REITs rise nearly 3% in September

U.S. REITs rose 2.7 percent in September, according to the FTSE Nareit Equity REITs Index, and increased 16.1 percent in the third quarter. That puts REIT performance into positive territory, year-to-date, with a return of 15.9 percent in the first nine months of the year.

REITs have been buoyed up by expectations of a looser monetary policy.

“The onset of the Federal Reserve’s rate-cutting cycle is expected to serve as a major catalyst for REITs, boosting valuations as discount rates fall. Historically, REITs have outperformed during similar economic conditions, and sectors with resilient, long-term cash flows are attractive today. Investors seeking real estate exposure should see this period as a compelling opportunity to benefit from REITs’ liquidity and potential for cap-rate compression,” said Todd Kellenberger, REITs portfolio manager at Principal Asset Management. He noted that this dynamic already has been in motion, with REITs beginning their recovery