Profiting from Sustainable Growth: A Review of 2009 Global REIT Performance and Expectations for 2010
1 At the start of 2009, very few investors could have predicted the strength of the recovery of listed real estate securities. Developers, particularly in China, Hong Kong and Brazil, were among the first to recover on the back of a rapid improvement of the housing environment and, in some cases, distressed valuation levels. While the latter half of 2009 saw a definite continuity of the recovery, it proved to be quite different in terms of its leadership. Not only did we see a regional shift as real estate firms from North America, Europe and Australia generally outperformed those of Asia, but it also seemed that investors gradually looked for a combination of sustainable income, quality real estate and better corporate governance. Differentiation among companies will likely become even more important in 2010 as returns will vary significantly depending on various corporations’ ability to deliver earnings according to expectations.