The total return to investors from U.S.-based REITs in the first quarter was 10.41%, underperforming the S&P 500, which had a 12.59% return for the period, according to the National Association of Real Estate Investment Trusts. Still, REITs were successful in raising money during the period, possibly setting the stage to jump into the commercial refinance market.
Looking back over the prior 12 months, all REITS returned 10.91% (equity REITS returned 11.29%) while the S&P 500 returned just 8.54%.
Going back for a three-year period, all REITs returned 39.98% (equity REITS 42.21%), much better than the S&P 500's 23.42%.
At March 31, the dividend yield for all REITs totaled 3.34% compared with 2.14% for the S&P 500 and 2.22% for 10-year U.S. Treasury Notes. Some sectors offered substantially higher yields than the overall REIT universe, including 14.56% for REITs which do home financing and 8.57% for commercial financing REITs.
NAREIT noted that in the first quarter, publicly traded U.S. REITs raised a total of $21.2 billion in capital, including $10.6 billion in equity. By comparison, REITs raised a total of $51.3 billion, including $31.1 billion in equity, in all of 2011, which was the industry's record year for both total capital and equity capital raised.
“REITs are well capitalized and well prepared to make strategic acquisitions in 2012,” said Steven A. Wechsler, NAREIT's president and CEO. “Those opportunities are likely to present themselves this year as $20 billion in five year commercial real estate loans made at the peak of the last real estate cycle come due—many of which will have difficulty being refinanced.”
