REITs fall in May, lagging broader market

U.S. REITs fell in May, with the FTSE Nareit Equity REITs Index falling 6.2 percent in the month. Year-to-date, REITs are down 13.8 percent, according to the index. Inflation and rising interest rates have posed problems for the sector, and REITs underperformed the broader market last month, as the S&P 500 Index was virtually flat in May.

The biggest drop was seen in the industrial sector, which fell 15.6 percent in May. The industrial sector is down 22.7 percent in 2022, although the segment has seen continued strong fundamentals this year. In industrial REIT news, Duke Realty Corp. rejected a $24 billion takeover offer from Prologis, claiming it was “insufficient.”

Other REIT sectors to record big declines in May include self-storage (down 9.4 percent), apartments (down 8.3 p