Nicole Funari

The large specialist ownership base for REITs can help investors in direct and indirect ways.

The REIT underweight for generalist funds benchmarked against the S&P 500 declined from 114 basis points in 2016Q4 to just 62 basis points as of 2021Q2.

Analysis shows REIT long-term returns outpaced home ownership returns, even accounting for the imputed value of rent.

Among survey respondents more than 62% of REITs by equity market capitalization indicated that they experienced an increase in ESG reporting requests from investors between 2019 and 2020.

The growing use of target-date funds (TDFs) remains the dominant investment-related trend in the defined contribution and individual retirement account markets, and REITs continued to be a critical component of TDFs in 2020.

Real estate rents and values tend to increase when prices do, due in part to the fact that many leases are tied to inflation. This supports REIT dividend growth and provides a reliable stream of income even during inflationary periods.

From 2016 to 2019, the jobs equivalent contribution from REITs has risen by 600 thousand.

REIT balance sheets were strong heading into the pandemic with easy access to cash and lines of credit, and operating performance proved to be resilient.

While REITs have underperformed the broader stock market so far in 2020, it is long-term returns that matter.  REITs have been a favorable choice when looking at long-term returns.

Roughly 44% of American households are invested in REIT stocks.