REIT ETFs are doing well this year, with one reason being the expectation of a return to more normal economic circumstances, says Michael Arone, chief investment strategist at State Street Global Advisors. "The second thing is inflation so values of rental property rents and the value of real estate increases as prices increase, and this provides reliable income above inflation, right now more than double both the S&P dividend yield and 10-year Treasury yields," Arone says.
An affiliate of Digital Colony Management is taking Boingo Wireless private in an $854 million acquisition. Digital Colony is acquiring Boingo common stock for $14 per share in cash and is taking on $199 million of its net debt obligations as part of the transaction.
REITs could be an appealing option for investors at a time when some experts are predicting inflation on the horizon, although there may be some variation among property sectors. REIT returns have performed well in periods in which inflation is low and rising or high and rising, according to Schroders ' analysis of US asset performance between 1973 and 2020.
The Montana Board of Investments is allocating $50 million to an undisclosed publicly traded REIT and $20 million to a cold-storage REIT. MBI, which could opportunistically increase its REIT exposure in the future, also committed a total of $100 million to Stockbridge Niche Logistics Fund and CBRE Strategic Partners US Value 9.
REIT share prices edged lower in the week ended Feb. 26, with a total return of -1.2% on the FTSE Nareit All Equity REITs Index. Performance was mixed across property sectors, with six sectors rising and six sectors declining. Home financing mREITs and commercial financing mREITs also posted small gains for the week.
Last year, US mall values declined about $4 billion after reappraisals that were made in response to defaults, payment delinquencies or foreclosures, according to data on 118 retail-anchored properties. The average decline was 60%. Landlords are working on plans that include restructuring debt or shedding certain properties and reinvesting in others.
The apartment markets in coastal cities that were hit hardest by the pandemic are showing signs of recovery, with 9 out of 10 posting positive rent growth last month, according to Apartment List. Five of the markets experienced rent growth for the first time since the beginning of the coronavirus crisis.
Restaurants and fast food eateries with drive-thru lanes proved to be popular with consumers during the pandemic and investors have been taking note. These restaurants typically have 10% to 20% higher rent, says Derek Waltchack, a partner at Shannon Waltchack.
Payless has opened a store in North Miami, Fla., that will feature augmented reality, interactive touchscreens and other features. In August, the brand indicated it could open hundreds of stores in the next five years.
Investors are turning Tampa, Fla.'s former University Mall into a mixed-used development that includes an innovation hub, office space and about 30,000 square feet of retail and restaurant space. The new project, dubbed Rithm At Uptown, will also include student housing.
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