U.S. REITs declined by 6.8 percent in September, according to the FTSE Nareit Equity REITs Index, and logged a decline of 7.1 percent in the third quarter. Year-to-date, equity REITs are down 2.1 percent, significantly lagging the broader equity markets. The S&P 500 Index is up 13.1 percent in the first three quarters of the year.
The best performance in September was recorded by the lodging/resorts sector, halting its decline in August, and advancing 0.9 percent. Year-to-date, hotel REITs have returned 0.8 percent. Data centers fell 7.1 percent in September but are the best-performing sector year-to-date, returning 16.4 percent in the first nine months of the year.
Public REITs present an opportunity to buy discounted real estate now, according to Todd Kellenberger, REITs portfolio manager with Principal Asset Management.
“The challenges for real estate have been visible for a while now, and markets have priced it in for REITs given their liquid, public n