REITS
REITS
REITS
Surveys
Real Estate Investment
Trusts
SEPTEMBER 2022
Copyright © 2022
CFRA
977 Seminole Trail, PMB 230
Charlottesville, VA 22901
All rights reserved.
CHARTS & FIGURES NEW THEMES
6 Revenue Growth
Real Estate Investment Growth
High Inflation and Rising Interest Rates Will Continue to Drive REIT Volatility
Sustained high inflation has prompted the Fed to accelerate their interest rate hiking trajectory, with current
estimates leading to rates of 3.50% to 3.75% by year-end 2022 (from 0.0% to 0.25% at the start of 2022).
Higher interest rates are a headwind for REITs as they lead to increased borrowing costs and often lower
property values. However, REITs are generally viewed as an inflation hedge due to contractual rent increases
built into leases and the concentration of “real assets” in their portfolios. Increased volatility should be expected
as investors weigh the potential impacts of these variables, with REITs able to adjust rents quickly (i.e., self-
storage, hotels) and those with limited need to raise debt likely benefiting.
Office REITs Face Difficult Outlook Amid Work from Home Trends and Potential Recession
Our outlook on office REITs is negative as the shift towards remote and hybrid work has resulted in a weak
post-Covid-19 recovery while a likely turn in the economy resulting in higher unemployment may cause a
further weakening of demand for office space. In H1 2022, physical occupancy among 10 major markets was
about 65% and at the 30% level for New York City and San Francisco.
Self-Storage REITs Benefit from Resilient Consumer and Demand for More Space
Sustained high demand since the pandemic has been driven by e-commerce growth as retailers look to utilize
self-storage facilities for “last-mile” delivery solutions and an acceleration in work from home trends requiring
people to find space for home-office setups. We believe these trends are likely to continue into 2023 while
industry fundamentals remain strong, with consumers length-of-stay at self-storage facilities rising in 1H 2022.
Shortages in U.S. Housing Supply and Low Affordability to Boost Residential REITs
We believe the pendulum for rent versus buy is moving back strongly in favor of rental properties, as
affordability and availability make owning a home extremely expensive today. As a result, we believe multi-
family and single-family rental units are poised to outperform into 2023.
Industrial REIT Fundamentals Remain Exceptional, Despite Significant New Construction Pipeline
We believe the secular shift towards e-commerce is likely to continue moving forward, helping keep demand for
industrial real estate elevated. Meanwhile, we think rental rate growth can remain in the high teens for premier
industrial REITs through 2022 as vacancy remains near historic lows. While new supply in 2023 is likely to
outpace net absorption, we think industrial REITs concentrated within Tier 1 markets will be more insulated
from this new supply growth due to limited available space and significant zoning restrictions.
ETF FOCUS
12.9%
VNQ AUM ($B)
Expense Discount of U.S. -11.5% Y/Y
Vanguard Real Ratio equity REITs from Decline in
41.1 0.12 consensus S&P P/FFO multiple
Estate
Global NAV per for August 2022
share estimates
Expense
SCHH AUM ($B)
Ratio
Schwab U.S. REIT 6.3 0.07
REET Expense
AUM ($B)
iShares Global Ratio
3.1 0.14
REIT
14.1% -40 bps Y/Y
Decline in
Expense Estimated
ICF AUM ($B) revenue growth
Implied Cap
iShares Cohen & Ratio Rate for Q1
2.7 0.33
for 2022
2022
Steers REIT
Revenue Growth
(aggregate value weighted per share, $) (in percent) ◆ Revenue grew 2.7% in 2021. We expect revenue
36 20
growth to remain strong moving forward, with
growth of 14.2% in 2022 and 5.7% in 2023.
34 15
◆ Due to the rather disparate nature of the property
32
10 types within the REIT industry, it isn’t easy to
30
5
characterize revenue trends at the aggregate
28 level. For most REITs, rental income is the largest
0
26
source of revenue growth, which we see staying
-5 strong in 2022 as the post-pandemic recovery
24
continues.
22 -10
◆ The Covid-19 pandemic has particularly hurt
20 -15
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2023* Office and Hotel REITs. The former is very
sensitive to the general economy, employment,
Total Revenue (left scale) Revenue Growth (right scale)
*Estimated.
and episodic events like the coronavirus, while the
Source: CFRA, S&P Global Market Intelligence. latter was further hampered by travel restrictions
put in place because of the pandemic. Each is
likely to face headwinds from new hybrid or work
from home trends as demand for office space
declines while business travel is unlikely to reach
pre-Covid-19 levels, in our view.
Price-to-NAV
(in percent, monthly average) ◆ Price recovered to a high of 104.2% NAV in April
120 2022 from the nadir of 68.0% in April 2020. The
110 price/NAV figure stood at 97.3% as of August 10,
100 2022, amid a slight pullback in the second half of
90
the year. Despite that, prices still stand above
the average of 89.3% of NAV since 2019.
80
Capitalization Rates
(in percent, quarterly) ◆ REIT cap rates declined across the board in Q1
10.0
9.0 2022 from year-end 2021 levels. The 10-year
8.0 Treasury yield, on the other hand, trends higher
7.0
6.0 after falling substantially from Q2 2020 through Q4
5.0
4.0
2020.
3.0
2.0 ◆ This suggests that property valuations are relatively
1.0
0.0
expensive and raises concerns about how prices
might react when interest rates rise.
Apartment
Industrial
Office
Retail
◆ However, as Treasury yields have inched higher
Total 10-year Treasury yield
recently, we think cap rates could start rising to
*Data through Q1.
Source: Mortgage Bankers Association, Federal Reserve. compensate investors adequately.
Housing Starts
(seasonally adjusted annual rate, in thousands) ◆ U.S. privately-owned housing starts were at a
1,500 seasonally adjusted annual rate (SAAR) of 1.43
1,250 million units in July 2022, down 8.5% Y/Y.
1,000 ◆ Total existing-home sales in July 2022 slipped
750
20.2% Y/Y to a SAAR of 4.81 million units,
extending the sales decline for the sixth month.
500
According to NAR, this reflects the impact of the
250 peak mortgage rate of 6% in June.
0
2008 2010 2012 2014 2016 2018 2020 2022*
◆ We attribute such a decline to soaring house
Single-family Multiunit
prices and higher mortgage rates, which works to
*Data as of July.
cool overheating demand. We forecast existing
Source: U.S. Department of Commerce. home sales to remain subdued into 2023 barring
a significant retreat of mortgage rates to well
below 5%.
Retail & Food Service Sales vs. E-commerce Retail Sales Growth
(Y/Y growth rate, in percent) ◆ Brick-and-mortar sales rebounded strongly
60 immediately after lockdown relaxation. However,
50 such increases were a result of a pent-up demand
40 and unsustainable. In Q2 2022, retail sales grew
30 10.8%, down from a high of 29.7% in Q2 2021.
20
◆ Conversely, e-commerce retail sales—a significant
10
driver of industrial property demand—surged
0
52.7% Y/Y in Q2 2020. However, as more people
-10
are allowed out of their homes, its growth started to
-20
2008 2010 2012 2014 2016 2018 2020 2022* taper (just 6.8% Y/Y growth in Q2 2022).
Retail and Food Service Sales ◆ In the longer term, we see a continued secular shift
E-Commerce Retail Sales
to online shopping as both the ease and speed of
*Data through Q2.
Source: U.S. Census Bureau. online shopping continue to improve, which will
likely hurt retailers for many years to come.
Through August 26, 2022, stocks in the real estate sector were down 17.9%, performing worse than the
S&P Composite 1500 index’s loss of 14.7%. This follows a 38.0% gain in 2021, a 8.5% decline in 2020, a
10.8% gain in 2019, and a 4.2% decline in 2018 for real estate stocks.
200
150
100
50
(50)
(100)
2015 2016 2017 2018 2019 2020 2021 2022*
Despite a dismal 2020, the REIT industry regained much of its footing in 2021 as economic activities
resumed and stay-at-home restrictions were largely relaxed. However, REIT performance alongside the
general economy took a turn for the worst in 2022 amid economic uncertainties brought on by 40-year
high inflation due to substantial economic stimulus during the pandemic, supply chain issues, and the
Russia-Ukraine war. With both countries being major exporters of raw food and energy products, being at
war meant major disruption for importers that rely heavily on those goods. Such an effect sent ripples
across the globe, most notably with increased food and gas prices, sending inflation rates through the
roof.
That said, we believe most negatives have been priced in at current market valuation, enabling REIT
share prices to recover in 2023 barring further escalation of the Russia-Ukraine conflict, a significant
global recession, or other disruptions to the return of normal economic activities around the globe from
Covid-19 lockdowns of previous years. Other major risk factors include uncertainties surrounding new
Covid-19 (or disease – i.e., Monkeypox) variants and the effects of increased interest rates.
While REIT fundamentals ultimately benefit from a strong economy, consumer spending, and job growth,
we think this could be somewhat offset by the relative attractiveness of shares of REITs. The low but
increasing interest rates make dividend-paying REITs more attractive, while unprecedented actions by
the Treasury and money creation by the Federal Reserve make ownership of “hard assets” like real
estate more appealing to investors worried about inflationary pressures currently in play. REITs generally
600
500
400
300
200
100
-100
Year-to-date (YTD) through July 2022, a total of 70 U.S. REITs announced dividend increases, or
approximately 42% of the total U.S. REIT industry. This is slightly down from the 88 dividend increases
announced in 2021 but contrasts the 44 companies forced to cut dividends during the pandemic year.
However, the good news is not spread equally across all property types. Property types that constituted
the largest increase in dividends include retail (with 15 YTD hikes – nine of which were shopping centers),
residential (14 hikes), and specialty (12 hikes – consisting of data center, energy infrastructure, casino,
advertising, timber, communications, land, and cineplex REITs). On the other hand, hotel and resort
REITs were the lowest with only one dividend increase. Since the pandemic, hotel and resort REITs
suspended dividend payments and drew down their credit facilities to preserve cash. Even with lockdown
restrictions being lifted in many areas, most hotel properties are still operating at very low levels. In July
2022, STR reported that occupancy rates averaged 69.6% for hotels in the U.S., while the average daily
rate and revenue per available room stood at $159.08 and $110.73, respectively.
As of August 10, 2022, the Dow Jones Equity All REIT Index dividend yield was 3.3%, representing a
positive spread of 49 basis points (bps) over the 10-year Treasury note yield of 2.8%. U.S. REIT yields
reached a post-pandemic high of 3.6% in June 2022 before sliding amid economic concerns. This is
compared to the 4.4% average yield in pre-pandemic 2019. The average yield spread between the Dow
Jones U.S. REIT index and the 10-year Treasury from 2015 to 2019 was approximately 230 bps (or 2.3
percentage points). Therefore, we see REITs as slightly undervalued on this measure.
5.0
4.0
3.0
2.0
1.0
0.0
2015 2016 2017 2018 2019 2020 2021 2022*
In addition, to combat unruly inflation, the Federal Reserve had raised interest rates for the first time since
the onset of the pandemic in March 2022. Since then, there were three instances of rate hikes, taking the
latest benchmark rate to a range of 2.25%-2.50%. For the last 12 months ended July 2022, consumer
prices were up 8.5%. While still high, the figure represents a significant drop from 40-year high 9.1%
recorded in June. Rising interest rates alone are viewed as a headwind for REITs, as by themselves they
are likely to lead to increased borrowing costs. REITs are often considered more sensitive to higher
borrowing costs than other industries, as they are heavily financed by debt, at-the-market (ATM) equity,
property dispositions to fund new developments, and mergers and acquisitions (M&A). This is largely a
result of REITs being required to distribute at least 90% of taxable income to shareholders annually in the
form of dividends, prohibiting REITs from utilizing a significant portion of their retained earnings for
business investment. Rising borrowing costs may further lead to depressed property values and even
properties trading at a discount to net asset value (NAV).
Operating Environment
U.S. Economic Forecast Update
Because the operating environment of the REIT industry is so closely aligned with the macroeconomic
environment, a review of the macroeconomic environment is helpful in assessing the REIT operating
environment. Despite the $1 trillion stimulus package and passing of the Inflation Reduction Act (also
known as the climate bill), the U.S. economy is still in a precarious position with increasing recessionary
fears. As such, real GDP is expected to grow only 1.7% this year, and 1.5% in 2023, according to
forecasts by Action Economics as of August 20, 2022.
The national unemployment rate currently stands at 3.5% in July 2022, on par with the pre-pandemic
figures and seemingly closer to the Fed’s “full employment” mandate. Job growth in July 2022 was
significantly higher than estimates despite higher interest rates and recessionary fears. There were
528,000 jobs created during the month, compared to economists’ expectation of only 250,000. Action
Economics forecasts the rate to remain 3.6% in 2022 and 2023.
However, we note unemployment tends to be a lagging indicator and can be a contrary indicator at
extreme lows and highs. Conversely, initial unemployment claims tend to be a leading indicator of
unemployment. Fortunately, this figure had also shown steady improvements since the start of the
pandemic. In the week ending August 18, 2022, only 250,000 people filed new claims for unemployment
benefits. The figure contrasts the 17 million new filings for the three weeks ending April 4, 2020, but
remained slightly above the four-week moving average of 246,750. Continuing unemployment claims
came off a record peak as well, standing at 1.4 million as of August 6, 2022 (versus 24.9 million at the
peak in May 2020).
In response to the Covid-19 outbreak, the Fed brought interest rates down to a range of 0.0% to 0.25%.
While most analysts (ourselves included) saw “lower for longer” as the default scenario for interest rates,
this all changed when the consumer price index (CPI) figure came in much higher than expected. CPI
figures reached 6.2% Y/Y in November 2021 before climbing to a 40-year high of 9.1% Y/Y in June 2022,
before inching lower to 8.5% Y/Y in July. This prompted the early termination of the Fed’s bond-buying
program and initiation of a multi-stage interest rate hike starting in March 2022.
REIT shares typically trade inversely to the 10-year Treasury yield, but the correlation appeared to have
broken during the height of the pandemic amid significant market fluctuations (see chart below). It wasn’t
until recently – in April 2021 – that the two resumed their inverse relationship. YTD through August 10,
2022, the 10-year yield gained 101 bps, while shares in the Dow Jones Equity All REIT Index rose by 44
bps.
3.0 100
2.5 80
2.0 60
1.5 40
1.0 20
0.5 0
0.0 -20
2016 2017 2018 2019 2020 2021 2022*
10-Year U.S. Treasury Yield - end of period (left scale) Dow Jones Equity All REIT (right scale)
As shown in the table below, most U.S. REITs are moderately levered and have been reducing leverage
along with the previous rising rate environment. This somewhat reversed in 2020, with REITs issuing
more debt to secure liquidity while also experiencing declining EBITDA. However, debt issuance was
once again reversed in 2021 amid improving economic conditions and revenue performance.
Cap rates today are low, but interest rates are even lower, despite recent hikes. The cap rate spread to
the 10-year Treasury yield – which measures the return above risk-free rates to property investors – has
widened from 3.1 percentage points (ppts) in the fourth quarter of 2018 to 5.4 ppts in the third quarter of
2020. Since then, we saw the narrowing of cap rate spread to 2.9 ppts as of the first quarter of 2022
(latest available) due to an increasing Treasury yield and decreasing cap rates.
We project capitalization rates for REITs will remain relatively low. We think institutional investors have
taken a greater interest in public REITs as a proxy for the commercial real estate market. REITs offer
investors a liquid investment vehicle to increase exposure to the real estate market, as well as the ability
to rotate between individual property groups quickly. Additionally, during periods of economic uncertainty,
REITs offer a consistent dividend component for investors who seek total return. We see cap rates rising
in the year ahead as investors demand higher compensation in a rising rate environment.
CAPITALIZATION RATES
(in percent, quarterly)
10.0
9.0
8.0
7.0
6.0
5.0
4.0
3.0
2.0
1.0
0.0
2008 2010 2012 2014 2016 2018 2020 2022*
Risks to increased real estate transactions are tied to buyers and sellers not agreeing on the fair value,
REITs’ hesitancy to dispose of key properties, reduced fundraising by private equity firms, a slow-growth
economy that ends in recession, less access to the credit markets, and reduced investor confidence. A
capital-market slowdown and uncertainty over property-level cash flow will likely mean fewer interested
buyers. In addition, lenders may increasingly get nervous, which will add to the transaction freeze. That
said, we do not foresee such an event happening in the short term.
10
(5)
(10)
(15)
(20)
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022*
HIGH - Competitors LOW - Most suppliers HIGH - Tenants usually HIGH - Potential HIGH - Not only are
can easily enter the are fragmented, have ample options multi-family tenants there a wide variety
market as long as they including suppliers of when choosing an have options of of well-capitalized
can acquire land and land, labor, and raw apartment, even within renting single-family multi-family
access capital markets. materials. However, the same small area for homes, buying a operators, but there
Some operators may suppliers are beholden large cities. Price residential unit or is also a large
have moderate barriers to economic cycles comparison is easy house, or even amount of "mom-
to entry in dense urban where they can and potential tenants moving in with and-pop" landlords
areas where land is demand higher prices can play landlords friends or family or that rent out
scarce and zoning or during boom phases against each other. finding a sub-lease. individual condo
entitlements can but must accept lower Leases are usually Affordability of home units, homes, rooms,
prevent new prices in cyclical short term at one year. ownership is a threat, etc. Although multi-
development, as in the downturns. However, due to higher even with low family has benefited
Seattle and California switching costs and mortgage rates from a shift to more
markets. Specialized inconvenience of average home selling renters after the
MULTI- multi-family, like moving, buyer power is prices have housing crisis,
FAMILY student housing or somewhat diminished continued to competition remains
manufactured housing and higher prices can increase. high and large
communities, may have be passed to current operators may find
higher barriers to entry tenants more easily. they need to lower
and are more Power of buyers may rents dramatically to
recession-resistant vary between Class A keep their preferred
properties. and Class B properties, 95% occupancy
or at different stages of levels. Multi-family
the economic cycle. REITs are either
concentrated in
coastal markets,
often in urban
markets or have a
large footprint in Sun
Belt markets.
MEDIUM - This is very LOW - Most suppliers HIGH - Tenants of MEDIUM - Business HIGH - Hotel
location dependent as are fragmented, hotel rooms have travelers or large operators face
the threat of entry to including suppliers of incredible choices with groups must usually intense competition
suburban and middle- land, labor, and raw multiple hotels often in use or contract with against other efficient
tier lodging is high but materials. However, the same geographic large hotel chains for and well-capitalized
first-tier and "trophy" suppliers are beholden area. Technology, such their needs. peers. Prices are
property locations in to economic cycles as travel search However, individuals readily visible to all
major cities or prime where they can engines, makes price and leisure travelers participants and can
waterfront locations are demand higher prices comparison easy, and have an increasingly be changed daily,
in very short supply. during boom phases given the lease term is expanding choice forcing competitors to
but must accept lower essentially one- given the rise of react instantaneously
LODGING prices in cyclical day/night, operators services such as so as to not lose
downturns. are subject to pricing Airbnb and vacation share. Given
and occupancy risks. rentals. Covid-19 has consolidation, the
demonstrated to large hotel operators
companies that much are roughly equal in
of their previous terms of power and
business travel and must fight for market
conferences were share.
unnecessary or not a
good return on
investment.
Residential REITs
Residential REITs own and manage various forms of residences and rent space in those properties to
tenants. Residential REITs include REITs specializing in apartment buildings, student housing,
manufactured homes, and single-family homes. Within those market segments, some residential REITs
also focus on specific geographical markets or classes of properties.
YTD through August 30, 2022, the Dow Jones U.S. Real Estate Residential Index was down 20.3%
versus S&P Composite 1500 Index’s decline of 15.9%. In comparison, the price performance for
residential REITs was up 59.9% in 2021 versus the S&P Composite 1500 Index’s gain of 28.5%. As of
August 17, 2022, S&P Global Market Intelligence indicated residential REITs traded at 2.9x P/B and have
a TEV/Unlevered FCF of 26.8x compared to U.S. equity REITs trading at a 2.8x P/B and 20.6x
TEV/Unlevered FCF multiple.
6.0
5.5
5.0
4.5
4.0
3.5
2017 2018 2019 2020 2021
EBITDA-to-interest expense Recurring EBITDA-to-interest expense
U.S. RESIDENTIAL REIT FUNDS FROM OPERATIONS & REAL ESTATE INVESTMENT
(in percent)
14 43
12
10 42
8 41
6
4 40
2
0 39
-2 38
-4
-6 37
2017 2018 2019 2020 2021
70 11
10
68
9
66
8
64
7
62 6
60 5
Top of mind are the housing shortage and affordability for home ownership that make multifamily rental
properties attractive, in our view. Most parts of the country are seeing 15%-20% Y/Y increases in new
lease rates, while renewal rates have been 8%-12% higher from our observations of the largest metro
markets. Residential REITs are likely to be optimistic for Q2 2022, as the pandemic is less disruptive to
rental revenue, net operating income, and occupancy levels. We think residential REITs may launch
select property developments and will complete developments in progress.
We think demand for rental units may exceed pre-pandemic levels in 2022, given U.S. housing shortage
and affordability with record average home selling prices. The pendulum for rent versus buy is moving
back strongly in favor of rental properties, as affordability and availability make owning a home extremely
expensive today.
Looking ahead to 2022, rental renewal and new lease rates are likely to recover as property owners are
less concerned about tenant turnover during strengthening economic conditions. New leases in many
markets have already removed one to two free months, and rental rates are moving well above pre-
pandemic levels in most urban markets. We note urban and suburban apartments are in high demand.
Affordability may be an issue with select Class A properties in coastal markets that ask for high rental
rates. In the Sun Belt markets, we see more stability in Class B properties that are older apartment
complexes, but high-priced Class A new apartments have solid leasing. We think residential REITs with
We are positive on leisure rentals of manufactured mobile homes in Sun Belt markets that benefit from
baby boomers retiring in large numbers. These homesite communities target retirees from middle-class
households, who are a more stable category, and that are not dependent on job employment.
Vaccinations are opening up these rental communities.
Another promising area is single-family rental homes that take advantage of families seeking a new
lifestyle in the suburbs. Recently, investors were 33% of February existing home sales. Private equity
firms and other institutions are increasing their investments in single-family home rental real estate. The
property developers target attractive neighborhoods at in-fill locations with demand attributes, such as
proximity to desirable schools.
1,750
1,500
1,250
1,000
750
500
250
Single-family Multiunit
U.S. RETAIL REIT FUNDS FROM OPERATIONS & REAL ESTATE INVESTMENT
(in percent)
30 54
53
20
52
10
51
0 50
49
-10
48
-20
47
-30 46
2017 2018 2019 2020 2021
In 2021, store openings outpaced closures for the first time since 2016. Data published by Coresight
Research showed that 5,083 store openings were announced by major retailers in 2021, compared to
5,079 closures during the same period. This trend has continued into 2022, with a net positive 3,765 store
openings projected through the first quarter, according to Daily on Retail, as retailers took advantage of
the strong U.S. consumer and a favorable funding environment. However, signs of a retail slowdown may
be beginning to emerge. After retail sales rose a staggering 75.0% in 2021 off of April 2020 lows,
according to the U.S. Census Bureau, retail sales declined 0.3% month-over-month in May 2022, the first
decline in five months. This slowdown in spending is likely a result of high inflation and recession fears
that are beginning to eat away at consumers’ spending power; at the same time, excess pandemic-
related savings are being spent down. If the U.S. economy begins to meaningfully slow in the second half
of the year, we expect that many retailers who have been focused on expanding their retail presence
coming out of the pandemic may be forced to reconsider plans or even close some recently opened
locations.
5.0
4.5
4.0
3.5
3.0
2.5
2.0
2017 2018 2019 2020 2021
EBITDA-to-interest expense Recurring EBITDA-to-interest expense
U.S. REGIONAL MALL REIT FUNDS FROM OPERATIONS & REAL ESTATE INVESTMENT
(in percent)
50 70
40 68
30 66
20
64
10
62
0
60
-10
-20 58
-30 56
-40 54
2017 2018 2019 2020 2021
Real estate investment growth
Funds from operations growth
Coronavirus Drove the Final Nail in the Coffin for Many Shopping Malls
Prior to the outbreak, enclosed shopping malls were already struggling for years. Weaker operators were
the first affected but soon spread to the “Class A” operators (see next section below). With the restrictions
in place to help stop the spread of the virus, virtually all shopping malls were ordered to close or partially
close, leaving their tenants with no choice but to close as well.
Many mall operators allowed tenants to defer a few more months’ rent, making it due sometime in mid to
late 2021. From an accounting perspective, REITs are required to put these tenants on a cash collection
basis if collectability is in doubt rather than continue to account for the full rent on an accrual basis.
Nevertheless, it was clear that mall operators faced a massive decline in rent revenue when cash flows
were already tight. However, shoppers have largely returned to malls, as evidenced by foot traffic
The year 2020 did see two publicly traded malls file for bankruptcy – CBL Properties and Pennsylvania
Real Estate Investment Trust. Both REITs have continued operations at their respective properties while
undergoing restructuring. In 2021, however, only Washington Prime Group filed for Chapter 11
bankruptcy protection. With rising interest rates and a potential recession looming over the next 6 to 12
months, many mall operators may find themselves tested again much sooner than they initially
anticipated.
While most restrictions on retail businesses were lifted months prior, it wasn’t until the fourth quarter of
2021 that a greater sense of normalcy was felt as increased vaccination rates boosted the return of in-
person shopping. However, we think retailers will not benefit equally from the increased footfall. For
example, open-air centers, especially those with grocery stores as anchors, have outperformed since
2020 amid greater demand for space than their indoor counterparts due to fears of virus spread.
We still see malls facing increasing challenges as most of their tenants are still apparel retailers,
grappling with the rise of online shopping and changing consumer tastes. Additionally, we think many
major anchor tenants, such as J.C. Penney, Sears, and Macy’s, will continue shutting down stores. Mall
operators like to point out this is a good thing as anchors typically pay rent multiple times lower than their
other tenants, allowing mall operators to recapture this space and lease it to higher-paying tenants.
However, we note it is increasingly hard to find replacement tenants that desire as much space as a large
anchor. Further, for mall REITs to subdivide or reposition the space will require increasing capital
expenditures, putting pressure on cash flows.
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022*
*Data as of June.
Source: U.S. Census Bureau.
U.S. STRIP CENTER REIT FUNDS FROM OPERATIONS & REAL ESTATE INVESTMENT
(in percent)
35 48
30
47
25
20 46
15 45
10
5 44
0 43
-5
42
-10
-15 41
2017 2018 2019 2020 2021
Most single-tenant REITs have a triple net lease structure in which the tenant is solely responsible for all
of the costs relating to the property being leased (e.g., real estate taxes, building insurance, maintenance)
in addition to the rent. We see REITs with value-oriented tenants, such as off-price and discount retailers,
as faring better due to these tenants’ ability to compete on price more effectively against online retailers.
We also expect retail REITs with properties located in dense urban areas to perform relatively better due
to constraints in supply and a relatively more affluent customer base. However, even with prime real
estate locations, these REITs will need to increase capital expenditures to redevelop and reposition
properties to adapt to the shifting retailer trends. We see smaller store formats and a move to mixed-use
properties, including hotels, residential units, or offices key to long-term success amid changing
consumer tastes.
E-commerce activity surged in 2020 when most of the world was confined to their own homes. This led to
a lower growth rate in 2021 (and a surge in conventional retail as stores reopen). Despite so, we still think
that e-commerce retail sales growth will continue to outpace total retail sales growth for the next five
years. However, different types of retailers (and therefore REIT tenants) will be affected by the shift to e-
commerce differently (see table on next page). Book retailers, for example, are the most vulnerable to e-
commerce threats as Amazon dominates the retail market for both print books and e-books. Retail REITs,
therefore, vary greatly in their exposure to tenants at risk of e-commerce disruption.
RETAIL & FOOD SERVICE SALES VS. E-COMMERCE RETAIL SALES GROWTH
60
50
40
30
20
10
0
-10
-20
2008 2010 2012 2014 2016 2018 2020 2022*
products in-store.
Amazon's purchase of PillPack has spurred renewed
interest in online pharmacy sales, which we think will
Drugstores 6%
continue to grow but at a slower pace than other
categories.
Native-online brands such as Warby Parker are now
Optical ND opening physical stores, which we think demonstrates the
value of brick-and-mortar for this category.
Mass merchandisers like Walmart and Target will look to
integrate e-commerce with their current store footprint,
Mass Merchandiser 7%
while we think discount clubs like Costco will continue to
fare well.
commerce.
We think nearly all consumer electronics sales will move
Electronics 34% online due to better pricing and extensive customer
reviews/recommendations.
The bankruptcy of Toys 'R' U.S. (while precipitated by high
leverage) is indicative of another big-box retailer that will
Hobbies, Toys, Games 25%
likely not be able to compete with lower prices and more
selection online.
The first casualty of Amazon, which still dominates as
Books 70% 40%-55% of all print books are purchased through
Amazon.com, plus Amazon's near-monopoly of e-books.
Source: U.S. Bureau of the Census, Packaged Facts, JLL, CFRA calculations; ND = No Data.
Office REITs
Office REITs own office buildings usually classified between urban or suburban geographies. These
REITs benefit when employment rises, forcing companies to find more space for their workers, and suffer
when companies lay off staff or move operations elsewhere. Office space generally is leased for several
years; therefore, the impact of changes in supply and demand can take time to flow through earnings and
funds from operations.
CFRA has a negative fundamental outlook on the office REIT sub-industry, given our fundamental
expectation that a recovery will be below pre-pandemic lease occupancies. We have moved from a
vibrant office market with full employment to economic slack in office real estate. Most offices across the
U.S. are open, but when will most employees follow? Perhaps when we are all vaccinated or Covid-19
ends.
History suggests office REITs’ share prices are sensitive to the economy and employment growth. While
both of these metrics declined sharply at the beginning of Covid-19 and remain poised to rebound, we
may be entering a new normal as to how companies and their employees want to use office space.
Looking ahead to 2022, office real estate is seeing signs of recovering, but the new normal may be very
different, with safeguards to protect workers. Delta and Omicron variants are likely to hurt office REIT
performance as well.
YTD through August 30, 2022, the Dow Jones U.S. Real Estate Office Index was down 28.8% versus
S&P Composite 1500 Index’s decline of 15.3%. In comparison, the price performance for office REITs
was up 23.4% in 2021 versus the S&P Composite 1500 Index’s gain of 28.5%. As of August 17, 2022,
S&P Global Market Intelligence indicated office REITs traded at 1.3x P/B and have a TEV/Unlevered FCF
of 19.7x compared to U.S. equity REITs trading at a 2.8x P/B and 20.6x TEV/Unlevered FCF multiple.
5.5
5.0
4.5
4.0
3.5
3.0
2017 2018 2019 2020 2021
EBITDA-to-interest expense Recurring EBITDA-to-interest expense
U.S. OFFICE REIT FUNDS FROM OPERATIONS & REAL ESTATE INVESTMENT
(in percent)
12 45
10 44
8 44
6 43
4 43
2 42
0 42
-2 41
-4 41
2017 2018 2019 2020 2021
Real estate investment growth
Funds from operations growth
Funds from operations-to-total revenue (right scale)
It will be challenging to get back to pre-pandemic occupancy levels. In H1 2022, physical occupancy
among 10 major markets was about 65% and at the 30% level for New York City and San Francisco. The
pace of employees returning to offices remains a risk that also affects office real estate transactions.
Currently, there are free rent concessions up to nine months for a seven- to nine-year lease. Both small
and large tenants have the pricing power to negotiate lower rental rates, to take less office space, and to
receive other incentives. We think this applies to renewing existing leases or signing new leases
somewhere else. Tenants are thinking about how much office space is required; we see concentration
risk in older office towers and new remote/hybrid policies that thin office workforce.
VACANCY RATES
(in percent)
18
16
14
12
10
8
6
4
2008 2009 2010 2011* 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
*Beginning with Q3 2011, NAR forecasts are generated based on historical data provided by REIS,
Inc., and do not correspond with prior historical information from previous forecasts.
Source: National Association of Realtors.
Leasing activity in Q1 2022 realized positive net absorption rate totaling 1.6m sq. ft., while leasing activity
totaled 45.8m sq. ft., according to CBRE, a leading real estate services firm. The overall vacancy rate fell
by 40 bps to 16.8% Q/Q. Downtown office vacancy rose 10 bps to 16.8%, its highest level since 1994.
Suburban office vacancy was 16.9%, the narrowest rate in many years.
Office construction has slowed further in Q1 2022 to 89.1m sq. ft. REIT companies plan to invest in select
new property developments, as they avoid office acquisitions and seek dispositions of non-core
properties. Many office REITs actively prune non-core properties, generally suburban offices with 80% to
90% occupancy rates versus central business district (CBD) markets with mid-90% occupancy.
That said, over the longer term, we still think that urban markets are likely to remain attractive for drawing
young talent in financial services, social media, and information technology. The panache of live, work,
play in urban markets has been harmed by Covid-19 until the coronavirus is no longer a threat.
Industrial REITs
Industrial REITs own and manage industrial facilities and rent space in those properties to tenants. Some
industrial REITs focus on specific types of properties, such as warehouses and distribution centers. They
play a critical role in the supply chain and are key to helping e-commerce retailers meet their rapid
delivery demands.
YTD through August 30, 2022, the Dow Jones U.S. Real Estate Industrial Index was down 27.1% versus
S&P Composite 1500 Index’s decline of 15.3%. In comparison, the price performance for industrial REITs
was up 55.2% in 2021 versus the S&P Composite 1500 Index’s gain of 28.5%. As of August 17, 2022,
S&P Global Market Intelligence indicated industrial REITs traded at 3.0x P/B and have a TEV/Unlevered
FCF of 34.7x compared to U.S. equity REITs trading at a 2.8x P/B and 20.6x TEV/Unlevered FCF
multiple.
12
10
0
2017 2018 2019 2020 2021
EBITDA-to-interest expense Recurring EBITDA-to-interest expense
U.S. INDUSTRIAL REIT FUNDS FROM OPERATIONS & REAL ESTATE INVESTMENT
(in percent)
40 53
35 51
30 49
47
25
45
20
43
15
41
10 39
5 37
0 35
2017 2018 2019 2020 2021
Real estate investment growth
Funds from operations growth
Funds from operations-to-total revenue (right scale)
Source: CFRA, S&P Global Market Intelligence.
Online sales have grown at steady compounded annual growth rates in the U.S., averaging over 17%
since 2010. Online spending in Q1 2022 increased sequentially, up 2.4% from the previous quarter and
6.6% year-over-year. While e-commerce spending as a percent of retail sales peaked over the pandemic
(16.4% in Q2 2020 vs. 14.3% in Q1 2022), we believe online retail still has ample room for further growth,
with Collier’s research estimating it will account for up to 23% of total retail sales by 2025.
Looking ahead, we expect net absorption (demand) to keep pace with new supply through 2022,
promoting elevated rental rate growth. Net absorption, a proxy for demand computed by taking the
industrial square feet leased during a period and subtracting the square feet that became vacant during
that period, has been very strong across U.S. markets over the last few years. In fact, demand (net
absorption) has now outpaced new supply growth for five consecutive quarters as of Q1 2022, according
to Cushman and Wakefield. While new construction has been increasing steadily during this period, new
supply has been hampered by significant supply chain backlogs, labor shortages, and rising materials
costs due to high inflation. In our view, each of these issues is likely to persist through year-end 2022.
As a result of this robust demand environment, overall industry vacancy has also decreased to an all-time
low of 3.3% in Q1 2022. This is again well below the long-run average vacancy rate of 5.9% over the last
15 years, according to CBRE. These decreasing vacancy rates have come despite average year-over-
year rental rate growth that reached an incredible 15.2% in Q1 2022, according to Cushman and
Wakefield. This is a major acceleration in rent growth from just 7.8% year-over-year in Q1 2021 and 1.1%
in Q1 2020. We expect the tight supply and demand conditions to allow rental rates to remain well above
historical levels, although some moderation from 15.2% growth is likely in the second half of 2022 and
into 2023.
Potential risks to our forecast include a significant decline in consumer spending, logistic operations
moving outside city centers in response to rising rents, and a reversal in current supply/demand dynamics
resulting in lower rents and/or occupancy rates.
YTD through August 30, 2022, the Dow Jones U.S. Real Estate Health Care Index was down 11.7%
versus S&P Composite 1500 Index’s decline of 15.3%. In comparison, the price performance for health
care REITs was up 16.5% in 2021 versus the S&P Composite 1500 Index’s gain of 28.5%. As of August
17, 2022, S&P Global Market Intelligence indicated health care REITs traded at 1.8x P/B and have a
TEV/Unlevered FCF of 4.9x compared to U.S. equity REITs trading at a 2.8x P/B and 20.6x
TEV/Unlevered FCF multiple.
4.7
4.5
4.3
4.1
3.9
3.7
3.5
2017 2018 2019 2020 2021
EBITDA-to-interest expense Recurring EBITDA-to-interest expense
U.S. HEALTH CARE REIT FUNDS FROM OPERATIONS & REAL ESTATE INVESTMENT
(in percent)
15 43
42
10
41
5
40
0 39
38
-5
37
-10
36
-15 35
2017 2018 2019 2020 2021
Real estate investment growth
Funds from operations growth
Funds from operations-to-total revenue (right scale)
Source: CFRA, S&P Global Market Intelligence.
Despite the disruptive nature of Covid-19 onto health care REITs, a recovery has since ensued.
Life sciences and medical office property types continue to exhibit strong sustained growth, while senior
operating housing properties (SHOP) have rebounded from pandemic lows. Our analysis of each sub-
segment follows:
▪ Senior Housing Benefitting from Higher Vaccination Rates and Positive Demographic Trends
Health care REITs concentrated within senior housing are likely to benefit from higher vaccination
rates and easing Covid-19 variant concerns. However, even with higher vaccination rates (over 91%
of the 65+ population is fully vaccinated), some restrictions will remain in place as facilities operate
with the utmost caution. As a result, industry expenses are likely to remain elevated due to increased
operating costs associated with Covid-19 safety precautions. While we expect labor pressures to
continue easing in 2022, elevated labor costs are likely to remain.
SHOP occupancy should continue rebounding from pandemic lows set in Q1 2021 but will likely fall
short of pre-pandemic levels in 2022. However, favorable supply/demand dynamics are emerging.
There has been a decrease in new senior housing supply, with 35,340 units under construction in Q4
2021, while slightly higher than Q3 2021, coming off the weakest pace since 2015, according to NIC
MAP Data Service. Further, inventory growth in Q1 2022 was the weakest since 2013. This trend is
likely to contribute to both higher occupancy and rent growth as demand returns or exceeds pre-
Covid-19 levels over the long term.
Life Sciences may face some headwinds through 2022 as funding likely slows from record 2021
levels, but our outlook remains positive. We expect any slowdown in funding to be minor as interest in
drug development, vaccines, and biotechnology remains elevated following the pandemic. Funding
reached $78b in 2021, up from $70b in 2020 and more than double the $36b in 2018, according to
Cushman & Wakefield. Tenant quality is key when evaluating REITs specializing in life sciences as a
tighter funding environment and rising recession risks could put some tenants, especially start-ups, at
increased risk of bankruptcy or missed rental payments.
20.5%
20.0% 19.7%
19.5%
19.5% 19.2%
19.0%
19.0% 18.8%
18.6%
18.4%
18.5%
18.0%
17.5%
17.7% 18.1% 18.5% 18.9% 19.3% 19.7% 20.0%
17.0%
2022 2023 2024 2025 2026 2027 2028
Source: U.S. Census Bureau, Centers for Medicare & Medicaid Services..
Self-Storage REITs
Self-storage REITs own and manage storage facilities and collect rent from customers. Self-storage
REITs rent space to both individuals and businesses.
YTD through August 30, 2022, the Dow Jones U.S. Real Estate Self-Storage Index was down 8.5%
versus S&P Composite 1500 Index’s decline of 15.3%. In comparison, the price performance for self-
storage REITs was up 74.9% in 2021 versus the S&P Composite 1500 Index’s gain of 28.5%. As of
August 17, 2022, S&P Global Market Intelligence indicated self-storage REITs traded at 7.7x P/B and
have a TEV/Unlevered FCF of 39.5x compared to U.S. equity REITs trading at a 2.8x P/B and 20.6x
TEV/Unlevered FCF multiple.
Shares of self-storage REITs have performed better on a relative basis through the pandemic as self-
storage is typically viewed as a more defensive sector during recessions. In 2021, the Dow Jones U.S.
Real Estate Self-Storage Index was up 74.9%, outperforming the broad Dow Jones Equity All REIT
Index’s 37.2%. However, self-storage REITs have struggled along with the broader equity REIT industry
in 2022 amid high inflation and rising interest rates, with the Dow Jones U.S. Real Estate Self-Storage
Index down 20.9%, in line with the Dow Jones Equity All REIT Index’s 20.6% drop as of July 13, 2022.
2021 saw exceptional rent growth due to people moving and adapting to changing pandemic lifestyles. A
generally strong housing market and increased adoption of flexible working arrangements have all led to
an increased demand for storage. The first half of 2022 has seen the self-storage market remain very
strong, although rental rate growth has started to decelerate from the rapid growth pace set in 2021.
However, through May 2022, industry fundamentals remain strong as properties under construction or in
the planning stages of development represent under 10% of existing inventory while street rental rates
remained at all-time highs, according to Yardi Matrix. We also expect new hybrid working arrangements
to be a long-term tailwind for the industry as many workers will need to set up and maintain home offices
long-term, driving increased demand for self-storage units. In our view, high e-commerce demand and
retailers push to offer “last-mile” delivery solutions should also continue providing tailwinds. In addition, as
inflation stays elevated, self-storages should benefit from its ability to quickly adjust rents, many of which
are on a month-to-month basis.
We were previously concerned about increasing supply given the favorable demand combined with easy
financing and low interest rates, which allowed operators to expand quickly. We admit our concerns of
increasing supply did not come to fruition as anticipated, or at least not to the extent where self-storage
REITs found themselves with too much supply and insufficient demand. Instead, many customers rented
units longer than anticipated while demand increased from others who found themselves working at home
6,000
5,000
4,000
3,000
2,000
1,000
When Covid-19 hit, there was a large spike in data center usage and traffic as many people were forced
to work remotely. Data traffic grew 60% Y/Y at the peak, which has stabilized to around 30% year-over-
year growth. The constant data usage throughout the day also fuels the strain as people reorganize their
work and home life around their personal schedules. We believe data traffic growth will remain in the 30%
to 50% range annually through 2030 as internet access increases globally while demand drivers such as
video streaming, e-commerce, and others continue growing at very high rates.
Demand is starting to outstrip supply in major markets, benefiting data centers. As of year-end 2021, the
global data center construction pipeline was at record levels, while the U.S. pipeline grew 19% Y/Y,
reaching 727 MW, according to JLL. Demand reached record levels in 2021, with 886 MW of absorption
Data center customers remained very healthy throughout the pandemic, and we do not expect many
requests for payment relief through year-end 2022.
Reducing power consumption is a win for both customers and data center operators. Lowering power
consumption can significantly reduce utility bills, which is important to every company. More recently, with
the rise in investor focus on environmental, social, and governance (ESG) metrics, lowering power
consumption also shows a commitment to environmental sustainability. While there are many ways to
improve the performance of the server, networking, and storage hardware, this is generally in the hands
of the customer who owns the equipment. The cooling system is provided by the data center operator.
Having efficient cooling options can be a strong competitive differentiator in a given market.
Datacenter operators are deploying innovative cooling and software monitoring to reduce cooling costs.
Digital Realty, Equinix, and QTS are racing to build data centers that take advantage of the unique
features of the local climate to cut cooling costs. For example, Equinix’s AM3 data center features its
Aquifer Thermal Energy Storage system, which employs cold groundwater in the winter months,
eliminating the need for traditional mechanical cooling and using excess heat to warm nearby buildings.
QTS has deployed smart airflow technology to monitor the temperature at the rack level and adjusts the
amount of cold air delivered based on exactly what is needed. Digital Realty also utilizes cold
groundwater when possible while also using more non-potable water for its evaporative cooling systems
rather than pulling from local potable water sources. These features are very attractive to customers, as
they can then advertise them to their customers. We believe Digital Realty, Equinix, and QTS have a lead
over the competition in terms of the number and efficiency of their data centers, which will help them win
new customers and expand relationships with existing customers.
Here’s why we see growth for wireless towers: 5G will continue to accelerate in 2022 by deploying small
cells and new macro antennas to support the network. In addition, 5G networks will deploy edge
computing, which could present a new revenue stream for these companies, which will be able to lease
space next to the towers.
We are seeing the first wave of C-Band deployments now that the A Block spectrum has been cleared.
However, we note there have been some limited delays due to concerns voiced by the aviation industry,
which is worried that C-band towers will interfere with radio altimeters. While the 5G C-band rollout ramps
up nationally, the target date for the spectrum deployed around airports has been consistently pushed
back. The network is now expected to be gradually rolled out around airports in July 2023. The higher-
frequency spectrum bands are valuable to wireless companies due to the ability to significantly increase
network capacity given how much more spectrum is available in those higher frequencies. However, the
signal travels over shorter distances, requiring more cell sites. As a result, we expect the deployment of
additional spectrum and this densification trend to drive significant demand for tower and small cell assets
in the years to come.
Regulatory Updates
1031 Exchange Could be Eliminated in a Biden Administration
The 1031 exchange – a rule regulating a like-kind exchange – has existed in the tax code for many
decades. It enables a property investor to avoid capital gains taxes on sales in certain circumstances; if
an investor rolls the proceeds of a real estate sale into a future property purchase of equal or greater
value, the profits are exempt from taxation. Until recently, the exemption applied to an array of assets,
including industrial equipment and rental cars. The provision for most industries was eliminated in the Tax
Reform Act of 2017, but it was left open for real estate.
However, President Biden said he wants to use proceeds from “rolling back unproductive and unequal tax
breaks for real estate investors with incomes over $400,000” on childcare and elderly services, leading
experts to believe the 1031 exchange program could be eliminated, which could reduce the number of
transactions that generate tax revenue and reduce liquidity. The proposed elimination would place a
$500,000 limit for individual gains and $1 million for joint returns. This encourages owners to hold on to
properties longer by disincentivizing property sales. It is projected to save property investors $41.4 billion
However, given the overall economic impact of abolishing the 1031 Exchange, we think the likelihood of
the rule being eliminated is low. According to a May 2021 study by Ernst & Young, tax income from
ancillary businesses associated with the Exchange came to approximately $7.8 billion. In addition, 1031-
related businesses would produce 568,000 jobs, including real estate investors, attorneys, lenders,
escrow specialists, etc., which brings in $27.5 billion in labor income.
Legislation was introduced in July 2022 to clamp down specifically on SFR Operators such as Invitation
Homes, American Homes 4 Rent, Tricon Residential, Progress Residential, and FirstKey Homes.
According to Washington Analysis, a CFRA business, this marks another milestone in the growing
scrutiny of the sector but does not change their view that federal policymakers lack a viable near-term
path to meaningfully restrict or upend current business practices and models. The bill intends to cap rent
increases on most single- and multi-family rental units at CPI or 5% annually, whichever is lower. Despite
its obvious benefits, Washington Analysis thinks the bill has near-zero odds of enactment for at least the
next 2-3 years and believes federal policymakers lack a viable path to restrict or upend the sector
meaningfully.
M&A Environment
In 2021, there were 14 mergers and acquisitions (M&A) involving U.S. REITs with transaction sizes over
$500 million totaling $102.3 billion were announced, representing a 433% increase over the $23.6 billion
in deal value of the 15 transactions announced in 2020, according to S&P Global Market Intelligence. The
2021 M&A deal total was boosted by a wave of deals involving non-traded REITs. YTD through August
23, 2022, a total of 12 deals worth $84.3 billion were announced, of which seven deals worth $46.5 billion
have been transacted.
The largest completed deal YTD through August 2022 was the $13.3 billion acquisition of American
Campus Communities (ACC) by Blackstone REIT. ACC is the largest owner, developer, and manager of
student housing communities in the U.S., with a portfolio of 166 properties in 71 leading universities,
including the University of California-Berkeley, University of Texas, and Arizona State University, among
others. In this all-cash acquisition, Blackstone will acquire all of ACC’s equity and assume all of its debts
in a bet that rents will continue to increase as students gradually return to campus.
In 2021, the largest completed deal was the $17.5 billion merger between VEREIT, Inc. and Realty
Income Corp., where Realty Income became the surviving corporation. Based in Phoenix, Arizona,
VEREIT is a full-service real estate operating company that owns offices, restaurants, single-tenant retail,
and industrial properties. The equity swap deal was completed in November 2021. With the merger,
Realty Income can leverage its expertise, size, and scale to accelerate its investment activities, thus
enhancing shareholder returns. Following the acquisition, Realty Income spun off almost all office assets
in the combined company into a new NYSE-listed REIT named Orion Office REIT Inc.
U.S. REIT M&A DEALS ANNOUNCED FROM 2021 THROUGH AUGUST 23, 2022*
(arranged by status, followed by completion date)
100
50
-50
-100
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022*
Asset dispositions have been a key source of capital for REITs, particularly office REITs, which have
been more likely to sell than buy in a robust transaction market with elevated pricing, but we expect that
to change in 2022. An increasing number of private equity (PE) firms and even big asset managers
(Blackrock, etc.) are focusing more on acquiring real estate. These firms have the advantage of retaining
much higher levels of capital, which enables these firms to raise significantly more debt than the REITs
industry.
Types of REITs
REITs are classified according to whether they invest directly or indirectly, by their ownership structure,
and by the segments of the real estate market that they serve.
▪ Mortgage REITs invest indirectly, by lending to real estate owners or operators, or by buying loans or
mortgage-backed securities. Mortgage REITs now invest largely in completed properties, avoiding the
construction and development loans that created problems for the industry in the early 1970s.
▪ Traditional REITs own their assets directly, rather than through an operating partnership.
▪ UPREITs consist of operating partnerships between a limited real estate partnership and a newly
formed REIT and are a tax-efficient way for investors in a limited real estate partnership to obtain
liquidity. The REIT contributes cash from a stock offering to the operating partnership; the real estate
partnership contributes a real estate portfolio. Both the REIT and the real estate partnership obtain
ownership units in the operating partnership.
After a set period (generally a year), owners of the real estate partnership can exchange their operating-
partnership units for cash or for stock in the REIT. Making this exchange generates a tax liability for the
real estate partnership – just as selling the original portfolio would – but partners can spread out their
tax payments by turning in their units over several years.
UPREITs became popular in the early 1990s, after the Tax Reform Act of 1986 had eliminated many of
the benefits of real estate partnerships. At the time, many banks were hesitant to make real estate
loans, which forced owners of partnerships to try to raise equity capital. Raising capital by going public
directly (through IPOs) would have triggered huge tax liabilities.
▪ DownREITs differ from UPREITs in that they own some property directly, whereas UPREITs hold most
of their property in operating partnerships. DownREITs can be formed by a property owner contributing
its properties to a REIT in exchange for shares. The REIT’s contribution may include putting cash into
the downREIT to pay off some of the debt on the contributed properties.
Other key requirements for REITs status, according to information provided by NAREIT, include having a
minimum of 100 shareholders, investing at least 75% of assets in real estate, and receiving at least 75%
REITs continually adjust the blend of equity and debt, as well as the combination of long- and short-term
debt, that they use to fund their businesses. Following the real estate and banking crises of the 1980s,
the industry generally scaled back its reliance on borrowing. Debt levels jumped significantly prior to the
2008-2009 financial crisis, but they have more recently declined as managers have sought to reduce
leverage. CFRA notes that REITs generally take on mortgage debt to purchase income-producing
property and that a high debt-to-assets ratio does not necessarily mean that a REIT is unsafe, especially
if it has a high-quality portfolio with a relatively predictable earnings stream.
It is also better that debt maturities be staggered to avoid onerous debt repayment schedules; lease
expirations are also generally staggered. However, many REITs tend to maintain diverse funding
sources, such as loans from banks and insurance companies, as well as corporate bonds, securitizations,
equity, and preferred equity.
A REIT’s profits depend on management’s ability to find and create investments that yield more than the
cost of capital. If a REIT can lock in a wide enough spread to offer returns that are attractive to investors,
it can obtain more capital and continue to make more investments.
Minimizing capital costs is critical to maintaining wide spreads. Rising interest rates increases borrowing
costs, although the impact can be limited if a REIT locks in low borrowing costs by issuing long-term debt
when rates are low. In times of low interest rates, REITs’ stocks can benefit because their high dividend
yields make them especially appealing when bond yields are low.
A REIT’s choice of how to invest its capital also determines profitability. REITs may or may not be
geographically diversified, but they tend to specialize in a given part of the real estate industry, such as
shopping centers, apartments, self-storage space, or warehouses. In addition, public REITs strive to add
higher-quality, better-located properties to their portfolios, which generally allows them to charge higher
rents than generic properties.
Industry Drivers
GDP. GDP measures the value of the goods and services produced in a given area during a defined
period. Percentage changes in inflation-adjusted GDP show whether (and how fast) a given economy is
growing or shrinking. This economic indicator is reported on a quarterly basis by the U.S. Bureau of
Economic Analysis (BEA), part of the U.S. Department of Commerce (DOC). The BEA issues advance
and preliminary estimates of GDP prior to reporting the final GDP figure for the quarter.
GDP is essential to understanding trends that affect real estate investment trusts (REITs) and the real
estate industry in general. For example, rapid economic growth can encourage companies to hire workers
and increase inventories, adding to demand for office and warehouse space. Slow growth or recessions
can undermine consumer spending, harming the prospects of REITs that specialize in retail space.
Unemployment rate. This statistic, defined as the percentage of the civilian workforce seeking jobs but
unable to find work, is most important to office REITs. Because employers need more office space as they
add to their workforces, declines in unemployment point to better conditions for these companies. Each
month, the U.S. Bureau of Labor Statistics (BLS), a division of the U.S. Department of Labor, releases
figures on both unemployment and the net creation of nonfarm jobs.
Retail sales. The U.S. Census Bureau (part of the U.S. DOC) publishes estimates of retail sales each
month, offering an indication of both the strength of consumer demand and the prosperity of the retail
segment. The figures matter to retail REITs because retailers are more likely to maintain existing outlets,
and open new ones, when sales are rising. Declining retail sales can also make it harder for retailers to
keep up with their lease payments.
New residential construction. Housing starts, reported monthly by the U.S. Census Bureau, provide an
indication of the amount of new housing that will be available in the future. Increases in the supply of
housing force landlords to compete more aggressively for tenants, making it harder for residential REITs
to raise or maintain rents. Statistics on both single-family and multifamily housing are available. The
single-family figures provide an indication of the outlook for competition from homes for sale, while
statistics on multifamily housing (buildings with five or more units) herald changes in the supply of rental
space.
Occupancy rates. Calculated as the ratio of occupied space to total available space, which is the
converse of vacancy rate (discussed below). This statistic serves as one of the indicators of the strength
of a particular real estate market.
Vacancy rates. Calculated as the ratio of unleased space to total available space, vacancy rates indicate
the strength of the rental market for a particular type of real estate in a particular area. Higher vacancy
rates put pressure on landlords to reduce rents or offer incentives (such as charging no rent for the first
month of a lease) in order to attract tenants. Real estate industry research firms and commercial real
estate brokers, such as CBRE Group, Inc., Cushman & Wakefield, and Marcus & Millichap, provide
occupancy statistics and projections for the U.S. as a whole and/or for individual markets.
Net absorption. Net absorption is the amount of square feet leased during the period minus the space
that is vacated. Absorption statistics show how rapidly demand is soaking up new supplies of space.
Figures on absorption are available from groups such as Reis and CBRE’s Econometric Advisors unit.
Qualitative Factors
There are key qualitative factors to analyze. These factors include the firm’s lines of business, its
geographical diversification, and its leasing arrangements.
Lines of Business
REITs are a varied lot. Although grouped in the same industry, these companies often have operations
that are driven by different segments of the economy. Therefore, when assessing a REIT, it is important
to understand the sources of a firm’s revenues and the factors that could affect earnings and dividends,
including seasonality and cyclicality.
Simon Property Group Inc., for example, is a large owner and operator of regional malls and premium
outlet centers; therefore, its business depends heavily on the state of the retail segment. An investor must
ascertain where the company is in the retail cycle. Is consumer spending likely to be robust, which would
motivate retailers to expand, thereby increasing demand for space and rental rates? Or is consumer
spending likely to be sluggish in an overcrowded retail environment, which could herald an increase in
bankruptcies, store closings, and higher vacancies?
For other kinds of REITs, revenues may be influenced by different factors. For example, hotel REITs are
heavily dependent on consumer and business travelers who tend to stay in hotels for short time periods,
so they have more volatile income streams. Health care REITs are dependent upon the fate of their
tenants, such as hospitals, with increasingly less dependence on government reimbursements.
Nonetheless, these reimbursement levels are relatively modest, but the tenant operators of health care
facilities tend to have narrow operating margins, making it harder for health care REITs to raise rents on
their properties than it might be for other kinds of REITs.
Geographic Diversification
In evaluating a REIT, it is important to look at the locations of the properties in a company’s portfolio. Are
the company’s assets concentrated in one market or section of the country? If so, then its performance
could be overly dependent upon the health of that region. If properties are dispersed around the country,
the operations should be less subject to regional economic shifts. Are the properties in supply constrained
markets (such as New York or San Francisco), where land is relatively expensive and difficult to obtain, or
in places like Dallas or Atlanta, where the supply of developable land is greater and barriers to entry
lower? Industrial and apartment REITs with properties in the latter two cities might have more difficulty
raising rental rates on expired leases than those in New York or San Francisco.
Leasing Arrangements
An investor should also determine how soon a company’s leases expire, the terms of the leases, and the
difference between current market rental rates and the rents the company is receiving under leases
already in place. Companies stand to benefit if many of their leases are due to expire at a time when
rents are rising. Conversely, revenue can stagnate or fall if a REIT must renegotiate many of its leases
when rents are declining.
Retail, office, and industrial REITs tend to write multiyear lease agreements with their corporate tenants;
these agreements typically include early termination penalties to ensure that the tenant fulfills its
Quantitative Factors
Several measures should be analyzed to assess a firm’s potential for financial success. These include
funds from operations (FFO), adjusted FFO, earnings per share (EPS), dividend yield, and several ratios.
Watch Out! Extending the depreciable life of an asset will boost a company's earnings while
shortening depreciable lives will decrease earnings. Therefore, it is important to refer to the
notes to the financial statements to ensure that a change in depreciable life has not
occurred. Additionally, compare the depreciable lives used by competitors to those used by
the company.
Watch Out! By making nonstandard adjustments to FFO REITs can effectively inflate FFO.
Inflating FFO can result in performance measures that are not comparable to peers and can
be motivated by executive compensation plans.
Dividend Yield
To arrive at this measure, annual dividends per share are divided by a company’s share price. This is an
important measure for REITs, because a relatively high average dividend yield is one reason why the
industry is attractive to investors. U.S. REITs are required to distribute 90% of taxable earnings to
shareholders.
Ratios
Several financial ratios are of particular interest when analyzing a REIT.
◆ Debt as a percentage of capitalization. This ratio allows investors to compare the level of borrowing
used by different REITs. This comparison is important because REITs that rely too heavily on borrowing
may be especially vulnerable during difficult times, as illustrated by the real estate and banking crises of
the 1980s and 2009. While many U.S. REITs remembered the trouble that REITs had in the 1980s and
2009, some have increased debt as credit has remained abundant through early 2020. When the
coronavirus hit, many REITs scrambled to raise even more debt and fully draw their lines of credit in order
to secure liquidity to sustain operations through the crisis. While some REITs have made moves to repay
this short-term debt or convert it to long-term debt, we have yet to see the full impact through this credit
cycle.
◆ Interest coverage. This is recurring earnings before interest, taxes, depreciation, and amortization
(EBITDA) divided by interest payments plus preferred dividends; it provides a measure of a REIT’s ability
to meet payments on financial obligations.
◆ Ratio of fixed-rate to floating-rate debt. Companies that rely more on variable-rate borrowings stand
to benefit when interest rates are falling, but they may be squeezed when rates rise. Investors’
expectations for rising rates may undermine prices for REITs that rely on floating-rate debt, even if actual
borrowing costs do not increase.
REIT Valuation
Any discussion of valuation should be prefaced by a mention of how REITs differ from other companies,
and how these differences affect valuation. We focus on both elements below.
REITs Tests
To qualify as a REIT and avoid taxation of profits, companies must meet a series of tests, some of which
are instrumental in selecting valuation models and formulating assumptions. The most important of these
are the ownership and payout tests.
◆ The ownership test. REITs are required to hold at least 75% of assets in real estate or real estate-
related securities. The ownership test means that REITs typically hold assets that have demonstrated a
propensity to appreciate over time. Most other kinds of companies, in contrast, hold intangible assets or
assets that depreciate over time due to wear or obsolescence. Because REITs are backed by positive net
asset value (NAV), REITs tend to be somewhat less risky than other publicly-traded companies.
Because the dividend portion of total return can never be negative, REITs shares typically have a
relatively low correlation with most stocks and bonds; i.e., they tend to behave differently under identical
market conditions. Because of their high dividend yields, REITs tend to have a lower standard deviation
of returns than many stocks, meaning they are less volatile over the long term. Because of these factors,
a lower risk premium is usually assigned to REITs stocks that have a lower beta than the broader equity
market. REITs with longer lease terms, which provide some protection during down cycles, tend to be
less risky than the industry as a whole.
Valuation
As opposed to book value (i.e., the value of a company according to its balance sheet), the intrinsic value
of a company reflects what the company’s actual sale price would be based on other value
considerations. There are different ways of measuring the intrinsic value of a REIT company, including
NAV, the dividend discount model, the discounted cash flow model, and replacement value.
◆ Net asset value. One measure of intrinsic value that we think has taken on added importance is net
asset value (NAV) per share. While the book value of many companies can be valued using generally
accepted accounting principles (GAAP), CFRA thinks this approach presents problems for REITs-
valuation purposes.
In the U.S., GAAP requires buildings to be depreciated on a straight-line basis over a defined period,
typically about 30 years. Historically, however, the value of land and buildings has appreciated over the
long term. As a result, a divergence between book value and the actual market value of the company’s
portfolio develops and tends to grow wider over time, resulting in the understatement of a REIT’s potential
break-up value. What we try to estimate in the NAV calculation is the potential value per share if the
company were to liquidate its property portfolio.
The first step in calculating NAV is to estimate the total net operating income of the properties owned by
the REIT. Net operating income measures the forward annualized cash flow (primarily rental income) that
a property or portfolio of properties will generate. CFRA does this by subtracting estimated property
operating expenses from assumed rents. We also make an adjustment for other items – such as straight-
line rents recorded but not received, as well as estimated recurring capital expenditures, such as tenant
installation costs and leasing commissions – that would be incurred to reach the estimated rent.
We then determine the cash rate of return, or capitalization (cap) rate, at which properties are generally
trading in private property transactions. Applying the cap rate to our estimated portfolio NOI, we can
calculate an approximate value at which the properties could be sold to other investors. (For this
calculation, we ignore non-operating corporate expenses, because it is assumed that only the assets are
being sold.)
To the estimated value of the property portfolio, we add all tangible assets on the balance sheet, including
properties under construction, cash, and so forth, but we generally avoid intangible assets, assuming little
value could be derived from them if the company were to liquidate. From this sum, we subtract liabilities,
minority interest, and “mezzanine” financing (a kind of hybrid financing that fills the gap when the
combination of equity and primary debt falls short of the capital needed) to arrive at a NAV. We divide this
by the number of shares outstanding to calculate NAV per share.
◆ P/FFO. One of the most common relative valuation metrics is P/FFO. This is similar to the much more
common price-to-earnings (P/E) ratio used to value companies relative to their peers. To calculate P/FFO,
we simply divide the market price of the stock by our forward estimate of FFO. Comparing the result with
the average for peer companies reveals whether a stock is trading at a premium or discount relative to
shares of other REITs. Of course, shares of individual companies often trade at a discount or premium for
valid reasons, such as higher growth rates, geographic concentration in stronger or weaker markets, or
concentration in property types with stronger or weaker fundamentals than other REITs.
◆ EV/EBITDA ratio. EV/EBITDA attempts to determine what one company may be willing to pay for
another. EV is calculated by multiplying the current market price of the shares by the number of shares
and equivalents outstanding, and then adding debt; it gives an idea of what it would cost to purchase the
company given today’s market capitalization. We divide this by an estimate of forward EBITDA to arrive at
a normalized multiple similar to P/E or P/FFO. EBITDA is used because it closely matches cash flow from
operations and assumes no taxation, since the tax rate of the acquiring entity is not known.
If there is significant merger and acquisition (M&A) activity in a particular property type, it will be easy to
perform the EV/EBITDA calculation on actual market transactions, thus arriving at a benchmark market
multiple. By comparing this multiple to a particular company’s EV/EBITDA, we can determine if its shares
are trading at a premium or discount to the market. If a company is trading at a significant discount, it may
be a takeover candidate. By applying the market multiple to the company’s EBITDA, and then reversing
the EV calculation, we can determine what the shares might be worth to an acquiring entity.
◆ Current yield. This is the company’s stated annual dividend divided by its price per share. This
normalizes dividend payments and gives U.S. a percentage that can be compared with the average of
peers to determine if a company’s stock is trading at a premium or discount relative to peers. As with
P/FFO or P/E comparisons, there are often logical reasons for a company’s stock to trade out of line with
peer averages, so we must consider other factors to determine whether today’s market price is in line with
our own assessment of relative value.
◆ Yield spreads. Because REITs are high-yield instruments, it is worthwhile to check the spread
between a REIT’s current yield and that of alternative income-oriented investment instruments, such as
utility stocks or Treasury bonds. Although REITs yields have historically traded at a positive yield spread
to the 10-year Treasury, for example, this spread varies widely and has periodically dipped to negative
territory. REITs could historically grow dividend payments at a rate exceeding inflation, while the yield on
a Treasury is static once purchased.
In a period of improving fundamentals, REITs will often be able to increase dividends in future periods,
making the stocks more attractive than fixed-income investments and contributing to periodic narrowing of
yield spreads. Utility companies can also raise dividends over time based on their fundamentals, which
should be considered when making yield comparisons with REITs.
Adjusted funds from operations (AFFOs)—Generally equal to the trusts funds from operations (FFO) with
adjustments made for recurring capital expenditures used to maintain the underlying assets of the REIT.
Apartment REIT—A REIT that specializes in investing in multi-family housing, also known as multi-family residential
property.
Capitalization rates (cap rates)—Ratio of current net operating income to the value of a property.
Diversified REIT—A REIT that owns a diversified portfolio in several real estate groups.
Equity REIT—A REIT that owns or holds equity in rental real estate; differs from a mortgage REIT.
Funds from operations (FFO)—The most commonly accepted and reported measure of a REIT’s operating
performance. FFO, as defined by the National Association of Real Estate Investment Trusts (NAREIT), is equal to a
REIT’s net income, excluding gains or losses from sales of property, and adding back real estate depreciation.
(Adding back depreciation allows investors to get around the fact that historical accounting standards assume that the
value of real estate assets diminishes predictably over time.)
Health care REIT—A REIT that owns health care properties, including long-term care facilities and hospitals.
Mortgage REIT—A REIT that originates or acquires mortgages or other loans secured by real estate collateral.
Differs from equity REITs in that it does not own real estate.
Net asset value (NAV)—One measure of a REIT’s intrinsic value, which estimates the potential value per share if the
company were to liquidate its property portfolio.
Real estate investment trust (REIT)—A private or public corporation that pays no income tax as long as its
operations are restricted to certain commercial real estate activities. To qualify as a REIT, a company must pay out
90% of its taxable income to investors each year.
Real estate operating company (REOC)—A company that invests in real estate, with shares traded on a public
exchange. Similar to a REIT, albeit more flexible in terms of the types of real investments they are capable of making,
as well as different in earnings distribution (an REOC reinvests into the business, compared with a REIT that
distributes them to unit holders).
Tax Reform Act of 1986—Federal law that permitted REITs not only to own but also to operate commercial real
estate properties.
Vacancy rate—The percentage of space in a given property or market that is not occupied.
STR, Inc
str.com
A division of CoStar Group that provides market data
on the hotel industry worldwide, including supply and
demand and market share data.
Yardi Matrix
yardimatrix.com
Yardi Matrix researches and reports on multifamily,
student housing, office, industrial, and self-storage
properties across the U.S.
ONLINE RESOURCES
INDUSTRIAL REITS
NYSE:PLD PLD [] PROLOGIS, INC. DEC 5,163.7 4,736.1 3,530.8 3,102.7 2,866.7 2,739.4 2,356.3 13.3 13.5 9.0 219 201 150 132 122 116
NYSE:DRE DRE [] DUKE REALTY CORPORATION DEC 1,118.6 1,004.3 983.9 957.2 790.3 746.3 805.0 (0.8) 8.4 11.4 139 125 122 119 98 93
NYSE:REXR REXR REXFORD INDUSTRIAL REALTY, INC. DEC 452.2 330.1 267.2 212.5 161.4 125.7 94.0 32.1 29.2 37.0 481 351 284 226 172 134
NYSE:EGP EGP § EASTGROUP PROPERTIES, INC. DEC 409.5 363.0 330.8 299.0 274.2 253.0 235.0 9.0 10.1 12.8 174 154 141 127 117 108
NYSE:FR FR † FIRST INDUSTRIAL REALTY TRUST, INC. DEC 476.1 447.8 425.5 403.7 396.4 378.0 365.8 4.6 4.7 6.3 130 122 116 110 108 103
OFFICE REITS
NYSE:ARE ARE [] ALEXANDRIA REAL ESTATE EQUITIES, INC. DEC 2,126.4 1,893.8 1,541.4 1,335.0 1,129.4 921.5 845.1 14.8 18.2 12.3 252 224 182 158 134 109
NYSE:BXP BXP [] BOSTON PROPERTIES, INC. DEC 2,865.9 2,737.8 2,974.6 2,715.6 2,620.5 2,560.7 2,512.9 4.7 2.3 4.7 114 109 118 108 104 102
NYSE:VNO VNO [] VORNADO REALTY TRUST DEC 1,705.2 1,612.2 2,003.6 2,172.9 2,096.0 2,177.9 1,967.0 (4.9) (4.8) 5.8 87 82 102 110 107 111
NYSE:KRC KRC † KILROY REALTY CORPORATION DEC 955.0 898.4 837.5 747.3 719.0 637.6 581.3 11.9 8.4 6.3 164 155 144 129 124 110
NYSE:CUZ CUZ † COUSINS PROPERTIES INCORPORATED DEC 761.9 748.4 670.2 487.4 513.3 269.8 210.4 20.5 23.1 1.8 362 356 319 232 244 128
Note: Data as originally reported. CAGR-Compound annual grow th rate. []Company included in the S&P 500. †Company included in the S&P MidCap 400. §Company included in the S&P SmallCap 600. #Of the follow ing calendar year.
Souce: S&P Capital IQ.
RETAIL REITS
NYSE:SPG SPG [] SIMON PROPERTY GROUP, INC. DEC 5,114.7 4,602.3 5,671.0 5,645.3 5,527.3 5,435.2 5,257.8 1.7 (1.2) 11.1 97 88 108 107 105 103
NYSE:O O [] REALTY INCOME CORPORATION DEC 2,081.6 1,647.1 1,488.2 1,327.8 1,215.8 1,103.2 1,023.3 17.6 13.5 26.4 203 161 145 130 119 108
NYSE:KIM KIM [] KIMCO REALTY CORPORATION DEC 1,364.6 1,057.9 1,158.9 1,164.8 1,200.8 1,170.8 1,166.8 5.2 3.1 29.0 117 91 99 100 103 100
NasdaqGS:REG REG [] REGENCY CENTERS CORPORATION DEC 1,203.9 1,047.9 1,164.7 1,160.3 1,021.1 645.9 591.2 9.6 13.3 14.9 204 177 197 196 173 109
NYSE:FRT FRT FEDERAL REALTY INVESTMENT TRUST DEC 952.5 827.4 933.8 912.0 856.9 801.6 745.4 5.6 3.5 15.1 128 111 125 122 115 108
SPECIALIZED REITS
NYSE:AMT AMT [] AMERICAN TOWER CORPORATION DEC 9,356.9 8,041.5 7,580.3 7,440.1 6,663.9 5,785.7 4,771.5 14.4 10.1 16.4 196 169 159 156 140 121
NYSE:CCI CCI [] CROWN CASTLE INC. DEC 6,340.0 5,840.0 5,763.0 5,370.0 4,255.0 3,921.0 3,663.9 12.0 10.1 8.6 173 159 157 147 116 107
NYSE:PSA PSA [] PUBLIC STORAGE DEC 3,498.9 2,984.3 2,924.7 2,825.3 2,744.2 2,614.2 2,418.8 6.9 6.0 17.2 145 123 121 117 113 108
NasdaqGS:EQIX EQIX [] EQUINIX, INC. DEC 6,260.0 5,622.6 5,159.2 5,102.3 4,347.6 3,612.0 2,725.9 14.9 11.6 11.3 230 206 189 187 159 133
NYSE:DLR DLR [] DIGITAL REALTY TRUST, INC. DEC 4,426.2 3,846.0 3,217.3 3,079.5 2,483.4 2,159.3 1,778.8 15.3 15.4 15.1 249 216 181 173 140 121
Note: Data as originally reported. CAGR-Compound annual grow th rate. []Company included in the S&P 500. †Company included in the S&P MidCap 400. §Company included in the S&P SmallCap 600. #Of the follow ing calendar year.
Souce: S&P Capital IQ.
INDUSTRIAL REITS
PLD [] PROLOGIS, INC. DEC 2,939.7 1,481.8 1,573.0 1,649.4 1,652.3 1,209.9 869.4 NA 19.4 98.4 338 170 181 190 190 139
DRE [] DUKE REALTY CORPORATION DEC 852.9 299.9 429.0 383.7 1,634.4 312.1 615.3 24.5 22.3 184.4 139 49 70 62 266 51
REXR REXFORD INDUSTRIAL REALTY, INC. DEC 128.2 76.4 62.0 46.2 40.7 25.1 1.9 NA 38.5 67.8 6,843 4,077 3,307 2,466 2,172 1,341
EGP § EASTGROUP PROPERTIES, INC. DEC 157.6 108.4 121.7 88.5 83.2 95.5 47.9 21.6 10.5 45.4 329 226 254 185 174 200
FR † FIRST INDUSTRIAL REALTY TRUST, INC. DEC 271.0 196.0 238.8 163.2 201.5 121.2 73.8 NA 17.5 38.3 367 266 324 221 273 164
OFFICE REITS
ARE [] ALEXANDRIA REAL ESTATE EQUITIES, INC. DEC 571.2 771.0 363.2 379.3 169.1 (65.9) 144.2 15.8 NM (25.9) 396 535 252 263 117 (46)
BXP [] BOSTON PROPERTIES, INC. DEC 505.2 872.7 521.5 582.8 462.4 512.8 583.1 6.4 (0.3) (42.1) 87 150 89 100 79 88
VNO [] VORNADO REALTY TRUST DEC 176.0 (297.0) 3,147.9 450.0 227.4 906.9 760.4 (12.4) (28.0) NM 23 (39) 414 59 30 119
KRC † KILROY REALTY CORPORATION DEC 628.1 187.1 195.4 258.4 164.6 293.8 234.1 26.4 16.4 235.7 268 80 83 110 70 126
CUZ † COUSINS PROPERTIES INCORPORATED DEC 278.6 237.3 150.4 79.2 216.3 79.1 125.5 NA 28.6 17.4 222 189 120 63 172 63
Note: Data as originally reported. CAGR-Compound annual grow th rate. []Company included in the S&P 500. †Company included in the S&P MidCap 400. §Company included in the S&P SmallCap 600. #Of the follow ing calendar year.
Souce: S&P Capital IQ.
RETAIL REITS
SPG [] SIMON PROPERTY GROUP, INC. DEC 2,249.6 1,112.6 2,101.6 2,440.1 1,948.0 1,838.9 1,827.7 8.2 4.1 102.2 123 61 115 134 107 101
O [] REALTY INCOME CORPORATION DEC 359.5 395.5 436.5 363.6 318.8 315.6 283.8 8.6 2.6 (9.1) 127 139 154 128 112 111
KIM [] KIMCO REALTY CORPORATION DEC 844.1 1,000.8 410.6 497.8 426.1 378.9 894.1 17.4 17.4 (15.7) 94 112 46 56 48 42
REG [] REGENCY CENTERS CORPORATION DEC 361.4 44.9 239.4 249.1 176.1 164.9 150.1 21.5 17.0 705.1 241 30 160 166 117 110
FRT FEDERAL REALTY INVESTMENT TRUST DEC 261.5 131.7 353.9 241.9 289.9 249.9 210.2 6.2 0.9 98.5 124 63 168 115 138 119
SPECIALIZED REITS
AMT [] AMERICAN TOWER CORPORATION DEC 2,567.7 1,690.6 1,887.8 1,236.4 1,238.9 956.4 685.1 20.5 21.8 51.9 375 247 276 180 181 140
CCI [] CROWN CASTLE INC. DEC 1,096.0 1,056.0 860.0 622.0 366.0 357.0 1,521.0 20.4 25.1 3.8 72 69 57 41 24 23
PSA [] PUBLIC STORAGE DEC 1,953.3 1,357.2 1,520.5 1,711.0 1,442.2 1,453.6 1,311.2 9.0 6.1 43.9 149 104 116 130 110 111
EQIX [] EQUINIX, INC. DEC 500.2 369.8 507.5 365.4 233.0 126.8 187.8 18.1 31.6 35.3 266 197 270 195 124 68
DLR [] DIGITAL REALTY TRUST, INC. DEC 1,709.3 356.4 579.8 331.2 248.3 426.2 296.7 27.0 32.0 379.6 576 120 195 112 84 144
Note: Data as originally reported. CAGR-Compound annual grow th rate. []Company included in the S&P 500. †Company included in the S&P MidCap 400. §Company included in the S&P SmallCap 600. #Of the follow ing calendar year.
Souce: S&P Capital IQ.
INDUSTRIAL REITS
PLD [] PROLOGIS, INC. DEC 56.9 31.3 44.5 53.2 57.6 44.2 5.0 2.6 3.9 4.3 5.6 4.0 8.5 5.2 6.6 8.2 9.5 7.0
DRE [] DUKE REALTY CORPORATION DEC 76.2 29.9 43.6 40.1 206.8 41.8 8.2 3.3 5.1 4.9 22.1 4.6 15.2 5.9 8.8 8.3 7.2 8.9
REXR REXFORD INDUSTRIAL REALTY, INC. DEC 28.4 23.1 23.2 21.7 25.2 20.0 1.9 1.5 1.7 1.7 1.9 1.7 3.2 2.6 2.8 2.9 3.6 3.1
EGP § EASTGROUP PROPERTIES, INC. DEC 38.5 29.9 36.8 29.6 30.3 37.7 4.9 4.0 4.8 4.2 4.3 5.2 11.1 8.8 11.7 10.7 12.0 16.0
FR † FIRST INDUSTRIAL REALTY TRUST, INC. DEC 56.9 43.8 56.1 40.4 50.8 32.1 6.5 5.2 6.8 5.2 6.8 4.3 13.2 10.7 14.0 10.6 15.1 10.5
OFFICE REITS
ARE [] ALEXANDRIA REAL ESTATE EQUITIES, INC. DEC 26.9 40.7 23.6 28.4 15.0 NM 1.9 3.4 2.0 2.6 1.4 NM 4.0 7.0 4.5 5.6 3.3 NM
BXP [] BOSTON PROPERTIES, INC. DEC 17.6 31.9 17.5 21.5 17.6 20.0 2.3 3.8 2.5 2.9 2.4 2.7 7.7 12.5 8.0 8.7 7.0 7.2
VNO [] VORNADO REALTY TRUST DEC 10.3 NM 157.1 20.7 10.8 41.6 1.0 NM 17.2 2.6 1.3 4.4 2.8 NM 47.3 7.1 3.7 6.6
KRC † KILROY REALTY CORPORATION DEC 65.8 20.8 23.3 34.6 22.9 46.1 5.9 1.9 2.2 3.3 2.4 4.4 12.0 4.2 4.9 6.8 4.7 8.7
CUZ † COUSINS PROPERTIES INCORPORATED DEC 36.6 31.7 22.4 16.2 42.1 29.3 3.8 3.3 2.1 1.9 5.1 1.9 6.1 5.3 4.2 2.9 8.2 2.9
RESIDENTIAL REITS
AVB [] AVALONBAY COMMUNITIES, INC. DEC 43.5 35.9 33.8 42.6 40.1 50.4 5.0 4.3 4.1 5.3 4.8 5.8 9.3 7.6 7.3 9.3 8.5 10.3
EQR [] EQUITY RESIDENTIAL DEC 54.1 35.5 35.9 25.5 24.4 176.9 6.3 4.5 4.6 3.2 2.9 20.7 12.3 8.7 9.3 6.3 5.8 40.4
MAA [] MID-AMERICA APARTMENT COMMUNITIES, INC. DEC 30.0 15.2 21.6 14.2 21.5 18.9 4.7 2.3 3.2 2.0 2.9 1.8 9.0 4.3 5.8 3.6 5.2 4.6
ESS [] ESSEX PROPERTY TRUST, INC. DEC 31.5 36.4 27.7 26.3 29.9 31.2 3.8 4.4 3.5 3.2 3.5 3.4 8.3 9.5 7.2 6.4 7.2 6.9
UDR [] UDR, INC. DEC 11.5 5.1 14.3 19.5 11.8 30.4 1.4 0.7 1.9 2.6 1.6 3.8 3.6 1.6 4.8 5.8 3.4 8.2
Note: Data as originally reported. CAGR-Compound annual grow th rate. []Company included in the S&P 500. †Company included in the S&P MidCap 400. §Company included in the S&P SmallCap 600. #Of the follow ing calendar year.
Souce: S&P Capital IQ.
SPECIALIZED REITS
AMT [] AMERICAN TOWER CORPORATION DEC 27.4 21.0 24.9 16.6 18.6 16.5 3.7 3.6 4.4 3.7 3.7 3.1 37.1 29.8 28.4 17.0 15.3 13.1
CCI [] CROWN CASTLE INC. DEC 17.3 18.1 14.9 11.6 8.6 9.1 2.8 2.7 2.2 1.9 1.1 1.6 13.1 10.6 7.8 5.2 3.7 4.9
PSA [] PUBLIC STORAGE DEC 55.8 45.5 52.0 60.6 52.6 55.6 11.2 11.5 13.4 15.7 13.4 14.3 21.4 15.2 16.7 19.0 15.7 15.7
EQIX [] EQUINIX, INC. DEC 8.0 6.6 9.8 7.2 5.4 3.5 1.8 1.4 2.1 1.8 1.2 1.0 4.6 3.8 6.3 5.2 4.2 3.2
DLR [] DIGITAL REALTY TRUST, INC. DEC 38.6 9.3 18.0 10.8 10.0 19.7 4.7 1.0 2.5 1.4 1.2 3.5 9.4 2.5 5.6 3.1 3.2 8.9
Note: Data as originally reported. CAGR-Compound annual grow th rate. []Company included in the S&P 500. †Company included in the S&P MidCap 400. §Company included in the S&P SmallCap 600. #Of the follow ing calendar year.
Souce: S&P Capital IQ.
INDUSTRIAL REITS
PLD [] PROLOGIS, INC. DEC 1.3 1.6 2.4 1.4 1.4 2.4 31.9 31.7 31.3 30.1 33.5 36.5 3337.0 2071.4 941.6 2802.8 2925.7 1173.6
DRE [] DUKE REALTY CORPORATION DEC 2.3 2.0 2.8 3.5 6.7 9.1 37.5 39.3 36.5 36.1 34.6 45.4 1350.6 1991.6 1070.6 583.7 302.9 195.3
REXR REXFORD INDUSTRIAL REALTY, INC. DEC 1.3 3.5 2.7 5.9 0.9 1.1 21.7 25.9 24.8 28.5 32.9 34.3 4782.5 714.7 1072.5 421.0 NM 13869.9
EGP § EASTGROUP PROPERTIES, INC. DEC 0.9 0.9 0.7 0.7 0.8 0.8 48.2 51.0 50.7 55.7 60.7 64.0 NM NM NM NM NM NM
FR † FIRST INDUSTRIAL REALTY TRUST, INC. DEC 1.6 3.1 1.7 1.2 1.8 1.6 41.7 45.2 45.3 43.6 46.8 51.2 1330.4 537.7 1533.8 6785.1 1500.7 2084.6
OFFICE REITS
ARE [] ALEXANDRIA REAL ESTATE EQUITIES, INC. DEC 2.1 3.3 3.0 2.7 1.8 1.2 31.6 36.0 40.0 41.0 42.4 43.6 1102.4 745.5 1038.4 986.7 1377.3 4204.3
BXP [] BOSTON PROPERTIES, INC. DEC 3.2 4.7 3.1 3.5 2.8 1.5 61.6 61.0 59.6 57.3 55.9 54.5 969.6 542.6 879.6 840.2 1045.0 2057.7
VNO [] VORNADO REALTY TRUST DEC 4.4 6.1 3.4 4.3 7.0 3.7 54.7 49.9 47.8 62.7 63.1 51.6 397.6 344.2 371.2 696.8 408.0 212.7
KRC † KILROY REALTY CORPORATION DEC 1.9 2.5 1.0 3.0 1.5 1.2 41.7 42.6 43.7 41.1 37.2 38.2 994.1 522.3 21963.3 893.3 1768.4 2349.0
CUZ † COUSINS PROPERTIES INCORPORATED DEC 0.8 1.5 2.2 1.0 2.0 1.2 32.7 32.5 33.4 27.4 27.9 35.5 NM 2286.8 807.4 NM 757.5 7836.3
RESIDENTIAL REITS
AVB [] AVALONBAY COMMUNITIES, INC. DEC 1.2 0.8 0.5 0.6 0.7 1.0 42.6 41.3 39.9 39.8 41.4 40.9 6612.8 NM NM NM NM 37406.3
EQR [] EQUITY RESIDENTIAL DEC 0.5 0.2 0.1 0.1 0.2 0.5 42.3 42.9 47.5 44.9 45.9 45.2 NM NM NM NM NM NM
MAA [] MID-AMERICA APARTMENT COMMUNITIES, INC. DEC 0.2 0.1 0.2 0.2 0.3 0.3 41.6 43.5 41.5 41.5 40.6 40.4 NM NM NM NM NM NM
ESS [] ESSEX PROPERTY TRUST, INC. DEC 1.0 0.7 0.7 0.8 0.5 1.1 50.1 49.3 47.4 46.6 46.9 46.7 49893.9 NM NM NM NM 13994.9
UDR [] UDR, INC. DEC 0.1 0.4 0.3 0.8 0.1 0.2 54.3 55.9 53.4 48.3 51.3 45.9 NM NM NM NM NM NM
Note: Data as originally reported. CAGR-Compound annual grow th rate. []Company included in the S&P 500. †Company included in the S&P MidCap 400. §Company included in the S&P SmallCap 600. #Of the follow ing calendar year.
Souce: S&P Capital IQ.
SPECIALIZED REITS
AMT [] AMERICAN TOWER CORPORATION DEC 0.4 0.8 0.5 0.5 0.8 1.0 81.0 85.6 76.2 72.6 70.8 69.4 NM NM NM NM NM 33506.8
CCI [] CROWN CASTLE INC. DEC 0.6 0.6 0.6 0.8 0.9 1.4 71.1 66.7 62.9 58.6 56.2 61.5 NM NM NM NM NM 3321.2
PSA [] PUBLIC STORAGE DEC 0.8 0.7 1.2 1.0 1.4 0.6 42.5 22.3 17.3 13.4 13.8 4.0 NM NM 3293.2 11068.0 1204.3 NM
EQIX [] EQUINIX, INC. DEC 1.8 1.3 1.3 1.0 1.8 1.4 51.5 49.2 52.1 56.7 54.8 54.3 856.4 1777.2 1362.8 NM 850.3 1189.6
DLR [] DIGITAL REALTY TRUST, INC. DEC 0.6 0.6 0.9 0.7 0.6 0.6 42.1 41.9 48.7 50.5 43.8 53.2 NM NM NM NM NM NM
Note: Data as originally reported. CAGR-Compound annual grow th rate. []Company included in the S&P 500. †Company included in the S&P MidCap 400. §Company included in the S&P SmallCap 600. #Of the follow ing calendar year.
Souce: S&P Capital IQ.
INDUSTRIAL REITS
PLD [] PROLOGIS, INC. DEC 42 - 24 54 - 31 37 - 23 24 - 19 22 - 16 24 - 16 64 116 86 68 57 74 2.9 - 1.5 2.6 - 1.6 3.7 - 2.1 3.4 - 2.3 3.2 - 2.7 3.6 - 2.6
DRE [] DUKE REALTY CORPORATION DEC 29 - 17 51 - 32 30 - 21 28 - 23 7 - 5 33 - 21 46 118 74 76 17 82 2.3 - 1.6 2.7 - 1.7 3.6 - 2.3 3.4 - 2.4 3.3 - 2.7 3.2 - 2.5
REXR REXFORD INDUSTRIAL REALTY, INC. DEC 98 - 58 105 - 67 102 - 60 80 - 63 65 - 45 64 - 42 116 153 143 142 115 143 2.2 - 1.2 2.1 - 1.3 2.5 - 1.5 2.2 - 1.5 2.4 - 1.9 2.7 - 1.8
EGP § EASTGROUP PROPERTIES, INC. DEC 57 - 34 53 - 32 42 - 27 41 - 31 39 - 28 26 - 17 84 111 89 81 104 85 3.0 - 1.7 2.4 - 1.7 3.4 - 2.1 3.2 - 2.2 3.3 - 2.6 3.6 - 2.7
FR † FIRST INDUSTRIAL REALTY TRUST, INC. DEC 31 - 19 30 - 18 23 - 15 26 - 21 19 - 15 28 - 18 52 65 49 67 50 68 2.6 - 1.6 2.6 - 1.8 3.7 - 2.1 3.2 - 2.1 3.1 - 2.6 3.3 - 2.6
OFFICE REITS
ARE [] ALEXANDRIA REAL ESTATE EQUITIES, INC. DEC 57 - 41 29 - 19 52 - 36 37 - 31 84 - 68 NM - NM 115 69 124 102 190 NM 3.5 - 2.1 2.8 - 2.1 3.6 - 2.4 3.5 - 2.5 3.1 - 2.7 3.1 - 2.7
BXP [] BOSTON PROPERTIES, INC. DEC 39 - 28 27 - 13 42 - 33 36 - 29 48 - 40 44 - 33 135 79 128 101 114 131 4.9 - 3.0 4.4 - 3.2 5.5 - 2.7 3.5 - 2.7 3.3 - 2.3 2.5 - 2.0
VNO [] VORNADO REALTY TRUST DEC 95 - 67 NM - NM 4 - 4 39 - 30 130 - 85 25 - 18 268 NM 18 119 247 61 8.1 - 4.5 6.0 - 4.2 8.9 - 3.8 4.5 - 3.5 4.3 - 3.3 3.9 - 2.3
KRC † KILROY REALTY CORPORATION DEC 14 - 10 54 - 28 45 - 33 30 - 23 51 - 44 26 - 16 38 120 100 69 100 51 4.3 - 2.6 3.7 - 2.7 4.3 - 2.2 3.1 - 2.3 2.7 - 2.2 2.5 - 1.9
CUZ † COUSINS PROPERTIES INCORPORATED DEC 22 - 17 27 - 14 35 - 26 52 - 40 18 - 15 37 - 23 66 74 95 135 46 64 4.8 - 2.9 3.8 - 3.1 5.3 - 2.7 3.5 - 2.6 3.2 - 2.5 4.1 - 2.5
RESIDENTIAL REITS
AVB [] AVALONBAY COMMUNITIES, INC. DEC 35 - 22 39 - 21 39 - 30 27 - 22 31 - 27 25 - 21 88 107 107 83 88 70 3.4 - 2.5 4.1 - 2.6 5.3 - 2.8 3.5 - 2.7 3.8 - 3.1 3.3 - 2.9
EQR [] EQUITY RESIDENTIAL DEC 25 - 16 36 - 19 34 - 24 41 - 31 43 - 37 7 - 5 68 97 86 120 123 16 3.6 - 2.6 4.2 - 2.7 5.2 - 2.6 3.4 - 2.6 3.7 - 3.0 3.4 - 2.9
MAA [] MID-AMERICA APARTMENT COMMUNITIES, INC. DEC 49 - 27 67 - 39 45 - 30 54 - 44 39 - 33 41 - 31 89 181 125 190 122 117 3.0 - 1.9 3.4 - 1.9 4.7 - 2.7 4.2 - 2.8 4.3 - 3.4 3.8 - 3.2
ESS [] ESSEX PROPERTY TRUST, INC. DEC 48 - 30 38 - 21 50 - 35 45 - 37 41 - 34 39 - 31 111 94 116 124 104 99 3.5 - 2.3 3.7 - 2.3 4.6 - 2.4 3.1 - 2.3 3.4 - 2.8 3.0 - 2.6
UDR [] UDR, INC. DEC 123 - 76 250 - 145 79 - 61 58 - 44 92 - 78 35 - 30 292 659 209 170 273 107 3.6 - 2.4 3.9 - 2.5 4.9 - 2.8 3.4 - 2.7 3.9 - 3.0 3.6 - 3.1
RETAIL REITS
SPG [] SIMON PROPERTY GROUP, INC. DEC 25 - 12 42 - 12 27 - 21 24 - 19 30 - 24 39 - 30 105 130 122 100 115 111 7.2 - 4.0 6.3 - 3.8 19.1 - 5.6 5.8 - 4.2 5.3 - 4.2 4.8 - 3.5
O [] REALTY INCOME CORPORATION DEC 85 - 67 72 - 37 59 - 45 53 - 38 57 - 48 64 - 45 325 244 195 209 218 202 4.7 - 4.0 4.9 - 3.8 6.6 - 3.4 4.4 - 3.3 5.4 - 4.1 4.8 - 4.0
KIM [] KIMCO REALTY CORPORATION DEC 15 - 9 9 - 3 27 - 18 18 - 13 30 - 20 41 - 32 45 38 129 106 119 125 4.3 - 2.7 4.5 - 2.8 14.5 - 0.0 7.8 - 5.1 8.5 - 5.9 6.2 - 4.1
REG [] REGENCY CENTERS CORPORATION DEC 36 - 21 242 - 122 49 - 40 47 - 38 72 - 59 60 - 46 112 670 163 151 186 135 4.4 - 3.2 5.4 - 3.2 7.4 - 3.6 4.0 - 3.3 4.0 - 3.0 3.6 - 2.8
FRT FEDERAL REALTY INVESTMENT TRUST DEC 41 - 25 81 - 41 31 - 25 43 - 34 37 - 30 49 - 39 128 246 89 125 98 107 4.6 - 3.1 5.2 - 3.2 6.4 - 3.2 3.5 - 2.9 3.7 - 3.0 3.3 - 2.7
SPECIALIZED REITS
AMT [] AMERICAN TOWER CORPORATION DEC 53 - 35 71 - 47 56 - 37 60 - 48 57 - 38 59 - 42 88 114 85 109 94 104 2.5 - 1.9 2.5 - 1.7 2.4 - 1.6 2.2 - 1.5 2.3 - 1.8 2.3 - 1.7
CCI [] CROWN CASTLE INC. DEC 81 - 58 74 - 50 83 - 59 95 - 82 141 - 105 108 - 82 217 207 235 305 420 359 3.8 - 2.8 3.6 - 2.6 4.1 - 2.7 4.3 - 3.0 4.3 - 3.7 4.7 - 3.5
PSA [] PUBLIC STORAGE DEC 37 - 22 38 - 26 36 - 27 27 - 21 34 - 29 40 - 30 81 118 106 94 113 104 2.7 - 1.9 3.7 - 2.4 5.0 - 3.4 4.1 - 3.0 4.4 - 3.4 4.1 - 3.5
EQIX [] EQUINIX, INC. DEC 158 - 107 198 - 116 97 - 57 100 - 74 163 - 117 215 - 147 209 256 165 202 267 394 2.0 - 1.4 1.9 - 1.3 2.2 - 1.3 2.7 - 1.7 2.4 - 1.7 2.2 - 1.6
DLR [] DIGITAL REALTY TRUST, INC. DEC 29 - 21 159 - 107 57 - 43 102 - 81 127 - 97 51 - 33 81 348 172 281 288 142 4.1 - 2.6 3.7 - 2.7 4.2 - 2.8 4.0 - 3.2 4.1 - 3.1 4.0 - 3.0
Note: Data as originally reported. CAGR-Compound annual grow th rate. []Company included in the S&P 500. †Company included in the S&P MidCap 400. §Company included in the S&P SmallCap 600. #Of the follow ing calendar year.
Souce: S&P Capital IQ.
INDUSTRIAL REITS
PLD [] PROLOGIS, INC. DEC 3.94 2.01 2.46 2.87 3.06 2.27 43.55 41.49 34.58 34.01 28.24 27.08 169.93 - 93.08 112.37 - 59.82 92.80 - 56.40 68.95 - 55.21 67.53 - 48.33 54.87 - 35.25
DRE [] DUKE REALTY CORPORATION DEC 2.25 0.80 1.18 1.07 4.58 0.88 15.58 13.59 13.38 12.68 12.47 9.55 66.22 - 37.61 43.45 - 25.19 36.04 - 24.88 29.48 - 24.30 30.14 - 23.93 28.99 - 18.52
REXR REXFORD INDUSTRIAL REALTY, INC. DEC 0.80 0.51 0.47 0.41 0.48 0.36 28.03 22.15 19.68 17.14 14.38 12.26 81.68 - 45.90 53.48 - 31.79 48.80 - 28.45 33.54 - 26.32 31.71 - 21.34 23.60 - 15.14
EGP § EASTGROUP PROPERTIES, INC. DEC 3.90 2.76 3.24 2.49 2.44 2.93 37.66 31.68 30.47 24.47 21.27 18.79 229.84 - 131.28 153.26 - 83.40 138.15 - 87.94 102.05 - 77.74 95.03 - 67.69 76.00 - 49.31
FR † FIRST INDUSTRIAL REALTY TRUST, INC. DEC 2.09 1.53 1.88 1.31 1.69 1.05 16.50 14.55 13.67 12.79 11.66 10.35 66.74 - 40.08 46.12 - 25.89 43.24 - 27.77 34.04 - 27.30 32.91 - 25.31 29.75 - 18.89
OFFICE REITS
ARE [] ALEXANDRIA REAL ESTATE EQUITIES, INC. DEC 3.82 6.01 3.12 3.52 1.58 (1.99) 98.58 82.40 71.06 64.20 58.10 52.50 224.95 - 154.37 179.79 - 109.22 163.51 - 110.66 131.00 - 109.04 134.37 - 106.89 114.67 - 70.69
BXP [] BOSTON PROPERTIES, INC. DEC 3.17 5.54 3.30 3.70 2.93 3.26 37.27 37.22 35.43 36.79 36.38 36.32 124.24 - 88.45 147.83 - 69.69 140.35 - 107.94 132.82 - 107.84 140.13 - 116.77 144.02 - 107.28
VNO [] VORNADO REALTY TRUST Earnings
DEC 0.53 per Share ($)
(1.83) 16.21 2.01 0.85 4.34 Tangible Book 30.42
25.55 27.84 Value per
18.04Share
17.30 ($)29.99 50.91 - 35.02 68.68 - 27.64 Share
70.54 Price (High-Low,
- 58.60 78.31 - 59.48$) 111.72 - 71.90 108.69 - 78.91
KRC † KILROY REALTY CORPORATION DEC 5.36 1.63 1.86 2.55 1.51 2.97 46.22 43.22 40.24 38.70 37.16 35.33 74.05 - 54.26 88.99 - 45.28 85.29 - 60.87 77.73 - 59.05 78.33 - 67.00 77.54 - 46.76
Ticker Company Yr. End 2016 2015 2014 2013 2012 2016 2015 2014 2013 2012 2016 2015 2014 2013 2012
CUZ † COUSINS PROPERTIES INCORPORATED DEC 1.87 1.60 1.17 0.75 2.08 1.25 29.58 28.80 27.94 24.91 24.56 22.40 40.70 - 31.01 42.99 - 21.15 41.37 - 30.76 39.52 - 30.12 38.52 - 31.24 45.60 - 28.36
DEPARTMENT STORES
DDS † DILLARDS
RESIDENTIAL REITS INC -CL A # JAN 4.93 6.91 7.79 7.10 6.98 53.41 49.98 49.02 45.33 41.24 88.58 - 54.37 144.21 - 65.14 126.83 - 82.75 97.87 - 75.33 89.98 - 42.54
KSS
AVB [] KOHL'S CORP COMMUNITIES, INC.
[] AVALONBAY # JAN 3.12DEC 3.487.19 4.28
5.89 4.08
5.63 4.19 6.35 7.52
7.05 29.75 78.3629.52
77.21 29.81
78.31 76.9728.33
75.43 27.24
74.23 254.6159.67 -
- 154.8433.87
229.40 - 79.60
118.17- 222.87
41.85 - 168.34
63.54191.91
- 48.68
- 152.6559.00 -
199.52 41.35 55.25 - - 158.32
- 169.50 192.29 42.04
EQR
M [] EQUITY
[] MACY'S RESIDENTIAL
INC # JAN 2.01DEC 3.263.54 4.30
2.45 2.60
3.93 1.77
3.29 1.63 11.68(0.24) 29.07 (0.52)
28.17 27.65
3.34 26.99 5.42
27.27 27.41
4.51 91.2045.50
- 56.79
- 87.53
29.94 - 73.61
45.43- 89.55
34.05 - 63.41
66.59 72.75
- - 54.9754.07
50.05 70.46
- - 59.49 42.17
36.35 81.76 - - 32.28
58.28
MAA
JWN [] MID-AMERICAINC
[] NORDSTROM APARTMENT COMMUNITIES, #
INC.JAN 2.05DEC 3.224.61 3.79
2.19 3.07
3.77 1.93
3.62 2.86 2.693.72 51.71 2.51
51.33 53.10
10.55 53.99 9.96
55.73 56.04
8.82 231.6362.82
- 122.15
- 148.88
35.01 - 83.16
82.00- 140.15
49.34 - 92.19
80.54104.98
- - 85.1663.72
54.90 110.95
- - 92.50 110.01
52.16 58.44 - - 46.27
82.91
ESS
JCP † PENNEY (J C) CO
[] ESSEX PROPERTY TRUST, INC. # JAN - DEC 7.51
(1.68) 8.69
(2.53) 6.66
(5.57) 5.90
(4.49)6.57 6.272.64 91.72 2.64
92.24 94.10
4.64 95.11 8.38
95.03 94.48
11.78 357.9011.99
- 226.79
- 329.74
6.00 - 10.09
175.81- 334.17
6.19 - 235.51 267.41
11.30 - -
4.90214.03 270.04
23.10 - - 6.24
218.41 240.55
43.18 - - 191.25
15.69
UDR [] UDR, INC. DEC 0.48 0.20 0.63 0.74 0.44 1.08 10.49 10.64 11.11 10.38 10.38 11.40 60.42 - 36.73 51.25 - 29.20 50.61 - 38.18 42.98 - 32.88 40.71 - 34.41 38.61 - 32.79
GENERAL MERCHANDISE STORES
† BIG LOTS INC
RETAIL REITS
BIG # JAN 3.37 2.83 2.49 2.17 2.96 14.70 14.67 14.92 15.66 13.00 56.54 - 33.78 51.11 - 37.41 51.75 - 25.50 39.22 - 27.42 47.22 - 26.69
SPG
DG [] SIMONGENERAL
[] DOLLAR PROPERTY CORP
GROUP, INC. # JAN 4.45DEC 3.966.84 3.50 3.59 6.81
3.17 7.872.87 6.24 5.87(0.48) 9.94 (0.56) 8.96 7.78
0.56 10.04(0.45)
11.04 12.72
(1.75) 171.1296.88
- 82.06
- 149.89 - 81.42
66.50 42.25- 186.44
59.75 - 142.40
71.78191.49
- - 145.7861.95
53.00 188.10
- - 150.15
39.73 229.10
56.04 - - 173.11
39.83
O
DLTR [] REALTY INCOME
[] DOLLAR TREE INC CORPORATION # JAN 3.80DEC 1.270.87 1.14
2.91 1.38
2.74 1.26
2.70 1.10 1.13
(13.58) 27.23 25.63
(18.26) 24.78
7.87 22.63 21.68
4.81 20.27
6.65 74.60 - 57.00
99.93 - 84.92
72.52 - 38.00-
84.22 82.17
60.31 - 61.59 66.91
71.53 - -
49.59 47.25 63.60
60.19 - - 52.85
37.70 72.30 -
56.81 - 50.47
37.12
KIM
FRED [] KIMCO
§ FREDS REALTY CORPORATION
INC # JAN NA DEC (0.20)1.60 (0.80)
2.25 0.80
0.71 1.020.81 0.87 0.79 NA 15.31 7.13 12.69 10.93
9.09 12.2210.79
12.02 10.62
11.67 24.9521.77
- 14.28
- 20.78 - 20.05
7.89 7.45- 21.86
11.27 - 14.32
21.05 18.37
- - 13.1618.93
13.07 26.16
- - 17.02
12.30 32.24 -
15.98 - 24.35
12.70
REG
OLLI [] REGENCY
§ OLLIE'S CENTERS
BARGAIN CORPORATION
OUTLET HLDGS # JAN 0.99DEC 0.622.12 0.26
0.47 1.43
0.34 1.46NA 1.00 1.42(0.44) 33.13 33.22
(1.98) 33.88
(5.43) 34.01 34.39
(4.88) 20.62
NA 78.07 - 43.49
32.75 - 64.65
16.13 - 31.80-
22.99 70.26
14.88 - 56.50NA 69.78
- - 54.87 NA
NA 72.05
- - NA
58.63 85.35
NA - - 65.16
NA
FRT FEDERAL REALTY INVESTMENT TRUST DEC 3.26 1.62 4.61 3.18 3.97 3.50 30.63 29.88 31.24 29.23 28.09 26.91 138.40 - 81.85 131.56 - 64.11 141.35 - 115.09 135.68 - 106.41 145.80 - 119.37 171.08 - 134.39
TGT [] TARGET CORP # JAN 4.62 5.29 3.86 3.10 4.57 19.23 21.06 21.39 25.08 25.31 84.14 - 65.50 85.81 - 68.15 76.64 - 54.66 73.50 - 58.01 65.80 - 47.25
SPECIALIZED
TUES REITS
§ TUESDAY MORNING CORP JUN 0.08 0.24 (0.24) (1.33) 0.09 5.10 5.00 4.66 4.85 6.24 9.23 - 4.40 22.88 - 4.86 22.82 - 11.82 16.44 - 6.26 6.86 - 3.12
AMT [] AMERICAN TOWER CORPORATION DEC 5.66 3.79 4.24 2.77 2.67 1.98 (63.62) (38.33) (30.35) (25.71) (26.07) (22.43) 303.72 - 197.50 272.20 - 174.32 242.00 - 153.93 168.58 - 130.37 155.28 - 102.51 118.26 - 83.07
CCI [] CROWN CASTLE INC.
OTHER COMPANIES WITH SIGNIFICANT MULTILINE RETAIL OPERATIONS DEC 2.53 2.35 1.79 1.23 0.80 0.95 (13.58) (11.72) (10.64) (9.69) (8.98) (5.13) 209.87 - 146.15 180.00 - 114.18 149.47 - 104.22 117.60 - 98.85 114.97 - 83.96 102.82 - 75.71
PSA
SHLD [] PUBLIC
SEARS STORAGECORP
HOLDINGS # JAN (20.78)DEC (10.59)
9.87 (15.82)
6.29 (12.87)
7.29 8.54
(8.78)6.73 6.81 (52.47) 28.16(38.81)
26.13 27.47
(31.00) 28.05 27.03 27.88
(14.06) (4.76) 377.3620.48
- 212.22
- 240.75 - 46.23
8.00 155.37- 266.76
18.03 - 193.89
51.06234.90
- - 180.4867.50
24.10 232.21
- - 192.15
38.88 277.60
85.90 - - 200.65
28.89
EQIX
WMT [] EQUINIX, INC.
[] WAL-MART STORES INC # JAN 4.40DEC 4.585.53 5.01 4.18 5.99
4.87 4.565.04 3.00 1.79 19.93 39.4720.1933.55 22.93
19.61 0.6117.550.67 16.859.25 885.2675.19
- 586.73
- 839.77 - 90.97
60.20 477.87- 609.97
56.30 - 343.58
88.09461.73
- - 335.2981.37
72.27 495.35
- - 355.18
67.72 391.07
77.60 - - 255.45
57.18
DLR [] DIGITAL REALTY TRUST, INC. DEC 5.94 1.00 2.35 1.21 0.99 2.20 24.24 19.77 14.86 6.39 13.91 12.82 178.22 - 124.65 165.49 - 105.00 136.32 - 100.05 125.10 - 96.56 127.23 - 98.03 113.21 - 69.89
Note: Data as originally reported. []Company included in the S&P 500. †Company included in the S&P MidCap 400. §Company included in the S&P SmallCap 600. #Of the following calendar year.
J-This amount
Note: Data includesreported.
as originally intangibles that cannot beannual
CAGR-Compound identified.
grow th rate. []Company included in the S&P 500. †Company included in the S&P MidCap 400. §Company included in the S&P SmallCap 600. #Of the follow ing calendar year.
Souce: S&P Capital IQ.
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