The State Of REITs: June 2018 Edition
Summary
- In May, there was a strong negative correlation between REIT market cap and total return with micro cap REITs significantly outperforming.
- The REIT recovery grew much stronger in May as all 20 REIT property types generated positive returns.
- REITs outperformed the S&P 500, DJIA and NASDAQ for the 3rd month in a row.
- Significant upside potential remains for REITs as the REIT sector still trades at a median 8.59% discount to net asset value (NAV).
- Hotel REITs continue to outperform with an 11.21% average YTD total return.
REIT Performance
May was the best month for REITs thus far in 2018, with the average REIT returning 5.90%. This outpaced the S&P 500 (+2.16%), Dow Jones Industrial Average (+1.05%) and NASDAQ (+5.32%). After badly underperforming over the first 2 months of the year, REITs have outperformed the broader market in each of the last 3 months. REITs still lag well behind the broader market on total return year to date. This gap could close, however, if REITs continue their strong recovery. In this monthly publication, I will provide REIT data on numerous metrics to help readers identify which property types and individual securities currently offer the best opportunities to achieve their investment goals.
Source: Graph by Simon Bowler, Data compiled from SNL.com
In May there was a very strong negative correlation between market cap and total return, with large cap REITs significantly underperforming (+2.55%). Micro cap REITs, on the other hand, yielded a stellar 9.58% return. This very strong month was not enough, however, to overcome the dismal -11.48% average return of micro caps over the first 4 months of the year. As a result, micro cap REITs remain the worst performers YTD, with small cap and mid cap REITs leading.
Source: Graph by Simon Bowler, Data compiled from SNL.com
All 20 REIT Property Types Yielded Positive Total Returns in May
The fact that every single REIT property type saw gains in May is truly a testament to the growing strength of the REIT recovery. The extent of these gains, however, varied greatly by property type. Single Family Housing, after a poor performance during the first 4 months, led with a 12.15% total return. Mall REITs, which have suffered in recent quarters from tenant bankruptcies and the “death of retail” media narrative, also saw a strong turnaround with a 9.36% return in May. Timber, which is among the top performers of 2018, tapered off a bit in June with a return of only 0.45%.
Source: Table by Simon Bowler, Data compiled from SNL.com
With the REIT recovery well underway, half of the 20 REIT property types are now in the black for YTD total return. As the year progresses, the disparity of performance among different property types continues to grow as the spread between the worst performance (Shopping Centers: -14.8%) and best performance (Hotels: 11.2%) has now reached 26%. This massive variance in performance across different property types and securities is providing a terrific opportunity for good active managers to generate substantial alpha.
Source: Table by Simon Bowler, Data compiled from SNL.com
As the REIT rally grew stronger in May, REITs experienced meaningful FFO multiple expansion, rising from an average P/FFO of 14.5x at the end of April to 15.4x at the end of May. Malls performed very well in May, but continue to trade at the lowest average FFO multiple (9.3x). Although some mall REITs trade at more mid-range FFO multiples, such as Macerich (MAC) at 14.05x, others trade at extremely low FFO multiples, such as CBL Properties (CBL) at 2.9x.
Source: Table by Simon Bowler, Data compiled from SNL.com
Performance of Individual REIT Securities
The extremely volatile Reven Housing REIT (RVEN) was the worst performing equity REIT in March (-39.5%) and in April (-10.7%), but in a stunning reversal was the best performing REIT of May (+47.29%). Health Care REIT New Senior Investment Group (SNR) was the worst performer in May due to an earnings miss and a delay in the announcement of the dividend while the company continues an ongoing strategic review. Even after a rough May, New Senior maintains a +2.13% YTD return. The Table below shows the performance of individual equity REITs ordered from worst to best. Note that 11 of the top 22 performers thus far in 2018 are Hotel REITs.
REIT | Ticker | Total MTD Return | Total YTD Return | Price/ 2018 FFO (x) | Dividend Yield | Property Type |
Wheeler Real Estate Investment Trust, Inc. | WHLR | 10.67% | -58.42% | 5.01 | 0.0% | Shopping Center |
Colony NorthStar, Inc. | CLNS | -3.60% | -47.38% | 8.05 | 7.4% | Diversified |
QTS Realty Trust, Inc. | QTS | 6.61% | -29.55% | 14.23 | 4.3% | Data Center |
Preferred Apartment Communities, Inc. | APTS | -0.27% | -26.32% | 10.18 | 6.7% | Multifamily |
Cedar Realty Trust, Inc. | CDR | 14.25% | -26.09% | 7.53 | 4.5% | Shopping Center |
Franklin Street Properties Corp. | FSP | -0.51% | -25.73% | 8.01 | 4.6% | Office |
Alexander & Baldwin, Inc. | ALEX | -6.94% | -23.18% | 13.67 | 0.0% | Diversified |
CIM Commercial Trust Corporation | CMCT | 0.34% | -21.36% | NA | 3.4% | Office |
Saul Centers, Inc. | BFS | 3.57% | -18.16% | 16.03 | 4.2% | Shopping Center |
Reven Housing REIT, Inc. | RVEN | 47.29% | -18.00% | NA | 0.0% | Single Family Housing |
Government Properties Income Trust | GOV | 16.33% | -16.98% | 7.29 | 11.8% | Office |
Kite Realty Group Trust | KRG | 6.59% | -16.93% | 7.82 | 8.1% | Shopping Center |
Empire State Realty Trust, Inc. | ESRT | -2.64% | -16.88% | 19.13 | 2.5% | Office |
Tanger Factory Outlet Centers, Inc. | SKT | -2.10% | -16.52% | 8.84 | 6.4% | Shopping Center |
Universal Health Realty Income Trust | UHT | 3.74% | -16.27% | NA | 4.2% | Health Care |
Taubman Centers, Inc. | TCO | -2.48% | -15.62% | 14.80 | 4.8% | Shopping Center |
Ramco-Gershenson Properties Trust | RPT | 2.93% | -14.96% | 9.30 | 7.2% | Shopping Center |
Forest City Realty Trust, Inc. | FCE.A | 1.55% | -14.75% | 13.57 | 3.6% | Diversified |
Regency Centers Corporation | REG | -0.34% | -14.41% | 15.43 | 3.8% | Shopping Center |
Healthcare Trust of America, Inc. | HTA | 2.68% | -13.56% | 15.29 | 4.8% | Health Care |
Urban Edge Properties | UE | 6.32% | -13.31% | 16.28 | 4.0% | Shopping Center |
Healthcare Realty Trust Incorporated | HR | -1.02% | -13.29% | 17.12 | 4.4% | Health Care |
Macerich Company | MAC | -2.24% | -13.16% | 14.05 | 5.3% | Malls |
Kimco Realty Corporation | KIM | 6.55% | -13.12% | 10.67 | 7.3% | Shopping Center |
Physicians Realty Trust | DOC | 1.87% | -12.99% | 13.93 | 6.0% | Health Care |
DDR Corp. | DDR | 4.76% | -12.90% | 8.61 | 10.0% | Shopping Center |
OUTFRONT Media Inc. (REIT) | OUT.REIT | 5.81% | -12.86% | 9.58 | 7.3% | Advertising |
GGP Inc. | GGP | 1.45% | -12.34% | 13.44 | 4.3% | Malls |
Whitestone REIT | WSR | 13.79% | -12.20% | 10.12 | 9.2% | Shopping Center |
Brixmor Property Group Inc. | BRX | 6.65% | -12.08% | 7.86 | 7.0% | Shopping Center |
Equinix, Inc. (REIT) | EQIX.REIT | -5.13% | -11.41% | 24.37 | 2.3% | Data Center |
Monmouth Real Estate Investment Corporation | MNR | -0.06% | -11.18% | 17.25 | 4.4% | Industrial |
Bluerock Residential Growth REIT, Inc. | BRG | -1.22% | -10.43% | 21.07 | 7.4% | Multifamily |
Iron Mountain Incorporated | IRM | -1.92% | -10.20% | 16.08 | 7.0% | Industrial |
Front Yard Residential Corporation | RESI | 7.13% | -9.97% | 16.07 | 5.7% | Single Family Housing |
Four Corners Property Trust, Inc. | FCPT | 1.02% | -9.86% | 16.08 | 4.8% | Triple Net |
Select Income REIT | SIR | 13.92% | -9.77% | 8.52 | 9.4% | Triple Net |
Federal Realty Investment Trust | FRT | 2.62% | -9.72% | 19.24 | 3.4% | Shopping Center |
Weingarten Realty Investors | WRI | 6.73% | -9.53% | 12.71 | 5.4% | Shopping Center |
Vornado Realty Trust | VNO | 3.40% | -9.24% | 20.48 | 3.6% | Office |
Clipper Realty Inc. | CLPR | 10.16% | -8.68% | 54.18 | 4.3% | Diversified |
Brandywine Realty Trust | BDN | 0.93% | -8.64% | 11.91 | 4.4% | Office |
Lexington Realty Trust | LXP | 7.34% | -8.57% | 8.86 | 8.2% | Triple Net |
American Homes 4 Rent | AMH | -1.39% | -8.56% | 18.20 | 1.0% | Single Family Housing |
Retail Opportunity Investments Corp. | ROIC | 5.35% | -8.17% | 15.26 | 4.3% | Shopping Center |
Gladstone Commercial Corporation | GOOD | 9.15% | -7.61% | 11.73 | 7.9% | Triple Net |
Ventas, Inc. | VTR | 6.30% | -7.46% | 13.66 | 5.8% | Health Care |
Retail Properties of America, Inc. | RPAI | 6.24% | -7.45% | 12.15 | 5.5% | Shopping Center |
Washington Real Estate Investment Trust | WRE | -0.14% | -6.80% | 15.41 | 4.1% | Diversified |
Welltower Inc. | WELL | 9.56% | -6.71% | 14.35 | 6.0% | Health Care |
CBL Properties | CBL | 21.05% | -6.54% | 2.90 | 15.2% | Malls |
AvalonBay Communities, Inc. | AVB | 1.56% | -6.38% | 18.53 | 3.5% | Multifamily |
Mack-Cali Realty Corporation | CLI | 15.14% | -6.32% | 10.66 | 4.1% | Office |
VEREIT, Inc. | VER | 5.29% | -6.26% | 10.50 | 7.7% | Triple Net |
Plymouth Industrial REIT, Inc. | PLYM | -1.40% | -6.18% | 13.35 | 9.0% | Industrial |
CyrusOne Inc. | CONE | 3.34% | -6.13% | 17.00 | 3.3% | Data Center |
Chatham Lodging Trust | CLDT | 9.71% | -6.10% | 10.82 | 6.3% | Hotel |
CoreSite Realty Corporation | COR | 1.98% | -5.90% | 21.09 | 3.8% | Data Center |
Armada Hoffler Properties, Inc. | AHH | 6.12% | -5.89% | 13.92 | 5.5% | Diversified |
Boston Properties, Inc. | BXP | 0.30% | -5.75% | 19.29 | 2.6% | Office |
Invitation Homes Inc. | INVH | -4.43% | -5.69% | 18.78 | 2.0% | Single Family Housing |
Douglas Emmett, Inc. | DEI | 3.27% | -5.62% | 19.20 | 2.6% | Diversified |
Lamar Advertising Company (REIT) | LAMR.REIT | 8.65% | -5.46% | 15.49 | 5.2% | Advertising |
Crown Castle International Corp. (REIT) | CCI.REIT | 3.25% | -5.28% | 21.33 | 4.0% | Infrastructure |
Mid-America Apartment Communities, Inc. | MAA | 2.30% | -5.07% | 15.58 | 3.9% | Multifamily |
HCP, Inc. | HCP | 4.23% | -5.05% | 13.29 | 6.2% | Health Care |
Acadia Realty Trust | AKR | 9.11% | -4.86% | 18.65 | 4.2% | Shopping Center |
Apartment Investment and Management Company | AIV | 1.55% | -4.76% | 16.67 | 3.7% | Multifamily |
Digital Realty Trust, Inc. | DLR | 1.69% | -4.73% | 16.38 | 3.7% | Data Center |
VICI Properties Inc. | VICI | 6.55% | -4.68% | 13.12 | 5.3% | Casino |
Paramount Group, Inc. | PGRE | 4.67% | -4.57% | 15.81 | 2.7% | Office |
Realty Income Corporation | O | 5.96% | -4.52% | 16.79 | 4.9% | Triple Net |
Simon Property Group, Inc. | SPG | 3.78% | -4.34% | 13.32 | 4.8% | Malls |
American Assets Trust, Inc. | AAT | 8.28% | -4.17% | 17.63 | 3.0% | Diversified |
iStar Inc. | STAR | 6.80% | -4.16% | NA | 0.0% | Diversified |
Highwoods Properties, Inc. | HIW | 9.79% | -4.06% | 13.95 | 3.9% | Office |
Easterly Government Properties, Inc. | DEA | -1.75% | -3.86% | 15.60 | 5.1% | Office |
Pennsylvania Real Estate Investment Trust | PEI | 15.91% | -3.74% | 7.23 | 7.5% | Malls |
UDR, Inc. | UDR | 0.89% | -3.67% | 18.87 | 3.5% | Multifamily |
Alexandria Real Estate Equities, Inc. | ARE | 0.28% | -3.65% | 18.79 | 2.9% | Office |
Camden Property Trust | CPT | 3.04% | -3.53% | 18.40 | 3.5% | Multifamily |
Corporate Office Properties Trust | OFC | 1.42% | -3.43% | 13.90 | 3.9% | Office |
Senior Housing Properties Trust | SNH | 13.42% | -3.35% | 10.46 | 8.8% | Health Care |
Gaming and Leisure Properties, Inc. | GLPI | 2.42% | -3.32% | 14.10 | 7.1% | Casino |
Gladstone Land Corporation | LAND | 1.62% | -3.32% | 22.89 | 4.1% | Land |
EPR Properties | EPR | 12.23% | -3.25% | 10.94 | 7.0% | Diversified |
SBA Communications Corporation (REIT) | SBAC.REIT | -1.35% | -3.24% | 22.88 | 0.0% | Infrastructure |
LTC Properties, Inc. | LTC | 14.35% | -3.17% | 13.70 | 5.5% | Health Care |
MedEquities Realty Trust, Inc. | MRT | 4.94% | -2.80% | 8.77 | 8.0% | Health Care |
Getty Realty Corp. | GTY | 4.23% | -2.59% | 14.28 | 4.9% | Triple Net |
SL Green Realty Corp. | SLG | -0.23% | -2.57% | 14.44 | 3.3% | Office |
American Tower Corporation (REIT) | AMT.REIT | 1.47% | -2.48% | 20.74 | 2.2% | Infrastructure |
CoreCivic, Inc. | CXW | 6.75% | -2.25% | 9.55 | 7.9% | Corrections |
Independence Realty Trust, Inc. | IRT | 3.19% | -1.98% | 12.94 | 7.4% | Multifamily |
Columbia Property Trust, Inc. | CXP | 4.49% | -1.81% | 15.19 | 3.6% | Office |
National Retail Properties, Inc. | NNN | 8.91% | -1.57% | 15.55 | 4.6% | Triple Net |
PS Business Parks, Inc. | PSB | 6.32% | -1.28% | 19.35 | 2.8% | Diversified |
CatchMark Timber Trust, Inc. | CTT | -1.59% | -1.27% | 31.31 | 4.2% | Timber |
CorEnergy Infrastructure Trust, Inc. | CORR | -4.15% | -1.22% | 9.83 | 8.2% | Infrastructure |
City Office REIT, Inc. | CIO | 8.96% | -0.90% | 11.10 | 7.6% | Office |
W. P. Carey Inc. | WPC | 5.26% | -0.86% | 13.96 | 6.0% | Triple Net |
National Health Investors, Inc. | NHI | 8.13% | -0.62% | 13.42 | 5.4% | Health Care |
Investors Real Estate Trust | IRET | 4.50% | -0.54% | 14.38 | 5.2% | Multifamily |
Farmland Partners Inc. | FPI | 11.68% | -0.46% | 13.98 | 6.0% | Land |
Apple Hospitality REIT, Inc. | APLE | 6.37% | -0.25% | 10.97 | 6.2% | Hotel |
Essex Property Trust, Inc. | ESS | -0.28% | -0.20% | 19.11 | 3.1% | Multifamily |
STAG Industrial, Inc. | STAG | 8.90% | -0.15% | 14.84 | 5.3% | Industrial |
CareTrust REIT, Inc. | CTRE | 24.83% | -0.11% | 12.71 | 5.0% | Health Care |
American Campus Communities, Inc. | ACC | 3.72% | 0.03% | 16.94 | 4.6% | Student Housing |
NexPoint Residential Trust, Inc. | NXRT | 3.47% | 0.20% | 16.80 | 3.6% | Multifamily |
Alexander's, Inc. | ALX | -0.34% | 0.23% | 24.82 | 4.6% | Diversified |
Piedmont Office Realty Trust, Inc. | PDM | 8.48% | 0.29% | 11.20 | 4.4% | Office |
One Liberty Properties, Inc. | OLP | 7.41% | 0.37% | 12.79 | 7.0% | Triple Net |
Medical Properties Trust, Inc. | MPW | 6.18% | 0.38% | 9.56 | 7.4% | Health Care |
Prologis, Inc. | PLD | -0.86% | 0.51% | 21.53 | 3.0% | Industrial |
Global Net Lease, Inc. | GNL | 7.05% | 0.68% | 9.22 | 10.7% | Triple Net |
Hospitality Properties Trust | HPT | 16.36% | 0.83% | 7.51 | 7.3% | Hotel |
Equity Residential | EQR | 3.69% | 1.27% | 19.85 | 3.4% | Multifamily |
UMH Properties, Inc. | UMH | 10.13% | 1.47% | 18.26 | 4.8% | Manufactured Housing |
Community Healthcare Trust Incorporated | CHCT | 10.32% | 1.80% | 16.61 | 5.7% | Health Care |
Equity Commonwealth | EQC | 0.39% | 1.97% | 58.29 | 0.0% | Office |
Potlatch Corporation | PCH | -2.60% | 1.98% | NA | 3.2% | Timber |
New Senior Investment Group Inc. | SNR | -13.23% | 2.13% | 7.79 | 13.4% | Health Care |
Public Storage | PSA | 4.99% | 2.39% | 20.04 | 3.8% | Self-Storage |
Kilroy Realty Corporation | KRC | 6.25% | 2.62% | 21.21 | 2.4% | Office |
Cousins Properties Incorporated | CUZ | 5.96% | 2.63% | 15.36 | 2.8% | Office |
Equity LifeStyle Properties, Inc. | ELS | 1.95% | 2.76% | 23.43 | 2.4% | Manufactured Housing |
Summit Hotel Properties, Inc. | INN | 6.91% | 2.92% | 11.05 | 4.7% | Hotel |
Urstadt Biddle Properties Inc. | UBA | 9.96% | 3.21% | 16.41 | 4.9% | Shopping Center |
MGM Growth Properties LLC | MGP | 6.11% | 3.43% | 14.37 | 5.6% | Casino |
Seritage Growth Properties | SRG | 17.12% | 3.69% | 32.42 | 2.3% | Triple Net |
Liberty Property Trust | LPT | 5.71% | 3.82% | 17.00 | 3.7% | Diversified |
Agree Realty Corporation | ADC | 8.31% | 4.03% | 18.19 | 3.9% | Triple Net |
Hudson Pacific Properties, Inc. | HPP | 7.70% | 4.15% | 18.56 | 2.8% | Office |
Condor Hospitality Trust, Inc. | CDOR | 4.20% | 4.20% | 9.98 | 7.8% | Hotel |
STORE Capital Corporation | STOR | 6.22% | 4.21% | 15.30 | 4.6% | Triple Net |
National Storage Affiliates Trust | NSA | 6.84% | 4.27% | 20.77 | 4.1% | Self-Storage |
Spirit Realty Capital, Inc. | SRC | 8.82% | 4.47% | 11.10 | 8.2% | Triple Net |
Duke Realty Corporation | DRE | 4.50% | 4.90% | 21.63 | 2.8% | Industrial |
Sun Communities, Inc. | SUI | 3.02% | 5.02% | 21.23 | 2.9% | Manufactured Housing |
Gramercy Property Trust | GPT | 17.32% | 5.18% | 13.63 | 5.4% | Triple Net |
First Industrial Realty Trust, Inc. | FR | 5.85% | 5.42% | 20.50 | 2.6% | Industrial |
Sunstone Hotel Investors, Inc. | SHO | 11.47% | 5.55% | 15.35 | 1.1% | Hotel |
EastGroup Properties, Inc. | EGP | 3.84% | 6.30% | 20.44 | 2.7% | Industrial |
Life Storage, Inc. | LSI | 4.61% | 6.35% | 17.22 | 4.3% | Self-Storage |
CubeSmart | CUBE | 3.60% | 6.59% | 18.65 | 3.9% | Self-Storage |
NorthStar Realty Europe Corp. | NRE | -2.33% | 6.71% | 14.00 | 4.3% | Office |
Weyerhaeuser Company | WY | 1.50% | 6.86% | NA | 3.4% | Timber |
JBG SMITH Properties | JBGS | 0.66% | 6.87% | NA | 2.4% | Diversified |
Education Realty Trust, Inc. | EDR | 11.03% | 7.17% | 19.79 | 4.3% | Student Housing |
Sotherly Hotels Inc. | SOHO | 5.26% | 7.52% | 6.58 | 7.1% | Hotel |
Rexford Industrial Realty, Inc. | REXR | 2.36% | 7.83% | 28.86 | 2.0% | Industrial |
RLJ Lodging Trust | RLJ | 12.66% | 8.31% | 9.87 | 5.6% | Hotel |
TIER REIT, Inc. | TIER | 15.52% | 8.72% | 14.47 | 3.3% | Office |
BRT Apartments Corp. | BRT | 4.55% | 9.09% | 11.92 | 6.4% | Multifamily |
Terreno Realty Corporation | TRNO | 2.58% | 9.40% | 29.56 | 2.3% | Industrial |
Washington Prime Group Inc. | WPG | 16.23% | 9.67% | 4.82 | 13.1% | Malls |
GEO Group, Inc. | GEO | 10.22% | 9.92% | 12.72 | 7.5% | Corrections |
Safety, Income & Growth Inc. | SAFE | 6.85% | 10.01% | 20.68 | 3.1% | Land |
Host Hotels & Resorts, Inc. | HST | 10.58% | 10.14% | 12.60 | 3.7% | Hotel |
Pebblebrook Hotel Trust | PEB | 16.66% | 11.02% | 15.22 | 3.7% | Hotel |
Extra Space Storage Inc. | EXR | 7.43% | 11.06% | 20.82 | 3.5% | Self-Storage |
DCT Industrial Trust Inc. | DCT | -0.67% | 11.51% | 25.22 | 2.2% | Industrial |
Ashford Hospitality Trust, Inc. | AHT | 7.12% | 11.55% | 5.20 | 6.5% | Hotel |
Global Medical REIT Inc. | GMRE | 14.76% | 12.21% | 11.16 | 9.1% | Health Care |
DiamondRock Hospitality Company | DRH | 15.20% | 14.08% | 12.42 | 3.9% | Hotel |
Braemar Hotels & Resorts, Inc. | BHR | 5.77% | 14.91% | 6.63 | 5.8% | Hotel |
New York REIT, Inc. | NYRT | 6.68% | 15.66% | NA | 0.0% | Office |
Sabra Health Care REIT, Inc. | SBRA | 15.88% | 16.23% | 8.29 | 8.6% | Health Care |
Park Hotels & Resorts Inc. | PK | 11.95% | 16.23% | 11.24 | 5.4% | Hotel |
InfraREIT, Inc. (REIT) | HIFR.REIT | 0.23% | 16.43% | NA | 4.7% | Infrastructure |
Omega Healthcare Investors, Inc. | OHI | 17.98% | 17.01% | 10.24 | 8.6% | Health Care |
Innovative Industrial Properties, Inc. | IIPR | 10.05% | 17.38% | 28.90 | 2.7% | Industrial |
Xenia Hotels & Resorts, Inc. | XHR | 22.24% | 18.20% | 11.63 | 4.4% | Hotel |
Chesapeake Lodging Trust | CHSP | 9.11% | 20.69% | 13.48 | 5.0% | Hotel |
Uniti Group Inc. | UNIT | 16.37% | 22.25% | 9.51 | 11.5% | Infrastructure |
Ryman Hospitality Properties, Inc. | RHP | 7.02% | 22.87% | 14.38 | 4.1% | Hotel |
Rayonier Inc. | RYN | 4.52% | 23.76% | NA | 2.8% | Timber |
LaSalle Hotel Properties | LHO | 16.00% | 24.15% | 15.37 | 2.6% | Hotel |
Hersha Hospitality Trust | HT | 13.26% | 26.15% | 10.28 | 5.3% | Hotel |
Quality Care Properties, Inc. | QCP | -4.64% | 51.70% | NA | 0.0% | Health Care |
Source: Table by Simon Bowler, Data compiled from SNL.com
For the convenience of reading this table in a larger font, the table above is available as a PDF as well.
Simon_Bowler_REIT_Data_05.31.2018.pdf
Source: Table by Simon Bowler, Data compiled from SNL.com
Dividend Yield
Dividend yield is an important component of a REIT's total return. The particularly high dividend yields of the REIT sector are, for many investors, the primary reason for investment in this sector. As many REITs are currently trading at share prices well below their NAV, yields are currently quite high for many REITs within the sector. Although a particularly high yield for a REIT may sometimes reflect a disproportionately high risk, there exist opportunities in some cases to capitalize on dividend yields that are sufficiently attractive to justify the underlying risks of the investment. I have included below a table ranking equity REITs from highest dividend yield (as of 05/31/2018) to lowest dividend yield.
REIT | Ticker | Dividend Yield 05/31/2018 |
CBL Properties | CBL | 15.2% |
New Senior Investment Group Inc. | SNR | 13.4% |
Washington Prime Group Inc. | WPG | 13.1% |
Government Properties Income Trust | GOV | 11.8% |
Uniti Group Inc. | UNIT | 11.5% |
Global Net Lease, Inc. | GNL | 10.7% |
DDR Corp. | DDR | 10.0% |
Select Income REIT | SIR | 9.4% |
Whitestone REIT | WSR | 9.2% |
Global Medical REIT Inc. | GMRE | 9.1% |
Plymouth Industrial REIT, Inc. | PLYM | 9.0% |
Senior Housing Properties Trust | SNH | 8.8% |
Sabra Health Care REIT, Inc. | SBRA | 8.6% |
Omega Healthcare Investors, Inc. | OHI | 8.6% |
Spirit Realty Capital, Inc. | SRC | 8.2% |
Lexington Realty Trust | LXP | 8.2% |
CorEnergy Infrastructure Trust, Inc. | CORR | 8.2% |
Kite Realty Group Trust | KRG | 8.1% |
MedEquities Realty Trust, Inc. | MRT | 8.0% |
CoreCivic, Inc. | CXW | 7.9% |
Gladstone Commercial Corporation | GOOD | 7.9% |
Condor Hospitality Trust, Inc. | CDOR | 7.8% |
VEREIT, Inc. | VER | 7.7% |
City Office REIT, Inc. | CIO | 7.6% |
GEO Group, Inc. | GEO | 7.5% |
Pennsylvania Real Estate Investment Trust | PEI | 7.5% |
Independence Realty Trust, Inc. | IRT | 7.4% |
Colony NorthStar, Inc. | CLNS | 7.4% |
Medical Properties Trust, Inc. | MPW | 7.4% |
Bluerock Residential Growth REIT, Inc. | BRG | 7.4% |
Hospitality Properties Trust | HPT | 7.3% |
Kimco Realty Corporation | KIM | 7.3% |
OUTFRONT Media Inc. (REIT) | OUT.REIT | 7.3% |
Ramco-Gershenson Properties Trust | RPT | 7.2% |
Gaming and Leisure Properties, Inc. | GLPI | 7.1% |
Sotherly Hotels Inc. | SOHO | 7.1% |
EPR Properties | EPR | 7.0% |
Brixmor Property Group Inc. | BRX | 7.0% |
Iron Mountain Incorporated | IRM | 7.0% |
One Liberty Properties, Inc. | OLP | 7.0% |
Preferred Apartment Communities, Inc. | APTS | 6.7% |
Ashford Hospitality Trust, Inc. | AHT | 6.5% |
Tanger Factory Outlet Centers, Inc. | SKT | 6.4% |
BRT Apartments Corp. | BRT | 6.4% |
Chatham Lodging Trust | CLDT | 6.3% |
Apple Hospitality REIT, Inc. | APLE | 6.2% |
HCP, Inc. | HCP | 6.2% |
W. P. Carey Inc. | WPC | 6.0% |
Welltower Inc. | WELL | 6.0% |
Physicians Realty Trust | DOC | 6.0% |
Farmland Partners Inc. | FPI | 6.0% |
Braemar Hotels & Resorts, Inc. | BHR | 5.8% |
Ventas, Inc. | VTR | 5.8% |
Community Healthcare Trust Incorporated | CHCT | 5.7% |
Front Yard Residential Corporation | RESI | 5.7% |
MGM Growth Properties LLC | MGP | 5.6% |
RLJ Lodging Trust | RLJ | 5.6% |
LTC Properties, Inc. | LTC | 5.5% |
Armada Hoffler Properties, Inc. | AHH | 5.5% |
Retail Properties of America, Inc. | RPAI | 5.5% |
National Health Investors, Inc. | NHI | 5.4% |
Gramercy Property Trust | GPT | 5.4% |
Weingarten Realty Investors | WRI | 5.4% |
Park Hotels & Resorts Inc. | PK | 5.4% |
Hersha Hospitality Trust | HT | 5.3% |
STAG Industrial, Inc. | STAG | 5.3% |
Macerich Company | MAC | 5.3% |
Lamar Advertising Company (REIT) | LAMR.REIT | 5.2% |
Investors Real Estate Trust | IRET | 5.2% |
Easterly Government Properties, Inc. | DEA | 5.1% |
CareTrust REIT, Inc. | CTRE | 5.0% |
Chesapeake Lodging Trust | CHSP | 5.0% |
Urstadt Biddle Properties Inc. | UBA | 4.9% |
Realty Income Corporation | O | 4.9% |
Getty Realty Corp. | GTY | 4.9% |
Simon Property Group, Inc. | SPG | 4.8% |
Four Corners Property Trust, Inc. | FCPT | 4.8% |
Taubman Centers, Inc. | TCO | 4.8% |
Healthcare Trust of America, Inc. | HTA | 4.8% |
UMH Properties, Inc. | UMH | 4.8% |
Summit Hotel Properties, Inc. | INN | 4.7% |
InfraREIT, Inc. (REIT) | HIFR.REIT | 4.7% |
Alexander's, Inc. | ALX | 4.6% |
Franklin Street Properties Corp. | FSP | 4.6% |
National Retail Properties, Inc. | NNN | 4.6% |
STORE Capital Corporation | STOR | 4.6% |
American Campus Communities, Inc. | ACC | 4.6% |
Cedar Realty Trust, Inc. | CDR | 4.5% |
Brandywine Realty Trust | BDN | 4.4% |
Piedmont Office Realty Trust, Inc. | PDM | 4.4% |
Xenia Hotels & Resorts, Inc. | XHR | 4.4% |
Healthcare Realty Trust Incorporated | HR | 4.4% |
Monmouth Real Estate Investment Corporation | MNR | 4.4% |
Life Storage, Inc. | LSI | 4.3% |
QTS Realty Trust, Inc. | QTS | 4.3% |
Clipper Realty Inc. | CLPR | 4.3% |
Retail Opportunity Investments Corp. | ROIC | 4.3% |
NorthStar Realty Europe Corp. | NRE | 4.3% |
Education Realty Trust, Inc. | EDR | 4.3% |
GGP Inc. | GGP | 4.3% |
Universal Health Realty Income Trust | UHT | 4.2% |
Saul Centers, Inc. | BFS | 4.2% |
Acadia Realty Trust | AKR | 4.2% |
CatchMark Timber Trust, Inc. | CTT | 4.2% |
Washington Real Estate Investment Trust | WRE | 4.1% |
National Storage Affiliates Trust | NSA | 4.1% |
Gladstone Land Corporation | LAND | 4.1% |
Mack-Cali Realty Corporation | CLI | 4.1% |
Ryman Hospitality Properties, Inc. | RHP | 4.1% |
Crown Castle International Corp. (REIT) | CCI.REIT | 4.0% |
Urban Edge Properties | UE | 4.0% |
Mid-America Apartment Communities, Inc. | MAA | 3.9% |
Corporate Office Properties Trust | OFC | 3.9% |
CubeSmart | CUBE | 3.9% |
Agree Realty Corporation | ADC | 3.9% |
DiamondRock Hospitality Company | DRH | 3.9% |
Highwoods Properties, Inc. | HIW | 3.9% |
CoreSite Realty Corporation | COR | 3.8% |
Regency Centers Corporation | REG | 3.8% |
Public Storage | PSA | 3.8% |
Digital Realty Trust, Inc. | DLR | 3.7% |
Apartment Investment and Management Company | AIV | 3.7% |
Pebblebrook Hotel Trust | PEB | 3.7% |
Host Hotels & Resorts, Inc. | HST | 3.7% |
Liberty Property Trust | LPT | 3.7% |
Vornado Realty Trust | VNO | 3.6% |
Columbia Property Trust, Inc. | CXP | 3.6% |
Forest City Realty Trust, Inc. | FCE.A | 3.6% |
NexPoint Residential Trust, Inc. | NXRT | 3.6% |
Extra Space Storage Inc. | EXR | 3.5% |
AvalonBay Communities, Inc. | AVB | 3.5% |
UDR, Inc. | UDR | 3.5% |
Camden Property Trust | CPT | 3.5% |
Weyerhaeuser Company | WY | 3.4% |
Equity Residential | EQR | 3.4% |
CIM Commercial Trust Corporation | CMCT | 3.4% |
Federal Realty Investment Trust | FRT | 3.4% |
SL Green Realty Corp. | SLG | 3.3% |
CyrusOne Inc. | CONE | 3.3% |
TIER REIT, Inc. | TIER | 3.3% |
Potlatch Corporation | PCH | 3.2% |
Safety, Income & Growth Inc. | SAFE | 3.1% |
Essex Property Trust, Inc. | ESS | 3.1% |
American Assets Trust, Inc. | AAT | 3.0% |
Prologis, Inc. | PLD | 3.0% |
Sun Communities, Inc. | SUI | 2.9% |
Alexandria Real Estate Equities, Inc. | ARE | 2.9% |
Hudson Pacific Properties, Inc. | HPP | 2.8% |
Duke Realty Corporation | DRE | 2.8% |
Cousins Properties Incorporated | CUZ | 2.8% |
Rayonier Inc. | RYN | 2.8% |
PS Business Parks, Inc. | PSB | 2.8% |
EastGroup Properties, Inc. | EGP | 2.7% |
Innovative Industrial Properties, Inc. | IIPR | 2.7% |
Paramount Group, Inc. | PGRE | 2.7% |
First Industrial Realty Trust, Inc. | FR | 2.6% |
LaSalle Hotel Properties | LHO | 2.6% |
Boston Properties, Inc. | BXP | 2.6% |
Douglas Emmett, Inc. | DEI | 2.6% |
Empire State Realty Trust, Inc. | ESRT | 2.5% |
Equity LifeStyle Properties, Inc. | ELS | 2.4% |
JBG SMITH Properties | JBGS | 2.4% |
Kilroy Realty Corporation | KRC | 2.4% |
Seritage Growth Properties | SRG | 2.3% |
Terreno Realty Corporation | TRNO | 2.3% |
Equinix, Inc. (REIT) | EQIX.REIT | 2.3% |
American Tower Corporation (REIT) | AMT.REIT | 2.2% |
DCT Industrial Trust Inc. | DCT | 2.2% |
Rexford Industrial Realty, Inc. | REXR | 2.0% |
Invitation Homes Inc. | INVH | 2.0% |
Sunstone Hotel Investors, Inc. | SHO | 1.1% |
American Homes 4 Rent | AMH | 1.0% |
Alexander & Baldwin, Inc. | ALEX | 0.0% |
Equity Commonwealth | EQC | 0.0% |
New York REIT, Inc. | NYRT | 0.0% |
Quality Care Properties, Inc. | QCP | 0.0% |
Reven Housing REIT, Inc. | RVEN | 0.0% |
SBA Communications Corporation (REIT) | SBAC.REIT | 0.0% |
iStar Inc. | STAR | 0.0% |
Wheeler Real Estate Investment Trust, Inc. | WHLR | 0.0% |
Source: Table by Simon Bowler, Data compiled from SNL.com
For the convenience of reading this table in a larger font, the table above is available as a PDF as well.
Simon_Bowler_Dividend_Yield_Ranking_05.31.2018.pdf
Source: Table by Simon Bowler, Data compiled from SNL.com
Although a REIT’s decision regarding whether to pay a quarterly dividend or a monthly dividend does not reflect on the quality of the company’s fundamentals or operations, a monthly dividend allows for a smoother cash flow to the investor. As requested in the comments of “The State of REITs May 2018 Edition”, below is a list of equity REITs that pay monthly dividends ranked from highest yield to lowest yield.
Monthly Pay REITs | Ticker | Dividend Yield 05/31/2018 |
Global Net Lease, Inc. | GNL | 10.7% |
Whitestone REIT | WSR | 9.2% |
Gladstone Commercial Corporation | GOOD | 7.9% |
EPR Properties | EPR | 7.0% |
Chatham Lodging Trust | CLDT | 6.3% |
Apple Hospitality REIT, Inc. | APLE | 6.2% |
LTC Properties, Inc. | LTC | 5.5% |
STAG Industrial, Inc. | STAG | 5.3% |
Realty Income Corporation | O | 4.9% |
Gladstone Land Corporation | LAND | 4.1% |
Source: Table by Simon Bowler, Data compiled from SNL.com
Although current dividend yield is a particularly important factor in selecting which security in which to invest, dividend growth is also certainly worth considering as well. The table below lists the REITs that have increased their dividend thus far in 2018 (as of the end of April). For those who are interested in investing in Canadian REITs, the table includes five additional monthly dividend REITs that hiked their dividend in 2018.
Source: SNL.com
Takeaway
Discussion of the broader market (the tech and financial sectors in particular) may dominate media coverage, but REITs have quietly outperformed the broader market in each of the last 3 months. Despite an endless media drumbeat warning against the imminent death of retail, mall REITs were up 9.36% in May. Those who are following the data, rather than the headlines, have had the opportunity to capitalize on these first few months of the REIT rebound after a far-larger than justified selloff. As most REITs continue to trade at discounted prices and REIT fundamentals remain strong, there appears to be a good chance that REITs will continue to outperform. Excessively discounted property types, such as Malls and Shopping Centers, have the potential to yield particularly outsized returns over upcoming months.
This article was written by
Simon Bowler is the Chief Communications Officer at 2nd Market Capital Advisory Corporation (2MCAC). 2MCAC specializes in the analysis and trading of real estate securities. Through a selective process and consideration of market dynamics, we aim to construct portfolios for rising streams of dividend income and capital appreciation.Our Portfolio Income Solutions Marketplace service provides stock picks, extensive analysis and data sheets to help enhance the returns of do-it-yourself investors.Investment Advisory Services
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Learn more about our REIT Total Return Portfolio.Simon Bowler, along with fellow SA contributors Dane Bowler and Ross Bowler, is an investment advisory representative of 2nd Market Capital Advisory Corporation (2MCAC), a state-registered investment advisor.Full Disclosure. All content is published and provided as an information source for investors capable of making their own investment decisions. None of the information offered should be construed to be advice or a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. The information offered is impersonal and not tailored to the investment needs of the specific person. Please see our SA Disclosure Statement for our Full Disclaimer.
Disclosure: I am/we are long UNIT, CBL AND SNR. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Additional disclosure: 2nd Market Capital and its affiliated accounts are long CBL, SNR and UNIT. I am personally long CBL and UNIT. This article is provided for informational purposes only. It is not a recommendation to buy or sell any security and is strictly the opinion of the writer. Information contained in this article is impersonal and not tailored to the investment needs of any particular person. It does not constitute a recommendation that any particular security or strategy is suitable for a specific person. Investing in publicly held securities is speculative and involves risk, including the possible loss of principal. The reader must determine whether any investment is suitable and accepts responsibility for their investment decisions. Simon Bowler is an investment advisor representative of 2MCAC, a Wisconsin registered investment advisor. Positive comments made by others should not be construed as an endorsement of the writer's abilities as an investment advisor representative. Commentary may contain forward looking statements which are by definition uncertain. Actual results may differ materially from our forecasts or estimations, and 2MCAC and its affiliates cannot be held liable for the use of and reliance upon the opinions, estimates, forecasts and findings in this article. Although the statements of fact and data in this report have been obtained from sources believed to be reliable, 2MCAC does not guarantee their accuracy and assumes no liability or responsibility for any omissions/errors.