U.S. REITs End 2019 With Double-Digit Returns

Record $109 Billion Raised in Public Markets

WASHINGTON, D.C. JAN. 13, 2020 In 2019, the U.S. REIT market delivered double-digit returns across nearly all sectors, raised a record amount of market capital, and continued to provide strong dividend yields to income investors, according to Nareit.

“REITs in 2019 provided both the long-term growth and recurring income that characterizes real estate investment,” said Nareit President and CEO Steven A. Wechsler. “The REIT market’s performance underlines the value of REITs as a total return investment, delivering price appreciation in tandem with dividends critical for investors seeking income in today’s low interest rate environment.”

The FTSE Nareit All Equity REITs Index delivered a total return of 28.66% for 2019, with a 0.13% gain for the fourth quarter, the FTSE Nareit Mortgage REITs had a total return of 21.33% and a 5.20% gain for the fourth quarter, and the FTSE Nareit All REITs Index, which contains both equity and mREITs, had a total return of 28.07% for the year with a 0.55% gain for the fourth quarter. The S&P 500’s total return for 2019 was 31.49%, with a gain of 9.07% in the fourth quarter.

Most REIT segments see double-digit returns

Nearly all equity REIT market segments had double-digit total returns in 2019. The manufactured homes sector led the equity REIT market’s performance with a 49.09% total return for the year. Other top performing segments included industrial REITs with a 48.71% return, single-family home REITs with 44.30%, data center REITs with 44.21%, and timber REITs with 42%.

Among mREITs, the commercial financing segment delivered a 32.10% total return for 2019, and home financing REITs gained 17.20%.

Capital raising increases; leverage falls

REITs raised a record $109.36 billion in equity and debt from public capital markets in 2019, nearly double the $55.63 raised in 2018. Equity raised in 2019 included $220 million from two IPOs, $31.99 billion in secondary common shares, and $4.45 billion in secondary preferred shares. REITs also raised a record $63.15 billion in unsecured debt in 2019, surpassing the previous record of $50.77 billion raised in 2017.

REITs continued to reduce their leverage, producing a debt ratio (total debt divided by total debt plus equity) of 27.50% for the FTSE Nareit All Equity REITs Index at the end of the third quarter, down from 32.30% at the same time last year.

REITs reward yield-seeking investors

REITs continued to offer strong dividend yields for income investors in 2019. The dividend yield of the FTSE Nareit All REITs Index was 4.06% at December 31 and the yield of the FTSE Nareit All Equity REITs Index was 3.70% compared to 1.85% for the S&P 500. The lodging/resorts sector led the equity REITs market in dividend yields with 6.89%. The next highest yielding equity REIT sectors included specialty (6.15%), diversified (5.78%), and retail (5.07%).

The home financing segment of the FTSE Nareit Mortgage REITs Index had a dividend yield of 10.80% at year-end, while the commercial financing segment’s yield was 7.53%.

Click Here for Complete REIT Market Data

Get Nareit Media blog posts delivered straight to your inbox.


The Nareit Media blog provides information for members of the news media on REITs, the REIT industry and Nareit. Media representatives seeking information on REIT returns, REIT performance relative to other investments, and the size and make-up of the U.S. REIT industry will find it here. Please see our Terms of Use.