The Market Commentary blog on reit.com presents analysis of the macro- and micro-economic fundamentals impacting the REIT and commercial real estate industry. The Nareit economics team offers their commentary on the state of the market, the outlook for commercial real estate and breaking macroeconomic news. The opinions set forth here are solely those of its author(s), and do not necessarily reflect the views of the Nareit or its membership.
CRE Expansion at Mid-year: No End in Sight
Nareit economist Calvin Schnure reviews the latest data on supply and demand conditions, and vacancy rates and rent growth.
REIT Debt: The Long and the Short of It
REITs have extended overall debt maturities and reduced leverage over the past decade, and access the commercial paper market from a position of balance sheet strength.
Supply-Demand Fundamentals Favor Apartment REITs
The occupancy rate at apartment REITs has continued to move to new record highs during this building boom.
Total Size of U.S. Commercial Real Estate Estimated Between $14 and $17 Trillion
Nareit completed its third annual round in estimating the size of U.S. commercial real estate, and find that the total dollar value in 2018 was $16.0 trillion, with lower and upper bounds of this estimate of $14.4 to $17.0 trillion.
REITs are an Investment Grade Sector
REITs have made important changes over the past decade in their overall leverage ratios, as well as the composition and structure of their debt.
REITs in the Community: CorEnergy and Nareit Participate in U.S. Congressional Roundtable on TRIA
Nareit was part of a TRIA roundtable in Kansas City on May 31.
REIT Earnings Rose to $15.9 billion in Q1
Funds from operations of all Equity REITs increased to $15.9 billion in the first quarter, according to the Nareit T-Tracker. Occupancy rates remain near the record highs set last year.
REIT Usage and Target Date Funds
In 2003, the share of TDFs with REIT exposure was only 50%, while in 2018, 97% of them invest in REITs. In fact, 60% of TDFs have a dedicated REIT sleeve within their asset allocation.
Economic Fundamentals for Commercial Real Estate Strong in Q1
Gross domestic product surpassed expectations in the first quarter, and strong job growth in March and April provide a favorable backdrop for demand for leased commercial space.
Gimme Shelter: REITs and Trade Disputes
While correlations between stock markets in the United States and China, and the rest of Asia and Europe have risen as trade disputes have heated up, REITs’ correlations with overseas markets have moved lower.
Is There Another Housing Bubble Building?
Rising house prices have raised concerns about whether another speculative bubble is brewing. In today’s housing markets, however, it is a scarcity of housing supply that is pushing up prices.
Commercial Real Estate Markets: A Slow Start to 2019
Real estate markets softened in the first quarter, with the demand for leased space slowing for most major property types. Demand did not fall but the weakness may reflect a cautious environment during the winter months.