In the the latest episode of The REIT Report: NAREIT’s Weekly Podcast, Mike Grupe, NAREIT executive vice president for research and investor outreach, offered his perspective on the implications of real estate being elevated to a new headline sector under the Global Industry Classification Standard (GICS).
David Neithercut, president and CEO of Equity Residential (NYSE: EQR), joined REIT.com for a CEO Spotlight video interview at REITWorld 2015: NAREIT’s Annual Convention for All Things REIT at the Wynn Las Vegas.
Neithercut, who served as NAREIT’s 2015 Chair, reflected on the main challenges and opportunities for the industry going into 2016.
REITs gained ground in September and outpaced the broader market, as fundamentals in the sector continued to hold firm, market watchers said.
The total returns of the FTSE/NAREIT All REIT Index rose 1.9 percent in September, while the S&P 500 Index lost 2.5 percent. The yield on the 10-year Treasury note was 0.1 percent lower for the month. Through the end of September, REIT total returns were down 4.5 percent, while the S&P 500 Index was down 5.3 percent.
The commercial real estate industry is poised for broad-based growth in the coming year as performance and profitability continue to improve across most property types and markets, according to projections from consulting firm Deloitte.
The company’s 2015 outlook is supported by improving property fundamentals, a strengthening economy, easy financing, and increased domestic and international investment activity, according to Deloitte. Against that backdrop, U.S. REITs are expected to continue to outperform benchmark indices such as the S&P 500 and Russell 2000.
In the latest edition of Quick Study, Brad Case, NAREIT’s senior vice president for research and industry information, offered an analysis of REIT market gains in August.
The total return on the FTSE NAREIT All REITs Index increased 3.4 percent for the month, slightly below the 4.0 percent gain in the S&P 500 Index during the same period. As of the end of August, the FTSE NAREIT All REITs Index was up 19.8 percent, compared to a 9.9 percent gain for the broader market.
“REITs are strongly outperforming… real estate investors have really been rewarded,” Case said.
REITs had another solid performance in May as the FTSE NAREIT All REITs Index posted a total return of 2.8 percent, ahead of the 2.4 percent return for the S&P 500 Index.
Year-to-date, the FTSE NAREIT All REITs Index has advanced 14.8 percent, while the S&P 500 Index is 5.0 percent higher.
“It’s another positive month, continuing the upward trend of the year,” noted Jeff Langbaum, REIT analyst for Bloomberg Industries.