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Real Estate Stocks Take A Hit, Some Prove More Resilient

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As the stock market crashed last week, major public property owners and brokerages experienced similar afflictions, with losses piling up and deepening as the year went on.

However, not all losses from the recent decline are created equal, with some companies doing better than others and those with atypical and diverse property types being more traditional. It handles financial turmoil better than any other company.

Buoyed by fresh rate hikes, stubbornly high inflation and an economy that many agree is steadily heading toward recession, the three major indexes fell last week, their fifth of the past six weeks. fell. NYSE Composite Index ended Sept. 23 Nearly 20% down Year-to-date, Dow Jones Industrial Average fell below 30,000 First time since June.

Overall, real estate stocks plunged Friday, with the FTSE Nareit All Equity REITs Index down 1.24% on Friday, down more than 25.5% for the year. The FTSE Nareit Real Estate 50 Index, which tracks the performance of the large-cap real estate sector in the U.S. stock market, doesn’t do too badly, but he fell about 1% in a day on Friday and was still under fire. About 18% per year.

Even REITs focused on real estate types that perform well in today’s economic environment, such as industrial and multifamily, are struggling.

Clipper Realty, which has multifamily portfolios in Manhattan and Brooklyn, was down 1.3% for the full year as of Friday, while other residential REITs including Invitation Homes, Independence Realty Trust, Equity Residential and American Homes 4 Rent have all fallen, some have fallen. in double digits. The stock has fallen about 12.8% in value over the past year.

Industrial REITs have not fared very well despite a surge in demand for the property type. late latelyIndustrial Logistics Properties Trust has lost more than 70% in value since last year (more than 3.5% on Friday), while industrial giant Prologis is down about 14.6% for the year.

Other volatile industrial REITs include First Industrial Trust, Plymouth Industrial REIT, and even Refrigerated Experts. american realtyhas recently felt power costs and other inflationary pressures and is passing those costs on to its customers.

This year’s more modest losers, still losers, include a long list of REITs. Shares of well-known companies such as Blackstone Mortgage Trust, Starwood Property Trust, Heathcare Realty Trust, Kimco Realty and AvalonBay Communities have fallen.

Some REIT stocks have seen their valuations plummet since this time last year, when the world came out of the pandemic and high inflation was still a relic of the 1970s.

PREIT for retail store owners crushed by debtwhich made a deadcat bounce of more than 5.3% on Friday, lost more than 87% of its value for the year — one of the few risers of the day. are both down more than 50% from last year, down nearly 3% and 5.5% respectively on Friday.

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of 182 listed stocks Listing of REITs As of Friday, only 24 companies saw stock gains year-over-year, according to the National Association of Real Estate Investment Trusts.

The exception to the year-over-year gains was BlueRock Residential Growth REIT, a national apartment specialist based in New York. Compared to a year ago, the company’s stock is up nearly 125% of his. In Friday’s trading, Bluerock was little moved, gaining 0.04%.

Only one residential REIT has gained momentum this year, BSR REIT, which owns the Sun Belt community, is up nearly 7% over the year.

Among this year’s winners are REITs with diversified portfolios that provide a hedge against a turbulent economy.

New Jersey stock’s first REIT was up 28.5% over the year, and CTO Realty Growth and WP Carey were up as well, but to a lesser extent.

Specialty REITs, outside of the main property types in general, were also this year’s winners. Agricultural specialist Farmland Partners was the strongest performer, up about 13.7%. Data center owner Iron Mountain and his gaming and entertainment property owner VICI Properties have come into action.

Even some retail REITs, such as net leasing specialist Agree Realty Corp., were up about 6.4%. Phillips Edison, Getty Realty and Alpine Income Property Trust are the winners in the retail category so far this year.

In the industrial sector, the only winner this year was Duke Realty’s stock, which rose about 6.1% over the year, albeit as a special case. Earlier this year, the company agreed to: $25.6 billion acquisition by Prologis.

Shares of major non-REIT real estate companies, especially international brokerages, have also generally fallen recently and since last year.

CBRE, Cushman & Wakefield, JLL, Colliers International Group and Newmark all posted losses in the 1.7% to 4.7% range last week.

Major real estate investors haven’t escaped the downtrend, even if real estate is only part of their holdings. Big investor Blackstone fell 2.2% on Friday, and the stock has plunged 33.2% for the year. Shares of KKR and Carlyle Group have similarly fallen.

Ahead of the market’s opening on Monday, US, European and Asian indices were all set to continue their decline. His three US indices are all expected to fall about 1.5%, while the Nikkei and Hang Seng are in slightly better shape, trending down 0.6% and 1.2% respectively.

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