U.S. REITs found their footing in the past two months, as the market began to anticipate a drop in interest rates. REITs gained 6.4 percent in August, according to the FTSE Nareit Equity REITs Index, and are up 12.9 percent year-to-date. Listed real estate outperformed the broader stock market in August, which saw the S&P 500 Index rise 4.9 percent, and the Nasdaq Composite Index advance 0.7 percent.
REITs’ strong performance in August was broad-based, with most property types showing a rise in total return. Among the best performers were self-storage (up 13.3 percent), apartments (up 10.4 percent), regional malls (up 8.5 percent) and healthcare (up 7.8 percent).
Looking ahead, REITs are in a strong position to continue to outperform.
“In the coming years, we expect to see listed REITs take advantage of their access to both equity and debt capital markets to go on offense and acquire quality real estate from private owners facing balance sheet pressure,â
