Market Analysis & Research

Diversified REITs saw FFO swing from negative $102 million in the second quarter to positive $962 million in Q3.

FFO rose 5.6% as the economy reopened and REITs display resilience with strong balance sheets, low leverage ratios.

The FTSE Nareit All Equity REITs index posted a total return of 6.9% last week, after a 4.3% gain the week before.

This year’s virtual sessions included organizations based in Switzerland, the U.K., Sweden, and Germany.

REITs outperformed the broader markets by a wide margin, especially those property sectors that had been most impacted by the shutdowns and social distancing measures.

The pandemic had a significant impact on demand for commercial real estate in the third quarter, resulting in rising vacancy rates and slowing or falling rents and property prices. The impact was uneven across property types, however, with greater effects on office and retail property markets, but smaller or little impact on multifamily and industrial properties.

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.

REITs posted declines comparable to those on broad market indices.

The travel industry has been severely impacted by the pandemic, including the lodging/resort REIT sector, but measures to reduce risks of infection have allowed hotels to continue reopening, and occupancy has begun to rise in recent months.