REITs Raised $22bn for Real Estate Investments in 2010: NAREIT
The US Real Estate Investment Trusts (REITs) raised $22bn in initial, debt and equity capital offerings in 2010, and as a whole the industry owns $500bn of commercial real estate assets, approximately 10% to 15% of total institutionally owned commercial real estate, according to a mid-year report by the National Association of REITs, NAREIT. Leading segments of the REIT industry included apartment REITs, up 16.29%, lodging and resorts, up 10.76%, and self storage, up 9.48%. For the 12 months ending June 30, 2010, an FTSE/NAREIT index of all 148 US REITs showed a 10.23% compound annual total return. By comparison, the Standard & Poor's (S&P) 500's compound annual total return over the same period was negative 1.59%, NAREIT said. “Through their skilled management teams, high-quality assets and strong dividends — which over longer periods have accounted for nearly two-thirds of total returns — REITs have consistently provided outstanding long-term performance for their investors,” NAREIT president and CEO Steven Wechsler said in a press statement. Of the $22bn in raised equity, $9.8bn was raised in secondary equity common and preferred share offerings, $10.9bn was raised in secured or unsecured debt offerings and $1.3bn was raised in initial public offerings (IPOs). Six REITs completed IPOs so far in 2010. REITs paid out $13.5bn in dividends in 2009, yields of approximately 4.92% for the all-REIT index, NAREIT said. Over the past 10 years, average daily dollar trading volume for REITs has grown from $390m in June 2000 to $1.6bn in June 2005. In June 2010, the average reached $4.2bn. Write to Austin Kilgore. The author held no relevant investments.