REITs have been underperforming the S&P 500 and Russell 2000 indexes all year, according to an analysis by BTIG.
On a total return year-to-date basis, FTSE NAREIT equity REITs saw a 10.8% increase through December 6. But the S&P 500 was up 27.7% and the Russell 2000 up 18.8% over the same period. On a fourth quarter-to-date basis, REITs were down 1.5%, with the S&P 500 up 5.7% and the Russell 2000 up 8.0%. And for the week ending December 6, 2024, REITs were down 2.5%, S&P 500 up 1.0%, and the Russell 2000 down 1.1%. Even on a trailing 12-month basis, REITs were up 17.7%, S&P 500 was up 32.8%, and Russell 2000 was up 28.9%.
On a year-to-date total return basis, property type REITs varied significantly: malls (35.0%), data centers (32.5%), healthcare (29.8%), office (26.4%), and multifamily (24.5%), strip center (21.8%), storage (9.2%), free-standing (7.2%), hotel (3.9%), single-family rentals (2.5%), manufactured homes (-1.1%), infrastructure (-4.8%), and industrial (-13.4%).
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In the week ending December 6, the top five performers in price return were Sunstone Hotel Investors (12.3%), Southerly Hotels (9.2%), CIM Commercial (6.9%), Pebblebrook Hotel (5.3%), and Xenis Hotels & Resorts (4.6%).
In contrast, there are the bottom five performers: BRT Apartments (-6.6%), Clipper Realty (-6.9%), Hudson Pacific Properties (=7.5%), Industrial Logistics Prop (-8.3), and Office Properties Income (-15.5%).
In the four weeks ending December, the top five performers were CBL & Associates (14.0%), Macerich Company (13.3%), Pebblebrook Hotel (12.6%), Sunstone Hotel Investors (11.7%), and American Healthcare REIT (9.5%).
The bottom five performers in the four weeks were Medical Properties Trust (-15.7%), Hudson Pacific Properties (-21.9%), Sotherly Hotels (-22.0%), Clipper Realty (-23.2%), and CIM Commercial (-24.2%).
Variations within different categories of REITs can be extreme. The data BTIG pulled together, on a year-to-date (up to December 6, 2024) total return basis, showed that the lowest return in multifamily was Clipper Reality at -4%, with the top being Independence Reality at 41.0%. Diversified — the low was -34.0% for Presido Property and the high, 40.2% for Gladstone Commercial. Data centers showed one of the smallest spread between a 23.4% bottom for Equinix and 34.4% top for Data Center Avg.
Free-standing’s low was -7.5% for NETSTREIT; the top was 32.6% for Essential Properties. Healthcare — -30.3% for Diversified Healthcare; 50.5% for Welltower.
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