth Slowing but Demand for Workers Remains
Hiring was strong in the hospitality, warehouse, and retail sectors in October, and the data marked 2.5 years with hires greater than separations.
REITs Outperformed Stocks in November
REITs posted positive results for the second consecutive month in November and outperformed stocks for the first time since April, as the FTSE Nareit All Equity REITs Index rose 6.0% and the FTSE Nareit Equity REITs Index gained 5.8%.
Property Fundamentals Across Most Sectors Remained Solid in Third Quarter 2022
With mixed economic growth results, waning job gains, increasing interest rates, and rising recession risk, the U.S. economy is facing numerous headwinds.