NAREIT: REIT Returns Declining

Pointing to more evidence of a slowdown in the commercial real estate sector, real estate investment trusts declined 5.92% on a total-return basis as of October, according to the National Association of Real Estate Investment Trusts.NAREIT reported that considering only equity REITs, total returns on the FTSE NAREIT indices (including price gains and dividend yields) were down 2.37% for the first 10 months of the year. Considering mortgage REITs alone, total returns as of October were down 44%. The specialty and industrial REIT sectors have performed best so far this year, turning in total returns of 16.86% and 13.15%, respectively, the REIT industry trade group said. Concerns about a slowdown in consumer spending notwithstanding, two retail sectors turned in positive returns, with "free-standing" retail posting an 8.08% gain and regional malls 3.98%. The other REIT sector that was positive for the period is health care (0.08%). REITs have been outperforming other investment avenues since 2001, turning in a total return of 34.35% for 2006. NAREIT can be found online at http://www.nareit.com.