REITs End 2016 with a Total Return of 9.3 Percent

REIT returns reversed a four-month downward trend in December   as concerns about rising interest rates eased, market watchers said.

The FTSE/NAREIT All REIT Index  had a total return of 4.2 percent in December, while the S&P 500 index return was 2.0 percent. Total returns of the FTSE/NAREIT All Equity Index were 4.5 percent in December, while total returns of the FTSE NAREIT Mortgage REITs Index were 0.7 percent.

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REIT Continue to Beat S&P 500 in 2016

REIT gains were in line with the broader market in July, but on a year-to-date basis, REITs have far outpaced the S&P 500 Index as investors continue to search for yield, analysts said.

The FTSE/NAREIT All REIT Index had a total return of 3.9 percent in July, while the S&P 500 Index gained 3.7 percent. For the year through the end of July, the total return of the FTSE/NAREIT All REIT Index was 18.1 percent, while the S&P 500 Index posted a total return of 7.7 percent. The yield on the 10-year Treasury note dropped 0.8 percent in the first seven months of 2016.

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Market Watchers Say REITs Poised for Solid 2016

After outperforming the S&P 500 in 2015, market observers expect REITs to offer solid growth prospects in 2016.

The FTSE NAREIT All REITs Index had a total return of 2.3 percent for 2015, compared to a return of 1.4 percent for the S&P 500 Index.  In December, the FTSE NAREIT All REITs Index gained 1.2 percent, while the S&P 500 Index dropped 1.6 percent.

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Green Street Projects Real Estate Pricing Adjustment in 2016

Andy McCulloch, managing director and head of real estate analytics at Green Street Advisors, joined REIT.com for a video interview at REITWorld 2015: NAREIT’s Annual Convention for All Things REIT at the Wynn Las Vegas.

McCulloch discussed the major findings of a recent Green Street report on the real estate cycle. The report concludes that the current commercial real estate cycle is nearing the end of its lifespan, although McCulloch conceded that the cycle could be extended. Valuations have become “fairly expensive,” according to McCulloch.

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