Nareit's REIT Report Podcast
A show about the latest news and developments in REITs and real estate investment. All episodes feature informative and timely interviews with REIT and publicly traded real estate executives, analysts, industry professionals, and thought leaders.
Thu, April 17, 2025
Episode 488: Jasper Street's Rob Main on REITs and the Reporting Landscape
Rob Main, managing partner at the shareholder advisory firm Jasper Street, joined the latest episode of Nareit’s REIT Report podcast. He discussed sustainability reporting and practical steps REITs can take to navigate the proxy season. Main described the corporate mood heading into proxy season as “anxious.” For many companies, however, as long as they've been engaging with their investors, have good disclosure, and aren't viewed as outliers by institutional investors, “they're probably going to have a good proxy season,” he said. Investors, meanwhile, are “cautious,” he said, and are likely to be more “tight-lipped” given recent SEC guidance. At the same time, their core belief about the importance of strong governance practices remains intact.
Thu, April 10, 2025
Episode 447: Green Street Sees REITs as a “Relative Safe Haven” Amid Market Volatility
Danny Ismail, co-head of strategic research at Green Street, joined Nareit’s REIT Report podcast to discuss how real estate and REITs are positioned in the current highly volatile market environment created by last week's White House announcement on tariffs. Ismail said there's good reason to fear a slowdown in economic growth resulting from an increase in tariffs, not just from potentially higher import costs, but also a pullback in business investment as well as consumer spending. As for the market response, “we'll see how the next few weeks shake out, but thus far REITs and real estate appear to be a relative safe haven,” Ismail said. One reason for that is the starting valuation of REITs prior to the tariff announcement, where REITs looked attractive relative to the S&P 500. “REITs came into this environment on the cheaper side, while private real estate came in looking fairly valued,” Ismail noted.
Thu, April 03, 2025
Episode 446: Piedmont CFO Sherry Rexroad Sees Capital Markets Easing in Second Half of 2025
Sherry Rexroad, executive vice president and CFO at Piedmont Office Realty Trust, Inc . (NYSE:PDM), was a guest on the latest episode of Nareit’s REIT Report podcast. Rexroad discussed ways to work within the current environment of shifting interest rates, recession worries, and geopolitical tensions in order to remain consistent on strategy. “It’s really important to differentiate between short-term volatility and secular change. Short-term volatility needs to be managed and monitored. It can be a distraction if you let it be,” she said. She noted that between 2019 and 2022, Piedmont shifted $1.4 billion of assets, or roughly a third of the portfolio, out of Chicago, Washington, D.C., Philadelphia, New Jersey, and Cambridge, Massachusetts, and into Atlanta and Dallas.
Thu, March 27, 2025
Episode 445: Mizuho’s Vikram Malhotra on Real Estate Implications of Growing Senior Population
Vikram Malhotra, managing director, real estate equities and research at Mizuho, joined the latest episode of the Nareit REIT Report podcast to share some of the findings from recent Mizuho research into the economic and investment implications likely to result from an aging population. Malhotra noted that the 75-plus cohort in the United States is set to grow at about 4% per annum over the next five to 10 years. By 2030, the group will represent 10% of the total population, up from 7.5% today. At the same time, their spending is expected to grow over 80%, or $700 billion, through 2030.
Thu, March 20, 2025
Episode 444: Nareit Hawaii Executive Director on Making the State a Better Place for Future Generations
Nareit Hawaii Executive Director Gladys Quinto Marrone was a guest on the latest episode of Nareit’s REIT Report podcast. Marrone discussed the mission of Nareit Hawaii, including its community outreach work. As to how the Nareit Hawaii Community Giving Initiative, established by the Nareit Foundation, goes about selecting the programs it chooses to support, Marrone noted, “We try to ensure that grantees come from all around the state and serve as many people as possible.” Typically, four to five Nareit Foundation grants have been awarded annually, totaling about $350,000 to $400,000. In addition, five to six grants a year totaling $150,000 to $200,000, from Nareit Hawaii are awarded to nonprofits supporting a variety of charitable causes. https://nareithawaii.com/
Thu, March 13, 2025
Episode 443: Cohen & Steers’ Ji Zhang Sees Scope for REITs to Outperform Equities
Ji Zhang, portfolio manager for global real estate at Cohen & Steers, was a guest on the latest episode of Nareit’s REIT Report podcast. Zhang spoke about her firm’s recent entry into the active exchange traded fund space, including the Cohen & Steers Real Estate Active ETF. Zhang explained that the ETF is designed specifically to invest in “high conviction ideas” in U.S. REITs, while opportunistically investing in international and other real estate-related securities. “The ultimate goal is to provide total return and portfolio diversification,” she said. The backdrop for REIT fundamentals is “quite healthy,” supported by steady demand and meaningfully below-trend supply, Zhang said
Thu, March 06, 2025
Episode 442: Uptick in REIT Leadership Transitions Expected to Continue: Ferguson Partners
Bill Ferguson, co-chairman and CEO of Ferguson Partners, and Mike Cordingley, who leads Ferguson’s North American Management Consulting and Leadership Consulting Business Units, were guests on Nareit’s REIT Report podcast. Ferguson and Cordingley discussed their latest research into REIT CEO succession trends and shared best practices for transition planning. “Succession is, if not the highest priority for the board, one of the highest priorities,” Ferguson said. He noted that there were seven CEO succession events per year from 2013 to 2022. In 2023, there were nine and in 2024 that increased to 12. Cordingley noted that the acceleration is set to continue for a number of reasons, including increasing activist involvement and an aging leadership cohort. “The average age per REIT CEO is 60 and typical retirement is occurring around 64,” he said.
Thu, February 27, 2025
Episode 441: REIT Performance Over 25-Year Period Warrants Inclusion in Investment Portfolios: CEM
Maaike van Bragt, senior research associate, and Chris Flynn, head of product development at CEM Benchmarking, were guests on the latest episode of Nareit’s REIT Report podcast. Van Bragt and Flynn discussed some of the findings from the 2024 CEM Benchmarking study into investment performance across various asset classes. In research sponsored by Nareit, CEM Benchmarking took a comprehensive look at investment allocations and realized investment performance across 12 asset classes over a 25-year period (1998–2022). While private equity was the strongest performer over that period, with an average net return of about 12%, REITs and U.S. small cap stocks came in second place with average returns of about 9.7%. Returns for private real estate were about 7.7% during the 25-year period. Van Bragt said CEM’s research “really shows that on a net return basis, REITs have done really well in the past 25 years. And so if you have real estate in your asset allocation, I think you should seriously consider using REITs or at least adding them to it.” Read the CEM Study: https://www.reit.com/data-research/research/updated-cem-benchmarking-study-highlights-reit-performance
Thu, February 20, 2025
Episode 440: Prologis Sees Rebalance of Logistics Real Estate Supply & Demand in 2025
Melinda McLaughlin, global head of research at Prologis, Inc . (NYSE: PLD), was a guest on the latest episode of Nareit’s REIT Report podcast. She discussed broad trends impacting logistics today, including global trade, delivery speeds, new construction, e-commerce, rising barriers to supply, standout global markets, and more. McLaughlin said 2025 looks set to be a “solid year” for both consumption and global trade, based on strong labor markets. E-commerce, meanwhile, is “absolutely gaining market share in all of our markets around the world,” she noted. At the same time, there's been a lack of construction for the largest logistics buildings since 2022, McLaughlin pointed out. “Today, and looking at 2025 as a whole, we see deliveries down 35% year over year for all types of logistics real estate, but that number is a 65% decline for bulk buildings, so really setting the stage for demand and supply to rebalance and maybe even have some scarcity in certain markets.”
Thu, February 13, 2025
Episode 439: JLL Income Property Trust’s Allan Swaringen Sees Continued Growth for NAV REITs
Allan Swaringen, president and CEO of JLL Income Property Trust , was a guest on the latest episode of Nareit’s REIT Report podcast. JLL IPT is a daily NAV REIT that owns and manages a diversified portfolio of apartment, industrial, grocery-anchored retail, health care, and office properties located in the United States. Swaringen said JLL IPT’s mission is to be a hybrid investment that balances the stability of performance in the private real estate markets with the same history of consistent, growing dividends that public REIT investors look for.
Thu, February 06, 2025
Episode 438: Citi Global Real Estate Outlook Sees Mix of Regional Trends in Play for 2025
Three members of Citi’s global real estate research team—Nick Joseph in the United States, Aaron Guy in the U.K., and Howard Penny in Australia—joined the latest episode of the Nareit REIT Report podcast to share their thoughts on regional outlooks and sector performance. Macro fundamentals, interest rates, and geopolitical sentiment are mixed globally, resulting in stock preferences that are heavily driven by regional teams’ micro analysis, Joseph said. The key driver behind Citi’s list of most preferred stocks in 2025 is the presence of positive rental growth, with rental growth weakness and high valuation the key reasons for the least preferred subsectors. Sector preferences are not globally consistent, Joseph stressed, highlighting the presence of significant local supply and demand drivers. Regionally, Citi is most positive on the U.S., Australia, Europe, the Philippines, and Indonesia, and more cautious on China, Latin America, India, Japan, Singapore, Hong Kong, and Thailand.
Thu, January 30, 2025
Episode 437: CBRE’s Richard Barkham Sees New Real Estate Cycle Emerging in 2025
Richard Barkham, chief economist at CBRE, was a guest on the latest episode of Nareit’s REIT Report podcast. CBRE is forecasting GDP growth of about 2.3% this year. With the economic momentum of 2024 continuing into 2025, “I think we're seeing the slow start to a new real estate cycle,” as vacancy begins to trend lower and rental growth generally firms and starts to head higher, Barkham said. Barkham described investor sentiment as “very positive” given the GDP forecast and the outlook for the year, “and based on the fact that people haven't been active for two or three years, or not very active….people are anxious to get moving and adjust their portfolios and deploy capital.”
Mon, January 27, 2025
Episode 436: Nareit’s Abby McCarthy on the Benefits REITs Offer to Investment Portfolios
Abby McCarthy, Nareit’s senior vice president for investment affairs, joined the REIT Report podcast to discuss the value REITs can provide to an overall investment portfolio. “REITs offer investors a low cost, effective, and liquid means of investing in commercial real estate. As real estate stocks, they provide meaningful benefits to investment portfolios, which does include competitive long-term total returns, a strong portfolio diversification, and stable dividend income,” McCarthy said. Research shows that 78% of financial advisors recommend REITs to their clients, McCarthy said, with advisors appreciating their dividend income, diversification opportunities, strong risk-adjusted returns, and liquidity.
Thu, January 09, 2025
Episode 435: JLL’s Sher Hafeez Sees Potential for Strategic Transactions by REITs in 2025
Sher Hafeez, senior managing director of JLL’s M&A and corporate advisory group, was a guest on the latest episode of Nareit’s REIT Report podcast. Hafeez discussed how REITs are trading at a premium to net asset value, with certain sectors, including health care, data centers, and office accounting for the lion’s share of that premium. Many of these sectors are taking advantage of this cost of capital benefit and have issued equity to shore up capital to be on the offensive in 2025, Hafeez said. “I’d expect REITs to be pretty active acquirers compared to the last couple of years,” he added.
Thu, January 02, 2025
Episode 434: REIT Access to Debt Markets, Ability to Issue Equity, Points to Growth Opportunities in 2025
John Worth, Nareit executive vice president, research and investor outreach, was a guest on the latest episode of the REIT Report podcast. Worth discussed some of the key features of Nareit’s recently-published 2025 REIT Outlook . REITs have ready access to unsecured debt markets as well as the ability to issue equity, Worth said, which puts the sector in a strong position for 2025. Meanwhile, Nareit has identified four key megatrends that will continue to shape the global REIT landscape over the coming decade: specialization, scale, innovation, and sustainability. “All four of them are areas where REITs are really well poised and have real ability to execute,” Worth said. 2025 REIT Outlook: https://www.reit.com/news/blog/market-commentary/finding-opportunities-reit-market-outlook-2025
Tue, December 17, 2024
Episode 433: SPECIAL EPISODE: U.S. CRE Contributes to the Global Discussion on Climate Risk
In this episode of the REIT Report special series “Building to Zero,” Elena Alschuler, head of sustainability, Americas, LaSalle Investment Management, shares how the U.S. real estate industry has advanced the discussion on future planning for energy investments and reducing building-related carbon emissions. Elena Alschuler, head of sustainability, Americas, LaSalle Investment Management, who recently served as the working group chair for the CRREM North America project, joined this final episode of the REIT Report special series focused on building on the real estate industry's journey to reduce emissions from the built-in environment to zero. She shares her experience in engaging the U.S. real estate community in a deep and thoughtful discussion around the CRREM Framework’s approach and methodology for measuring transition risk to institutional real estate portfolios. Alschuler shares how “a couple of years ago, a lot of investors were starting to look at these CRREM curves, and we liked the idea of having forward-looking targets to benchmark against in terms of planning energy and carbon performance. But when we started looking at portfolios against this particular set of curves, many of us were getting crazy results. So, twelve [U.S. and Canadian] real estate companies, including LaSalle, decided to co-fund a ULI working group, which was supported by the CRREM team in Europe, to do industry engagement and Larence Berkely National Labs (LBNL) to do the technical work.”
Thu, December 12, 2024
Episode 432: REIT Premiums Could Spark Vigorous Deployment of Capital in Some Sectors: Green Street
Cedrik Lachance, director of research at Green Street, was a guest on the latest episode of Nareit’s REIT Report podcast. He discussed key priorities for the REIT sector, opportunities for growth, valuation levels, IPO prospects, trends in Europe, and more. Lachance said that with the REIT market bestowing “pretty meaningful premiums in some sectors, we expect to see a fairly aggressive deployment of capital” from companies in the data center and health care sectors, self-storage, and to some extent retail. He added that there are also companies in the office sector trading at premiums to NAV and “that's going to influence how they allocate capital.” Green Street sees the strongest rent growth potential in data centers. “That story has been well told, but it remains an area where we think there's meaningful upside,” Lachance said.
Thu, December 05, 2024
Episode 431: Institutional Real Estate Investors Boost REIT Allocations in Latest Hodes Weill Survey
Doug Weill, managing partner at Hodes Weill and Associates, was a guest on the latest episode of the Nareit REIT Report. Hodes Weill recently released its 2024 Real Estate Allocations Monitor which showed that about 39% of institutions actively allocated capital to REITs in 2023, compared with 36% the prior year. Sovereign wealth funds were “meaningfully more active,” Weill said. “I think this is an ongoing trend where institutions are increasingly active out of their real estate allocations in REITs. And REITs are increasingly a complement to private market investments.” About 67% of institutions indicated that liquidity is one of the key reasons why they invest in REITs, which was up from about 46% the prior year.
Thu, November 14, 2024
Episode 430: Commercial Real Estate on Cusp of Next Upturn: PwC
Andrew Alperstein, real estate partner at PwC, was a guest on the latest episode of Nareit’s REIT Report podcast. Alperstein said a key theme from the PwC/Urban Land Institute Emerging Trends in Real Estate® 2025 report is that commercial real estate is at the outset of a new cycle, one that is likely to result in increased activity and improved momentum in the year ahead. “We were pleasantly surprised and pleased to see an improvement in sentiment as we looked at our 2025 publication relative to 2024 and 2023,” Alperstein said, “particularly given we've had a challenging couple of years with higher interest rates and really a lack of transaction activity.” Alperstein added that the interest rate environment forms “a very important piece of the momentum that we hope to see going into next year.”
Tue, November 05, 2024
Episode 429: SPECIAL EPISODE: CRE Provides Lessons Learned on Building Performance Standard Regulations
In this episode of the REIT Report special series “Building to Zero,” Duane Desiderio, senior vice president at the Real Estate Roundtable (RER) shares a recently released 20-point policy guide which outlines lessons learned from the building owner perspective over the past seven years since the first building performance standard was implemented in 2017. Since Local Law 97 was passed by the City Council in New York City as part of the Climate Mobilization Act in April 2019, commercial building owners in the United States have experienced the rise in regulations know as Building Performance Standards (BPS), which are intended to regulate the use of energy in existing buildings. Buildings owners are currently navigating a patchwork of law with various rules, processes, and compliance pathways in cities and states across the county. “A good way to start the conversation is by drawing a bit of a contrast to the climate and energy policies on buildings that we've seen come from the federal level, where the emphasis has been on carrots not sticks, incentives to encourage buildings to push the envelope to reduce emissions to become more efficient. At the state and local level unlike the federal level, these BEPS laws would impose mandatory limits on buildings to either reduce their energy by certain amounts every year or to reduce their carbon emissions every year or in some cases both.”
Thu, October 31, 2024
Episode 428: Deloitte 2025 CRE Outlook Points to “Major Boost” in Optimistic Sentiment
Sally Ann Flood, vice chair and U.S. real estate sector leader at Deloitte, was a guest on the latest episode of Nareit’s REIT Report podcast. She reviewed highlights of the firm’s 2025 commercial real estate outlook, which indicates that next year could be a potential turning point for the sector. “After two consecutive years where most survey respondents expected revenue declines, this year 88% of global respondents now report they expect revenues to increase going forward,” Flood said.
Thu, October 24, 2024
Episode 427: Top-Down Recovery Evident in Office Sector: JLL
Jacob Rowden, senior manager for U.S. office research at JLL, was a guest on the latest episode of Nareit’s REIT Report podcast. He noted that within the last year, a top-down recovery has been evident in the office sector that is now beginning to spill over more broadly. Rowden noted that factors supporting a more positive direction for the sector include employees spending more time in the office, a lack of new construction, and a record volume of office inventory being removed for conversions or redevelopments to other property types.
Thu, October 17, 2024
Episode 426: Nareit 2024 Compensation Survey Shows Voluntary Turnover Fluidity Starting to Stabilize
Jeremy Banoff, vice chairman of Ferguson Partners and co-leader of the firm’s Compensation Consulting group, was a guest on the latest episode of the Nareit REIT Report podcast. Banoff discussed some of the key findings from the 2024 Nareit Compensation & Benefits survey, which is conducted by Ferguson Partners and sponsored by Nareit. The participation rate for this year’s survey represents approximately 72% of the U.S. listed equity REIT industry’s total market capitalization. This year’s survey showed a slight downward shift in voluntary turnover levels. Banoff explained that in the past few years, the baseline has been relatively higher, with “the pendulum tilted toward employees.” That’s now started to stabilize, with the pendulum swinging back toward employers, he said, although “not all the way.”
Thu, October 10, 2024
Episode 425: EY’s Brandon Pizzola Says REIT Industry’s Economic Footprint Continues to Grow
Brandon Pizzola, economist in EY’s Quantitative Economics and Statistics (QUEST) practice, was a guest on the latest episode of Nareit’s REIT Report podcast. Nareit commissioned EY to estimate the economic contribution of U.S. REITs in 2023, the most recent year of complete information. The data showed that REITs supported an estimated 3.5 million full-time equivalent (FTE) jobs and $278 billion of labor income. “The one thing to flag is that REITs continue to grow,” Pizzola said. He pointed out that in 2021, the economic footprint of REITs was 3.2 million FTE jobs, with that number growing to 3.4 million in 2022, before rising again in 2023. The data encompasses public listed, public non-listed, and private REITs.
Thu, October 03, 2024
Episode 424: Principal’s Todd Kellenberger Says Rate Cuts Likely to Boost REIT Property Values
Todd Kellenberger, REIT client portfolio manager at Principal Asset Management, was a guest on the latest episode of Nareit’s REIT Report podcast. Kellenberger discussed how REITs are likely to perform amid either an economic soft landing or mild recession, as well as the impact of lower interest rates on the sector. “The general trajectory of where markets are headed is favorable for real estate,” Kellenberger said. He noted that the Federal Reserve is seeking to ease monetary conditions to avoid an economic hard landing, “and that will importantly bring down the cost of capital for real estate and likely bring a recovery to property values.”
Thu, September 26, 2024
Episode 423: AEW’s Mike Acton Sees CRE Investors Adopting Micro Focus on Assets, Location
Mike Acton, head of research at AEW Capital Management, was a guest on the latest episode of Nareit’s REIT Report podcast. Acton discussed the broader macro backdrop for commercial real estate. While markets are excited about the prospect of interest rate cuts, that sentiment is set against concern about potential recession and possible policy changes after the election. “It's a little bit of a mixed bag as far as the broader outlook goes.” During the interview, Acton also noted that at this stage, most investors have rebalanced their portfolios along property sector lines. Going forward, it's likely going to be less about what specific property sectors investors are targeting and probably a lot more about the quality of the individual properties and locations. “Micro locations are becoming much, much more important in the investment decision than say market decisions,” he said.
Thu, September 19, 2024
Episode 422: Phillips Edison, Cohen & Steers Join Forces in Grocery-Anchored Retail Shopping Sector
Jeff Edison, chairman and CEO of Phillips Edison & Company, Inc. (Nasdaq: PECO), and James Corl, head of the private real estate group at Cohen & Steers, were guests on the latest episode of the Nareit REIT Report podcast. PECO and Cohen & Steers Income Opportunities REIT, Inc. (CNSREIT) have formed a joint venture focused on acquiring open-air grocery-anchored shopping centers. The joint venture is 80% owned by CNSREIT and 20% by PECO and is targeting $300 million in equity. In the interview, Edison and Corl discuss the clear benefits they see from their partnership, their shared perspectives on what makes a strong investment in the sector, and the outlook for future growth.
Thu, September 12, 2024
Episode 421: Teacher Retirement System of Texas Directors Share Tactical REIT Investment Strategy
Brendan Cooper and Jared Morris, directors at Teacher Retirement System of Texas (TRS), joined the latest episode of Nareit’s REIT Report podcast to discuss how TRS tactically invested in REITs during a period of public and private real estate valuation divergence. In 2022, the TRS Strategic Property REIT Execution and Delivery (SPREAD) team were monitoring a sell-off in public REITs and were ready to take action. One quarter of TRS’s total $400 million commitment was initially invested in December 2022, half was deployed in March 2023, and the remaining quarter was invested in October 2023. During that period, the internal rate of return achieved by TRS was 17.1%.
Fri, September 06, 2024
Episode 420: Single Family Rental REITs Playing Growing Role in Boosting Housing Supply
Colin Trovato, portfolio manager at Ranger Global Real Estate Advisors, was a guest on the latest episode of Nareit’s REIT Report podcast. Trovato discussed housing trends and the role of the single family rental (SFR) sector in helping to alleviate the shortage of supply. Trovato discussed the impact of rising interest rates on home ownership and the demand for SFRs. Higher rates since 2022 have increased home buying costs and reduced housing inventory, as many current homeowners are reluctant to move due to their favorable mortgage rates. This scarcity has boosted demand for SFRs, making renting more attractive compared to buying.
Thu, August 29, 2024
Episode 419: Ashley Fox and Empify Working to Educate Broader Investor Base on Accessibility, Benefits of REITs
Ashley Fox, CEO and founder of Empify and the WealthBuilders Community App, was a guest on the latest episode of Nareit’s REIT Report podcast. She spoke about the efforts Empify has undertaken to educate individuals with limited funds and investment experience, enabling them to build a financial foundation and begin building wealth. Fox left a career on Wall Street in 2013 and set out to “financially empower the 99% that Wall Street often overlooks.” She created Empify with a goal to become the middleman between financial institutions and the everyday person, “because I understood the language of Wall Street, but I also understood the language in the hearts and minds of both adults and children and Empify bridges that gap.” Empify has launched over 10,000 brand new investors, Fox said, adding that members of the WealthBuilders Community App have invested over $650,000 in REITs. She noted that a key takeway from Empify’s five-week REIT Investing Accelerator program is the extent to which REIT-owned properties are a consistent feature of investors’ everyday lives. This episode is supported by LoopNet .
Tue, August 27, 2024
Episode 418: SPECIAL EPISODE: USGBC’s Journey to Support Decarbonization of the Built Environment
In this episode of the REIT Report special series “Building to Zero,” the U.S. Green Building Council’s Heather Payson and Wes Sullens share their perspectives on the building sector’s sustainability journey and the path forward for decarbonizing commercial real estate. When USGBC was founded over 30 years ago and the first version of LEED was released, it established a clear and understandable framework to measure and define “green buildings.” Today, LEED has become a widely used rating system around the globe and, as a recognized indicator of leadership, has become an indispensable resource for the buildings community at large. “There's just so much going on in this space, and the urgency is greater than ever. We have to balance the urgency of what the market needs with what's possible. While things like policy help establish a floor…. it's become even more challenging to [define] what leadership means in these times,” shares Wes Sullens, LEED Fellow and Director at USGBC. “We use our group of volunteers and experts… that help us write our rating system. It's not something we cook up in a vacuum, the idea is to make sure LEED is that consensus standard for leadership, which I think is a unique place in the market.”
Thu, August 22, 2024
Episode 417: Moody’s Sees Digital Realty, Equinix Capital Investment Levels Remaining Elevated
Ranjini Venkatesan, vice president and senior credit officer at Moody’s Ratings, was a guest on the latest episode of the Nareit REIT Report podcast. Venkatesan discussed how capital investment levels have been high for both Digital Realty (NYSE: DLR) and Equinix, Inc . (Nasdaq: EQIX), and are expected to remain so. “Over the last three years, annual investment by Digital Realty and Equinix averaged 5.5 % of their gross asset base, which is high,” she said. Both REITs have demonstrated the ability to raise capital at healthy pricing through different credit cycles and with strong leasing execution for the properties being built, she added. This episode is supported by LoopNet .
Fri, August 16, 2024
Episode 416: Two Decades After IPO, Extra Space Storage CFO Says Growth “in our DNA”
Scott Stubbs, executive vice president and CFO of Extra Space Storage Inc . (NYSE: EXR), joined the latest episode of Nareit’s REIT Report podcast. During the interview, Stubbs reflected on professional and personal accomplishments and challenges surrounding the REIT’s 2004 IPO and discussed further growth opportunities ahead. August marks the 20th anniversary of the Extra Space IPO. Stubbs noted that in 2004, self-storage was not considered a core asset class for a real estate investor. “We were a bit of an outlier at the time and there were still some negative connotations about self-storage. I think that it did take some time to help people understand that self-storage is a great asset class. It's very stable. It is institutional,” Stubbs said. This episode is supported by LoopNet .
Thu, August 08, 2024
Episode 415: EPRA CEO Sees Opportunities, Challenges for European Real Estate Amid New Political Landscape
Dominique Moerenhout, CEO of EPRA, the European Public Real Estate Association, was a guest on the latest edition of Nareit’s REIT Report podcast. Moerenhout discussed political changes underway in Europe and the U.K. today and their impact on listed real estate. He noted that the EU's new competitiveness focus will create a more business-friendly environment, while the U.K. Labour party’s proactive policies and commitment to a new industrial strategy are “very welcome.” At the same time, political uncertainty in France following recent elections poses “significant risks,” he said. “Investors will need to navigate these varied landscapes carefully, balancing their opportunities with the potential changes ahead. The return to, in my view, a normal real estate transactions market will probably take more time than initially anticipated or hoped for,” Moerenhout said. This episode is supported by LoopNet .
Thu, August 01, 2024
Episode 414: J.P. Morgan’s Chad Tredway Sees “Great Entry Point” for Real Estate Investment
Chad Tredway, managing director and head of real estate Americas at J.P. Morgan Asset Management, was a guest on the latest episode of the REIT Report podcast. Tredway said the current environment represents “the best buying opportunity” for commercial real estate. Fundamentals are strong and investors are in a position to purchase assets at a 10% to 30% discount compared with pre-2022 levels, “which represents an amazing return.” “Now is a great entry point for those that have capital. And we also see hope on the horizon as we believe rates will come down...we think it's a great time to think about long-term investment in this space and we do believe in real estate as a long-term anchor for portfolios,” Tredway said. This episode is supported by LoopNet .
Thu, July 25, 2024
Episode 413: Hogan Lovells’ David Bonser Says Access to Capital Supporting Public REITs in Second Half
David Bonser, global managing partner of the corporate practice and global co-head of the REIT practice at Hogan Lovells, was a guest on the latest episode of the Nareit REIT Report. Bonser discussed the current state of the capital markets for REITs and the most popular methods for raising capital. “You are seeing people lock in to raise debt capital because they've held off for a couple of years, and you do need to get your debt balance sheet in order, so we're seeing a lot of activity there,” Bonser said.
Tue, July 23, 2024
Episode 412: SPECIAL EPISODE: Unlocking Clean Energy Supply Through Utility Grid Expansion and Improvement
In this episode of the REIT Report special series “Building to Zero,” Bryn Baker from the Clean Energy Buyers Association (CEBA) discusses how energy customers are a powerful voice for modernizing the power system that underpins economic growth and development. The Clean Energy Buyers Association (CEBA) represents members with about $15 trillion in market cap. That's about 400 members who collectively are a community of commercial, industrial, and institutional energy buyers. In this episode, Baker discusses how energy customers drive demand and how CEBA is focused on addressing barriers to energy supply challenges that hold back the demand for clean energy.
Thu, July 18, 2024
Episode 411: LaSalle’s Brian Klinksiek Sees Potential of New Golden Era for REITs
Brian Klinksiek, LaSalle’s global head of research and strategy, was a guest on the latest edition of the Nareit REIT Report podcast. Klinksiek said REITs are in a position to play a consolidator role in the market, given their access to capital, improving valuations, and operational advantages. “We've been framing the outlook for REITs as, are we at the dawn of the next REIT golden era? We think the answer is probably yes,” Klinksiek said.
Thu, July 11, 2024
Episode 410: Nareit’s Mid-Year Outlook Highlights Strong REIT Operational Performance
John Worth, Nareit executive vice president, research and investor outreach, was a guest on the latest episode of the REIT Report. Worth discussed some of the key features of Nareit’s newly-published 2024 Mid-Year Report. Worth noted that despite REITs underperforming the broader stock market this year, they remain able to navigate the current period of higher interest rates. “REITs’ operational performance has been very solid. We've continued to see high occupancy rates in the major property types and we've seen positive NOI and FFO growth. We're also seeing the continuation of really disciplined balance sheets,” Worth said. 2024 REIT Mid-Year Report: https://www.reit.com/news/blog/market-commentary/2024-midyear-reit-key-themes
Thu, June 27, 2024
Episode 409: PwC’s Tim Bodner Sees Dynamic Real Estate Market Adapting to New Economic Realities
Tim Bodner, U.S. real estate deals leader at PwC, was a guest on the latest episode of Nareit’s REIT Report podcast. Bodner underscored a dynamic real estate market adapting to new economic realities and the importance of leveraging technological advancements to navigate challenges and seize emerging opportunities in 2024. He noted that transaction volume in traditional real estate sectors continues to be lower than a year ago, reflecting persistent challenges such as valuation disparities between buyers and sellers. Meanwhile, ongoing shifts in the financing landscape are resulting in traditional lenders retreating while private credit, especially from insurance-backed alternative asset managers, gain traction.
Thu, June 13, 2024
Episode 408: REIT Balance Sheets Give “Luxury of Time” Until Interest Rates Adjust: AEW’s Gina Szymanski
Gina Szymanski, managing director and lead portfolio manager, North America REITs, at AEW Capital Management, was a guest on the latest episode of the REIT Report podcast. Szymanski noted that a lot of discussion at Nareit’s REITweek: 2024 Investor Conference focused on the capital markets backdrop and what that means for transaction activity.
Thu, May 30, 2024
Episode 407: Vibrant Mixed-Use Districts Key to Urban Revitalization: CBRE
Julie Whelan, global head of occupier thought leadership at CBRE, was a guest on the latest episode of the REIT Report podcast. Whelan discussed the findings of a new CBRE report, Shaping Tomorrow’s Cities, which looks at ways to reinvent U.S. cities after the upheaval of the pandemic and the growth of remote work. She noted that urban revitalization trends that were evident in the period leading up to the pandemic were “stopped in their tracks” by COVID-19 and the “sheer concern of density being a health problem.” The CBRE report found that a diverse built environment in vibrant mixed-use districts was more attractive to office tenants, more attractive to residents, and more attractive to retailers setting up shops to support the population in that area. Vibrant mixed-use districts are essential for urban rejuvenation, Whelan said, “because just working in cities is not the pure draw anymore.”
Thu, May 23, 2024
Episode 406: Host Hotels “Really Well Positioned” to Continue Acquiring in 2024
Jim Risoleo, president and CEO of Host Hotels & Resorts, Inc . (Nasdaq: HST), was a guest on the latest episode of the REIT Report podcast. During the interview, Risoleo discussed the REIT’s latest results, trends in leisure and group travel, recent acquisitions in Nashville, conditions in Maui, renovation projects, sustainability targets, and more. Commenting on the outlook for the lodging sector in general, Risoleo said it is set up for solid performance for at least the next several years, with supply growth at historically low levels.
Thu, May 16, 2024
Episode 405: DLA Piper 2024 Global Real Estate Survey Points to Mood of Cautious Optimism
John Sullivan, chair of U.S. real estate and co-chair of the global real estate practice at DLA Piper, was a guest on the latest episode of the Nareit REIT Report. Sullivan shared some of the findings from the DLA Piper Global Real Estate State of the Market Survey 2024. He described sentiment among CRE executives today as one of “cautious optimism.” “I think the message we're getting is that people think the skies are starting to clear a little bit. Nobody is saying that we're there yet, but people are looking at interest rates having stabilized and there's an expectation of some rate cuts,” Sullivan said.
Thu, May 09, 2024
Episode 404: Deloitte’s Jonathan Keith Sees Delayed Uptick in M&A Transaction Activity
Jonathan Keith, managing director with the risk and financial advisory practice at Deloitte and Touche LLP, where he is also the real estate sector leader in the M&A group, was a guest on the latest episode of the Nareit REIT Report podcast. Keith discusses Deloitte's 2024 commercial real estate M&A outlook, noting that higher interest rates due to ongoing inflation concerns may extend the period of lower M&A transaction volume that has been in place since the second quarter of 2022. Keith also highlights sector-specific trends and identifies industrial and data centers as strong sectors, while highlighting opportunities in multifamily investments.
Tue, May 07, 2024
Episode 403: SPECIAL EPISODE: DOE Better Buildings Initiative’s Support for Building Sector Decarbonization
This episode of the REIT Report’s ongoing series “Building to Zero” features Maria Vargas, senior program advisor and director of the Better Buildings Initiative for the U.S. Department of Energy, and focuses on how success, solutions, and challenges are being addressed at the industry level. Vargas shared her perspective on the importance of industry collaboration over her career, which includes 25 years at the Environmental Protection Agency and the past 13 years at DOE. She shares how the Better Buildings Initiative was designed to serve as a platform to drive and accelerate the adoption of energy efficiency and other decarbonization. “What we recognize is that we spend about $200 billion a year to run our commercial buildings in this country. We spend, on average, about another $200 billion on our industrial facilities. And we know that, on average, 20% to 30% of that energy is wasted.”
Thu, May 02, 2024
Episode 402: Ranger Global’s Todd Voigt Sees Buying Opportunities for REITs Amid Market Volatility
Todd Voigt, senior portfolio manager at Ranger Global Real Estate Advisors, was a guest on the latest episode of Nareit’s REIT Report podcast. Voigt discussed key issues impacting real estate investing today and how REITs might find opportunities amid market volatility. “The great opportunity that U.S. REITs have, and particularly those early winners that we're seeing raise capital now, is that they have the balance sheets and access to equity to be the buyers. And oftentimes there'll be less buyers at that table and that's where you oftentimes get the best returns,” Voigt said.
Thu, April 25, 2024
Episode 401: Global Real Estate Professors Say Executive Training Program Fills Gap for Mid-Career Professionals
Nils Kok, professor of real estate at the University of Maastricht, and Siqi Zheng, professor of real estate at the Massachusetts Institute of Technology, were guests on the latest episode of Nareit’s REIT Report podcast. Kok and Zheng are two of the academic directors of the Global Real Estate Leaders Program, an executive training program aimed at emerging real estate professionals with at least 10 years’ experience, sponsored by the MIT Center for Real Estate and Maastricht University Centre. Nareit is a participating organization in the new executive education program. Kok noted that the program is aimed at executives who are eager to learn about the latest real estate finance or mega trends, but don’t have the time to go back to school for a year.
Mon, April 22, 2024
Episode 400: JBG SMITH’s Matt Kelly on Placemaking and Striking the Right Balance Across Communities
Matt Kelly, CEO of JBG SMITH (NYSE: JBGS) and Nareit’s 2024 chair, was a guest on the 400 th episode of Nareit’s REIT Report podcast. In a wide-ranging interview, Kelly speaks about placemaking—a hallmark of the REIT’s approach to development—and the importance of “striking the right balance” between public space, retail, and work and living spaces, alongside basic neighborhood necessities. He also talks about the importance of affordable housing, JBG SMITH’s shift to become a majority multifamily REIT, the Potomac Yard arena project, the REIT’s ongoing commitment to National Landing and the Northern Virginia submarket, and more.
Fri, April 12, 2024
Episode 399: American Century Investments’ Steven Brown Sees Improved REIT Earnings in 2024 & 2025
Steven Brown, senior vice president and senior portfolio manager for American Century Investments, was a guest on the latest episode of the REIT Report podcast. Brown described the landscape for REIT investment today, noting that most REITs issued earnings growth guidance for 2024 of around 4%. “The REIT earnings outlook still looks very solid,” Brown said. “Demand is better than supply in most property sectors…higher interest rates as well as the higher cost of construction have started to slow supply in many of the markets we invest in. We think the picture is improving for…REIT earnings growth in 2024 and 2025.” Register for Nareit's REITweek: 2024 Investor Conference: https:// go.reit.com/reitweekRR
Tue, April 09, 2024
Episode 398: SPECIAL EPISODE: BXP’s Ben Myers on Electrifying the Built Environment
This episode of the REIT Report’s ongoing series “Building to Zero” features Ben Myers, senior vice president of sustainability at BXP (NYSE: BXP) and continues to dig deeper into the real estate industry’s journey to reduce emissions from the built environment. Myers shares his view on why it is so important to take a long term view on electrification, which refers to the replacement of fossil fuel equipment, like internal combustion engines and gas boilers, with electric motors or heat pumps. The common case for electrification is that building owners can decarbonize and utilize equipment that is significantly more efficient. “Electrification of everything is what I'm here to talk about today. And in particular, how to spread this religion around electrification. I am a believer that we need to electrify the built environment and I'll explain why, but I do think that we need to take some important steps to get there,” Myers says.
Thu, April 04, 2024
Episode 397: Chilton Capital Management on Why REITs Stand to Benefit from Capex Spending
Matt Werner, senior portfolio manager for REITs at Chilton Capital Management, was a guest on the latest episode of Nareit’s REIT Report podcast. Werner emphasized the resilience of public REITs amid economic challenges, especially in managing debt maturities and maintaining dividend payments during periods of uncertainty. According to Werner, public REITs are now positioned to capitalize on market volatility, with robust balance sheets enabling them to acquire distressed properties. "We're still kind of waiting for the sort of big moment for public REITs to go out and make significant acquisitions or for private companies to bite the bullet and decide that going public is the only kind of way to save their company."
Thu, March 21, 2024
Episode 396: DigitalBridge on Digital Infrastructure as Real Estate for the Modern Economy
Bill Hughes, managing director of liquid strategies at DigitalBridge Investment Management, was a guest on the latest edition of the Nareit REIT Report podcast. Hughes discussed some of the trends and developments in digital infrastructure and real estate securities markets today. He noted that the types of real estate businesses that get characterized as digital infrastructure currently compose around 40% of the publicly traded real estate market by value. “That's something that was not true a decade, a decade and a half ago.” When analyzing digital infrastructure, the same issues that impact traditional real estate—such as supply and demand dynamics, unit level economics, the capital intensity of the asset over time, lease structures, and credit counterparties—should all be considered, Hughes said.
Thu, March 14, 2024
Episode 395: CBRE IM’s Elisabeth Troni on Deciding to Add Listed REITs to a Global Investment Strategy
Elisabeth Troni, fund manager with CBRE IM’s flagship global investment strategy, was a guest on the latest episode of Nareit’s REIT Report. CBRE IM’s flagship global strategy began to allocate to listed REITs in December 2022. Troni explains the timing behind that decision and the scope it gave the strategy to access niche and specialized property sectors. Since December 2022, the strategy has entirely invested in an actively managed but broadly diversified strategy, Troni said. She added that the addition of a completion strategy, which would unlock opportunities in those specialty sectors, is currently under review. Troni noted that while the market is unsure about when rate cuts may occur, “what we do feel confident about is the fact that higher rates are priced into public markets in terms of the pricing levels, and they have a strong chance to outperform when the market can see the end of rising rates.”
Thu, March 07, 2024
Episode 394: Raymond James’ Steve Loffman on REIT Capital Market Trends
Steve Loffman, managing director at Raymond James, was a guest on the latest episode of Nareit’s REIT Report podcast. Loffman is also a program director and speaker at Nareit’s REITwise : 2024 Law, Accounting & Finance Conference in Hollywood Florida, March 19-21. Loffman described the contours of the REIT capital market landscape today, noting that broadly speaking, “it's been a little bit challenging,” with REITs trading at a discount to net asset value (NAV). “But as time moves on, and if we believe in the yield curve, which I certainly do, I think we'll be making strides to get closer to NAV from an equity perspective,” he added.
Tue, February 27, 2024
Episode 393: SPECIAL EPISODE: Empire State Realty Trust Makes the Business Case for Decarbonization Strategy
This episode of the Nareit REIT Report’s ongoing series, “Building to Zero,” features Dana Schneider, director of energy and sustainability and ESG at Empire State Realty Trust, Inc. (NYSE: ESRT) and continues the discussion related to the real estate industry’s journey to reduce emissions from the built environment. In this episode, Schneider shares how ESRT began the journey on decarbonization more than 15 years ago by focusing on making the business case for deep energy retrofits. “By creating a process and publishing our energy and financial modeling, we showed what every step of the process would look like and demonstrated that we could have a guaranteed savings of 38% with a payback of three years. Frankly, it's better than we thought it would be,” Schneider says. “But more important than just the results was the idea that we could share the process and show what did and didn't work, how to do the right steps in the right order, how to work from the outside of the building in.”
Thu, February 22, 2024
Episode 392: More Private Real Estate Likely to Shift to Public Over Time: Nareit’s Tony Edwards
Tony Edwards, Nareit’s senior executive vice president, was a guest on the Nareit REIT Report® podcast. Edwards will be retiring from Nareit at the end of March, and in this episode he reflects on some of the highpoints of his career and the major changes in the industry during the past three decades. Edwards said he expects to see more private real estate shift to the public market over time, pointing to the benefits REITs offer in terms of market discipline, low leverage, and their ability to weather market disruptions such as the great financial crisis and the pandemic.
Thu, February 15, 2024
Episode 391: Citi Global Real Estate Outlook Sees Stock Picking as Key Theme in 2024
Three members of Citi’s global real estate research team—Nick Joseph in the U.S., Aaron Guy in the U.K., and Howard Penny in Australia—were guests on the latest episode of the Nareit REIT Report podcast. Amid the market cross currents of slower global economic growth, offset to some extent by anticipated lower interest rates, “we are generally constructive on commercial real estate in 2024,” Joseph said. At the same time, Citi’s 2024 global real estate outlook also stresses the importance of stock picking, rather than broader sector and subsector allocations. For the U.S., Citi is projecting total returns for REITs of 10% to 15% in 2024, with adjusted FFO growth of about 3%. “Growth is being driven by slowing but still solid operating results, development and the redevelopment benefit that is coming on, and the retention of free cash flow,” Joseph said.
Thu, February 08, 2024
Episode 390: Life Sciences Real Estate Market Looking More Positive After Challenging 2023: JLL
Travis McCready, head of life sciences, Americas markets, at JLL, was a guest on the latest episode of Nareit’s REIT Report podcast. McCready said 2023 was one of the most challenging years in memory for life sciences real estate due to a slowdown in the deployment of venture capital, higher interest rates and inflation, and “rather aggressive” real estate development of lab space in the past two years. Based on activity so far in 2024, though, “the year is already shaping up to be much more positive than the year before, so fingers crossed that we are looking at a return to an upwards trajectory in the months and year to come,” McCready said.
Thu, February 01, 2024
Episode 389: REIT Valuations Look Attractive Amid Favorable Macro Backdrop: Morgan Stanley
Laurel Durkay, head of global listed real assets at Morgan Stanley, was a guest on the latest edition of the Nareit REIT Report podcast. Durkay said REITs today are “cheap” versus broader equities. “They do screen attractively versus private real estate. They look compelling versus where REITs have historically traded, and they look pretty fairly valued versus fixed income. The macro backdrop is favorable with interest rate stabilization and the increasing likelihood of cuts this year… I think valuations look attractive.” Despite this backdrop, negative rhetoric about the real estate sector “and the potential for the other shoe to drop” persists, Durkay said. “Investors in Europe and Asia really do want to learn more about real estate, but it's hard to move past that conversation of the fate of offices in big U.S. cities like New York and San Francisco,” she noted.
Thu, January 25, 2024
Episode 388: Cohen & Steers Launches Tool to Aid Investor Real Estate Allocation Decisions
Jeff Palma, senior vice president and head of multi-asset solutions at Cohen & Steers, was a guest on the latest episode of Nareit’s REIT report podcast. Palma discussed the launch of Real Assets Compass, an interactive tool designed to help institutional investors and financial advisors make informed decisions about strategic allocations to listed and private real estate. “We feel that there's an education gap among clients, institutional and individual investors alike, about some of the benefits of real estate,” Palma said. “Despite the evidence that we have that historically real estate has positively contributed to both returns and diversification benefits in broad multi-asset portfolios, it's sort of been an under-owned asset class,” he noted.
Thu, January 11, 2024
Episode 387: REITs Well-Positioned to Navigate and Potentially Thrive in 2024’s Higher Interest Rate Environment
John Worth, executive vide president, research and investor outreach at Nareit, was a guest on the latest episode of the REIT Report podcast. Worth outlined some of the key messages in Nareit’s 2024 REIT Outlook, including three reasons that may make 2024 a good year for REITs. He noted that historically, at the end of a Federal Reserve tightening cycle, REITs have outperformed private real estate and equities over the following two and four quarters. “We think we saw a little preview of that at the end of the fourth quarter,” Worth said. Meanwhile, the divergence between public and private real estate valuations continues to be quite wide. Worth said that gap is expected to close in 2024, both through REITs performing well and continued markdowns for private real estate.
Thu, January 04, 2024
Episode 386: RCLCO Fund Advisors Says U.S. Institutional Investors Under-Allocating to REITs
William Maher, director of strategy and research at RCLCO Fund Advisors (RFA), was a guest on Nareit’s REIT Report podcast. RFA’s clients include some of the larger public pension funds, and increasingly non-U.S. investors. Maher said that most U.S. institutional investors today allocate less than 10% of their real estate allocation to REITs. “I think that indicates a big underweight that they're probably not aware of,” Maher said. He added that RFA’s investor clients continue to want greater exposure to a broader range of property types and will continue to look to REITs to provide that access. Mid-size and larger institutions should have a “permanent long-term position in REITs for diversification, market knowledge, [and] exposure to property types that are difficult to access in the private markets,” he said.
Thu, December 14, 2023
Episode 385: Extra Space Storage Focusing on Fundamentals in 2024 After Hectic 2023
Gwyn McNeal, executive vice president and chief legal officer at Extra Space Storage Inc. (NYSE: EXR), was a guest on the Nareit REIT Report podcast. McNeal discussed her role at Extra Space, the merger with Life Storage and issues she has dealt with on the legal and personnel side, legal issues facing all REITs today, as well as advice for those seeking a legal career in the commercial real estate sector. Turning to the priorities for 2024 that she is most excited about, McNeal referred to a mandate from Extra Space’s CEO to focus on the fundamentals, after an “incredibly crazy” 2023. That involves making sure new staff are fully onboarded and trained, operating platforms are able to fully support the newly merged company, and that properties acquired through the merger are up to the same specifications as the Extra Space properties.
Fri, December 08, 2023
Episode 384: Real Estate Investors Adjusting to New Ways to Add Value, Profitability in Changed Environment: PwC
Andrew Alperstein, PwC U.S. real estate partner, and Daniel Sullivan, PwC U.S. financial markets and real estate leader, discussed key takeaways of PwC and ULI’s Emerging Trends in Real Estate 2024 report, which incorporates data and insights from more than 2,000 industry experts. One of the main themes of this year's report is what it terms the “Great Reset,” in which old assumptions are no longer valid. Alperstein said commercial real estate investors are going to have to be “more diligent, more operationally focused, as they strive to add value and profitability relative to recent years when low rates, decreasing cap rates, and a high amount of leverage was a big part of the way value was created and profitability was obtained.” As for transaction volume, the current environment of higher rates, more rigorous underwriting from the lender side, and a pullback from the banks is going to make it challenging, particularly to get bigger deals done, Alperstein said.
Thu, November 16, 2023
Episode 383: Creating a Neuroinclusive Work Environment is “Good Business for Everybody”
Tracy Powell-Rudy, vice president of corporate engagement at Integrate, a nonprofit that helps organizations identify, recruit, and retain autistic and neurodivergent talent, was a guest on the latest episode of Nareit’s REIT Report podcast. Powell-Rudy discussed the level of awareness around neurodiversity in the wider population today, the level of participation for neurodiverse individuals in the workplace, and some of the key factors impacting their hiring. She also discussed practical steps that companies can take to become more aware of neurodiversity, to make their hiring processes more amenable to neurodiverse candidates, and how to signal to the outside world that neurodiversity is something that’s on a company’s radar. In addition, Powell-Rudy covered best practices for companies that are starting up hiring programs or looking to work with a partner.
Thu, November 09, 2023
Episode 382: Institutional Real Estate Investors Largely Sidelined for Now; See REITs as Complementing Strategy
Doug Weill, founder and co-managing partner of Hodes Weill & Associates, a leading global capital advisory firm, was a guest on the latest episode of Nareit’s REIT Report podcast. Hodes Weill recently released the 2023 Real Estate Allocations Monitor, which showed that institutions’ target allocations to real estate were flat at about 10.8% year-over-year. “Institutions are very cautious in the market today. And while they're reasonably optimistic about the opportunity to invest over the next couple of years, right now in the moment there are numerous cross currents,” Weill said. At the same time, several large institutions have increased their target allocations over the past 12 months, Weill noted. “I think that has been a signal to the market that they are encouraged about the opportunity to invest and perhaps lean into the opportunity.” Such institutions include Norges Bank and CalSTRS.
Thu, November 02, 2023
Episode 381: American Tower CEO Says Global Presence Fosters Connectivity in Responsible, Equitable, Sustainable Way
Tom Bartlett, president and CEO of American Tower Corp . (NYSE: AMT), was a guest on the latest episode of Nareit’s REIT Report podcast. Bartlett discussed American Tower’s recently launched Sustainability Report and provided an overview of the REIT’s broader sustainability strategy. He explained that “neutral hosting” is central to the company’s inherently sustainable business model. “Neutral hosting allows multiple customers to lease space on a shared single tower or asset, which reduces the number of sites required and minimizes the industry's overall environmental impact”, he said. Beyond providing digital infrastructure, Bartlett noted that American Tower’s global presence enables it to play “a significant role in fostering connectivity in a responsible, equitable, and sustainable way to realize our vision of building a more connected world.”
Thu, October 26, 2023
Episode 380: Modiv Industrial Sees Upside Potential in Mission-Critical Manufacturing Facilities
Aaron Halfacre, president and CEO of Modiv Industrial, Inc . (NYSE: MDV), was a guest on the latest episode of Nareit’s REIT Report podcast. Halfacre discussed Modiv’s evolution toward focusing on industrial manufacturing facilities, after starting out as a diversified net lease REIT. “We discovered that industrial manufacturing facilities were, like us, flying a bit below the radar and also, like us, providing investors with very attractive upside potential. The manufacturing sector has strong fundamentals, solid cap rates, healthy contractual rent bumps, long-term dependable leases, and somewhat of an inefficient transaction marketplace. All of that made it clear to us that we were onto something,” Halfacre said.
Thu, October 19, 2023
Episode 379: REIT Fundamentals Remain Strong Ahead of Third Quarter Earnings
David Auerbach, REIT industry expert and the chief investment officer of Hoya Capital & Hoya ETFs, was a guest on the latest episode of Nareit’s REIT Report podcast. Auerbach said fundamentals for REITs have remained “very strong,” despite the Federal Reserve’s tighter monetary policy. “If you look at the last quarter, public REITs reported same store property level income about 10% above where they were pre-pandemic. Many of these REITs have been preparing for winter for a long period of time, cleaning up their balance sheets, focusing less on variable rate debt.” He added that investors want management teams to do four things—grow revenues, grow profits, grow guidance, and grow dividends. “Pretty much by and large, that's been what's happening across the spectrum in the REIT industry.”
Fri, October 13, 2023
Episode 378: REIT Scale and Cost of Capital Advantages Enhanced by PropTech
Brad Thomas, real estate expert, analyst, and CEO of Wide Moat Research, was a guest of Nareit’s REIT Report podcast. In this latest episode, Thomas discusses many of the themes and topics that appear in his newly released book, REITs for Dummies , including the increasingly important role played by PropTech within the sector. “We've seen PropTech throughout most every property category, in multifamily, self-storage, you name it. Every sector has some PropTech component, which is really an interesting part of this innovation…it's really helped these companies grow and produce more earnings,” Thomas says.
Thu, October 05, 2023
Episode 377: New Research Shows REITs Historically Outperform Private Real Estate on Sustainability Performance
Avis Devine, associate professor of real estate finance and sustainability at the Schulich School of Business at Toronto’s York University, was a guest on the latest episode of Nareit’s REIT Report. Devine discussed new research, sponsored by Nareit, into the sustainability performance of listed REITs and private real estate as well as their approaches toward sustainability commitments and disclosure, and the relationship between sustainability disclosure and performance among REITs. “Public and private real estate firms make different decisions regarding their sustainability commitments and their disclosure,” Devine said. Using the Global Real Estate Sustainability Benchmark (GRESB) reporting structure, the research shows that historically REITs have outperformed private funds on sustainability performance. However, that gap has been narrowing in recent years
Thu, September 28, 2023
Episode 376: Listed REITs Offer a Compelling Opportunity Versus Equities, Private Real Estate: Principal
Todd Kellenberger, REIT client portfolio manager at Principal Asset Management, was a guest on the latest episode of Nareit’s REIT Report podcast. Kellenberger noted that listed REITs currently trade at significant valuation discounts to both equities and private real estate. He pointed out that the earnings price multiple of REITs versus equities today is over two standard deviations away from the long-term mean—"a level that's even cheaper than what we saw during the GFC, particularly for U.S. listed REITs.” Meanwhile, the change in valuations for private real estate have been slower than for listed REITs, given the appraisal-based methodologies and limited price discovery in today's transaction markets, he added.
Thu, September 21, 2023
Episode 375: Safehold CIO Says Modern Ground Lease Concept “Here to Stay”
Marcos Alvarado, president and CIO at Safehold Inc . (NYSE: SAFE), was a guest on the latest episode of Nareit’s REIT Report. Alvarado said Safehold has made a “tremendous” amount of progress in the last six years in terms of portfolio expansion and growth in enterprise value, “but in the greater scheme of what we're looking to accomplish, I think we're still very, very early on…that's what excites us about the future.”
Tue, September 19, 2023
Episode 374: Life Sciences Industry No Longer Confined to Coastal Markets: JLL
Travis McCready, head of life sciences, Americas markets, JLL, was a guest on the latest episode of the REIT Report. Speaking in conjunction with the release of JLL’s 2023 Life Sciences Industry and Real Estate Perspective , McCready noted that while Boston and San Francisco remain leading life science markets on a national and international level, other markets in the United States are showing signs of growth and vitality.
Tue, September 12, 2023
Episode 373: Real Estate Roundtable says CRE Playing Key Role in Success of Federal Climate Programs
As part of Building to Zero, an ongoing series of interviews on the decarbonization of the commercial real estate sector, Duane Desiderio, senior vice president and counsel for the Real Estate Roundtable, joined a special episode of Nareit’s REIT Report podcast. Desiderio spoke with Nareit’s Senior Vice President of Environmental Stewardship and Sustainability Jessica Long to discuss recent and upcoming activity related to federal policy that supports real estate owners’ efforts to measure and reduce carbon emissions, disclose climate-related financial risk and opportunity, and comply with local building standards.
Fri, September 08, 2023
Episode 372: CBRE Says Global Real Estate Investors Remain Cautious as Cross-Border Capital Flows Drop in First Half
Richard Barkham, global chief economist, head of global research and head of Americas research at CBRE, was a guest on the latest episode of the REIT Report podcast. Barkham discussed the state of global cross-border real estate capital flows, which totaled $30.5 billion in the first half of this year. That marked a 52% decline from the same period a year earlier and down 44% compared to an average of the first half periods between 2018 to 2022. Despite being a “pretty weak year really,” the mood of the global real estate investor is “far from despondent,” Barkham said. The mood is “wary and cautious until we get a much clearer signal on the glide path for interest rates, both in the United States and in the global economy.” Notable trends during the first half included an inflow of funds into the U.S. from Singapore and Japan, reflecting the buyout of STORE Capital Corp. by sovereign wealth fund GIC and a $1 billion Japanese investment into New York City office.
Thu, August 31, 2023
Episode 371: Actively Managed Funds’ Allocations Shed Light on REIT Market Performance
Nicole Funari, Nareit vice president for research, was a guest on the latest episode of the Nareit REIT Report. Funari discussed Nareit’s new project that initially involves tracking quarterly investment holdings for the 28 largest actively managed real estate investment funds that focus on REITs from 2010 to the first quarter of 2023. While performance returns offer a broad market perspective on what investors think about REITs, by narrowing the focus to active managers, or “people whose income and livelihoods depends on how well they can read the market for commercial real estate, we really get to capitalize on their unique insights and their expertise in this area,” Funari said.
Thu, August 03, 2023
Episode 370: REITs Well Prepared to Navigate Ongoing Economic, Capital Market Uncertainty at Mid-Year
Nareit Senior Vice President for Research Ed Pierzak joined the latest episode of the REIT Report podcast to talk about some of the key findings from Nareit’s 2023 mid-year report. Pierzak noted that two main factors are at play today—the divergence in public and private real estate valuations, and challenges in the capital markets, particularly around refinancing. The public-private valuation gap really reached its peak in the latter half of 2022, Pierzak said. Progress has been made since then, albeit slowly, he noted. However, whenever such valuation dislocations occur, “they can present opportunities for REIT investors…historically, when we’ve seen these major public and private valuation divergences, we see that REIT total returns have tended to bounce and even surge.”
Thu, July 27, 2023
Episode 369: Management Consultant Says REITs Should Hone Their Story to Engage Investors
Gene Rubin, president of management consultancy firm Rivel, joined the latest episode of Nareit’s REIT Report podcast to talk about strategic investor communications and investor engagement in the REIT space. Rivel recently carried out a generalist investor perception study on the REIT industry and Rubin discussed some of the findings that emerged. He noted that the outlook for REITs as an investment class in North America has “improved significantly” since a similar survey was undertaken in 2018. In the previous survey, over half of respondents said they were underweight in REITs, compared to about 40% this time.
Thu, July 13, 2023
Episode 368: Tower REITs Gaining Important Underlying Cash Flow Driver from 5G Deployment: Invesco
Darin Turner, managing director and chief investment officer for Invesco’s listed real assets team, was a guest on the latest edition of the Nareit REIT Report podcast. Turner discussed the scope and growth of the tower REIT industry, its performance history, how the leasing structure works, the impact of 5G, global opportunities and challenges, benefits for the sector from AI and edge computing, and more. Key Takeaways from the interview include: There are approximately 420,000 macro tower and small cell sites across the United States, with REITs owing about 90% of the approximately 150,000 macro tower sites. There hasn’t been any significant new development of macro tower sites in the last decade. New supply is “incredibly limited.” Most of the recent growth for tower REITs has been in international markets, in both emerging and developed markets.
Thu, July 06, 2023
Episode 367: Stability of Underlying Property Sector Trends is Key to Real Estate Deal Activity: PwC
Tim Bodner, global and U.S. real estate deals leader at PwC, was a guest on the latest episode of the REIT Report podcast. Bodner commented on the current state of real estate transaction activity, how different property segments are faring, opportunities amid today’s challenging environment, strategies being used to get deals done, and more. During the interview, Bodner noted that: It’s a “much more challenging” deal environment today than it was previously. Pockets of strength are emerging across the real estate landscape, including logistics, self-storage, areas of the hospitality sector, experiential real estate, and even office. The most important factor in terms of getting deals done today is the stability of the underlying trends that are driving activity in a particular sector.
Thu, June 29, 2023
Episode 366: Top-Tier Office Properties Experiencing Continued Rent Growth: CBRE
Julie Whelan, global head of occupier research at CBRE, was a guest on the latest episode of the Nareit REIT Report podcast. During the interview, Whelan discussed broad office occupancy trends, changes in how office space is utilized, the flight to quality, the role of flexible office space, the importance of an office’s location, and more. Among Whelan’s key takeaways were: Net effective rents, that account for landlord concessions, are continuing to grow at the top tier of the office market. In some cases, the rent differential between top quality and lower quality office space has never been greater. A great office building alone isn’t enough. “Buildings have to be in great submarkets right now,” and that means mixed-use environments. “The office has a really exciting role to play in the future of how cities are reinvented.” Office space is going to be in a transformative phase as it plays a key role in the evolution of mixed-use locations.
Mon, June 26, 2023
Episode 365: SPECIAL EPISODE: Norges Bank Says Real Estate Facing “Tremendous Pressure” to Decarbonize
Nina Galbiati, Norges Bank’s global lead sustainability for real estate, was a guest on a special episode of Nareit’s REIT Report podcast. Norges Bank is a long-term investor that has roughly 4.1% of their global investment portfolio invested in real estate, with about half of that allocated to public REITs. With the firm’s focus on maximizing risk-adjusted returns, Norges has been an influential leader in promoting the adoption of sustainability for real estate companies globally for many years. On this episode of the REIT Report, Galbiati joined Nareit’s Senior Vice President of Environmental Stewardship and Sustainability Jessica Long to discuss how the real estate industry is addressing a key challenge of decarbonization planning and the importance of real estate companies in the U.S. clearly disclosing their strategy, decision making, and targets around key environmental matters. “Real estate is facing tremendous pressure to decarbonize. This is partly regulatory pressure, but it’s definitely coming from a shift in demand from tenants as well as investors. We don’t think the current market valuation is pricing those risks adequately today,” Galbiati said.
Thu, June 22, 2023
Episode 364: COAERS Seeing Increased Diversification, Liquidity, Returns from REIT Completion Strategy
David Stafford, deputy chief investment officer at The City of Austin Employees' Retirement System (COAERS), was a guest on the latest episode of Nareit’s REIT Report Podcast. During the interview, Stafford discussed COAERS’ decision to use REITs as part of a portfolio completion strategy starting in early 2020—an approach that has been successful for the fund and one that it continues to assess on an ongoing basis. He also spoke about the importance of having a mindset attuned to trying a new investment approach, the benefits that REITs provide to COAERS, market issues that COAERS is watching, advice for funds considering a change in strategy, and more. COAERS is a defined benefit plan that administers retirement benefits for regular employees of the city of Austin and currently serves about 19,000 current, inactive, and retired members. The system’s investments total approximately $3 billion and are broadly diversified across asset classes including equities, real assets, fixed income, multi-asset strategies, commodities, and cash.
Thu, June 15, 2023
Episode 363: Time is Right to Increase Exposure to REITs and Listed Real Estate: DWS
John Vojticek, global head of liquid real assets at DWS, a global asset manager with nearly $1 trillion of assets under management, was a guest on the latest episode of the REIT Report podcast. Vojticek commented on the operating environment for listed REITs, DWS’s recommendations for using REITs in conjunction with private real estate to complete portfolios, the access REITs provide to emerging asset classes, the benefits of global investment in REITs, and more.
Mon, June 12, 2023
Episode 362: REITs Likely to Outperform Equities and Private Real Estate Once Fed Rate Hike Cycle Ends
Uma Moriarity, senior investment strategist at CenterSquare Investment Management, was a guest on the latest episode of Nareit’s REIT Report podcast. Moriarity spoke about how REITs are faring in the current interest rate climate, how their valuations compare to private real estate, REITs and their position in the capital markets, property sectors that CenterSquare is bullish on, and more. A pause in interest rate hikes is generally expected to occur at the next Federal Reserve meeting, Moriarity said. While some are expecting a subsequent rate hike in July, “it’s fair to say that we're closer to the end (of the rate hike cycle) than we are to the beginning,” she added.
Thu, June 08, 2023
Episode 361: Listed Real Estate Offers Investors Ready Access to Specialty Property Types
Andrew Duffy, co-founder, managing partner, chief investment officer, and senior portfolio manager of Ranger Global Real Estate Advisors, an independent investment advisor, was a guest on the latest episode of Nareit’s REIT Report podcast. Duffy spoke about: the state of commercial real estate today and how Ranger Global distinguishes between the performance of geographies and property types; the appeal of next generation property types; the advantages and risks of investing domestically versus globally; the dislocation between listed and private real estate; and the benefits of investing in listed real estate funds.
Thu, June 01, 2023
Episode 360: Alexander & Baldwin CEO Says Right Time for Transition as REIT Nears Completion of Transformation
Chris Benjamin, CEO of Alexander & Baldwin, Inc . (NYSE: ALEX), was a guest on the latest episode of Nareit’s REIT Report podcast. Benjamin, who will step down as CEO on June 30, reflected on his tenure at A&B, why supporting community organizations has played an important complement to his executive role, the transformation the company has undergone and its decision to convert to a REIT, changing the culture of A&B and its progress on DEI issues, and more. Benjamin said that now is a good time for a transition in leadership, given that “we have nearly completed the significant transformation that we’ve gone through as a company.” The leadership change also coincides with Benjamin’s 60 th birthday, a point at which he is eager to pursue new interests. Lance Parker, currently A&B's president & COO, has been appointed president & CEO effective July 1.
Thu, May 25, 2023
Episode 359: Global Emerging Market Real Estate Fund Finds Opportunities from Rapid Urbanization Trends
John Haskell, founder and chief investment officer at Atla Capital Management LLC, was a guest on the latest episode of the Nareit REIT Report. During the interview, Haskell talked about the opportunities from investing in global emerging market listed real estate, the scope of the market, the key theme of urbanization, challenges posed by the lack of reporting standardization, the potential shelter that emerging markets offer relative to other markets, and more. Haskell manages the Atla Global Urbanization Listed Fund. A key theme for the fund is urbanization, and the opportunities presented by the rapid rise of emerging market cities. “The greatest social and economic transformations in the world today are in developing countries and it all comes down, in my opinion, to urbanization. While developed cities have mostly plateaued in population growth, emerging market cities are inflecting in population and in wealth,” Haskell said.
Thu, May 18, 2023
Episode 358: REITs Set to Benefit from Prior Repricing, Anticipated Pause in Rate Hikes
Jonathan Miniman, global portfolio manager and head of the Americas real estate securities research team at CBRE Investment Management, was a guest on the latest episode of the Nareit REIT Report. During the interview, Miniman discussed: concerns impacting commercial real estate—including the banking crisis; potential opportunities for REITs in the months ahead; the role REITs can play in conjunction with private real estate; and the role that active managers can play for REIT investors. Miniman said that the repricing of REITs that occurred last year, coupled with a likely near-term pausing in interest rate hikes, provide a “catalyst” for the asset class going forward. “The listed market has taken a whole lot of the pain already,” Miniman said. He noted that in the past four historical interest rate increase cycles, listed REITs have started to gain ground about three months prior to the final increase.
Thu, May 11, 2023
Episode 357: REITs Likely to Attract Growing Interest from Private Real Estate Funds
REITs are likely to attract growing interest from private real estate funds looking to deploy capital where they see value discrepancies, says Christian Busken, senior vice president and director of real assets at FEG Investment Advisors. “There's a growing recognition that REITs present some attractive opportunities and I think that we'll see more private firms getting into the space,” Busken told the REIT Report podcast. He noted that “it's not unusual for us to see some of our private real estate funds selectively take positions in REITs where they see some kind of a value discrepancy.” Busken added that with $300 billion-plus of private real estate dry powder on the sidelines and needing to be deployed, “we could definitely see more private funds playing in the market.”
Thu, May 04, 2023
Episode 356: Columbia Threadneedle Launches ETF Amid Signs of Maintained or Increased Real Estate Allocations
Recent survey data from Columbia Threadneedle Investments shows that 93% of financial advisors plan to maintain or increase their real estate allocations over the next 12 to 24 months, confirming that the “timing is right” for the launch of the Columbia Research Enhanced Real Estate ETF (NYSE Arca: CRED), says Marc Zeitoun, head of strategic beta at the global asset manager. Columbia Threadneedle launched CRED on April 26. The ETF tracks a custom, proprietary index which typically tracks 70-90 REITs weighted across eight sectors. It is designed to outperform the FTSE Nareit All Equity REITs Index through research-driven security selection and modified market cap weighting that emphasizes income and geographic opportunity. Speaking on the REIT Report, Zeitoun noted that the firm’s survey data also showed that 82% of financial advisors favored the REIT structure as a way to express their preferences in real estate. “So, we think that timing is right, and we know for sure that the packaging is right relative to the way that advisors and allocators build their client portfolios.”
Mon, May 01, 2023
Episode 355: REITs Increasingly Adopting Practices That Offer Visibility into Their Environmental, Social Performance
REITs are making gains across the board in adopting practices that enable investors to make informed decisions taking into account environmental and social strategy and performance, says Jessica Long, Nareit senior vice president for environmental stewardship and sustainability. Speaking on the REIT Report, Long noted that Nareit’s latest REIT ESG Dashboard shows that 100% of the top 100 REITs are reporting publicly on ESG in some manner. “REITs really are demonstrating that as an industry, real estate is taking seriously the requests from investors and regulators and other key stakeholders that are saying that ‘these environmental and social issues are important to us and we want to understand how you're managing those things.’” One data point in the latest dashboard shows that 89% of REITs are reporting on their climate risk policy. Long noted that these percentages show that REITs “are out ahead on this….and putting in place policies and procedures and looking at the metrics to help better manage this risk and understand what's happening within a REIT’s real estate portfolios.”
Thu, April 20, 2023
Episode 354: Championing DEI Change Requires Organizations to Take Multi-Pronged Approach
Championing change related to diversity, equity, and inclusion matters requires organizations to actively commit people and resources to the task, to clarify that change is everybody’s responsibility, and to build coalitions wherever possible, says Adjoa B. Asamoah, an advocate of racial equity and an award-winning social impact strategist. Asamoah, a keynote speaker at Nareit's REITwise: 2023 Law, Accounting & Finance Conference, developed the legislative strategy for the CROWN Act and leads the movement on behalf of the CROWN Coalition to end race-based hair discrimination. Speaking on the Nareit REIT Report, she described the CROWN Act as a “blueprint for championing change,” and added that it has been “groundbreaking on so many fronts and really shows that people can have a role in creating the society that they want to live in.”
Thu, April 06, 2023
Episode 353: Life Sciences Market Being Driven by Late Stage Clinical Pipeline, CBRE Says
A record number of products still under development in the life sciences sector continue to provide tailwinds for the industry, despite volatility in the broader macroeconomic environment, says Matt Gardner, CBRE’s U.S. life sciences leader. Speaking on the Nareit REIT Report, Gardner noted that a bull run of investment in life sciences, that started in 2015, “left us with an incredible number of products in development. And those are still there.” Gardner stressed that the life sciences industry doesn’t follow broader economic patterns. “If a product takes 10 to 15 years to develop, the investment in that product isn't going to follow a seven year economic cycle, which is why we look at this record number of products in phase two and phase three clinical trials as such an important sign of the industry's overall wellbeing. The science is still there,” he said.
Thu, March 30, 2023
Episode 352: Residential REITs Benefitting from Strong Balance Sheets and Leasing Tailwinds
Residential REITs offer investors a safe option amid current volatility, with strong balance sheets, leasing tailwinds, and the continued shortage of affordable starter homes among the key factors supporting growth in the sector, says David Auerbach, managing director at Armada ETF Advisors. Armada’s flagship product HAUS is an exchange traded fund (ETF) comprised of 25 pure play residential REITs in the multifamily, manufactured housing, single-family rental, and senior housing segments. It recently celebrated its one year anniversary of being a publicly traded entity. Speaking to the Nareit REIT Report, Auerbach noted that most REITs in the residential sector were able to lock in attractive long-term debt and are well-capitalized to handle the current interest rate environment. As for leasing and rent growth trends, Auerbach pointed to continued strength in many of the Sunbelt markets, while there are signs of residents returning to some of the coastal markets as well.
Thu, March 23, 2023
Episode 351: Farmland Partners CEO Sees “Huge Potential” to Grow Asset Class
Farmland Partners Inc . (NYSE: FPI) President and CEO Luca Fabbri says there is “huge potential” to grow the share of farmland assets within institutional investor portfolios, especially given the sector’s risk return profile, asset appreciation, and inflation protection benefits. A co-founder of Farmland Partners alongside former CEO Paul Pittman, Fabbri was named president in October 2021 after serving as the company’s CFO since its inception. He became CEO in February. Speaking with the Nareit REIT Report, Fabbri said the value of U.S. farmland assets is about $2.7 trillion, with institutional investors accounting for probably 5% or less of that amount. That means that there is still a lot of education to be done to show investors that the asset class offers many potential benefits. Among those are the scarcity of the underlying asset, an attractive risk return profile, asset appreciation, inflation protection, and the absence of correlation with other asset classes.
Thu, March 16, 2023
Episode 350: Essex CEO Mike Schall Reflects on Finding the “Right Investments in the Right Place”
Essex Property Trust, Inc . (NYSE:ESS) President and CEO Mike Schall says the multifamily REIT is facing favorable tailwinds—including continued tech investment in its core markets, muted supply, and strong balance sheet fundamentals—as he prepares to step down from his current role at the end of the month. Schall has served as president and CEO since 2011. His successor is Angela Kleiman, Essex’s current SVP and COO. Speaking with the REIT Report, Schall said, “Coming out of periods of disruption, we've always been an opportunistic company. We've always found the right investments in the right place. And I think this is the case today.” Schall highlighted the rapid pace of investments underway today by tech companies in artificial intelligence, which is likely to drive the economies of northern California and Seattle. “That will help Essex continue to grow as it has over much of the last 30 years or so.”
Thu, March 09, 2023
Episode 349: NMHC President Says Demand for More Housing is “As Far as the Eye Can See”
The supply of housing in the United States has “never been more out of balance”—with the lack of affordable housing particularly acute—making long-term policy initiatives on the federal, state, and local level more important than ever, says Sharon Wilson Géno, president of the National Multifamily Housing Council (NMHC). Wilson Géno assumed the role of president from Doug Bibby in January, when he officially stepped down after more than 20 years of leading the organization. Speaking on the REIT Report, Wilson Géno said, “The bottom line is, the demand for more housing in this country is as far as the eye can see.” Research by NMHC and other organizations indicates that the U.S. housing stock is in a deficit of about 4 million units. Wilson Géno said new households have formed in the wake of the pandemic, “and that really put a significant strain on the housing supply that was available.” Sizeable rent increases also occurred into the first half of 2022, she noted.
Thu, March 02, 2023
Episode 348: Dynex Capital Maintaining Flexible Mindset, Strong Liquidity Amid Current Uncertainty
Dynex Capital, Inc . (NYSE: DX) CEO Byron Boston describes the current geopolitical and macroeconomic conditions as an “evolving period” in which the mREIT is maintaining a flexible mindset and evaluating multiple scenarios for the future. Boston, who is also the mREIT’s co-chief investment officer, told the REIT Report that “we're respectful of this evolving period. We're respectful that we may continue to be surprised.” In response, Dynex Capital is carrying more cash and liquidity on its balance sheet, he noted. “Liquidity is absolutely key.” This year, Dynex Capital will not be trying to predict exactly how far or how fast inflation will go, Boston said. “We are evaluating from a month-to-month basis. We're carrying more cash and liquidity because we feel it is dangerous to try to pick one scenario and structure your portfolio around that one scenario with economic variables being this uncertain, and the potential for exogenous shocks to the economy so high.” Dynex Capital’s number one strategy, according to Boston, is “how much risk should we take in this environment? We have a flexible enough mindset not to reject the data as it's coming out.”
Thu, February 23, 2023
Episode 347: Investors Should Prioritize Listed Real Estate Market Over Private: LaSalle
Investors looking to allocate to real estate today should consider the listed market first, with REITs in particular priced to deliver annual returns in the high single digit range for the next several years, says Lisa Kaufman, head of global securities at LaSalle. “We see public real estate as unequivocally more attractive than private real estate today,” Kaufman told Nareit’s REIT Report podcast. Kaufman said the REIT market has been “really very rational” through the recent period of tightening financial conditions, “and financial conditions do remain in the driver's seat.” She noted that REIT returns “are attractive and we have a higher level of conviction in our outlook today just given the material tightening of financial conditions and the repricing that's already occurred in the REIT sector.” REITs are underrepresented today in institutional real estate portfolios, Kaufman said. Listed real estate represents around 45% of institutional quality real estate worldwide, but only about 20% of investors’ real estate allocation. REITs have the additional benefit of being disproportionately weighted toward non-traditional property types like self-storage, health care, and data centers, she said.
Thu, February 16, 2023
Episode 346: REITs Offer Protection Against High and Moderate Inflation
REITs provide protection against high and moderate inflation across a range of property types, says Nareit Vice President of Research Nicole Funari. Speaking on Nareit’s REIT Report podcast, Funari noted that, in terms of how REITs respond to inflation pressures, “people are inclined to believe that there might be differences among the property sectors, but the data doesn't bear that out.”
Thu, February 09, 2023
Episode 345: Citi Analysts see Opportunities Amidst Uncertainty Across Global Real Estate Markets in 2023
The potential for rolling country-level recessions and the impact of higher interest rates on transactions and capital flows are among the main themes influencing global real estate investment in 2023. The result, according to Citi’s global real estate research team, are opportunities mixed in with the broader uncertainty facing investors. “I think there's a lot more uncertainty entering 2023 than we've seen at least in the past few years, putting aside COVID. I think that's going to be the biggest challenge and opportunity depending on how that turns out,” Nick Joseph, Citi’s global head of real estate and head of the U.S. real estate and lodging research team, told Nareit’s REIT Report podcast. Global sector-specific trends that Citi is monitoring include: the future of the office; e-commerce and the impact on brick and mortar; lodging demand and recovery; health care coming out of the pandemic; housing trends; and digital transformation and its impact on infrastructure.
Thu, February 02, 2023
Episode 344: Nareit’s Ayris Scales says REITs Undertaking “Critical” Work to Better Reflect Diverse Demographics
The REIT industry is undertaking “critical” work to ensure that real estate’s leadership, staff, and procurement opportunities better reflect the nation’s wider demographics, says Ayris T. Scales, Nareit’s senior vice president for social responsibility and global initiatives. Speaking on Nareit’s REIT Report, Scales said that Nareit is working together with its REIT members to accelerate change collectively and “elevate the way that we do things on behalf of the industry.” Scales outlined two key projects underway at Nareit to advance diversity and inclusion throughout the industry. She noted that the grant application process for the Nareit Foundation’s Dividends through Diversity, Equity, and Inclusion (DDEI) Giving Campaign opened this week. Among the groups urged to apply, Scales said, are organizations focusing on ways to help secure talent for the real estate industry by looking at ways to expose high school or college students to real estate opportunities through mentorship, internships, and any other types of leadership and professional development opportunities.
Thu, January 26, 2023
Episode 343: Cohen & Steers’ Rich Hill Says Timing is Right for Building Exposure to REITs
REITs have historically made solid returns following the onset of a recession, particularly in the early stages of the cycle, making this an ideal time for investors to begin building an exposure to the asset class, says Rich Hill, head of real estate strategy and research at Cohen & Steers. Speaking on the Nareit REIT Report, Hill said REITs have historically produced average 12-month forward returns of more than 10% following the onset of a recession, with early-cycle returns exceeding 20%.
Thu, January 19, 2023
Episode 342: Real Estate Capital Markets Recovery Likely Around Mid-2023: CBRE
A recovery in the real estate capital markets is likely to begin around the middle of the year, with transaction activity becoming better supported over the course of 2023 as financial stresses start to ease, says Richard Barkham, CBRE’s global chief economist. Speaking on the Nareit REIT Report podcast, Barkham said, “real estate capital markets tend to lead the economy, both on the downside and in the upturn…it’s going to take a while for investors to start to move because they want to assess the situation in terms of fundamentals. But we do see a capital markets recovery beginning around mid-year.” Barkham said transaction activity is likely to become better supported over the course of the year as financial conditions improve, primarily in the second half of the year. However, “that's not to say there won't be activity in the first half of the year. There is a record amount of capital looking to deploy in real estate and looking for opportunities, particularly if pricing is a little bit more favorable.”
Thu, January 12, 2023
Episode 341: New Initiative Aims to Launch Ethnically Diverse Students into Real Estate Careers
Centers for Leadership Excellence (CLE), a new initiative from the Ferguson Charitable Foundation, seeks to introduce ethnically diverse college students to career opportunities available in real estate, with the long-term goal of helping to change the racial and ethnic composition of the sector. “We want to get these students into the boardroom and into the c-suite because as leaders they can effectuate change,” Bill Ferguson, chairman of Ferguson Partners and president of the Ferguson Charitable Foundation, told the Nareit REIT Report. Ebony Mitchell, director of strategic initiatives at Ferguson and student liaison for CLE, noted that with the lack of ethnic diversity in commercial real estate, “there's been a limited number of role models and mentors of color to attract young collegiate talent on and off campus.” She added that many of Ferguson’s clients have also struggled with attracting diverse talent, especially at the entry level due to traditional campus recruiting efforts. Ferguson explained that students selected into the CLE Program are required to take a certain number of courses in real estate in order to graduate with a minor in real estate. Given Ferguson’s vast network of corporate relationships across 12 sectors in the real estate industry, “we are connecting them with clear opportunities,” he said.
Thu, January 05, 2023
Episode 340: REITs Well Positioned to Navigate Economic and Market Uncertainty of 2023
REITs have demonstrated resilient operational performance and are well prepared for the continued economic uncertainty, higher interest rates, and elevated inflation expected in the coming year, says Ed Pierzak, Nareit’s senior vice president for research. Speaking on the Nareit REIT Report, Pierzak noted that REITs are not only performing well but are keeping pace with inflation. Meanwhile, balance sheets are in “great shape,” with leverage ratios near historical lows. With the risk of recession a dominant theme for 2023, Pierzak pointed out that “a recession does not have to equate to negative property total returns.” A Nareit analysis of the last six U.S recessions shows that on average, REIT's underperformed private real estate in the four quarters before a recession. However, REIT's outperformed private real estate both during a recession and in the four quarters after. A comparison of the FTSE Nareit All Equity Index to the Russell 1000 Index found that it outperformed broader equities before, during, and after recessions.
Fri, December 02, 2022
Episode 339: Retrofitting Buildings Seen as Essential Step to Reaching Net Zero Emissions Goals
As decarbonizing buildings becomes essential to achieving net zero emissions goals, the real estate industry needs to rebalance its efforts away from new building in favor of retrofitting existing buildings, says Jeremy Kelly, director of global research at JLL. Speaking on the REIT Report, Kelly said retrofitting has to become “the new normal” given that about a 10th of global emissions are coming from new construction. JLL has calculated that in mature cities, 80% of office buildings that exist today will still be standing in 2050. That means a retrofitting rate of about 3-3.5% of inventory every single year to meet net zero targets. However, that compares with retrofitting rates that are around 1% today. “So, we've got to triple, quadruple the rates of retrofitting,” Kelly said.
Thu, November 10, 2022
Episode 338: Real Estate Investors Await Better Price Discovery Before Committing to the Market
Constriction in the credit markets has caused real estate investment transactions to slow, but there’s still plenty of dry powder on the sidelines ready to execute as soon as clearer price discovery emerges, says Byron Carlock, real estate practice leader at PwC. Speaking on the REIT Report, Carlock said that the current sentiment is one of cautious optimism. “Demand on the street from any of the product types is still quite good, especially multifamily, industrial, even the hotel sector. And frankly, retail is picking up again.” Carlock discussed the sectors highlighted in PwC’s Emerging Trends in Real Estate 2023 report that are likely to be most insulated from economic uncertainty. Industrial was in first place, followed by multifamily. “Affordability of home ownership continues to suffer, so we’re moving to a greater renter orientation in our population,” he said.
Thu, November 03, 2022
Episode 337: GRESB’s Dan Winters Expects REIT Scores to Increase in Coming Years
The REIT industry is likely to see additional gains in GRESB performance in the years ahead, given that a number of listed REITs appeared in the benchmark for the first time this past year, says Dan Winters, senior director at GRESB. Speaking on the REIT Report, Winters noted that in general, GRESB scores start to ramp up in year two and year three, “so I'm really expecting some additional increases in the REIT score in the years ahead.” Winters also discussed how a flight to quality real estate assets is likely to characterize the next several years, with companies needing to offer a superior investment and occupant experience to maintain competitiveness. Winters said that achieving those aims requires “a solid ESG program that's continuing to advance.” He added that the biggest threat to ESG is inertia, but that in the current economic climate the real estate industry is more likely to accelerate ESG-oriented efforts than pull back.
Thu, October 27, 2022
Episode 336: Newly-Rebranded Elme Communities Sees Significant Demand from Mid-Market Renters
A growing need for more mid-market affordable housing, particularly in its targeted Sun Belt markets, has Elme Communities (NYSE: ELME), formerly WashREIT, anticipating its strongest growth in 20 years, says President and CEO Paul McDermott. “That mid-market renter is really the deepest part of the demand curve, and we only see that curve growing,” McDermott told the REIT Report. While acknowledging the current volatile interest rate climate, he added that it doesn’t “erase the fact that there is a significant need for more affordable homes, especially in the markets that we're targeting, and in that particular rental band cohort that we're targeting also.” Elme has been fully focused on multifamily since completing the sale of retail and office assets in 2021, although the REIT started messaging its intent to focus on multifamily back in 2016. McDermott noted that households making between $35,000 and $75,000 comprise over a third of rental households in its targeted Sun Belt markets. However, the share of new product delivering into those markets since 2018 that's affordable to households making around $60,000 is 2% or less, he added.
Thu, October 13, 2022
Episode 335: REITs Look Increasingly to International Markets for Life Sciences Exposure
REITs active in life sciences real estate are increasingly looking to complement their domestic portfolios with holdings in international markets where world-class scientists and strong infrastructure are creating a “vibrant ecosystem,” says Travis McCready, head of life sciences, Americas markets, at JLL. “The life sciences market is increasingly going global, and from a REIT perspective, it's going global faster,” McCready told Nareit’s REIT Report. “I can't think of any of the leading REITs, publicly traded or private, that are simply looking at portfolios in the U.S. anymore. Everyone is looking for exposure across the Atlantic and across the Pacific.” In addition to seeking ways to deploy capital, REITs are taking advantage of international markets that are “incredibly effective” at creating conditions ripe for life sciences innovation, McCready said. Elsewhere in the podcast, McCready noted that from a venture capital standpoint, things are looking “quite good” for the life sciences market. However, “where the picture seems to change radically is when you start looking at the public markets, particularly IPOs, which for the life sciences ecosystem is somewhat of the lifeblood and the way that capital and exits are created.”
Thu, September 29, 2022
Episode 334: Healthy Building Environments Seen as “Table Stakes” for Tenants & Investors
Healthy building environments have become an essential requirement for attracting and retaining tenants, and also for ensuring that real estate assets avoid becoming stranded for failing to meet baseline requirements, says Joanna Frank, president and CEO of the Center for Active Design (CfAD), operator of the Fitwel healthy building certification system. Speaking on the REIT Report, Frank noted that “health is seen as essential. It is seen as table stakes. If you want to attract and retain tenants, you really need to be able to answer that question of ‘how is this a health-promoting environment?’” For investors, Frank pointed to “a distinct possibility of having stranded assets, of actually seeing your asset become less valuable, if you aren't meeting that baseline for being a healthy building because your peers and your competitors are able to articulate that.”
Thu, September 22, 2022
Episode 333: PropTech Seeing Increased Investment, Faster Deployment Across Real Estate Industry
Widespread acceptance that PropTech is an integral part of the real estate landscape today has helped accelerate the adoption of new tech solutions and paved the way for real estate stakeholders to act more nimbly than before, says Sarah Liu, partner on the Real Estate Technology Investment team at venture capital firm Fifth Wall. “Instead of having to wait sometimes maybe more than a year in order to get a decision, we are seeing folks able to test and pilot technology with a speed to deployment of sometimes just a matter of weeks,” Liu told the REIT Report. Liu noted that four or five years ago, the annual amount invested into PropTech was around $4 billion; by last year that number had risen to about $30 billion. Turning to areas where Fifth Wall is collaborating with REITs in PropTech adoption, Liu pointed to investments in electric vehicle charging and property management, including maintenance and renovation. She noted that there are more opportunities for collaboration that haven't yet been tapped, or are still at the early stages, such as sensor tech and improved building management systems.
Fri, September 16, 2022
Episode 332: Deloitte Outlook Shows CFOs Expect Real Estate Revenues to Come Under Pressure
Inflation pressures, higher interest rates, and supply chain challenges have created a climate of uncertainty in which commercial real estate executives see revenues coming under pressure, according to Deloitte US Real Estate Leader Jeff Smith. Speaking on the REIT Report, Smith said that Deloitte’s 2023 Commercial Real Estate Outlook, which is based on survey results for more than 450 CFOs, showed that 48% of respondents expect revenues to decrease in 2022. That compares with only about 9% expecting a decrease in the prior year’s survey. Despite the anticipated decline in revenues, CFOs were “pretty positive” when it came to real estate fundamentals, Smith said. Over 50% of CFOs said they expect increased leasing and rental rates in the next 12-18 months, along with decreased vacancies, he added.
Wed, September 14, 2022
Episode 331: American Tower Executive Sees Industry Collaboration as Essential for Achieving ESG Results
Making substantive progress on ESG issues involves going beyond individual corporate actions to encompass industry-wide efforts to bring about real change, says Mneesha Nahata, SVP, Legal & Chief Sustainability Officer at American Tower Corp . (NYSE: AMT). Speaking on the REIT Report, Nahata noted that in addition to finding practical solutions, making investments, and innovating as a company, “it is really about working together and collaboration with other like-minded companies to make a substantive difference, whether that is working together to reduce greenhouse gas emissions, or bridging the digital divide to provide upskilling opportunities to underserved communities.” Nahata said American Tower has placed sustainable operations at the core of its business. “We believe we can be champions of change in the industry and that requires addressing ESG holistically across our organization. And that includes at the very top.”
Thu, September 08, 2022
Episode 330: Inflation Reduction Act Offers New Energy-Related Provisions for REITs
The recently enacted Inflation Reduction Act contains $369 billion in energy-related provisions, including new tax credit incentives that were previously unavailable to the REIT industry, says Nareit EVP and General Counsel Cathy Barré. Speaking to the REIT Report, Barré points out that a number of obstacles have historically limited the ability of REITs to utilize tax credit incentives, with REIT tax credits typically going unused. Barré points out that under the new legislation, however, REITs that make an eligible investment in EV charging stations, or geothermal and solar capability, will now have the full tax credit available to sell at the REIT level. During the interview, Barré discusses how the legislation will impact REITs that invest in eligible sustainability-related projects. She also explains the nature of the tax credit incentives, and how REITs can qualify.
Thu, August 18, 2022
Episode 329: Strong Board/Management Partnership Benefits REIT Performance Long Term
A corporate governance structure that includes board members that are independent, yet work as strong partners to the executive board, has clear long-term benefits for REIT performance, says Bill Ferguson, chairman of global professional services firm Ferguson Partners. Speaking on the REIT Report, Ferguson said “it’s a fine balance…the board is there to be a fiduciary and represent the shareholders’ interests, but the bottom line is that they also need to be a good partner to the leadership team to make sure that the strategy and the execution of the business makes sense.” Issues surrounding governance, in addition to a range of other ESG topics, will be explored at Nareit’s upcoming REITworks: 2022 Conference held on Sept. 12-13 in La Quinta, California.
Thu, August 11, 2022
Episode 328: Green Street Says Investors Should Prioritize Public Real Estate in Current Volatility
With listed REITs trading at sizeable discounts to their underlying gross asset value, institutional investors should prioritize public real estate at this time, says Dave Bragg, co-head of strategic research at Green Street. “Now is a great time to prioritize the public market as it is on sale,” Bragg told the REIT Report. Bragg stressed the advisability for investors to have a dual mandate across the public and private real estate markets as it “really does maximize one's opportunity to generate alpha.” Listed REITs have had meaningful declines this year, Bragg noted, but it reflects a broader trend, which is that “just about every asset that one can imagine has delivered a negative total return.” Bragg also noted that capital flows are a key driver of the disconnect in public and private market values. Private market flows have remained robust in 2022 and may even match last year’s record-setting tally, he said. Meanwhile, flows into listed REITs “remain quite tepid.”
Fri, August 05, 2022
Episode 327: PREIT CEO Says Sale of Unproductive Assets Positions Company Well for Future Growth
The sale of roughly half of PREIT’s (NYSE: PEI) portfolio of shopping malls, combined with the replacement of unproductive department stores with better performing assets, positions the company well for the future and makes a compelling case for investors, says Chairman and CEO Joe Coradino. Speaking on the Nareit REIT Report, Coradino also commented on how PREIT is evolving its properties into community hubs. “With assets in Philadelphia and Washington, D.C. that are well located, and with opportunities to do upwards of 4,000 apartments, [as well as] medical facilities and life sciences technology, our ability to attract either buyers or joint venture partners is pretty profound. It gives us a way to harvest capital and create value in these properties,” Coradino said.
Fri, July 22, 2022
Episode 326: Real Estate Deal Activity Focusing More on Experiential-Oriented Sectors
Real estate deal activity is concentrating on sectors that can perform well in a rising rate environment or in periods of high inflation, with experiential-oriented assets in particular demand, says Tim Bodner, partner and U.S. real estate deals leader at PwC. Speaking on the REIT Report, Bodner said PwC has continued to see activity building in the lodging space, as well as for casinos, marinas, and ski resorts. “All things that are tied to people being out.” Bodner said PwC is anticipating robust deal activity in the back half of 2022, although it may be more episodic in the listed segment of the market. The current environment has meant that there’s a lot more focus on underwriting, Bodner said. “Certainly, growth in rents and in NOI is something that folks are spending a lot of time putting attention on to make sure they feel good about their forward projections.”
Thu, July 14, 2022
Episode 325: Measurabl CEO Says Real Estate has “Tremendous” Leadership Opportunity to Advance Sustainability
Commercial real estate is in a position to take a leading role to advance the sustainability agenda, while regulation is also helping to move the whole industry forward, says Matt Ellis, founder and CEO of Measurabl, a provider of ESG data management solutions. Speaking on the REIT Report, Ellis said there is a “tremendous leadership opportunity in our sector to really take advantage of the transition to green for the better of everyone—our occupiers and customers, our investors, and certainly ourselves as well. I think that we're in a good position to do it. We just can't slow down. We’ve got to speed up.” Ellis described Measurabl, launched in 2013, as a “decade-long project to build the tools for measuring, managing, reporting, and ultimately acting on sustainability for the real estate sector.” He noted that there has been “a profound migration of organizations of every size around the world towards more sustainable business models. This is being done in just the span of a few years.”
Fri, July 08, 2022
Episode 324: Affordable Housing Crisis Not Just a Lower Income Phenomena, Former Fannie Mae Exec Says
The affordable housing crisis facing the United States today is not just a lower-income phenomena, but impacts individuals making six-figure salaries, says Kenneth Bacon, co-founder and managing partner of financial advisory and asset management firm RailField Partners, and former Fannie Mae executive. Speaking on the REIT Report, Bacon, who also serves as board chair at Welltower Inc . (NYSE: WELL), said “if you pull back the covers and look at the data, you'll see that young professionals, people earning six figure salaries in cities like San Francisco and New York, are hard pressed to find places that they can afford.” Bacon said the biggest problem behind the lack of affordable housing today is that the building process has become too long and difficult. As for the state of the commercial real estate sector today, Bacon said that as interest rates rise he sees a return to a “more normalized investment ecology.” That in turn will mean that investors are “going to have to work a lot harder to get some of these returns. I think some deals just aren’t going to get done.”
Mon, June 27, 2022
Episode 323: Lodging Real Estate Sector Fundamentals Healthy, but Margins Softening
Conditions in the lodging and hospitality real estate sector are healthy overall, but the combination of ongoing labor shortages, interest rate creep, and high construction costs are acting to soften margins, says Daniel Weede, partner in Morris, Manning & Martin’s hospitality, real estate, and real estate development & finance practices. Speaking on the REIT Report, Weede noted that “there's a lot of optimism in this industry, and I think, at least for the next several years, that's likely to stay.” However, “margins are thinner,” he added. Weede also discussed the potential for consolidation, noting that there will be likely be more merger and acquisition activity in the next 12 to 24 months than seen in the previous 12 to 24 months. “It's a healthy industry, but you've got some players that are doing really, really well, and others that are struggling a little bit.”
Thu, June 16, 2022
Episode 322: Phillips Edison Seeing Strong Operating Environment in Grocery-Anchored Shopping Segment
Phillips Edison & Co., Inc. is seeing a “really strong” operating environment across its portfolio, but the REIT also has a realistic view that there are going to be pressures weighing on the consumer from a range of macroeconomic factors, Chairman and CEO Jeffrey Edison said. Speaking on Nareit’s REIT Report, Edison noted that questions from investors at Nareit’s REITweek: 2022 Investor Conference last week revolved around the theme of potential disruption to the current environment from factors including higher interest rates and inflation pressure. “I think we have a realistic view that there are going to be pressures on the consumer from those macro events,” Edison said.
Wed, June 01, 2022
Episode 321: Commercial Real Estate Providing Buffer Against Inflation Pressures: Nuveen
Commercial real estate continues to provide a solid hedge against inflation, a trend that has been borne out over multiple decades during periods when inflation has exceeded 4%, says Carly Tripp, global chief investment officer and head of investments for Nuveen Real Estate. Speaking on the REIT Report, Tripp noted that Nuveen research shows that compared to other asset classes, commercial real estate was the only one that emerged with an overall net positive return during those inflationary periods. “We always say real estate is an inflation hedge, and we're seeing that play through right now. So it's a good time to be in commercial real estate in my opinion,” Tripp said.
Fri, May 27, 2022
Episode 320: Macerich CEO Says Consumers Largely Confident, Despite Current Uncertainty
Consumers remain largely confident about their personal situations, despite a host of broader economic and geopolitical concerns, says Tom O’Hern, CEO of Macerich (NYSE: MAC). That sentiment is fueling sales and leasing volumes across the REIT’s portfolio of retail and mixed-use real estate. “The resiliency of the American consumer is amazing, and it is once again on display. Shoppers have come roaring back to our centers to shop with a purpose,” O’Hern told the REIT Report. During the first quarter, sales were 111% of what they were pre-COVID. “Despite the economic uncertainty regarding inflation that we haven't frankly seen in decades, higher mortgage rates, a very volatile stock market, and the war in Ukraine, American consumers remain largely confident about their own situations,” O’Hern said.
Tue, May 24, 2022
Episode 319: Commercial Real Estate Seen as Good Option in Times of Inflation, Geopolitical Conflict
Private equity funds, endowments, and large institutional investors will continue to have a large appetite for commercial real estate given the current inflationary environment and geopolitical uncertainty, says John Sullivan, chair of DLA Piper’s U.S. real estate practice and co-chair of its global real estate practice. Speaking on the Nareit REIT Report, Sullivan said that asset classes with the ability to reprice themselves due to short lease cycles, such as multifamily and industrial real estate, “are viewed as a good bet because you can raise your rents to… at least keep up with inflation.” Sullivan highlighted some of the findings of DLA Piper’s 2022 State of the Market survey, including that respondents see logistics, multi-family, life science, and data centers as offering the most attractive risk- adjusted returns for the next 12 months.
Tue, May 17, 2022
Episode 318: Global Investment in U.S. Real Estate at Strongest-Ever Level
Global investment in U.S. real estate is at its strongest-ever level, with non-core markets and multifamily and industrial asset classes continuing to lead the charge in terms of investor interest, according to Gunnar Branson, CEO of AFIRE, the association for international real estate investors focused on commercial property in the U.S. Speaking on the Nareit REIT Report, Branson noted that while there are certainly lots of concerns surrounding global events, “real estate investing is on a terrific pace in the first quarter.” The top property asset class for institutional investors from around the world continues to be multifamily, Branson said, followed by industrial real estate. And while the office asset class will definitely continue to exist, questions remain about which offices are going to succeed, and which will have to rethink the level of capital investment that will be required to compete, he added.
Thu, May 12, 2022
Episode 317: Human Capital Strategies Key as Real Estate Industry Faces Skills Gap
A skills gap within the real estate industry means that to attract talent, firms must adopt human capital strategies that align with changes in employee expectations, says Gemma Burgess, president of Ferguson Partners. Burgess will become CEO of Ferguson, a global professional services firm, on June 1. Speaking on the REIT Report, Burgess attributed a skills gap within the real estate industry to the fact that many mid-level professionals left the field in the wake of the global financial crisis. “We’re definitely facing a missing generation in our industry. That’s suddenly making the succession work more challenging,” she added. Meanwhile, Burgess pointed to changes that have occurred in the workplace. “People want to work in different ways today. They want to work more flexibly. They certainly want to work within an environment where they feel like they belong and that there’s a culture that they believe in, and they can see a future for themselves.”
Tue, May 10, 2022
Episode 316: Return to Office to Take Rest of 2022 to Take Hold
Although a return to the office has started in earnest, it will take the rest of 2022 to take hold, and even longer before clear patterns of usage emerge, says Julie Whelan, global head of occupier research at CBRE. Speaking on the REIT Report, Whelan said it will likely be 2023 “before we can really start to hang our hat on trends that we can say are stable [in order] to build assumptions about what new work patterns are going to look like.” Whelan described current office usage as “muted…but the good news is that it’s picking up.” Some of the Southern states have seen a higher return to office rate, although in the past week New York and Washington, D.C. actually saw some of the biggest gains, she noted.
Thu, May 05, 2022
Episode 315: Angel Oak Sees Growth Opportunity as Non-Qualified Mortgage Segment Reverts to Historical Norms
Angel Oak Mortgage, Inc . (NYSE: AOMR) CFO Brandon Filson sees the non-qualified mortgage (QM) loan segment reverting over time to its historical level of about 10% of the overall mortgage market, compared to 2% today, providing the mREIT with significant opportunity for growth in the years ahead. Speaking on the REIT Report, Filson noted that 10% of the overall market would be about $200 billion, versus about $25 to $50 billion today. Angel Oak Mortgage, which went public in June 2021, focuses on acquiring and investing in first lien non-QM loans and other mortgage-related assets in the U.S. mortgage market. Non-QM loans are not backed by government agencies and are aimed at homebuyers unable to meet the strict criteria of a qualifying mortgage in areas such as income or personal debt.
Thu, April 28, 2022
Episode 314: Business Models Seen as Central to Corporate Performance & Wealth Creation
Business models are central to corporate performance and wealth creation, and even the most complex models can be reduced to six basic variables, says Chris Volk, a veteran REIT executive, business leader, and author. Speaking on the REIT Report, Volk discussed his upcoming book, The Value Equation, which will be published on May 10. Volk also discussed his career, during which he introduced and led three public companies. One of those was STORE Capital Corp. (NYSE: STOR), his third net lease iteration, formed in 2011. Combined, the companies provided more than $20 billion in growth capital to thousands of businesses, he said.
Fri, April 22, 2022
Episode 313: Non-Traded Alternative Investments Market Could Reach $250 Billion Within Next 5 Years
Capital flow of non-traded alternative investments could grow to a $250 billion a year market within the next five years, with early 2022 data already pointing to a record-breaking year for fundraising in the sector, according to the Institute for Portfolio Alternatives (IPA). Speaking on the REIT Report on April 18, Anya Coverman, SVP, government affairs and general counsel at IPA, said the outlook for 2022 is “incredibly bright. You have Blackstone, Starwood, and other large asset managers leading with a blockbuster year.” Citing research data from Robert A. Stanger & Co., Coverman said sales overall are topping $19.1 billion in January and February. “So, this is already on pace to beat last year's record tally of $70 billion.”
Fri, April 15, 2022
Episode 312: Residential Real Estate Seeing Strong Supply-Demand Backdrop: Fund Manager
Outside of the industrial sector, residential real estate in the United States “probably has the best supply-demand backdrop in global real estate right now,” says Ryan Dobratz, portfolio manager of the Third Avenue Real Estate Value Fund. Speaking on the REIT Report, Dobratz said he sees “a significant amount of demand for single family housing, in particular within more affordable Sunbelt markets, at the same time that supply is very, very low.” Companies active on the home building side are seeing benefits, Dobratz said, including timber REITs. Timber REITs are going to be able to generate much higher levels of cash flow and ultimately pay much higher dividends, given residential market conditions, he noted. “Timber is also a terrific place to be invested in an inflationary environment.” Dobratz pointed to the war in Ukraine, supply chain issues, and high inflation as issues of macro concern right now. At the same time, he noted that “commercial real estate has historically been a great place to park capital and to protect it from inflation over time.”
Thu, March 31, 2022
Episode 311: SEC Climate Change Disclosure Proposals Seen as First Step in Finding the Right Regulatory Balance
Proposed Securities and Exchange Commission (SEC) rules to enhance and standardize climate-related disclosures for investors are just the first step in terms of finding the right balance of what's required from a regulatory perspective, said Uma Pattarkine, a senior investment strategy analyst and global ESG lead for CenterSquare Investment Management. Pattarkine told the REIT Report that the SEC proposals were “a lot more robust than I had originally anticipated,” given the level of initial disclosure, and require REITs to be able to get a lot of that data at the property level. Many REITs, Pattarkine said, are already committed to science-based targets. For such companies, the SEC proposals will not impose any additional burdens. However, for REITs that have been lagging in terms of collecting data, “it's going to take a lot of work for them to get to what the SEC might require from a disclosure perspective.”
Fri, March 18, 2022
Episode 310: Camden Property Trust COO Says Pandemic Amplified the Importance of Gender Equity, Diversity
Laurie Baker, COO at Camden Property Trust (NYSE: CPT), says the importance of gender equity and diversity within the commercial real estate industry has been amplified as a result of the pandemic. Speaking on Nareit’s REIT Report, Baker said that while more women are rising to key leadership positions across the industry, the pandemic “in many ways stalled the progress that was being made because they [women] were disproportionately forced to choose between careers and caregiving for their family.” At the same time, Baker said, the pandemic also presented opportunities in the form of new forms of flexibility and “resetting definitions of career satisfaction and what company success and personal success is.” Baker, who was named COO in late 2021, also reflected on her more than two decades at Camden, including her work implementing pioneer revenue management technology as well as helping to create Camden’s first investment funds.
Fri, March 04, 2022
Episode 309: Invitation Homes Expanding Choice in Housing Market Through Pathway Homes Investment
Dallas Tanner, president and CEO of Invitation Homes Inc . (NYSE: INVH), says the REIT’s $250 million investment in Pathway Homes will expand choice in the housing market by helping first-time homebuyers who lack access to traditional avenues to home ownership. Speaking on the REIT Report, Tanner said Pathway, launched in partnership with Regis Group and Fifth Wall, is an opportunity to support a growing segment in the marketplace—individuals that want a lease option purchase agreement or the chance to build equity in a home over time. Pathway works directly with customers to identify and purchase a home, offering them the opportunity to first lease and then buy the home outright at a future date. In addition to investing in the homes and technology platform for Pathway and its real estate fund, Invitation Homes will provide maintenance and other services to all Pathway homes, enabling the REIT to broaden its third-party property management services.
Fri, February 25, 2022
Episode 308: Progress on DEI Requires Committed Leadership, Statements Backed by Action
Committed leadership and statements backed up by substantive action are key to ensuring that organizations make progress on diversity, equity, and inclusion (DEI), according to Kira Banks, co-founder of the Institute for Healing Justice and Equity at Saint Louis University, where she is also an associate professor in the department of psychology. Speaking on the REIT Report, Banks notes that since George Floyd's murder in 2020, more leaders in business are understanding that DEI is core. “They understand it is a part of the work of doing business nowadays.” However, the work won’t be sustainable unless leadership is fully committed, Banks says. “If leadership is not on board, it gives other people an opportunity to opt out.” Banks also says that more organizations are understanding that symbolic statements are insufficient and must be backed up with action. “Those sorts of symbolic gestures in some ways can do more harm than good if they're disingenuous, if they're not followed up by anything substantive,” she notes.
Wed, February 23, 2022
Episode 307: Long-Term Interest Rates to Remain Very Favorable for Commercial Real Estate
Anticipated interest rate increases of about one and a half percentage points by year-end will still create a “very favorable” environment for commercial real estate, says Nareit Senior Economist Calvin Schnure. Speaking on the Nareit REIT Report, Schnure noted that it is “appropriate” for the Federal Reserve to be raising interest rates at this point and removing the stimulus that was put in place early in the pandemic. Schnure noted that goods inflation has been at about 12% over the past year, while service price inflation has slowed somewhat. “This suggests that we're not having a long- term problem from wage pressures with inflation. I do expect inflation to slow down, mostly in the second half of this year,” he said. REITs, Schnure said, perform better than most other sectors during periods of moderate to high inflation because they represent a real asset that own properties whose values rise with prices and with leases that can respond to changing market conditions.
Mon, February 14, 2022
Episode 306: Hotel Transaction Activity Expected to be “Incredibly Strong” in 2022
Transaction activity in the hotel sector this year is expected to be “incredibly strong,” with robust pricing continuing in the luxury resort segment and the start of a recovery in business transient and group demand, according to Kevin Davis, CEO of JLL Hotels & Hospitality, Americas. Speaking on the REIT Report, Davis noted that JLL has more than $12 billion in its U.S. hotel sales and financing pipeline for 2022, the highest level since 2015, which was already a record year from a transaction volume perspective. If JLL is a proxy for the market, “my expectation is that you'll see a lot of transactions this year.” Davis said anticipated gains for 2022 follow a particularly strong year for the industry in 2021. This was fueled by the large amount of capital that had aggregated on the sidelines to take advantage of potential distress in the sector—which never materialized—as well as pent-up consumer demand for travel.
Fri, February 04, 2022
Episode 305: Farmland Investment Offers Stability, Good Returns, Inflation Hedge Benefits
Investing in the farmland sector offers stability, strong income, good total returns, and inflation hedge characteristics, among other benefits, according to Martin Davies, global head of Nuveen Natural Capital. Speaking on the REIT Report, Davies also noted that “one very compelling theme is not being correlated to the economic cycle. Through the COVID-19 pandemic we’ve seen no dip-off in farmland returns. As we’ve seen historically through other economic crises, such as the global financial crisis and the tech bubble, farmland returns stayed strong through that period.” Davies noted that while land values historically have been a function of what was actually produced, going forward there could be increased opportunities to monetize some of the additional benefits that exist, including water quality, biodiversity, and carbon sequestration.
Mon, January 31, 2022
Episode 304: Data Center Sector Promoting Renewable Energy Use Across the Electric Grid
The data center sector is playing a significant role in getting utilities to increase the use of renewables across the electricity grid and bring about the larger goal of a 90% carbon-free electricity system by 2030, according to Breana Wheeler, director of operations at BREEAM USA. Speaking on the REIT Report on Jan. 24, Wheeler noted that the focus on decarbonizing the grid is “really critical, because while reducing energy consumption is important, data centers specifically will always face significant challenges to either build enough renewables to cover total usage or build close enough to an abundant supply of renewable energy.” Wheeler also discussed how BREEAM’s relationship with the data center sector has developed over the years, whether the general perception of data center energy consumption fits the reality, and how the data center sector is having a positive knock-on effect in terms of making other industry sectors improve their sustainability performance.
Thu, January 27, 2022
Episode 303: Prologis sees Multi-Year Tailwinds from Efforts to Rebuild Inventory Levels
Prologis, Inc . (NYSE: PLD) Global Head of Capital Deployment Dan Letter says ongoing efforts by companies to rebuild inventories to pre-pandemic levels, and a focus on resiliency rather than efficiency in the supply chain, will create multi-year tailwinds for the REIT. Speaking on the REIT Report, Letter noted that inventory to sales levels are 10% below where they stood pre-pandemic. “Our customers are just trying to get back to the pre-COVID levels, let alone build that new safety stock on top of that,” he said. Letter said he expects supply chain challenges will persist into 2023. Vacancy rates are at unprecedented lows and space in Prologis’ markets is effectively sold out, he added. Prologis continues to see broad based demand in markets around the globe, according to Letter. The REIT is planning to start over $5 billion in developments this year, and also expects to make about $1.5 billion in acquisitions. In addition, Prologis’ land portfolio will allow it to develop over $26 billion of new product.
Fri, January 14, 2022
Episode 302: American Finance Trust Strengthens Commitment to Brick and Mortar Retail
With a footprint heavily weighted toward the Sunbelt, plus an expanding portfolio of necessity retail assets, Michael Weil, CEO of American Finance Trust, Inc . (Nasdaq: AFIN), says the REIT is well-positioned for 2022 and beyond. Speaking on the REIT Report podcast Jan. 12, Weil said the company’s proposed $1.3 billion acquisition of shopping center assets from subsidiaries of CIM Real Estate Finance Trust, Inc., combined with its upcoming rebranding to The Necessity Retail REIT Where America Shops, spells out its clear focus on a particularly active corner of the retail sector. Since the REIT’s listing on Nasdaq in 2018, it has focused on single tenant and multi-tenant retail, with the latter in the form of open-air shopping centers. “We think it's an incredibly viable, strong asset class and it creates a portfolio that has terrific underlying strength,” Weil said. Over the last four or five years, as the REIT has continued focusing on necessity retail, it has grown from about $3.4 billion of assets to a projected $5.1 billion.
Thu, December 16, 2021
Episode 301: REIT Industry Seeing Ample Capital, Rising Rents, & Elevated Asset Values at Year-End
The REIT industry is closing out 2021 in a position of strength, with ample financing available, brisk merger and acquisition activity, high and rising rents, and elevated asset levels, according to Evan Hudson, partner and real estate capital markets legal expert at Stroock. “The credit markets are incredibly active, they’re liquid, they’re deep,” Hudson said. He noted that in addition to common and preferred equity deals, largely through at-the-market (ATM) offerings, his firm is also seeing a high level of joint venture activity. Following a productive year for M&A deals in 2021, Hudson expects all property sectors to be active in 2022. “Even though we have price agreement (between buyer and seller) and the price is very high, a lot of deals are still happening.” He stressed that what is new in the current environment is the entrance of “colossal” non-traded REITs with hefty amounts of cash to deploy.
Fri, December 10, 2021
Episode 300: Economy on Sound Footing Entering 2022, Providing Solid Backdrop for REIT Performance
The economy will enter 2022 on a firm footing and should be able to withstand a variety of challenges that have emerged in recent months, providing a backdrop for continued solid REIT performance, says Nareit Senior Economist Calvin Schnure. Schnure noted that the economic mood has shifted over the last couple of months, reflecting the new Omicron COVID-19 variant, supply chain issues, price spikes, and labor shortages, among other issues. “Overall, though, the economy is quite sound. It has a lot of strength and should be able to handle these challenges pretty easily in the year ahead,” Schnure said, particularly since many of the current challenges are related to the pandemic and should ease as COVID cases come down. As for the hot topics of inflation and interest rates, Schnure pointed out that inflation is still very connected to short-term bottlenecks. “We’re going to see continued concern about inflation, which the Fed is going to be watching closely,” he said, with gradual increases in interest rates likely to begin around the middle of next year.
Wed, November 17, 2021
Episode 299: REIT M&A Boosted by Price Recovery, Attractive Financing, & Renewed Activist Pressure
Total REIT M&A activity through the third quarter of 2021 has already surpassed levels seen in 2019 and 2020, boosted by price recovery, attractive financing, and renewed pressure from activist investors, says Blake Liggio, partner in the real estate industry group of global law firm Goodwin. “Pricing for deals has improved coming out of the pricing troughs that we saw in many sectors during the pandemic… over the last two years it has been more challenging for boards to justify a sale of the company,” Liggio said. The current pace of deal volume, supported by low interest rates and attractive financing, is likely to remain intact through the end of the year, he added. The industrial, self-storage, data centers, multifamily, and life science sectors continued to see M&A activity from the end of 2019 and largely throughout 2020, Liggio said. In 2021, other sectors such as retail and office, have regained activity or begun to think about entering into a transactional strategic review.
Fri, November 05, 2021
Episode 298: Pebblebrook CEO Says Lodging Sector Showing a Varied Recovery Path
The hotel and lodging sector is showing a varied recovery, as it outperforms 2019 levels in some areas but struggles in others, according to Pebblebrook Hotel Trust (NYSE: PEB) Chairman, President, and CEO Jon Bortz. Speaking on Nareit’s REIT Report, Bortz noted that strength in the market has tended to be concentrated in resorts, particularly drive-to resorts, which are often achieving higher occupancy and rates than seen in 2019. The struggles, on the other hand, have mainly been in the urban environment, Bortz said. He noted that in San Francisco, Pebblebrook’s revenue is still down 80% from 2019 levels, while in Washington, D.C., revenue is down 70% over that same period. Bortz said signs of recovery in business travel are already evident, “but it’s a very slow recovery.” He said business transient travel appears to be about 40-50% back, while business group travel is about 30-40% back.
Tue, November 02, 2021
Episode 297: Real Estate Industry Must Tackle Carbon Reduction Collectively or Face Government Mandate
The real estate industry needs to collaborate and embrace technology as it works to reduce carbon emissions or else face having external mandates forced upon it, says Peter Gajdoš, a partner at venture capital firm Fifth Wall. Speaking on the Nareit REIT Report, Gajdoš, who co-leads Fifth Wall’s climate technology investment team, noted that although tackling carbon emissions will take decades, the real estate industry should see it not as a threat but as an opportunity to cooperate. “Let’s work together, let’s find solutions because otherwise I believe the sector will be mandated to fix the carbon problem and I’d rather see the sector proactively working on this and finding solutions ourselves rather than a top-down approach from the government,” Gajdoš said.
Wed, October 27, 2021
Episode 296: Prologis Addressing Heightened Need for Logistics Labor and Talent
Increased customer demand for logistics labor, combined with rising worker expectations around training and career opportunities, has led Prologis, Inc . (NYSE: PLD) to expand its logistics training program to six major logistics hubs, with plans to add programs in nine additional national markets by the end of 2021. Speaking on Nareit’s REIT Report, Steven Hussain, vice president of workforce programs and community relations at Prologis, explained that the REIT’s Community Workforce Initiative (CWI) training program launched in 2018 in response to conversations with Prologis’ largest customers that identified labor and talent as their number one pain point. At the same time, Prologis’ community partners were looking for “on ramps” to well-paid jobs for individuals they served. Since then, the labor market has become even more challenging, Hussain explained. “It’s incredibly competitive and incredibly challenging to recruit right now and worker concerns around COVID-19 persist and safety is top of mind. At the same time, worker expectations around ongoing education, training, and career paths are also rising, so there’s a lot that customers and employers are having to do to adjust to this new reality,” he said.
Fri, October 22, 2021
Episode 295: Farmland Real Estate Offers “Great Hedge” in Balanced Portfolios: Green Street
Farmland real estate is one of the nation’s largest commercial real estate sectors and its low risk and volatility profile makes it a “great hedge” within a balanced portfolio, says Pierre Rigaud, vice president, advisory and consulting, at Green Street. Speaking on the REIT Report, Rigaud noted that the farmland real estate sector is valued at $2-3 trillion. Institutional ownership in the sector is only about 1%, compared with 5-15% in most other real estate sectors. The two key crops in the sector are row crops and permanent crops, with row crops having a lower risk profile than permanent crops. Rigaud said farmland real estate and how it compares to other asset classes is not well understood by investors at this time. Some of the key attributes of farmland real estate include its lower obsolescence risk, lower fungibility risk, and lower capex burden. Population growth has outpaced the supply of arable land, Rigaud noted, resulting in land appreciation. As a result, “U.S. farmland has had a very strong track record of delivering relatively attractive returns over long holding periods.”
Tue, October 19, 2021
Episode 294: Real Estate Fundamentals, Supported by GDP and Job Growth, Look “Very Favorable”: Portfolio Manager
The landscape for real estate fundamentals looks “very favorable” going forward, supported by GDP and employment growth, according to Lowell Bolken, portfolio manager of the Securian AM Real Asset Income Fund and Real Estate Securities Fund. “We think employment will be strong as job openings are still above the actual unemployed population right now,” Bolken told Nareit’s REIT Report. He noted that in terms of REIT valuations, it’s a mixed picture. However, “we're very confident where the economy is going in terms of real estate and other sectors…growth is still in the offing.” Bolken, meanwhile, noted that while inflation might not last longer term, “it's less than transitory.” As a result, Securian is positioning itself for short term inflation by focusing on assets with shorter term leases such as apartments, self-storage, and hotels, while de-emphasizing the net lease sector.
Thu, October 14, 2021
Episode 293: REIT Veteran Jonathan Morris Offers Deep Dive into Industry with New REIT Academy Platform
Jonathan Morris, adjunct professor in Georgetown University’s Master’s of Real Estate program and a former REIT executive, believes the continued success and evolution of the REIT industry highlights the need to enhance the level of understanding of the REIT structure and what makes it work so well. Speaking on the REIT Report, Morris said he has launched a new education platform, REIT Academy, to fill the void in executive and professional development education in the REIT industry. The inaugural program spans eight weeks, comprised of one evening per week for three hours of live instruction, as well as guest speakers from the industry. Morris said the program will give a student “pretty much everything you need to know to be able to understand any given REIT and come to your own conclusions, using the tools that you'll learn here to assess how to value the company.”
Fri, October 08, 2021
Episode 292: Homeowners Should Broaden Investment Outlook to Include Commercial Real Estate
Investors who own their own homes may be taking a limited view of real estate investment, and in turn are missing out on the benefits of owning commercial real estate through REITs, according to Nicole Funari, Nareit vice president of research. Speaking on the REIT Report, Funari noted that oftentimes homeowners think they are already invested in real estate simply by owning their own home. While that is true, they also need to examine the differences between homeownership and owning commercial real estate, she said. “They think they are covered in their investment portfolio when we feel that, no, you really are missing out on the benefits of commercial real estate,” especially because a lot of homeowners don’t consider the breadth of commercial real estate asset classes, Funari said.
Mon, September 20, 2021
Episode 291: REITs Convincingly Outperform Private Equity Real Estate Funds, Research Finds
REITs have convincingly outperformed private equity real estate funds in head-to-head matchups over a 20-year sample period from the first quarter of 2000 to the fourth quarter of 2019, according to Tom Arnold, a visiting scholar at the University of Florida’s Warrington College of Business. Speaking with the REIT Report, Arnold highlighted the results of new research, sponsored by Nareit, that he carried out with fellow academics David Ling and Andy Naranjo at the University of Florida. Arnold explained that one of the main takeaways from the research is that even with no risk adjustments, 53% of the time investors would have been better off in the REIT index during the period that the private equity real estate fund was investing. The mean out-performance was 165 basis points, or 1.65 percentage points, per year. With a conservative investment for relative risk, REITs outperformed nearly 70% of the time, and their outperformance grew from 165 basis points per year to almost 600 basis points per year.
Tue, September 14, 2021
Episode 290: SPECIAL EPISODE: REITs Can Help Institutional Investors Gain Access to New Economy Property Sectors, Says Principal Real Estate Investors Portfolio Manager
REITs can help provide access to the new economy sectors—such as cell towers, data centers, and networked logistics properties—that complement the traditional real estate property types, according to Todd Kellenberger, client portfolio manager, real estate securities at Principal Real Estate Investors. Kellenberger noted that the idea of using REITs to gain access to these new economy sectors as part of a portfolio completion strategy has garnered increased attention from institutional investor clients recently. Kellenberger joined guest host Meredith Despins, Nareit’s senior vice president, investment affairs, for a special edition of The REIT Report podcast to discuss the role REITs can play in building a successful 21st century real estate investment portfolio.
Tue, September 07, 2021
Episode 289: Technology Changing Traditional Concepts of Industrial Real Estate
As technological innovation results in more efficient supply chain distribution, changes are also occurring in traditional concepts of industrial real estate and where it should be located, says Steve Weikal, lecturer, researcher, and the CRE Tech lead in the MIT Real Estate Innovation Lab. “Certainly what the industry thinks of as industrial real estate, or warehouse distribution real estate, has changed and will continue to change,” Weikal said on the REIT Report podcast. “If we are able to use technology to provide distribution more efficiently, more effectively, and in smaller spaces, which is very often the case, can we now do that in structures and in buildings that we hadn't considered before?” Weikal said. The proliferation of specialized data has enabled the industry to determine “the kinds of buildings that we need, the shapes, the sizes, and especially where they need to be located in order to make the global distribution system more efficient,” Weikal noted.
Mon, August 23, 2021
Episode 288: Korn Ferry Recruiter Sees “Unprecedented” Demand for Sustainability and ESG Talent
A global pandemic, major climate events, and a focus on social change have combined to create “unprecedented” demand for talent to fill sustainability and ESG positions, says Shelly Fust, co-leader for Korn Ferry’s global Sustainability and ESG Solutions Center of Expertise. Speaking on the REIT Report, Fust described sustainability and ESG as “a very big tent,” requiring talent from all sectors and all levels to fill the demand being created by this accelerating market. “There's so much momentum underway in this space. I believe truly that anyone who has the passion and interest in this sector can find a very rewarding career,” she added. Fust noted that corporate sustainability roles were really just being created about 15 years ago and were relatively thinly staffed at the top corporate level. “Many of those first chief sustainability executives are now preparing to retire. And as we're having to then magnify these roles across just about every organization, we’re finding that there's significantly more demand than there is talent,” Fust said.
Wed, August 18, 2021
Episode 287: Recovery in Leisure Travel Segment Continues in Face of COVID Variant Concerns
The recovery in the leisure travel sector continues, despite concerns over new COVID-19 variants, while a similar trend in the business travel segment is yet to emerge, according to Jim Sullivan, managing director and REIT analyst at BTIG. Speaking on the REIT Report, Sullivan said that as of mid-August, “we have not seen any material decline. Traffic volume is holding up pretty well in the face of the Delta variant concerns.” Sullivan said Transportation Security Administration (TSA) data point to a “pretty consistently high” level of comfort in traveling, particularly for the leisure traveler. Recovery in the business sector is going to occur later, however. One reason the leisure market is seeing strong demand is the new flexibility provided to travelers who are able to work remotely, Sullivan noted.
Mon, August 02, 2021
Episode 286: Conditions Healthy for Real Estate Investment, Global CIO Carly Tripp Says
Conditions remain healthy for real estate investment, with inflation expected to be transitory and any increase in long-term interest rates likely to be modest, according to Carly Tripp, global chief investment officer and head of Nuveen Real Estate Investments. Speaking on the REIT Report, Tripp said that although inflation had been felt in terms of cost fluctuations for building materials, Nuveen’s view is that inflation is transitory. “Overall, we’re not concerned at this point and continue to see a recovery across the board with some of these supply/demand imbalances expected to rectify over the next two or three quarters.” Tripp noted that interest rates remain “extremely attractive,” despite expectations of rate rises for the past decade. While the Federal Reserve has indicated it has no plans to increase short term rates anytime soon, long term rates, which are dependent on the market, are not posing a problem either, she added.
Thu, July 22, 2021
Episode 285: REIT M&A Activity Underscores Resiliency of Real Estate, Deloitte Says
Recent REIT M&A activity underscores the resiliency of the real estate sector and more transactions are likely this year as conditions remain favorable for continued deal-making, experts at Deloitte say. Lynn Kawaminami, partner at Deloitte Tax, and Nathan Florio, principal at Deloitte Transactions and Business Analytics, spoke to the REIT Report on July 20. “All the activity that we’ve seen this year has really underscored the resiliency of real estate…even the sectors that struggled last year are starting to come back,” Kawaminami said. “The fundamentals are good, and I think we’re ready to get back to normal.”
Tue, July 13, 2021
Episode 284: Mass Transit Reliance Playing Key Role in Office Re-Population
Reliance on mass transit is playing a key role in determining the pace at which office markets across the country re-populate, says Julie Whelan, head of occupier research for the Americas at CBRE. Speaking on the REIT Report, Whelan noted that Texas is currently experiencing probably the largest return to the office, despite vaccination rates in some parts of the state lagging the national average. Other markets, such as California and New York, have higher vaccination rates but are returning to the office more slowly because of mass transit dependance, she added. More focus needs to be placed on getting people comfortable on mass transit again and getting it back to normal schedules and routes. “It’s an essential piece of getting people back to work,” she said. Until that happens, “reduced ridership is really only going to sustain that reduced occupancy in buildings that we’re seeing.” Whelan said best estimates point to current office occupancy at only a third of what was considered normal pre-pandemic. That is expected to change in the fall, however, as “the leisure of summer is going to abate and we’re going to get back into that normal routine.”
Wed, July 07, 2021
Episode 283: Real Estate Deal Activity Accelerating in Sectors with Strong Macro Tailwinds
Real estate deal activity is accelerating in sectors with strong macro tailwinds, along with increased confidence in the public markets toward valuations, according to Tim Bodner, partner and U.S. real estate deals leader at PwC. Speaking on the REIT Report, Bodner said property sectors including logistics, multifamily, and life science have all seen increased deal flow. Office assets located in technology-oriented cities have also seen increased activity, while the leisure and hospitality sectors have also experienced a rise in transactions. “There continues to be an incredible amount of capital on the sidelines” on both the debt and equity side, Bodner said. He also pointed to an “incredible amount” of capital being raised by public non-listed REITs, which topped $3 billion in May.
Mon, June 28, 2021
Episode 282: U.S. REITs Have Moved Past COVID “Very Distinctly”: Green Street
Fundamentals for U.S. REITs have moved beyond COVID-19 “very distinctly,” with market rent growth, occupancy gains, and cash flow rebound evident across a range of sectors within the industry, according to Cedrik Lachance, director of global REIT research at Green Street. Lachance, who assumes his new role as Green Street’s director of research on July 1st, spoke on the REIT Report. From a GDP perspective, 2021 is a “year of rebound,” Lachance said. He noted that manufactured homes and industrial real estate are two sectors that Green Street believes will have the best combination of market rent growth and occupancy gains over the next five years. From a cash flow perspective, a significant rebound is also occurring in sectors that were negatively affected during the pandemic, including senior housing and lodging, Lachance said. At the same time, he pointed to “very attractive sustainable growth” for the next few years in sectors such as apartments and student housing. A number of other sectors should experience net operating income (NOI) growth in the 4-5% range for the next couple of years, he said. Turning to M&A activity, Lachance noted that, particularly in the public markets, deals have tended to occur between companies with a disparity in the cost of capital. Those deals “make a ton of sense,” he said. Going forward, M&A activity is most likely to occur between companies that have notable similarities but a relative difference in their cost of capital, he noted. As for the future of office, Lachance said that Green Street views work from home “as really the defining story of the real estate world in the pandemic,” and one where the influence extends to a range of other real estate sectors including residential, hotels, and suburban shopping centers. Lachance said the lack of clarity into the future of the office sector will likely last for another 12 months, but “when it’s all said and done, you’ll have about a 15% drop in office demand.” Lachance also commented on trends in European real estate, including the growth of non-traditional sectors. As for broader trends, he noted that Green Street firmly believes that public markets will remain an area of growth for REITs. Lachance also commented on the inflation hedge benefits of real estate.
Mon, June 07, 2021
Episode 281: High-Quality New York Office Real Estate Assets Continuing to Attract Investment
High-quality office real estate in New York continued to attract investor interest throughout the pandemic, and the office market overall is “certainly improving,” according to Nadir Settles, head of New York office investment at Nuveen Real Estate. Speaking on the REIT Report, Settles noted that while there hasn’t been a lot of price discovery during the past year, the few transactions that did occur, notably for high-quality assets, did well. “Investors showed that they are willing to come to New York for the right product, even if it was office,” he said. Settles said the New York office market has seen about a 10% drop in rents, “which is not bad for where we thought we were going.” Tenant improvements have increased substantially, while concessions have been made to attract tenants, he noted. Tenants are ready to commit quicker on turnkey space, he said, but they also want flexibility on how the deal is structured.
Thu, May 27, 2021
Episode 280: SPECIAL EPISODE: Robert L. Johnson Shares His Philosophy on Leadership in Business and the Black Community
In a REIT Report podcast interview, Robert L. Johnson discusses his early career, his business strategy, and his insights regarding race in America. Johnson is the founder and chairman of The RLJ Companies, LLC, which sponsored the formation of RLJ Lodging Trust (NYSE: RLJ), and the founder of Black Entertainment Television (BET). During the interview with Nathaalie Carey, Nareit senior vice president for industry affairs and social responsibility, Johnson discusses his coming of age at a time when the United States was “opening doors to Black Americans,” and his underlying belief that “you have an obligation to live up to the tenets of society to make the whole community better."
Wed, May 26, 2021
Episode 279: REIT ESG Data Improving in Quantity and Quality, But Standardization Issues Remain
REIT industry ESG data continues to improve both in quality and quantity, yet the lack of standardization remains a challenge, according to Bradford Stoesser, senior managing director and global industry analyst at Wellington Management. In a REIT Report interview, Stoesser said REIT ESG data is “markedly better than even just a few years ago.” “We are starting to see a proliferation of data providers and while more ESG data is a positive, quality and standardization are important, allowing for effective comparisons,” Stoesser said. He noted that companies largely self-report, meaning that transparency is often lacking. Data providers, meanwhile, measure ESG differently and often are not clear in terms of the specific subcategories of E, S and G, and how they are measured, Stoesser explained. “The risk is that investors end up with very different impressions of a corporate’s ESG (information) based on the data they source,” he said.
Fri, April 23, 2021
Episode 278: Industry Experts Publish First Academically-Focused Textbook on REIT Investment
The authors of a new book on REITs and real estate investment, Educated REIT Investing, say it is the first of its kind to target academic institutions, while still being concise enough to attract a general audience. The book is co-authored by Stephanie Krewson-Kelly, vice president of investor relations at Corporate Office Educated REIT InvestingProperties Trust (NYSE: OFC), and Glenn Mueller, a professor at the University of Denver’s Franklin L. Burns School of Real Estate and Construction Management, and a real estate investment strategist at Black Creek Group. The book updates Krewson-Kelly’s 2016 book, The Intelligent REIT Investor, and includes new chapters by Mueller. Nareit Senior Economist Calvin Schnure and Merrie Frankel, president of Minerva Realty Consultants, also contributed to the book.
Fri, April 16, 2021
Episode 277: Safehold CEO Says Strong Rent Coverage, New Credit Ratings Position REIT for Growth
With 100% of its ground lease rents paid in 2020 and newly-received investment grade credit ratings, Safehold Inc. (NYSE: SAFE) Chairman and CEO Jay Sugarman says the REIT is “really well positioned to keep growing.” Speaking on the REIT Report, Sugarman noted that despite the challenges of 2020, “last year actually proved how strong the business is.” Meanwhile, new ratings from Moody’s Investors Services and Fitch Ratings “will be a pretty major competitive advantage,” he added. Sugarman noted that when it comes to selecting particular property types, “our mission is to go where the best markets and land is.” Multifamily has been a “great story so far,” and represents about 25% of the portfolio, he said. “I imagine we’ll be in all property types in the top 30 markets in the next year or so.”
Fri, March 19, 2021
Episode 276: Clubhouse Emerging as New Social Media Platform for Real Estate Sector Education & Networking
Social media site Clubhouse is emerging as a new and innovative way to facilitate education about commercial real estate and to provide networking opportunities for individuals across the industry, according to David Auerbach, an institutional trader at World Equity Group, Inc. Clubhouse is an invitation-only iPhone social media app launched in 2020 that enables users to join live audio discussions on a range of topics hosted in ‘rooms’ on the Clubhouse platform. Participants can enter the various rooms as an audience member and can join the conversation by digitally raising their hand to the host. Speaking on the REIT Report, Auerbach discussed his own involvement with Clubhouse, which includes hosting daily discussions on a variety of REIT and real estate-related topics with his partner, Yoni Miller.
Mon, March 15, 2021
Episode 275: REIT Recovery From the Worst of the Pandemic Underway, Nareit T-Tracker Shows
Nareit’s T-Tracker fourth quarter 2020 data indicate that the REIT industry is recovering from its weakest levels seen during the pandemic. Speaking on the REIT Report, Nareit Senior Economist Calvin Schnure said the REIT industry is “showing a good continuing recovery, not a complete recovery, but a recovery from the worst part of the pandemic a year ago.” According to the T-Tracker, funds from operations (FFO) of all equity REITs gained 11.3% in the fourth quarter from the third quarter, which itself was 10.3% higher than the second quarter. The recovery is not uniform, Schnure pointed out. Earnings for sectors at the front line of the shutdown, such as lodging and retail, continue to be quite weak. Other sectors have benefitted, namely those that support the digital economy, as well as industrial.
Fri, March 12, 2021
Episode 274: TIGER 21 Founder Says Performance Differences Across Real Estate Have Never Been Greater
Differences in how real estate sectors perform have never been as “profound” as they are today, according to Michael Sonnenfeldt, founder and chairman of TIGER 21, a peer membership organization of high net worth current and former entrepreneurs, investors, and top executives. TIGER 21 members collectively manage personal assets of over $85 billion. Speaking on the REIT Report, Sonnenfeldt described the current situation in real estate as a “tale of two cities,” with retail “in a difficult strait” and industrial “on fire.” Sonnenfeldt explained that real estate has been the number one asset allocation for TIGER 21 members since the group was founded in 1999—and is likely to stay that way. Currently, real estate accounts for 27% of TIGER 21 portfolios and is favored by members due to its unique benefits and member expertise in the field, he said.
Mon, March 08, 2021
Episode 273: SPECIAL EPISODE: Pension Consultant Sees Growing Interest in Portfolio Completion Strategies Using REITs
Matt Ritter, senior research consultant for NEPC, joined guest host Meredith Despins, Nareit senior vice president, investment affairs, for a special edition of The REIT Report podcast to discuss how REIT-based investment can deliver access to a 21st century real estate portfolio. NEPC is an independent investment consultant and private wealth advisor. Its clients—including public pensions, corporate pensions, endowments, foundations, health care groups, and private wealth—collectively represent approximately $1.1 trillion in total assets. Ritter is a member of NEPC’s Real Assets Research Group and the Portfolio Construction Lead for the Real Assets Beta Group. Speaking to the challenges clients are facing in their real estate portfolios today, Ritter noted that many clients—particularly those with net outflows—are seeking durable income and are asking “what’s the future of my existing portfolio going to look like?” Historically, many institutional investors have accessed real estate through private markets, which focuses on the four main property types: Office, Apartments, Retail, and Industrial. “We’re seeing a pretty wide range of returns and expectation by property type. This was a trend that was evident prior to the pandemic, but has really accelerated over the past year,” he observed.
Fri, March 05, 2021
Episode 272: Data Centers in Leadership Position on Climate Change
The data center industry holds a leadership position on climate change issues as technological advances create greater efficiencies while economies of scale result in a lower energy profile, according to Kyle Myers, senior director of environmental health, safety, and sustainability at CyrusOne, Inc. (Nasdaq: CONE). Speaking on the REIT Report, Myers pointed to estimates that 1-3% of the entire power consumed on earth is consumed within data centers. CyrusOne has set a goal of reaching zero carbon emissions by 2040 across the organization. Myers said innovation on the design side is “super important,” while CyrusOne is also looking at existing efficiencies across the portfolio, such as infrastructure and operational improvements.
Mon, March 01, 2021
Episode 271: SPECIAL EPISODE: Past Segregation Policies Continue to Weigh on Black Community Today, Author Says
Past racially-explicit policies by federal, state, and local governments—especially those concerning housing—imposed a level of segregation on the United States that was so powerful it still determines the racial landscape of today, according to Richard Rothstein, author of The Color of Law: A Forgotten History of How Our Government Segregated America. Rothstein is also a distinguished fellow of the Economic Policy Institute and a senior fellow (emeritus) at the Thurgood Marshall Institute of the NAACP Legal Defense Fund. In a wide-ranging conversation with Nathaalie Carey, Nareit senior vice president for industry affairs and social responsibility, Rothstein pointed to the government’s deliberate move after World War II to create white suburban communities across the country as a key factor in preventing the accumulation of wealth and advancement of the African American population.
Mon, February 15, 2021
Episode 270: REITs Expected to Take Keener Interest in SPAC Structure Going Forward
Following a breakout year for special purpose acquisition companies (SPACs) in 2020, activity is forecast to remain brisk in 2021, with REITs expected to take a keener interest in the structure, according to Jocelyn Arel and Audrey Leigh, partners at Goodwin. SPACs are a pool of capital formed through an initial public offering (IPO). SPAC sponsors go through the traditional IPO process, complete with Securities and Exchange Commission (SEC) review and roadshows, Arel, a partner in the firm’s Technology Companies practice and leader of the firm’s SPAC practice, explained. The capital is then placed into trust and is available to combine with an operating company and fund that company’s IPO, referred to as the SPAC-IPO. “People are looking at the structure as an efficient way to take companies public and as an alternative to the traditional IPO or direct listings. In essence it’s really giving companies optionality in terms of how they want to approach the market,” Arel said.
Mon, February 01, 2021
Episode 269: GDP in Q4 Highlights Pandemic’s Continued Impact on Services Sector
Fourth quarter GDP data released by the Bureau of Economic Analysis underscores the continued pressure facing the services sector, although a surge in spending is likely once vaccines bring the pandemic under control, Nareit Senior Economist Calvin Schnure says. Speaking on the REIT Report, Schnure noted that GDP growth in the fourth quarter of 2020 slowed to a 4.0% annual rate after a record 33% in the third quarter. Some slowing was inevitable, Schnure said. He noted that a large divergence remains in place between the services and goods sectors, with the decline in services spending accounting for almost all of the decline in fourth quarter GDP compared to before the pandemic.
Fri, January 22, 2021
Episode 268: Recovery for Economy and Commercial Real Estate Backloaded to Second Half of 2021
While an economic recovery is expected to take hold, benefitting commercial real estate in its wake, any significant improvement is likely to occur starting in the second half of 2021, according to Nareit Senior Economist Calvin Schnure. Speaking on the REIT report, Schnure highlighted some of the key themes of Nareit’s 2021 Outlook for REITs and Commercial Real Estate. Schnure noted that “we’re going to see some strengthening of the economic recovery and that’s going to benefit the commercial real estate markets quite a bit.” However, the improvement will really be driven by vaccines bringing the pandemic under control, which is not expected before the second half.
Tue, January 19, 2021
Episode 267: INDUS Realty CEO Sees Growing Demand as Supply Chains Adjust and Economy Continues to Grow
INDUS Realty Trust, Inc. (Nasdaq: INDT) President and CEO Michael Gamzon says the REIT’s focus on logistics real estate in high growth, supply-constrained markets with multiple drivers of demand positions the company well to respond to changes in supply chain strategies. INDUS recently elected REIT status and changed its name from Griffin Industrial Realty. Speaking on the REIT Report, Gamzon said the company chose to convert to a REIT in part because it “aligned with the business we’re in,” as well as allowing INDUS to seek out capital in order to be an active developer and acquirer of assets. INDUS’ core markets are: Hartford, Connecticut; Lehigh Valley, Pennsylvania; Orlando; and Charlotte, North Carolina. Gamzon described Lehigh Valley as “one of the best performing markets in the country.”
Thu, January 07, 2021
Episode 266: Nareit Leader in the Light Awards Demonstrate How REITs Stepped Up to Face Pandemic Challenges
Nareit’s 2020 Leader in the Light Awards highlighted a strong field of companies that have worked hard during the pandemic to put their tenants’ needs first, while also reducing their energy, water, and waste output, according to Cliff Majersik, senior advisor for policy and programs at the Institute for Market Transformation. Majersik served as a judge for the 2020 Leader in the Light Awards. He noted that REITs have put a premium on making their buildings comfortable, productive, desirable, and above all—safe for their tenants.
Thu, December 17, 2020
Episode 265: Prologis Sees Increased Automation Helping to Create More Resilient Supply Chains
The increased adoption of automation technology within logistics real estate will help ease the shift toward more resilient, just-in-case supply chains, according to Melinda McLaughlin, vice president and global head of research at Prologis, Inc. (NYSE: PLD). Speaking on the REIT Report, McLaughlin said the shift in supply chain format will put an intense strain on the amount of available supply of property. “Automation can help customers adapt to that and incorporate that move to more resilient supply chains, without necessarily being limited by the amount of labor or logistics real estate out in the market,” she said. McLaughlin noted that the level of automation adoption in logistics real estate is increasing but is lower than most people think. Only about 20% of warehouse facilities incorporate more advanced types of automation, and that’s highly concentrated toward e-commerce facilities due to their labor intensity, she said.
Thu, December 10, 2020
Episode 264: New Howard Hughes CEO Sees “Unparalleled Opportunity” to Drive NAV Growth
David O’Reilly, CEO of The Howard Hughes Corporation (NYSE: HHC), said the REIT has an “unparalleled opportunity” to continue to drive net asset value (NAV) growth over the next several years and decades. O’Reilly was named CEO at the start of December, after serving in that position on an interim basis since September. Speaking on the REIT Report, O’Reilly attributed the growth potential to increased demand for mixed-use live, work, play communities, coupled with over $1 billion of liquidity on the company’s balance sheet.
Mon, December 07, 2020
Episode 263: Recent Real Estate Valuations Point to More Confidence in Recovery Next Year
Recent news on commercial real estate valuations reflect growing confidence that the sector will start to recover in 2021, said Nareit Senior Economist Calvin Schnure. Speaking Dec. 7 on the REIT Report, Schnure noted that valuations appear to be more stable than they appeared a few months ago, when the sales prices of properties that were being sold showed a big discount. Volumes at that time were light, though. “As we get a better look at the market, the valuations reflect a bit more confidence that the real estate markets will recover next year,” Schnure said. Overall, Schnure noted that real estate is holding up quite well in the current environment, with rent collections recovering as businesses open up, “but obviously there are still strains.” Turning to the broader economy, Schnure noted that while it appears to be slowing, “we’re not at risk of a stall.”
Tue, December 01, 2020
Episode 262: How the City of Austin’s Pension Plan Implemented a Portfolio Completion Strategy Using REITs
David Veal, chief investment officer for the City of Austin Employee’s Retirement System (COAERS), joined guest host Meredith Despins, Nareit senior vice president, investment affairs, for a special edition of the REIT Report to discuss how investing in a completion portfolio using REITs is delivering value to the pension system’s real estate investment portfolio. Pension funds have long recognized the important role real estate plays in diversified investment portfolios. However, over the past 20 years, the real estate economy has expanded beyond the property sectors institutional investors have traditionally invested in—like retail, office, residential, or industrial. Today’s REIT industry reflects that evolution and offers investors access to a diversity of property types, including the new economy property sectors like infrastructure, cell towers, data centers, and networked logistics properties that house the growing digital economy. This rise of 21st century real estate has prompted institutional investors—such as COAERS—to adopt a portfolio completion strategy. A portfolio completion strategy is a tool investors have to invest in property sectors, including new economy sectors, that complement the traditional real estate property types in order to achieve more robust diversification, boost portfolio investment returns, and dampen volatility.
Mon, November 23, 2020
Episode 261: STORE Capital’s Mary Fedewa Says Net Lease REIT has Just Begun to Tap Potential Growth Opportunities
STORE Capital Corp. (NYSE: STOR) President and COO Mary Fedewa says that after six years as a public company, the net lease REIT has “barely scratched the surface” in terms of tapping potential opportunities for growth. Speaking on the REIT Report, Fedewa said STORE continues to see trends “driving more net lease activity, as companies recognize the benefit of using their own capital to grow their business rather than to hold real estate.” Fedewa said that with over 200,000 companies within its target market, STORE sees plenty of runway for growth. “Opportunity is so large that it allows us to be highly selective and to focus on investment opportunities that are accretive to our shareholders, regardless of market conditions,” she noted.
Mon, November 16, 2020
Vaccine Optimism Pushes REITs to Highest Levels Since Start of Pandemic
REIT share prices, buoyed by positive developments with regard to progress on a COVID-19 vaccine, ended last week at their highest levels since the start of the pandemic, according to Nareit Senior Economist Calvin Schnure. Speaking Nov. 16 on the REIT Report, Schnure noted that news that Pfizer trials showed a success rate of 90% sent REITs sharply higher, especially for those sectors most impacted by the pandemic. Lodging and resort REITs were up 31% on Nov. 9 alone, while retail REITs were up nearly 20%. REITs closed out the week at the highest Friday close since March 6.
Fri, November 13, 2020
DLA Piper Survey Cites Capital Looking to Invest in Real Estate as Reason for Optimism
The DLA Piper annual survey of real estate executives cites the availability of capital looking to invest in commercial real estate as a reason for optimism in the current environment. Speaking on the REIT Report, John Sullivan, U.S. chair and global co-chair of DLA Piper’s real estate practice, said “the fact that there are folks out there with money to invest—and actually we’re seeing some increases now in investment—is a reason for some optimism.” The survey showed 58% of respondents citing an abundance of available investment capital as the top reason for an optimistic economic outlook, an increase of 15 percentage points from the 2019 survey. Sullivan pointed to recent estimates of around $400 billion in available institutional capital looking to invest in commercial real estate.
Thu, November 05, 2020
Gaming REITs Likely to See Increased Downside Protection from Growth in iGaming
Gaming REITs whose tenants are investing in online gaming (iGaming) platforms are expected to benefit from increased downside protection, according to Spenser Allaway, an analyst on Green Street’s research team and sector head of net lease, gaming, and self-storage. Speaking on the REIT Report, Allaway said downside protection for the gaming REITs will be in the form of improved underlying tenant credit. The three primary gaming REIT tenants are: Penn National Gaming, a tenant of Gaming and Leisure Properties, Inc. (Nasdaq: GLPI); Caesars Entertainment, the operator for VICI Properties Inc. (NYSE: VICI); and MGM Resorts, a key tenant of MGM Growth Properties LLC (NYSE: MGP). “All of these tenants have made sizeable investments to establish an online presence,” Allaway said.
Mon, November 02, 2020
GDP Surges in Q3, But Still Below Year-Earlier
Third-quarter GDP posted the biggest increase in history as it rebounded from a record decline in the Spring, yet it still remains below levels seen a year earlier, indicating that further improvement is needed, said Nareit Senior Economist Calvin Schnure. Speaking on the REIT Report, Schnure noted that even after the 33% increase, third quarter GDP is “still down by as much as you might see in a typical recession, so we still have a ways to go.” As for which areas showed growth, Schnure pointed to spending on goods, particularly items that can be used at home. In fact, total durable goods spending is 12.7% higher than a year earlier, Schnure said.
Mon, October 19, 2020
Retail Sales Figures Point to Potentially Robust Holiday Sales Season
Retail sales figures for September came in stronger than expected, laying the groundwork for a potentially robust holiday sales season this year, according to Nareit Senior Economist Calvin Schnure. September retail sales jumped nearly 2%, which was stronger than expected. “The economy’s not as weak as some people may have feared a month or two ago,” Schnure said. Nearly all categories of spending are running at about 5% above pre-pandemic levels, although a few notable exceptions include gasoline, restaurants, and clothing and accessories, Schnure said. The overall gains mean that “we could well see a surprisingly robust holiday sales season,” he noted.
Fri, October 16, 2020
REIT Market Volatility Creating Potential for Opportunistic Investment
Current volatility within the REIT market is creating the potential for opportunistic investment, particularly among well-capitalized companies with seasoned management teams, said Jay Olander, managing partner of Cornerstone Realty Advisors. Olander has served in senior REIT management positions for over 25 years. Most recently, he oversaw the $1.9 billion sale in 2016 of Landmark Apartment Trust, Inc., an apartment REIT. Speaking on the REIT Report, Olander compared current market conditions to those of previous cycles, concluding that “over time, we do expect that the investment market will return, just as we’ve seen in the past.”
Mon, October 05, 2020
September Jobs Report Raises Concerns Over Pace of Economic Recovery
A slowing of payroll employment in September raises concerns over the pace of the economic recovery in the months ahead, Nareit Senior Economist Calvin Schnure said. Speaking Oct. 5 on the REIT Report, Schnure noted that despite the 661,000 rise in payroll employment in September, “the report had more warning signs than good news.” The increase came in below market expectations, and while the unemployment rate dropped to 7.9%, a big part of that was because people stopped looking for jobs—especially women and minorities.
Mon, September 28, 2020
Nareit Rent Collection Surveys from Past Half-Year Highlight Resiliency of REITs During Crisis
The biggest story to emerge from the past six months has been the bounce-back in certain retail sectors. Funari noted that rent collection for free standing retail started out at 73% and by September was almost at 95% of typical rent collected. Shopping centers started the pandemic at slightly over 50% and were at 82% of typical rent collection by September, she noted. Nareit decided to end its regularly scheduled rent collection survey this month, Funari explained, because most property sectors had stabilized by July and the remaining sectors seemed to be heading in that direction through September. Furthermore, rent collection is only one piece of REIT operations, Funari said. “It says a lot about tenant health, which was useful information, especially early in the pandemic, but as we’ve stabilized over time, we’re just not learning new information about the REITs themselves.”
Fri, September 25, 2020
Flexibility is Key to Future-Proof Commercial Real Estate for the Next Decade
The commercial real estate industry should use the current environment as a catalyst to future-proof assets for the changing ways in which they will be used over the coming decade, according to Nikki Greenberg, founder and CEO of Real Estate of the Future. Speaking on the REIT Report, Greenberg noted that while the ways we live and work have rapidly changed, the spaces we occupy have not. “We really need to use this as an opportunity to become future ready as we look toward 2030,” she said. “Across the board, all sectors do need to do better,” Greenberg said. She stressed the importance of “a different way of thinking” that looks at the full scope of challenges ahead. “You have to have people in the room who don’t think like you…the traditional way of working and owning and operating space, that’s not going to serve us in the short term and it’s not going to serve us very well in the longer term either,” she said.
Mon, September 14, 2020
Economic News Pointing to Ongoing Broad Recovery
Most of the current economic news is pointing to an ongoing recovery, including for commercial real estate fundamentals, according to Nareit Senior Economist Calvin Schnure. Speaking Sept. 14th on the Nareit REIT Report, Schnure noted that August retail sales data, to be reported on Wednesday, are expected to show a 1% increase. “Most aspects of retail sales actually are above pre-pandemic levels,” he said. At the same time, the Job Openings and Labor Turnover Survey (JOLTS) showed that job openings rose 10% in July and are getting close to the range they were in late last year, Schnure said. Layoffs, meanwhile, have been below pre-pandemic rates during May, June, and July.
Thu, September 10, 2020
Nuveen Chief Investment Officer Sees Widening Spread Between Property Sectors in Second Half
Against a backdrop of overall positive economic momentum, the performance gap between property sectors is likely to expand during the second half of the year, according to Carly Tripp, chief investment officer for the Americas at Nuveen Real Estate. Speaking on the REIT Report, Tripp also discussed how to ideally go about positioning a portfolio amidst the current level of uncertainty. “It’s really important to be disciplined and patient during times of uncertainty in order to not sacrifice long-term results or short-term gains,” Tripp said.
Tue, September 08, 2020
August Jobs Report Shows Economic Recovery Still on Track
August employment data released last week shows that the economic recovery remains on track, despite worries about a potential rebound in the coronavirus, according to Nareit Senior Economist Calvin Schnure. Employers hired back more than a million workers last month, with total payroll employment rising by 1.4 million. This number did include temporary workers hired for the Census, Schnure pointed out, but private payrolls were also up 1 million. The unemployment rate also dropped more than expected, to 8.4%. At the same time, total employment is 11.5 million below where it was in February, Schnure noted, and less than half of the February to April decline in employment has been reversed at this point.
Thu, September 03, 2020
Cedar Realty Trust COO Sees Long-Term Appeal of Urban Gathering Places
The appeal of attractive urban gathering places has remained intact throughout the coronavirus crisis, despite reports of preferences shifting toward less dense, suburban locations, says Robin Zeigler, EVP and COO at Cedar Realty Trust, Inc. (NYSE: CDR). “One of the things we’ve seen during this period is that people do still have a desire to gather and to be in certain types of environments. The desire to have outdoor dining, the desire to go to a bar is still evident…people want good urban gathering places,” Zeigler told the REIT Report. Cedar Realty owns a portfolio of predominantly grocery-anchored shopping centers in high-density urban markets from Washington, D.C. to Boston.
Mon, August 31, 2020
Continued Signs of Economic Resilience Providing Firm Backdrop for Commercial Real Estate
Continued signs of resilience in the economy, even as the coronavirus remains active, point to a positive environment for commercial real estate going forward, according to Nareit Senior Economist Calvin Schnure. Speaking Aug. 31 on the REIT Report, Schnure noted that new home sales in July rose to their highest level since 2006. Durable goods orders rose more than expected, and industrial production and business investment are on track to return to pre-pandemic levels, he added. Consumer spending also rose nearly 2% in July.
Fri, August 28, 2020
Brookfield Portfolio Manager Says Trends Triggered by Coronavirus May Not Be Permanent
While COVID-19 has created short-term disruption and altered business and leisure routines, trends prevalent today may not necessarily remain in place for the longer term, according to Bernhard Krieg, managing director and portfolio manager on the real estate equities team for Brookfield’s Public Securities Group. Krieg noted that a valuation shift between growth and value-oriented stocks was already evident before the pandemic and has diverged further since then. However, “to a certain degree these trends are not permanent, in our view,” he said. “It’s easy sometimes to extrapolate the most recent trends and think they will not change materially…It’s our view that we are going to revert back to normal and investing globally gives us some important perspective on some of the markets where the pandemic has subsided,” Krieg said.
Mon, August 24, 2020
REIT Operating Performance Points to Upside Potential in the Year Ahead
The economy continues to experience a high degree of uncertainty, but operating performance across the REIT industry indicates that there could be some upside potential in the year ahead, said Nareit Senior Economist Calvin Schnure. On the economic front, positive figures for housing starts, existing home sales, and the homebuilders’ survey have been tempered by high jobless claims, soaring mortgage delinquencies, and a wave of bankruptcies. “The bottom line right now is that the economy is struggling to get back on its feet. It’s making some progress, but it’s going to continue to struggle so long as the COVID-19 virus remains uncontained,” Schnure said.
Thu, August 20, 2020
VICI Properties “Back on the Offensive,” CEO Says
After spending much of the second quarter in a defensive mode, VICI Properties Inc. (NYSE: VICI) is now actively looking for ways to opportunistically deploy capital, says CEO Ed Pitoniak. Speaking on the Nareit REIT Report, Pitoniak said that once VICI began to receive signals that its assets, particularly those in regional markets, were going to reopen strongly following COVID-19 shutdowns, “we felt confident enough to go back on the offensive.” In mid-June, VICI announced it had agreed to provide a $400 million mortgage loan secured by the Caesars Forum Convention Center in Las Vegas and had also agreed to acquire approximately 23 acres of undeveloped land parcels adjacent to the center of the Las Vegas Strip for approximately $103.5 million.
Mon, August 17, 2020
Retail Sales Continued to Rebound in July, Supporting Retail REITs
Retail sales data for July point to a resumption in consumer spending, providing a boost for the retail REIT sector that has been under pressure throughout the coronavirus crisis, according to Nareit Senior Economist Calvin Schnure. Retail sales rose 1.2% in July. While the increase was slower than that seen in the previous two months, sales rose to a level that was higher than before the crisis. Schnure noted that this is the fastest in history that retail sales have ever fully reversed the decline that occurred during a recession. “This is good news for the retail REITs in the months ahead, that we’re seeing the retail spending coming back,” he said.
Thu, August 13, 2020
Boston, San Diego, San Francisco Continue to Top Life Science Venture Capital Investment
Boston, San Diego, and San Francisco continue to attract the lion’s share of life science venture capital investment, but strong industry tailwinds are raising the prospects for a number of other markets across the nation, according to Audrey Symes, director of research for healthcare, life sciences, and advisory at JLL. Speaking on the REIT Report, Symes noted that even before the coronavirus crisis, the life science sector was at a point where many years of research and development were starting to bear fruit, including less expensive and more accessible gene mapping and personalized medicine. “Life science was on an upswing, regardless,” Symes said, with venture capital inflows into the sector reaching a peak. “The stimulation from Operation Warp Speed and biomedical advanced research and development authority from the federal government is just adding fuel to the fire,” she said.
Mon, August 10, 2020
Latest Economic News Mostly Positive, But Highlights Need for Additional Stimulus Measures
Economic reports released in the past week were mostly positive, but with millions still unemployed and benefits expiring, the need for additional stimulus measures remains, according to Nareit Senior Economist Calvin Schnure. Speaking Aug. 10 on the REIT Report, Schnure said economic data reported last week “helps dispel some of the fears that the recovery stalled last month” due to the continued spread of the coronavirus. Schnure noted that the ISM survey on manufacturing rose to 54.2, stronger than expected and above the 50 mark that indicates a growing sector. Motor vehicle sales were at a 14.5 million unit pace last month, also above expectations. “Consumers are coming back as the economy reopens,” he said.
Fri, August 07, 2020
Duke Realty Executives Reflect on Lessons Learned on the ESG Journey
Executives from Duke Realty Corp. (NYSE: DRE), a leader in corporate responsibility matters, joined a special edition of the REIT Report on August 5 to share their observations and advice on initiating and growing a vibrant ESG strategy that is embraced at all levels of the company. In conjunction with Nareit’s multimedia series ESG Exchange, Nareit Executive Vice President and General Counsel Cathy Barré spoke with Ann Dee, executive vice president and general counsel, and Megan Basore, vice president of corporate responsibility. Dee played a key role in the evolution of the ESG function at Duke Realty, serving in 2015 as the executive liaison of a cross-functional group of leaders looking at how to move forward on ESG matters. This led to the creation of a cross-functional corporate responsibility council.
Mon, August 03, 2020
Record Decline in GDP was Concentrated in a Few Areas, Bolstering Outlook for Recovery
Declines in second quarter GDP were concentrated in a few front-line sectors, making it more likely that the economy can begin to recover by the second half of this year or the first half of 2021, according to Nareit Senior Economist Calvin Schnure. Second quarter GDP data released last week showed an annualized decline of 32.9%, which was in line with expectations. Schnure noted that the decline was front-loaded, as shutdowns had the biggest impact in April. Since then, there has been a relatively robust rebound as the economy began reopening, although he warned that some slippage of gains could occur if COVID-19 puts the reopening on hold.
Fri, July 31, 2020
Real Estate Deal Activity Falls in First Half; Recovery Possible by Q4: PwC
The total value and volume of real estate deals across all property sectors declined in the first half of the year compared to the previous six months, but activity is expected to recover by the fourth quarter, according to Tim Bodner, partner and U.S. real estate deals leader at PwC. PwC recently released its mid-year review of real estate deal activity that showed almost a 50% decline in deal value and volume in the first half of 2020 compared with the second half of 2019. While the declines occurred across the board, Bodner noted that on a six-month basis, logistics was the only sector that experienced a year-over-year increase. In the first half of 2020, about $42 billion of logistics activity occurred versus $34 billion in the first half of 2019, he noted.
Thu, July 30, 2020
Innovation in Office Sector Only Going to Accelerate Post-COVID
The innovation trend that emerged in the office sector prior to the coronavirus is only going to accelerate as organizations adapt to changes in how workplaces operate in a post-pandemic environment, according to Julie Whelan, head of occupier research for the Americas at CBRE. Whelan told the REIT Report July 24 that innovation will be accelerated in large part by the success of the remote work model during the crisis. “The office is now becoming just one place among a network of locations where work gets done, so of course the role of it is going to accordingly change,” she said. Prior to COVID, organizations were moving to models that were less hierarchical, less routine- driven, and more project-driven—all of which requires collaboration, Whelan said. Going forward, the conflict between the need for collaboration and increased remote working will spur innovation in terms of the tools and technology that are used every day, and how physical workspaces tie the physical and digital together to drive seamless interaction, she noted.
Mon, July 27, 2020
Housing Data Point to Economy’s Underlying Strength, Assuming Continued Reopening
The economy continued to rebound in June, according to housing market data released last week, although the outlook depends on the reopening continuing on its current path—an open question at this point, Nareit Senior Economist Calvin Schnure said. Speaking July 27 on the Nareit REIT Report, Schnure highlighted the jump in new and existing June home sales, with new home sales actually higher than they were a year ago. He said this suggests that the underlying economic demand “is intact as long as it’s safe to go out and go about our business.” Although house prices were a bit soft, as indicated by the Case-Shiller index, on balance the data point to “a reasonably strong housing market as we’re coming out of the shutdown,” he noted. Meanwhile, Schnure noted that jobless claims numbers out last week may have been misinterpreted as more negative than they actually were, as a result of confusion over seasonal factors. “This is really not sending a signal of growing weakness in the job market,” he said.
Mon, July 20, 2020
Economic Data Show Potential for Rebound, But Dependent on Continued Reopening
Economic data released last week show a lot of potential for rebound—as long as the reopening can continue to proceed, according to Nareit Senior Economist Calvin Schnure. Speaking July 20 on the Nareit REIT Report podcast, Schnure highlighted the range of economic indicators for June that were reported, including industrial production, retail sales, and housing starts. Those numbers underscore the possibility of getting the economy back to where it was before the pandemic, but “only as long as the virus is under control,” he said. News that the virus is surging in parts of the United States is creating tension in the market and threatens a pause or partial reversal of economic gains. Schnure also discussed the potential for another round of stimulus. While details remain unclear at this point, the expiration of extended unemployment benefits at the end of this month gives some pressure to meet that deadline, he noted.
Thu, July 16, 2020
Family Rental Housing Segment Plays Key Future Role, ULI Expert Says
Family renter households are likely to account for a growing share of the overall renter pool as the millennial generation begins to raise families and create homes of their own, says Christopher Ptomey, executive director of the Urban Land institute’s Terwilliger Center for Housing. Families currently account for about a third of the overall renter pool, Ptomey told Nareit’s REIT Report, but that is likely to change. “The millennial generation is reaching a tipping point demographically,” he said. “With the size of the millennial generation, we really expect that family renter cohort being a larger and larger portion of the overall number.”
Tue, July 14, 2020
New State Closures Place Additional Strain on REIT Tenants
A rollback of state reopening plans across the United States is placing additional strain on REIT tenants, especially those in the retail real estate segment, according to Jim Sullivan, managing director and REIT analyst at BTIG. On July 13, California announced a statewide closure of all indoor operations of dine-in restaurants, movie theaters, and family entertainment centers, among others. County indoor closures include fitness centers, hair salons and barbershops, and malls, if those counties have been on a county monitoring list for three consecutive days. Speaking July 14 on the Nareit REIT Report, Sullivan said certain types of retail will be particularly hard hit by the reclosure orders. “For retailers of apparel, footwear, and accessories, particularly if there’s a seasonal element, it’s going to be very, very difficult for the retailers in the malls to be open on an effective, efficient basis to generate levels of revenue comparable to pre-COVID levels,” Sullivan said.
Mon, July 13, 2020
REITs, Economy Remain Under Pressure as Coronavirus Case Numbers Climb
REIT share prices edged lower last week, as both the broader economy and also the real estate sector continue to be buffeted by the opposing forces of economic reopening and the spread of the virus, according to Nareit Senior Economist Calvin Schnure. Speaking July 13 on the Nareit REIT Report, Schnure said news of more rapid growth of new cases, especially across the Sunbelt, is leading to a reconsideration of the prospects of reopening right away or being able to do so fully, rather than in slow stages. Those concerns were reflected in REIT performance last week, with the sector down on balance, with the exception of timber, infrastructure, and home financing mREITs.
Tue, July 07, 2020
REIT Valuation Levels Attracting Investor Attention
LaSalle Investment Management Securities Global CEO Lisa Kaufman said REITs are attracting investor attention on the basis that they currently offer “very good value” relative to the private market, as well as on a historic basis relative to equities and bonds. Speaking July 6 on the Nareit REIT Report podcast, Kaufman said REITs in the United States and globally have “dramatically repriced,” and are materially underperforming broader equities and private real estate, “so we do see very good value today.” LaSalle has lowered its REIT net asset value (NAV) estimates about 15%, and even with that reduction “we see some big discounts on offer,” Kaufman said. This is not lost on investors, she said, particularly the more opportunistic ones who are “adding money to the sector or even launching new programs to take advantage of what they see, and what we would agree, is a really good entry point.”
Mon, July 06, 2020
June Employment Numbers Show Commercial Real Estate Heading in Right Direction
Nareit Senior Economist Calvin Schnure said the June employment numbers released last week were a “welcome positive surprise” that shows commercial real estate is heading in the right direction. Speaking July 6 on the REIT Report podcast, Schnure said the 4.8 million jobs reported for June exceeded expectations by a wide margin. The unemployment rate, meanwhile, fell more than anticipated, to 11.1%. While that is still a very high number, Schnure said, “this is a good down payment on the recovery that we’re going to need.” Hiring last month was concentrated in the sectors that had the biggest job losses when the economy shut down, such as retail and hospitality, Schnure pointed out. Despite the jump in employment, many of these establishments will not be doing their pre-crisis level of business right away, he noted.
Mon, June 29, 2020
Federal Reserve Limits Bank Dividends, Buybacks, But Sees Banks as Well Capitalized to Support Recovery
Nareit Senior Economist Calvin Schnure said the Federal Reserve’s latest bank stress test results point to a banking system that is well positioned to support the real estate economy under various recovery scenarios. Speaking June 29 on the REIT Report podcast, Schnure said the stress tests showed that most banks remain well capitalized under either a V, U, or W-shaped recovery. A V-shape sees the economy recovering later this year or early 2021, a U-shape points to a more sluggish recovery, and a W-shape indicates a double-dip recession. The Fed also suspended share buybacks and limited dividend payments, Schnure said, noting that share buybacks have accounted for about 70% of payments made to shareholders by large banks.
Mon, June 22, 2020
REITs Facing Mixed Picture as Economic Recovery Contends with COVID-19 Concerns
Nareit Senior Economist Calvin Schnure said REITs are facing a “mixed picture” as the forces of economic recovery are being tempered by uncertainty regarding the ongoing risks from COVID-19. In the June 22 edition of the REIT Report, Schnure noted that the recent divergence between the course of the pandemic and the pace of economic activity strengthened over the past week. While REITs and the broader equity markets reacted positively to surprisingly strong May retail sales numbers, that optimism subsided later in the week on news of a surge in new COVID-19 cases and what that means for the prospects of economic reopening.
Fri, June 19, 2020
REITs Bolstered by Stimulus Measures, Functioning Capital Markets, & Broad Array of Financing Options
Gina Szymanski, portfolio manager and director at AEW Capital Management, an affiliate of Natixis Investment Managers, joined the latest edition of the Nareit REIT Report podcast. Szymanski discussed some of the differences between the current COVID-19 crisis and the global financial crisis. She pointed to the size and pace of fiscal and monetary stimulus as “the biggest difference by far.” “During the last crisis the Fed was still learning how to be creative. This time around they are very aware of the playbook," Szymanski said.
Mon, June 15, 2020
REITs in Push-Pull Situation Between Efforts to Reopen Economy and Progress on Health Front
In the latest edition of the REIT Report, Nareit Senior Economist Calvin Schnure said investors will be watching this week to see if economic indicators point to an uptrend similar to what was seen in the recently-released May unemployment report. May retail sales numbers released this week will show whether or not spending has bottomed, Schnure said. The Federal Reserve, meanwhile, will report industrial production this week, while housing starts will also be released. “Over the next several days, we’ll get a lot better idea of whether the whole economy is starting to turn towards recovery the way we saw in the job market,” Schnure said.
Fri, June 12, 2020
Financial Service Firms Face Complex Challenges Returning to the Office: Deloitte
In the latest edition of the Nareit REIT Report, Darin Buelow, global location strategy leader at Deloitte, looked at the specific challenges that financial institutions face in returning to the workplace after an extended absence resulting from COVID-19. According to Deloitte, financial institutions account for more than 15% of total office leasing activity. Buelow noted that many financial service firms are located in downtown high-rise environments where employees have to use public transportation and deal with elevator access. COVID-19 is hitting these companies “very profoundly,” he noted.
Mon, June 08, 2020
REIT Executives “Cautiously Optimistic” at REITweek as Economy Begins to Reopen
Nareit Senior Economist Calvin Schnure discussed some of the main themes from Nareit’s REITweek: Virtual Investor Conference and the May jobs report in the June 8 edition of the Nareit REIT Report podcast. Schnure characterized the overall mood at REITweek as “cautiously optimistic.” “Obviously we’re still in unchartered waters and there’s a lot of concern about unforeseen risks in the period ahead,” Schnure noted. While economic activity is beginning to resume, few expect it to be without glitches, he added. At the same time, property sectors are seeing a wide range of impacts from the crisis. In the retail sector, for example, the reopening of the economy is expected to help rent collection but going forward many tenants are still going to have a low level of revenue, “so we’re not out of the woods yet on that front,” Schnure said.
Fri, May 29, 2020
Commercial Real Estate Recruiting Specialist Expects Pick-Up in Hiring
The latest edition of the Nareit REIT Report podcast looked at employment trends in the commercial real estate industry with Marc Torrey, vice president and global sales director at SelectLeaders, a career resources platform for real estate professionals. Torrey explained that the landscape for commercial real estate hiring heading into the coronavirus crisis reflected a typical trend seen in an election year: a slow down on the transaction hiring side and a pick-up on the operations and asset management side. “We were already seeing that, and it went into overdrive with the start of the coronavirus,” he said. While commercial real estate hiring slowed down considerably in April, it picked back up in May, according to Torrey, especially for full-service real estate firms. “We have seen it coming back in May and I think we’re going to see a lot of hiring happening over the course of the next few months and even (for) years to come as a result of everything that’s transpired,” he said.
Wed, May 27, 2020
REIT Earnings Fell 9% in the First Quarter as COVID-19 Crisis Hit Travel, Shopping
Nareit’s T-Tracker, a comprehensive summary of REIT earnings and operating performance, showed an overall picture of weak earnings in the first quarter, with about half of the 9% decline in funds from operations (FFO) reflecting the lodging and hotels sector. Speaking May 26 on the Nareit REIT Report podcast, Nareit Senior Economist Calvin Schnure noted that regional malls also had a decline in earnings and most other property sectors had modest declines. Industrial REITs, meanwhile, had a 21.7% increase in FFO, and single family home REITs saw a 7% FFO increase. Most of the first quarter predated the COVID-19 crisis. As a result, second quarter T-Tracker results are likely to be “quite a bit weaker,” Schnure said.
Fri, May 22, 2020
Commercial Real Estate Firms Beginning to Implement Lessons from COVID-19 Crisis
Commercial real estate firms are beginning to implement lessons learned from the COVID-19 pandemic and create targeted measures to emerge stronger in the medium-term, according to Jim Berry, U.S. real estate leader at Deloitte & Touche LLP. Speaking on the Nareit REIT Report podcast, Berry noted that the industry has moved from an initial ‘respond’ phase into a ‘recover’ phase, with many commercial real estate executives now focused on issues such as preparing for re-entry to physical spaces and promoting employee and tenant wellbeing. Executives are also looking at what worked well in the early stages of the crisis and what needs to be improved upon, he said.
Mon, May 18, 2020
Data Show April Online Retail Sales Gains Unable to Offset Broader Declines
The latest retail sales data point to a continued role for brick and mortar retail once the coronavirus crisis passes, according to Nareit Senior Economist Calvin Schnure. Speaking May 18 on the Nareit REIT Report podcast, Schnure noted that the more than 8% rise in non-store retail sales in April, which includes e-commerce, was unable to offset the overall decline of 16.4%. “Online commerce is still no substitute for a lot of the shopping that people do. So, even after this crisis passes, this tells us there’s still a strong role for brick and mortar retail sales,” Schnure said.
Fri, May 15, 2020
Hudson Pacific Implementing New Operating Procedures in Response to COVID-19
Hudson Pacific Properties, Inc. (NYSE: HPP) is preparing to welcome tenants back into its buildings by implementing new standard operating procedures across its portfolio, touching on everything from enhanced cleaning to increased signage and physical distancing policies. Speaking on the Nareit REIT Report podcast, Natalie Teear, vice president of sustainability and social impact at Hudson Pacific, said the REIT is rolling out a “four-C’s” approach that encompasses communication, confidence, convenience, and cooperation. Hudson Pacific is also launching a mobile app at all of its multi-tenant properties in order to share the most up to date information with tenants on a real-time basis.
Wed, May 13, 2020
REIT Industry’s Focus on Tenant Needs Seen as Key Issue Post-Crisis
The REIT industry’s focus on the needs and concerns of its tenants will become increasingly important as a result of the coronavirus crisis, according to Gil Menna, co-chair of the REITs and Real Estate M&A practice at Goodwin. Speaking on the Nareit REIT Report podcast, Menna said one of the ways that REITs can be opportunistic in the current environment is by focusing on unique ways to deal with tenancy concerns that evolve from the pandemic. “Trying to attract tenants back to [real estate] space, using the space in a way that’s novel and useful to tenants to addresses their needs and concerns—and helping them psychologically become productive again—will be an important part of the opportunity set available to REITs,” Menna said.
Mon, May 11, 2020
April Jobs Report Shows Bulk of Losses in Front-Line Sectors
Nareit Senior Economist Calvin Schnure said that while the April jobs report was “clearly a shock to the economy,” the bulk of job losses were confined to a few sectors facing complete shutdowns. In the May 11 edition of the REIT Report, Schnure noted that the April report showed a record decline in employment while the unemployment rate jumped to 14.7%, the highest level since the Great Depression. However, the data are “less alarming than we might have expected,“ Schnure said. He noted that 60% of the job losses were in sectors such as restaurants, doctors’ offices, and retail—which may be in a position to rehire at a later date.
Mon, May 04, 2020
Retail Real Estate Pioneering New Strategies for a Post-COVID 19 Return to Business
The retail real estate sector is leading the way in terms of preparing for a post-COVID 19 return to more normal business operations, according to Nareit Senior Economist Calvin Schnure. Speaking May 4 on the Nareit REIT Report, Schnure pointed to the various new safety measures that Simon Property Group, Inc. (NYSE: SPG) has implemented in order to reopen some of its malls. “The retail sector and the shopping malls are not isolated, they’re just the first part of our economy that’s going to be dealing with a post-COVID world. They are pioneering the way so that people can interact safely together,” Schnure said.
Fri, May 01, 2020
Kite Realty Offers Tenants a “Bridge to the Other Side” Through Small Business Loan Program
A new small business loan program recently launched by Kite Realty Group Trust (NYSE: KRG) is trying to give its tenants a “bridge to the other side” during the current economic uncertainty, said Kite Realty chairman and CEO John Kite. In the May 1 edition of the REIT Report, Kite said the company is “on the front lines of this thing as it relates to the small business community.” The KRG Small Business Loan program will provide up to $5 million in total assistance and allow Kite’s small business tenants to request a loan amount of up to three months of operating expenses. Kite said the idea to assist the REIT’s tenants, who were having difficulty accessing the Paycheck Protection Plan, “gained steam very quickly inside the company.” The reaction to the program so far has been positive. “We fully anticipate looking to lend out as much as we can in this program,” Kite said.
Thu, April 30, 2020
REIT Industry’s Footprint in Non-Traditional Asset Classes Seen as Post-Crisis Advantage
The REIT industry’s “heavy footprint” in non-traditional asset classes gives it a clear advantage as the world adapts to new ways of living in response to the coronavirus crisis, said Scott Crowe, Chief Investment Strategist at CenterSquare Investment Management. Speaking April 30 on the Nareit REIT Report podcast, Crowe said the crisis “ushers in a whole new paradigm of what real estate really is,” especially the idea of core versus non-core real estate. “The reality is that the way we live our lives is going to evolve significantly,” he noted. One of the advantages that the REIT industry has is its “heavy footprint” in non-traditional asset classes, such as data centers and towers, Crowe said. He noted that the industry has “a much higher proportion of winners than losers as it relates to what the post-COVID-19 real estate new normal may look like.”
Mon, April 27, 2020
REIT Markets Lower, But Conditions Appear to be Settling
While REIT share prices drifted lower in the past week, conditions appear to have settled somewhat compared to the large swings seen in the early weeks of the coronavirus crisis, said Nareit Senior Economist Calvin Schnure. Speaking April 27 on the Nareit REIT Report podcast, Schnure pointed to single digit moves in the past two weeks. One possible reason for the more restrained movement is the approach of first quarter earnings, he noted: “There could be a lot of investors who are in a wait-and-see mode.” Looking at real estate markets overall, Schnure highlighted the release of CoStar data showing demand weakened considerably across all major property types, despite social distancing going into effect only in the closing weeks of the quarter. Net growth of demand for office space was at its lowest level since 2010, and net demand for retail space fell due to store closures, the first decline since 2009.
Sun, April 26, 2020
American Campus Communities Helping Students Weather Coronavirus Disruptions
Bill Bayless, CEO of American Campus Communities, Inc. (NYSE: ACC), said the REIT is helping its student residents weather coronavirus-related disruption by ensuring they have a home during the crisis, regardless of their ability to pay rent on a timely basis. Speaking April 23 on the Nareit REIT Report, Bayless said the company’s Resident Hardship Program ensures students can complete their online education in an academically oriented environment without facing late fees, online payment fees, financially-related evictions, or any negative impact to their credit reports if they and their families are facing financial disruption. To date, 2,787 residents have applied under the program out of more than 100,000 residents, Bayless said. In April, the company abated $1.6 million in rent and has already abated $400,000 in rent for May. Bayless said American Campus is “very pleased and optimistic about the return to campus in the fall by students, even if classes are going to be held online.” To date, the REIT’s portfolio is about 76% preleased for the fall, and in the 30-day period after March 16, it had 5,000 students lease to return in the fall. Lease cancellations for the fall are actually slower than in prior years, he noted.
Thu, April 23, 2020
Nareit April Rent Survey Shows Industrial, Multifamily, Office REITs Performing Well
A Nareit survey of April rent collection across the REIT industry points to a strong performance by industrial, multifamily, and office REITs. Nareit Executive Vice President for Research and Investor Outreach John Worth told the REIT Report April 22 that industrial REITs saw 99% of typical rents received in April. The survey was conducted between April 8-15. Multifamily REITs collected 93.5% of typical April rents, while office REITs collected 89.3% of typical April rents. Worth noted that there had been uncertainty as to how office REITs would fare, but “the fact that nearly 90% of rents have been paid does reflect the strong credit quality of REIT tenants.” Health care REITs collected 85.7% of typical April rents, while shopping centers collected 46.2%.
Wed, April 22, 2020
Social Aspect of ESG Expected to Gain Attention in Response to Coronavirus
On the 50th annual Earth Day celebration, Nareit Senior Vice President for ESG Issues Fulya Kocak said the social aspect of ESG is likely to see greater focus as a result of the coronavirus crisis. Speaking on the Nareit REIT Report podcast, Kocak said that while attention to social matters was already gaining a lot of interest before the crisis, “after we return to our new normal we are going to see more focus on health and wellness as well as flexibility and adaptation of the workforce to different ways of getting things done.” Kocak also commented on the upcoming Nareit ESG annual report, which will highlight the increased reporting underway by REITs. “There has been good progress made on the transparency aspects of ESG,” she said.
Thu, April 16, 2020
Kimco Realty is Helping Small Retail Tenants Survive the Financial Impact of Coronavirus
Kimco Realty Corp. CEO Conor Flynn said the REIT’s large national retail tenants need to pay their rent so that financial assistance can get to where it is needed most—small shop retailers. In an April 15 REIT Report interview, Flynn—who was recently diagnosed with COVID-19 and suffered mild symptoms—outlined the REIT’s efforts to help its ‘mom and pop’ tenants, including rent deferral and its new Tenant Assistance Program (TAP). Flynn said TAP’s aim is to help its smaller tenants “bridge to the other side of this” by offering free legal services to help them navigate federal and statewide assistance programs. So far, over 1,700 tenants have taken advantage of TAP and Kimco continues to try and get more tenants to actively use it. “Time is not on the side of our small shop retailers,” he said.
Mon, April 13, 2020
REIT Markets Settling into Middle Range Following Sharp Declines in March
After steep share price declines across the REIT industry in recent weeks, a more moderating pattern appears to have set in, according to Nareit senior economist Calvin Schnure. In an April 13 REIT Report podcast interview, Schnure noted that REITs are down 13% to 15% this year, representing a significant discount. However, “the markets appear to have settled into a middle range. You’re no longer seeing the very sharp declines that we saw in March and they’re looking forward to the period when this virus is more under control and the economy can get back to work—commercial real estate included.” Schnure noted that REITs made gains in the prior week, and outpaced the S&P 500, as the sector was boosted by Federal Reserve policy provisions to support real estate if tenants fail to make rent payments. Schnure also commented that a range of factors are influencing investor sentiment, and those factors all reflect different time frames. For instance, public health news is determined by the measures taken several weeks ago to limit the spread of the coronavirus, while the unemployment news is more closely tied to what’s going on today in the economy. At the same time, policy measures by the Fed and proposals for further stimulus point to the future.
Fri, April 10, 2020
Camden Property Trust CEO Expresses Optimism on Residents’ Ability and Willingness to Pay Rent
Ric Campo, chairman and CEO of Camden Property Trust (NYSE: CPT), said that while April rent collections have slowed somewhat in the past week, “generally we feel pretty good about where we are” in terms of residents’ ability and willingness to pay rent. In an April 9 REIT Report interview, Campo discussed the REIT’s efforts to help its residents weather the crisis, including the establishment of a $5 million tenant relief grant. He explained that Camden wanted to help fill the gap between when a resident might have lost a job and the receipt of federal benefits. “Business should focus on being a real partner in the community… it’s just the right thing to do to help people when times are tough,” Campo said. He noted that there was more demand for the grant than expected, with the entire $5 million amount allocated in about 16 minutes. Checks were sent out to residents within 24 hours of their grant applications being approved, he noted.
Thu, April 09, 2020
Lodging Sector Facing Protracted Recovery
The lodging sector was one of the first industries to feel the economic brunt of the coronavirus crisis, and it will likely be one of the last to benefit from an eventual upturn, Pebblebrook Hotel Trust (NYSE: PEB) Chairman and CEO Jon Bortz said. Speaking April 9 on the REIT Report podcast, Bortz said about half of the hotels across the industry have now closed completely, with millions of employees furloughed. “We think it’s going to be a very slow recovery,” he said. By the end of March, operations at all but eight of Pebblebrook’s 54 hotels had been suspended and over 7,500 employees furloughed. Meanwhile, costs have been cut at the corporate level, with executives volunteering to either reduce or forego their compensation. Pebblebrook has cut back on capital projects and drawn down its line of credit completely. “We’re sitting on a little over $700 million that should allow us, with a fairly significant cash burn, to get through the better part of next year,” Bortz said. Bortz, who is 2020 chair of the American Hotel and Lodging Association, also described some of the advocacy efforts the group has conducted.
Mon, April 06, 2020
Economic Uncertainty from Coronavirus to Remain High, Likely into May
Nareit Senior Economist Calvin Schnure said in an April 6 REIT Report podcast interview that uncertainty surrounding the coronavirus and its impact on the economy and markets will remain high, certainly through April and likely into May. Schnure also noted that while REITs and broader stock indices are at a deep discount compared to pre-crisis levels, they are up from lows reached several weeks ago. Investors seem to be anticipating that the policy actions taken so far, notably the $2 trillion fiscal stimulus as well as Federal Reserve measures to support financial markets and make sure they continue to function smoothly, are going to help a lot of households and businesses, Schnure said. “Investors seem to anticipate these measures are going to buffer the economy and the markets from some of the worst scenarios,” he noted.
Fri, April 03, 2020
Leadership Skills Under Close Scrutiny During Periods of Crisis
The April 2 edition of the REIT Report podcast featured Walt Rakowich on the topic of leadership during a time of crisis. Rakowich became CEO of ProLogis at the height of the economic downturn in 2008 and restored the company’s finances, enabling it to merge with AMB Property Corp. in 2011 to create Prologis, Inc. Rakowich noted that while every crisis is different, “how and why we lead is actually quite consistent.” During a crisis, a leader needs to understand that people are watching and listening even more intently than when things are going well. “How you deal with situations, how you communicate, what you say, how you treat people—all of those things matter,” he said.
Mon, March 30, 2020
REITs’ Liquidity Resources Will Help Sector Face Coronavirus Challenges Ahead
In the March 30 edition of the REIT Report podcast, Nareit Senior Economist Calvin Schnure highlighted the latest developments in how the coronavirus crisis is impacting the economy and commercial real estate. Schnure noted that public health officials are indicating that “we need to prepare for a long haul,” which in turn is increasingly impacting cash flows for businesses and wages and incomes for workers. The first hard data on the magnitude of the effect came last week as initial jobless claims soared to a record 3.3 million, but “even this number understates the true impact,” Schnure said. The unemployment rate is likely to rise from 3.5% to 7.0% and is probably heading to 10% or higher in coming weeks, he added. “This is a major challenge for us in the months ahead.”
Fri, March 27, 2020
Strong Pre-Crisis Real Estate Fundamentals Will Help Sector Navigate Current Volatility
CBRE Chief Global Economist and Head of Americas Research Richard Barkham and CBRE’s Head of Occupier Research, Americas, Julie Whelan, joined the REIT Report on March 27 to talk about the economy, commercial real estate, and the impact of the coronavirus pandemic. Barkham described the economic impact as “brutal in the short term,” with GDP in the United States likely to contract by 6.3% in the first quarter and 20% in the second quarter. If new COVID-19 infections begin to fall by mid-to-late April, and lockdown situations start to ease from mid-May, “we’re looking to an improved second half and a very strong 2021,” he said. Fundamentals in the real estate sector were strong heading into the crisis, Whelan observed, as she pointed to solid occupancy levels and a disciplined approach to construction. “All of that has set us up to weather the storm that we’re in quite well,” she said.
Mon, March 23, 2020
Ultimate Economic, Financial Impact of COVID-19 Unclear Until More Progress on Public Health Front
In the latest edition of the REIT Report podcast, Nareit Senior Economist Calvin Schnure said the ultimate economic and financial impact of COVID-19 will be unclear until there is more progress on the public health front. Authorities, meanwhile, are acting quickly to support the economy, including the resurrection of the Federal Reserve’s crisis programs, Schnure noted. “The most important impact on the economy is the short-term cash flow problems for businesses that rely on face-to-face interactions with the public…it is encouraging that authorities are acting quickly to support the economy through this period,” Schnure said.
Wed, March 18, 2020
Prologis Sees Structural Changes to Logistics Real Estate in Wake of Coronavirus
In the latest edition of the Nareit REIT Report podcast, Chris Caton, global head of strategy and analytics at Prologis, Inc., discussed the impact of COVID-19 on the warehouse and logistics industry. The current uncertainty is likely to be a headwind for the economy and all forms of real estate, logistics real estate included, Caton said. Caton pointed out that logistics real estate has benefited from historic low vacancy rates and strong demand and disciplined supply. Potential customers who have had a difficult time securing space up until now may see that situation change, he said. Investors, meanwhile, are likely to recognize “the relative beneficial attributes of logistics real estate in terms of the long-term demand drivers against other categories that have more uncertainty,” Caton said.
Fri, March 13, 2020
REITs’ Long-Term Leases Provide Some Stability During a Period of Market Turmoil
In the latest edition of the Nareit REIT Report podcast, Nareit senior economist Calvin Schnure highlighted the latest developments surrounding the impact of the coronavirus pandemic on the economy and REITs. Schnure emphasized that this is first and foremost a public health crisis, but also one which is impacting the economic and financial livelihood of tens of thousands of people. The situation is changing quite rapidly, Schnure said. He noted that his analysis as of March 12 is different from what it was just a few days ago. Schnure noted that a pandemic of the current scale hasn’t been seen before in modern history. “The experience in several other countries …is that it is possible to slow the spread of this virus and that will limit the effect on the economy, commercial real estate, and REITs,” Schnure said.
Fri, March 06, 2020
Opportunity Zone Investment Interest Accelerating Since Final Regulations Released
The latest edition of the Nareit REIT Report podcast looks at developments surrounding opportunity zone investing with Dan King, senior manager, national tax services, at CohnReznick LLP. Opportunity zones were created by the Tax Cut & Jobs Act of 2017, and final regulations were released by the Treasury Department and the IRS at the end of December 2019. “The final regulations have answered a lot of the uncertainties in the market,” King observed, and include “a lot of taxpayer-friendly aspects.” While there are still some aspects that need to be clarified, overall the final regulation package has been “very well received by the industry,” which has resulted in CohnReznick “getting a lot more questions coming in, and a lot more people interested in doing deals,” King said. In terms of the types of investors being drawn to opportunity zones, King pointed to interest from family offices, real estate developers, and closely-held businesses.
Mon, February 24, 2020
REIT Property Count Continues to Rise
Nareit’s vice president for research, Nicole Funari, joined the latest edition of the REIT Report podcast to discuss some of the findings from Nareit’s latest REITs Across America data, including the contribution that REITs make to the U.S. economy, their geographic footprint, and their shareholder base. Funari noted that the number of REIT properties has increased every year since Nareit began counting in 2016. The latest data shows over 520,000 REIT properties, comprised of 207,000 actual buildings, 219,000 signs or billboards, and 95,000 cellphone towers. Traditional REITs still have the highest level of gross asset value, according to Funari, but some of the newer sectors like data centers have shown the most growth over the past three years. Lodging has also shown large growth in gross asset value, as has retail, which has posted the second highest growth rate over the past three years. While the value of traditional mall and shopping center assets are down, there has been an uptick in the gross asset value of single tenant retail and restaurants, Funari explained.
Thu, February 13, 2020
Short-Term Rentals Play Important Factor in Traditional Lodging Sector Valuations
While the growth in the supply of short-term rental (STR) units has tempered in recent years, the STR market is an important factor in valuation calculations for the traditional lodging sector, according to Jamie Lane, senior managing economist of CBRE Americas Hotels Research. Speaking on the Nareit REIT Report podcast, Lane noted that with a bigger inventory of STR units now in place, year-over-year percentage growth rates for STR supply in the U.S. will continue to ease. STR unit supply grew by 26% in 2019, down from 39% in 2018, and down from the seven years of exponential growth prior to that. The rate of supply growth is expected to slow in 2020 to 19%. Despite the slower growth rate, new units have still averaged over 100,000 per year since 2016, with 2020 marking the fifth consecutive year that this threshold has been met. As a result, the supply penetration rate of STR units to traditional hotel units reached almost 10.5% in 2019 and is expected to hit 12.2% in 2020, Lane said. In 2014, the vast majority of STR units were coming online in urban areas. Lane notes that since then, most of the growth has primarily occurred in rural and suburban areas. Urban units dropped to 21% of the total STR supply in 2019 from 46% in 2014.
Thu, February 06, 2020
Real Estate Transaction Value Lower in 2019; Logistics Deals Buck the Trend
The latest edition of the Nareit REIT Report podcast looked at real estate deal activity with Tim Bodner, U.S. real estate deals leader at PwC. Although the volume and value of commercial real estate deals in 2019 were lower relative to 2018—a particularly strong year—activity was higher than in 2017. Most of the decline in 2019 came from the lodging and retail real estate sectors. In retail real estate, transaction value was down 31%, while falling 15.5% in the lodging space. On the other hand, the value of logistics transactions rose 13% in 2019. Nearly all other real estate sectors logged a decline in transaction value in 2019, according to PwC. In 2019, nine REIT M&As took place, representing about $24 billion in value. About 70% of that total represented the logistics sector. Fundraising by public REITs from January through November 2019 hit $107.3 billion, or nearly twice the total for all of 2018 and 7% higher than the previous peak in 2017.
Fri, January 24, 2020
Lodging and Resort REIT RevPAR Likely to be Stagnant in 2020
After underperforming in 2019, the lodging and resort REIT sector is on a similar track in the first few weeks of 2020, according to Evercore ISI managing director Rich Hightower. In the latest edition of the Nareit REIT Report podcast, Hightower said he expects no more than a 1-2% increase in room night demand in 2020. Supply, meanwhile, is increasing at a 2-2 ½% range, and more so in some of the urban markets. “It seems to be hard to argue for ADR (average daily rate) improvements in a declining occupancy scenario,” Hightower said. He noted that the industry didn’t see much pricing power at all in 2019, and that was at a time when occupancies were still growing. Consequently, RevPAR is likely to be flat to lower in 2020, according to Hightower. Meanwhile, Hightower noted that TRevPAR (total revenue per available room) became a mainstream statistic that companies started to report in 2019. It captures non-room revenue and is growing at a rate in excess of RevPAR, he said.
Wed, January 15, 2020
Commercial Real Estate Market in ‘Mature Recovery’ Stage at Start of 2020
In the latest edition of the Nareit REIT Report podcast, Calvin Schnure, Nareit senior vice president for research and economic analysis, shared his thoughts on the economy, real estate, and REITs in 2020. In Nareit’s 2020 Economic Outlook, Schnure uses the term “uncharted waters” to describe the current environment. He explained that the phrase underlines the fact that the risks normally faced this far into a typical expansion or commercial real estate boom aren’t present at this time. “We know there are risks ahead, we just can’t look to the usual corners to see where they are going to be,” Schnure said. He added that because there is no clear idea of when the current expansion might end, the descriptor “late cycle” doesn’t really apply. A more accurate term for the state of the commercial real estate market is that of a “mature recovery,” he noted.
Thu, January 09, 2020
Differentiation Among Health Care Real Estate Portfolios Likely to Persist in 2020
The latest edition of the Nareit REIT Report podcast looked at trends in the REIT health care real estate segment with Michael Gorman, a managing director and REIT analyst at BTIG. The key theme last year was the differentiation in the underlying performance of health care real estate portfolios, according to Gorman. That trend is likely to remain in place, at least in the first half of 2020, he noted. In 2020, “we don’t see a groundswell of improvement in any of the particular property types. Senior housing is still going to be pretty choppy at the national level,” Gorman said. However, the medical office building segment should return to external growth in a “more meaningful way” in 2020, he added. One key factor adding to uncertainty in the health care real estate sector this year is November’s general election, according to Gorman.
Wed, December 18, 2019
Retail Real Estate Faced Mixed Picture in 2019; Trend Likely to Hold in 2020
While retail real estate faced challenges in 2019, performance varied quite widely across the sector, a trend that is likely to continue into 2020, according to Mizuho Americas REITs analyst Haendel St. Juste. St. Juste was a recent guest on Nareit’s REIT Report podcast. He highlighted the disparity in performance between regional malls, which faced challenges, and shopping centers, that have had a “formidable run.” In terms of the regional malls, “there’s lots of uncertainty with key tenants heading into 2020,” he said, while also describing Simon Property Group (NYSE: SPG) as “the most investable company in that space.” For those investors looking for retail exposure, St. Juste highlights the triple net lease segment, which he feels offers “the best risk-adjusted returns.”
Thu, December 12, 2019
REITs Should Highlight Their Uniqueness in Effort to Engage with Generalist Investors
Jonathan Keehner and John Roe, partners at strategic communications and investor relations firm Joele Frank, were guests on the latest edition of the Nareit REIT Report podcast. Nareit has worked with Joele Frank to create a Communications Toolkit with a framework for developing an effective communications strategy for generalist investors. It was recently distributed to Nareit members. Keehner described what he sees as a “real disparity between the dedicated investor group and the generalist group.” To help alleviate that gap, he suggests REITs “hit the reset button” and really focus on communicating what makes their company unique. “It’s about introducing the story and making it compelling, it’s about leveraging the exciting aspects of a portfolio to draw in a new audience,” Keehner said. At the same time, he recommends that REITs take a fresh look at their IR exposure: “It’s [about] doubling down on the existing investor base and then thinking creatively about ways to engage with a new investor base.”
Thu, December 05, 2019
Selective, Strategic M&A to Continue in 2020, Portfolio Manager Says
Frank Haggerty, Jr., portfolio manager for all dedicated global real estate securities managed by Duff & Phelps Investment Management, joined Nareit’s REIT Report podcast during REITworld 2019 in Los Angeles. Haggerty highlighted some of the geographic regions that are expected to perform well in 2020. In the United States, he said, Duff & Phelps is most positive on Southeastern markets. The region is seeing the technology job growth that is evident in other parts of the country, he noted, combined with a strong corporate relocation tailwind as companies seek lower-cost and more business-friendly environments. As for Europe, Dublin, Madrid, and Barcelona are all markets that are showing potential, he said. In terms of U.S. REIT fundamentals, Haggerty said Duff & Phelps is watching supply: “Clearly given where we’re at in the real estate economic cycle, supply is an issue in a number of property types,” he said. Growth in jobs and wages are also being closely watched, he added. Meanwhile, Haggerty said he expects to see a continuation of selective, strategic M&A between public companies next year. IPO activity is likely to also to be limited. “We will see a handful of property deals coming out, particularly if valuations stay at their current level,” he said.
Mon, November 25, 2019
REIT Investors Eyeing Cash Flow Growth, Dividend Growth, Value Creation
John Guinee, managing director at Stifel, joined Nareit’s REIT Report podcast during REITworld 2019 in Los Angeles. Guinee noted that the overall REIT market has drifted from a “net asset value (NAV)-based investment bias to a real bias of cash flow growth, dividend growth, and value creation.” Across all property sectors there’s demand from investors for stocks that incorporate these three components, he said. Turning to the industrial sector, Guinee pointed to in-place rents that are 10%-20% below market value, while land costs are going up, and supply/demand is broadly in balance. At the same time, e-commerce is providing about 60 million square feet of additional demand. “With that backdrop, the industrial REITs are able to generate high FFO growth simply because they have such good fundamentals,” Guinee said. Multifamily is much the same, according to Guinee, with supply/demand largely in balance and topline revenue growth of 4%-5%. Office REITs, however, are finding it “very difficult” to grow FFO and the dividend.
Wed, November 20, 2019
Postal Realty Trust CEO Sees “Tremendous Opportunity” in Niche Sector
Andrew Spodek, CEO of Postal Realty Trust, was a guest on the latest edition of the Nareit REIT Report podcast. Postal Realty Trust owns 366 post office properties across 43 states and was one of only a handful of REIT IPOs that occurred in 2019. Spodek noted that there are 32,000 postal facilities throughout the country, of which 23,000 are leased and pay about $1 billion in gross rent. Of those 23,000, 16,000 are owned individually, he said: “That’s how fragmented this market is.” As for the timing of the IPO, Spodek pointed to two key determining factors: a “generational shift” in the ownership of post office assets; and a decision by the post office to outsource its real estate services, “which is very different from what these owners are used to.” Providing owners with an ability to move their assets into institutional hands “was something we felt was very timely,” Spodek said.
Fri, November 01, 2019
Senior Housing Occupancy Trends “Relatively Weak,” NIC Chief Economist Says
In the latest edition of the Nareit REIT Report podcast, Beth Burnham Mace, chief economist and director of outreach at the National Investment Center for Seniors Housing & Care (NIC), looked at the latest trends and developments in the senior housing sector. Mace described today’s typical senior housing resident as 83 years old with higher acuity needs than in the past. “Because of the great recession, people delayed the timing of when they moved into senior housing, and that has held to be true even today.” Occupancy trends have been “relatively weak,” Mace said. In the third quarter, the senior housing occupancy rate was 88%, up from 87.7% in the second quarter—which was the lowest level in eight years. Net absorption of senior housing units in the third quarter was the highest number in a single quarter since NIC began recording data in 2006. Assisted living occupancy in the third quarter moved off its record low level seen over the prior three quarters to hit 85.4%. Independent living occupancy, meanwhile, was 90.2% in the third quarter.
Thu, October 17, 2019
Focus on Tenant Experience Ranks High in Deloitte 2020 Outlook
In the latest edition of the Nareit REIT Report podcast, Jim Berry, U.S. Real Estate leader at Deloitte & Touche LLP, highlighted some of the trends that emerged in Deloitte’s recently released 2020 commercial real estate outlook. Deloitte based its findings on a survey of 750 real estate owners and operators in 10 major global markets. One of the key trends in the outlook was the importance of tenant experience, with 64% of respondents saying they would continue to increase their investment in tenant experience technology. “We noted that the clear movement on the expectations of the tenants, as well as the overall end-user, was really impacting the way real estate companies are…continuing to make decisions,” Berry said.
Wed, October 02, 2019
Institutional Investors Paying Increased Attention to Public Real Estate Platforms
In the latest edition of Nareit’s REIT Report podcast, Gil Menna, co-chair of the REITs and real estate M&A practice at law firm Goodwin, discussed the climate surrounding mergers and acquisitions (M&A) and initial public offering (IPO) activity. M&A activity has been light in 2019 compared to previous years, in large part due to an “anemic” REIT market performance last year, Menna said. “Certain sectors in the REIT market have been off. Normally that would result in privatization transactions of public companies that are trading at discounts to net asset value (NAV), but we haven’t seen a significant amount of activity there as well because there has been an abundance of private opportunities available for capital that’s attracted to the real estate asset class,” Menna explained.
Thu, September 19, 2019
CHROs Playing Increasingly Important Role on Executive Boards
The latest edition of the Nareit REIT Report podcast looked at the increasingly important role that chief human resource officers (CHROs) are playing on executive boards. Bill Ferguson, CEO of Ferguson Partners Ltd., and Elizabeth Gaffney, global CHRO practice leader at Ferguson, discussed their new research on the topic. “Human capital issues are increasingly dominating boardroom discussions,” according to Ferguson. He noted that Ferguson research has identified 56 either active or retired CHROs on Fortune 500 boards. “We were surprised the number was as big as it was—75% of these had been appointed since 2015 and 30% since 2017,” he said. According to Gaffney, the human resources role has become much more important throughout all industries: “The role of HR has moved from one that has been viewed as tactical in nature to one that is strategic. CHROs are now reporting to the CEO in most companies and are certainly part of the C-suite.”
Fri, September 06, 2019
Former Highwoods CEO Ed Fritsch Looks Back on Three-Plus Decades at Office REIT
The latest edition of the Nareit REIT Report podcast featured an interview with Ed Fritsch, who stepped down as CEO of Highwoods Properties on Sept. 1 following a career of more than 30 years at the Raleigh, North Carolina-based office REIT. Fritsch joined Highwoods in 1982 at the age of 23 and was a partner in the predecessor firm before its IPO in June 1994. He served as COO from January 1998 to July 2004 and was vice president of operations and secretary from June 1994 to January 1998. He became the company’s president in December 2003 and CEO in July 2004. Fritsch also served as Nareit chair in 2016. Fritsch said that holding a variety of positions throughout his career at Highwoods enabled him to “leverage that information to the good of the company.” A year after Fritsch became CEO, Highwoods implemented a strategic plan that remains in place today. “I knew Highwoods was a good company, but I was keenly interested in how we could make it better. The team made a pledge that no person, no process, and no property was sacred—we popped the hood and questioned every part of the engine,” Fritsch said.
Wed, August 21, 2019
Smaller and Mid-Sized Industrial Real Estate Deals on the Rise, JLL Says
The latest edition of the Nareit REIT Report podcast looked at industrial real estate trends with George Cutro and Chad Buch from JLL’s Chicago industrial research team. Cutro and Buch also co-host JLL’s Chicago Industrial-Real Time Podcast. Buch said JLL is “cautiously optimistic” for industrial real estate in 2019. Despite global uncertainty, “the fundamentals are really healthy,” driven by consumer consumption, e-commerce, and supply chain innovations. Cutro noted that e-commerce has changed the supply chain cycle, with the advent of smaller sized distribution centers replacing a traditional hub-and-spoke system. “We’re seeing a lot more demand in that smaller size, call it under 500,000 square feet, that’s really driving today’s numbers,” Cutro said. “The big deals all happened a couple of years ago in the coastal and core markets…now this is the second round of smaller and mid-sized deals happening in some of the secondary markets,” Buch said.
Mon, August 12, 2019
Prologis Says Industrial Demand Growing at a Sustainable Pace
The latest edition of the Nareit REIT report podcast featured Melinda McLaughlin, vice president of research at Prologis, Inc. (NYSE: PLD), who discussed some of the highlights of Prologis’ latest Industrial Business Indicator (IBI) index report, a quarterly survey of customer sentiment. McLaughlin described industrial demand at mid-2019 as “healthy,” with the IBI index currently at a level of around 60. Customers are continuing to grow at a “sustainable pace” following 2018, which was the second highest level for net absorption of industrial space seen in this cycle. “The tailwinds to demand, which we've seen throughout this cycle, continue to play a large part in what we're seeing in terms of customer leasing activity,” McLaughlin said.
Fri, July 26, 2019
Infrastructure REITs Playing Growing Role in Digital Economy
The latest edition of the Nareit REIT Report podcast looked at the advent of 5G—and what it means for infrastructure REITs—with Ji Zhang, senior research analyst at Cohen & Steers. Zhang discussed the evolution of infrastructure REITs as a component of the broader REIT industry. In 2000, traditional REIT sectors accounted for about three quarters of REIT market capitalization, she observed. Today, they count for just under half. The first data center REIT was listed in 2004 at just under $300 million in market cap. In 2012, the first tower company converted to a REIT at about a $30 billion market cap. Today, tower and data center REITs comprise just under 25% of the REIT investment universe. “We believe these technology-oriented sectors will continue to gain in importance given their secular demand drivers and important roles in the digital economy,” Zhang noted.
Thu, July 18, 2019
Kimco Realty CEO Says ESG Focus Embedded Across Entire Organization
In the latest edition of the Nareit REIT Report podcast, Kimco Realty Corp. CEO Conor Flynn discussed the shopping center REIT’s unique approach to ESG matters. Flynn reflected on the evolution of Kimco’s ESG program since its inauguration 8 years ago. “Today we’re in a very different place,” he said. As the program has matured, Kimco has found ways to embed various ESG activities and responsibilities into existing teams across the entire organization. Now, instead of having one individual directing all its ESG efforts, Kimco has shifted to managing through a cross-functional steering committee comprised of various department leaders. From an environmental perspective, moving the needle requires a sustained multiyear commitment, Flynn observed. He noted that the scale with which Kimco has adopted energy efficiency measures has been “transformative.” For example, the REIT recently concluded a first-of-its-kind installation of over 4,500 submeters across every tenant space in its portfolio. Because tenants are now billed on their actual consumption, they have a direct financial incentive to conserve, he said.
Tue, July 02, 2019
REIT Fundamentals are “Sound” Heading into Second Half, Portfolio Manager Says
Steven Brown, global head and senior portfolio manager, real estate, at American Century Investment Management, discussed broad trends impacting the REIT market during a podcast interview at REITweek: 2019 Investor Conference. REITs have had a “nice bounce” in 2019, partly because of how inexpensive they were at the end of 2018 but also because of the change in Federal Reserve language toward interest rates, according to Brown. “We think that real estate fundamentals are sound, but if we do get a period of easing, that will support real estate even more," he said.
Wed, June 26, 2019
Cold Storage Industry Demand Driven by Population Growth, Changing Retail Habits
In the latest edition of the Nareit REIT report podcast, Matt Walaszek, associate director of industrial and logistics research at CBRE, provided an overview of trends in the cold storage sector. While cold storage represents only a small portion of the overall industrial warehouse inventory, major demand drivers such as population growth and changing consumer behaviors are driving increased attention to the segment, according to Walaszek. The strongest demand for cold storage facilities is currently coming from densely-populated metro areas, including Los Angeles, Seattle, Chicago, and the Northeast region. However, areas that are experiencing significant population growth, such as South Florida, Atlanta, and Dallas, are also fueling demand, he said.
Wed, June 19, 2019
REIT Industry Veteran Expects More Public-to-Private M&A Transactions
Marty Cicco, senior managing director at Evercore Partners, spoke with Nareit’s REIT Report podcast in New York at REITweek: 2019 Investor Conference. Cicco assessed the state of the commercial real estate market at mid-year. “It ranges from healthy, to beyond healthy, to unbelievable in some cases, but there are still a few sectors that have some challenges,” he said. At the same time, the business cycle—while clearly in the later stages—is breaking all records, according to Cicco. “You’re in an extraordinary time with low interest rates, the economy in the U.S. appears healthy, but we’re obviously in the midst of a growing trade war with China…[and] you’ve got issue like North Korea and Iran out there that could jolt the markets,” Cicco said.
Wed, June 12, 2019
Trade Tensions Reinforce the Value of Real Estate Investment, Portfolio Manager Says
Joel Beam, senior portfolio manager of real estate strategies at Salient, spoke with Nareit’s REIT Report podcast in New York at REITweek: 2019 Investor Conference. Trade tensions are reinforcing the value of property investment in general, according to Beam. REITs have outperformed this year and have outperformed “meaningfully” versus the broader market since April 30, he said. “I think that’s a testament that real estate represents a flight-to-safety approach for a lot of folks.” While certain subsectors may have more exposure to trade policy changes, “we’re really waiting for clarity on these matters before making portfolio changes. To some extent it’s too soon to tell,” Beam said. Beam also commented on the ongoing impact of e-commerce. “To me, the drama in this space is all about what happens to retail…we’re in a situation where tenants have more leverage and more choices, and landlords on the margin are having to rethink how they tenant their properties,” he said.
Fri, May 31, 2019
REITs and Listed Real Estate Offer Potential for “Outsized Returns”
REITs and listed real estate are likely to see minimal impact from ongoing trade tensions, while the sector offers the potential for “outsized returns” due to solid fundamentals, according to Laurel Durkay, senior vice president and portfolio manager of global and U.S. real estate at Cohen & Steers. Durkay was a guest on the latest edition of the Nareit REIT Report podcast. The domestically-focused nature of real estate securities provides “relative insulation” from trade tensions versus the broader equity market, Durkay said. “We do believe that real estate and REITs do offer a lot of very positive attributes in a time of heightened economic insecurity,” she noted.
Wed, May 22, 2019
New York Climate Change Bill Sets Bold Goals for Existing Buildings
The latest edition of the Nareit REIT Report podcast looked at the impact of New York’s recently-passed Climate Mobilization Act with Cliff Majersik, executive director of the Institute for Market Transformation. Majersik described the bill, which calls for buildings larger than 25,000 square feet to institute a 40% reduction in carbon emissions by 2030 and 80% by 2050, as “very ambitious.” He noted that New York and Washington, D.C. are the only two cities in the nation to target existing buildings. While many building owners probably won’t have to make any adjustments during the first compliance period, they would be “well advised to look at the whole scope of the law, all the way out to 2050, and to try to make sure they are taking action now that will position themselves to meet the requirements going forward,” Majersik said.
Wed, May 15, 2019
REITs Showing Increased Receptiveness to PropTech
The latest edition of the Nareit REIT Report podcast explores the topic of real estate-targeted technology, commonly known as PropTech, with Blake Liggio, a partner in the law firm Goodwin’s Real Estate Industry Group. PropTech has seen significant acceleration in recent years due to the growth of technologies targeting real estate and the increase in capital supporting those platforms, according to Liggio. Liggio said the benefits of PropTech within the real estate industry, namely the ability to increase operational efficiencies and impact overall returns, have become clearer. “This is a relatively new development…real estate was generally resistant to the idea that advancing technology was necessarily a worthwhile effort to explore,” he said.
Thu, May 02, 2019
PREIT Hitting Development Milestones in 2019
The latest edition of Nareit’s REIT Report podcast took an inside look at retail real estate with Joe Coradino, CEO of Philadelphia-based PREIT since 2012. Coradino described 2019 as an “exciting year” for PREIT. “We have so many milestones that we will execute on this year, projects that are coming to fruition that in some cases go back nearly 15 years.” One noteworthy project is Fashion District Philadelphia, which opens in September. It sits atop the main transportation station in downtown Philadelphia, with about 22 million commuters a year accessing public transportation via the mall’s concourse level.
Wed, April 24, 2019
Global Investors Remain Confident in U.S. Property Market
The latest edition of the Nareit REIT Report podcast featured Gunnar Branson, the CEO of AFIRE, an association for global investors focused on institutional real estate in the United States. Branson highlighted some of the key findings from AFIRE’s recently-released annual International Investor Survey. Despite the current length of the real estate cycle and geopolitical and economic concerns, Branson said there’s “a strong sense of confidence in how things look this year. There continues to be a lot of interest from non-U.S. investors in U.S. property markets.”
Wed, April 17, 2019
Braemar Hotels CEO Says Luxury Sector Buyers are Impacting Pricing
Richard Stockton, president and CEO of Braemar Hotels & Resorts discussed developments in the luxury hotel segment during the latest edition of the Nareit REIT Report podcast. Braemar invests primarily in full-service luxury hotels and resorts. Stockton discussed steps Braemar has taken to realign its portfolio, while also commenting on some of the significant weather-related challenges the REIT has faced. Stockton, meanwhile, touched on the benefits Braemar is accruing through its Enhanced Return Funding Program with external advisor Ashford Inc. Turning to investment transaction and liquidity in the luxury resort sector, Stockton said major buyers, including other REITs, have moved into the space. “That has put some pressure on pricing…pricing has gotten richer. It’s been a little bit more difficult for us to find deals that make sense financially, so we’re finding ourselves sifting through more deals than we’ve had to do in the past to meet our return criteria.”
Tue, April 02, 2019
PACE Loans, Opportunity Zones Emerge as Areas of Interest for REITs
Michael Kessler, a partner in the New York REIT practice of Alston & Bird LLP, was a guest on the latest episode of Nareit’s REIT Report podcast. Kessler discussed the next wave of innovative ideas and concepts that are emerging in the REIT sector. One area that is generating attention is clean energy and Property Assessed Clean Energy (PACE) loans, Kessler said. These provide incentives and regulatory frameworks to enable private capital, including mREITs, to fund energy efficiency improvements in residential and commercial properties. Many states have adopted PACE programs or are actively considering them, according to Kessler, adding that estimates point to hundreds of billions of dollars of improvements needing funding over time. Kessler sees opportunity zones as another area of interest. While not every opportunity zone strategy is right for a REIT, such as a fix-and-flip strategy, “many other strategies could work nicely using a REIT platform and potentially see better valuations.”
Fri, March 22, 2019
REITs Playing Key Role in Life Science Industry Momentum
In the latest edition of the Nareit REIT Report podcast, Ian Anderson, director of research and analysis at CBRE, spoke about the momentum driving the life science industry and the real estate that it occupies. A new report from CBRE shows that the industry is growing at its fastest pace in 18 years, with construction of lab space in the top five markets monitored by CBRE doubling over the past year. “The industry is certainly on a tear,” Anderson said. The long-term trajectory doesn’t show anything to derail growth, which continues to attract more investors to the industry. REITs, meanwhile, play a leading role in that growth. “There’s a lot of capital needed upfront, which scares off some of the smaller investors. That gives REITs an advantage right there,” Anderson said.
Fri, March 15, 2019
REITs Well Prepared for Lease Accounting Standard Changes
In the latest edition of the Nareit REIT Report podcast, Serena Wolfe, a partner at Ernst & Young LLP, discussed the Financial Accounting Standards Board’s lease accounting standard that took effect for publicly traded companies, including REITs, at the beginning of 2019. The new standard had been under discussion for 10 years or more, and “where we actually ended up is very different from where we began,” Wolfe said. The impact for REITs as lessors is not as significant as originally anticipated, and definitely not as large as for lessees, such as restaurants and retailers, she noted. REITs that are lessees, through a ground lease or a building lease, for example, “could face a large absolute dollar value on the balance sheet.” REITs, meanwhile, are largely up to date in adopting the new standard, according to Wolfe. She added that the new standard eliminates real-estate-specific lease guidance, meaning that REITs now have to follow guidance for leases of all assets. REITs will have to step back and look at their procedures and controls and figure out how they need to be adapted or changed, which is “particularly important for our public REITs that have internal control reporting,” she said.
Fri, March 08, 2019
Real Estate Associations Collaborate to Address Growing Need for Industry Talent
In the latest edition of the Nareit REIT Report podcast, Doug Bibby, president of the National Multifamily Housing Council (NMHC), discussed a new initiative aimed at attracting talent into the real estate industry. The NMHC is part of a collaboration of 29 real estate industry organizations, including Nareit, that are working to highlight the diversity of career paths within the sector. Together they have created Careers Building Communities (CBC), a platform designed for students, educators, and other individuals to explore the industry and learn more about what it takes to obtain education and employment within each sector. “It’s no secret that the job market is really, really tight right now. Commercial real estate is looking to fill literally millions of jobs,” Bibby said.
Mon, March 04, 2019
Large Institutional Investors Positively Impacting REIT Governance, Experts Say
The latest edition of the Nareit REIT Report podcast featured Yoel Kranz, a partner in Goodwin’s REIT Capital Markets and M&A/Corporate Governance practices, and Daniel Adams, a partner in the firm’s Business Law Department, where he is co-chair of the Capital Markets group and a member of its REITs and Real Estate M&A practices. Kranz and Adams spoke on various corporate governance issues, including where the impetus for change in the REIT sector is coming from today. Kranz pointed out that there is a relatively small group of large institutional investors that have changed the way they approach governance issues. “It used to be that these were very passive investors…that has really changed,” he said. Large institutional investors have taken a very active interest in governance and are making their wishes and interests known to management teams. “We’re living in a social and political environment today where governance is front and center,” Kranz said. “There really is a focus on good governance and doing the right thing and being good stewards of shareholder capital.”
Mon, February 18, 2019
New York Real Estate Outlook Bright, Despite Amazon Pullback in Long Island City
In the latest edition of the Nareit REIT Report podcast, Jim Sullivan, managing director and REIT analyst at BTIG, discussed the outlook for New York real estate following Amazon’s decision to abandon its plans to locate a second headquarters in Long Island City. Sullivan said that while the loss of a potential 25,000 jobs will obviously result in less demand, a recent decision by Alexandria Real Estate Equities, Inc. (NYSE: ARE) to purchase property in Long Island City speaks to the area’s growing importance as a home for the life sciences industry. He expects Alexandria to expand its presence there in the coming years. Overall, the Amazon decision is “not a death knell for Long Island City, but clearly a short-term setback.” Over the last couple of years, New York has become a center of tech job growth—including a significant commitment from Google, as well as from Amazon in Manhattan, according to Sullivan. “Firms up and down the spectrum of tech and social media are expanding aggressively in New York,” with New York-based tech start-ups raising more than $20 billion from venture capital in 2018, he noted.
Thu, February 07, 2019
Conditions in Place for Continued REIT M&A Activity in 2019
In the latest edition of the Nareit REIT Report podcast, Tim Bodner, U.S. real estate deals leader at PwC, discussed a range of topics, including the outlook for REIT mergers and acquisitions (M&A); the appeal of non-gateway markets; and the performance of non-traditional REIT asset classes. Last year saw several major REIT M&A deals, with an average value per transaction of $6.4 billion. Two deals exceeded $10 billion, Bodner noted. “We do believe that conditions are in place for more of the same in 2019,” fueled in part by the “tremendous” amount of private capital available, Bodner said.
Wed, January 30, 2019
REITs Enjoying Attractive Dividend Yields, Record-Low Leverage
Michael Torres, CEO of Adelante Capital Management, and Jeung Hyun, portfolio manager, joined the latest edition of the Nareit REIT Report podcast. Torres and Hyun discussed a number of topics, including: REIT fundamentals; discounts to net asset value (NAV); merger and acquisition (M&A) activity; the role of active portfolio management; and the potential for increased Asian investment in real estate. Torres noted that the REIT industry is entering 2019 with attractive dividend yields and record-low leverage. On the other hand, private market participants have a lower cost of capital and the ability to outbid their public market counterparts. Hyun said he expects some property types will trade at discounts to NAV for the foreseeable future. As for M&A activity, public to public deals are not as likely because “investors aren’t making enough of a distinction between companies and management teams to whom they want to grant the cost of capital advantage.”
Fri, January 18, 2019
Congressional Gridlock on the Agenda in 2019
In the latest edition of Nareit’s REIT Report podcast, Nareit Senior Vice President for Government Relations Robert Dibblee and Nareit Vice President for Government Relations John Jones discuss the outlook for the 116th Congress. With the House of Representatives now under Democratic control, and a divided Congress for the first time in nearly a decade—in addition to a looming presidential election cycle—prospects for legislative accomplishments are modest. “There will mostly be gridlock where policy is concerned, which we’re seeing reflected in the recent government shutdown,” Dibblee said. Must-do items, such as appropriations bills and debt limit legislation, could be the only two exceptions to the gridlock for the next two years, he said. “However, the current standoff could have long-term impacts on every aspect of the legislative agenda that we can’t anticipate right now.” Jones noted that “most issues will end up becoming polarized and it will be very difficult to accomplish anything of great importance during a presidential election cycle, especially beginning late 2019.”
Mon, January 07, 2019
REIT Supply and Demand Fundamentals Largely in Balance Heading into 2019
Tom Bohjalian, Cohen & Steers’ head of U.S. real estate and a senior portfolio manager for the firm’s real estate securities portfolios, was a guest on the latest edition of Nareit’s REIT Report podcast. Bohjalian sees REIT fundamentals in 2019 looking a lot like 2018, “with supply and demand largely in balance and with landlords still having some relative pricing power.” Cash flow and dividend growth on a per share basis should remain in a mid-single digit range for both 2019 and 2020. Asset values should also remain relatively stable. Bohjalian shared the view that REITs remain significantly underrepresented in defined contribution (DC) pension plans. Increased investor education on the positive attributes of REITs, including strong returns, diversification, and liquidity, will result in investors moving away from a traditional equity and fixed income allocation to one that adds more alternatives, including REITs, he said. “It will be a continued process of education and that will take time,” Bohjalian noted.
Wed, December 12, 2018
BlackRock Focusing on Sustainability’s Quantifiable Financial Impact
Sherry Rexroad, chief investment officer of the Americas and global real estate securities platform at BlackRock, Inc., was a guest on Nareit’s REIT Report podcast, recorded in San Francisco during Nareit’s REITworld: 2018 Annual Conference. Rexroad said sustainability is playing an increasingly central role in investment decisions at BlackRock. “We really believe that sustainability-related issues, ranging from board composition and human capital to climate change, can, and often do, have real quantifiable financial impacts,” Rexroad said. BlackRock’s approach, she said, is to include environmental, social, and governance (ESG) information into the investment decision-making process as part of the risk and return analysis.
Wed, December 05, 2018
Real Estate Recruitment Expert Optimistic on Diversity of Executive Board Composition
Gemma Burgess, managing director at executive search firm Ferguson Partners Ltd., was a guest on Nareit’s REIT Report podcast, recorded in San Francisco during Nareit’s REITworld: 2018 Annual Conference. Burgess commented on California’s move to require public companies to have at least one female on their boards. “We see it as a great step forward. Moreover, the importance here is placed on the investor community and boards to do the right thing… I think we’re seeing that in huge numbers at the moment across the country,” Burgess said.
Thu, November 29, 2018
REIT Credit Trends Look Stable as Fundamentals Remain Solid, Moody’s Says
Lori Marks, a senior credit officer at Moody's Investors Service, Inc., was a guest on Nareit’s REIT Report podcast, recorded in San Francisco during Nareit’s REITworld: 2018 Annual Conference. Marks said overall credit conditions for REITs are “stable, as real estate fundamentals remain solid and REITs maintain healthy balance sheets.” Growth is slowing for many property types, she said, with REITs expected to generate low single digit net operating income (NOI) growth next year. Moody’s expects REITs to maintain discipline as they seek investment opportunities, Marks said. “REITs are still able to issue unsecured debt at attractive, albeit higher, interest rates, and are also enjoying access to private capital as institutional demand for real estate remains strong,” she noted.
Mon, November 19, 2018
Data Center REITs Gaining Acceptance from Ratings Agencies, CyrusOne CFO Says
Diane Morefield, executive vice president and CFO of Cyrus One Inc. , was a guest on Nareit’s REIT Report podcast, recorded in San Francisco during Nareit’s REITworld: 2018 Annual Conference. CyrusOne received an investment grade rating from Standard & Poor’s in September. Although the company welcomed the news, Morefield said the ratings agencies have been slow to understand the data center model. She noted that prior to the CyrusOne upgrade there was only one other data center REIT with an investment grade rating. “Our profile, and that of the other data centers, is very consistent with the broader REIT industry,” Morefield said. She noted that more than 70 percent of CyrusOne’s customers are investment grade rated. “We’ve suffered from being classified as … a non-traditional REIT category, which has caused the rating agencies to review our asset class, in our view, more harshly than other REITs,” Morefield said. Looking ahead, “we’re very optimistic that we will achieve full investment grade rating in the near term as the other rating agencies now catch on to our more traditional traits.” Morefield also commented on CyrusOne’s focus on customer satisfaction. About 80 percent of leasing activity each quarter comes from existing customers. Meanwhile, Morefield said CyrusOne’s biggest opportunity for 2019 lies in international expansion. “We are well on the way to having a really strong footprint and portfolio throughout Europe,” she noted, while the company is also investing in data center platforms in China and Latin America.
Wed, November 14, 2018
Real Estate Fundamentals in Equilibrium Across Most Sectors, LaSalle Global CEO Says
Lisa Kaufman, global CEO and Americas portfolio manager for LaSalle Investment Management Securities, was a guest on Nareit’s REIT Report podcast, recorded in San Francisco during Nareit’s REITworld: 2018 Annual Conference. Kaufman said operating fundamentals are in equilibrium across most real estate sectors, with internal growth likely to roughly match inflation for the next couple of years. Among the outliers, however, are cell towers, where the runway for growth is “longer and better than what the market perceives,” she said.
Mon, November 05, 2018
Brookfield Portfolio Manager Favors High-Quality Malls, San Francisco Office
Bernhard Krieg, managing director and portfolio manager on the real estate equities team for Brookfield’s public securities group, was a guest on the latest edition of Nareit’s REIT Report podcast. Krieg discussed some of the factors that he and his team use to evaluate the global real estate securities landscape and commented on the gap between public and private real estate valuations in the United States. As for where he sees some of the best value opportunities in the U.S. market, Krieg pointed to high-quality shopping malls. “We think there’s a really big opportunity that exists for some of the larger, well-capitalized mall operators that are currently trading at a significant discount to their underlying market valuation,” Krieg said.
Thu, October 18, 2018
Deloitte 2019 Outlook Points to Increased Allocation to Real Estate
Jim Berry, U.S. Real Estate leader at Deloitte & Touche LLP, joined the latest edition of Nareit’s REIT Report podcast to discuss Deloitte’s newly-released 2019 Commercial Real Estate Outlook. The outlook surveyed 500 global commercial real estate investors on the factors that will drive their investment decisions in the year ahead. Berry noted that more than 97 percent of those surveyed indicated they would increase their capital allocation to real estate in the next 18 months, despite concerns about interest rates, trade tariffs, tax reform, and Brexit uncertainty. At the same time, investors plan to diversify their portfolio, “to capture the evolution of the real estate market due to the changing nature of work and tenant preferences,” Berry said. Meanwhile, the Deloitte report refers to certain real estate companies as “change agents,” due to their ability to alter the view about how physical space is used today. “Every company at this point has an opportunity to advance the ball, to adopt some of these change agent-type mentalities…it’s no longer an option to sit still and follow the old models,” he said. Berry also noted that pension fund survey respondents are planning to increase their capital commitment to real estate by 9 percent over the next 18 months—and a “significant portion” of this could be directed toward REITs. “It’s not just the largest REITs, but probably some of the midsize and smaller REITs, that have an opportunity to capitalize on these institutional investors as they plan to expand beyond just core markets in search of additional yield,” Berry said.
Fri, October 12, 2018
SOFR Transition to Impact Real Estate Market Broadly
Evan Marble, a member of Chatham Financial’s hedge advisory team, was a guest on the latest edition of Nareit’s REIT Report podcast. Marble discussed the planned transition away from the London Interbank Offered Rate (LIBOR) in favor of the Secured Overnight Financing Rate (SOFR). LIBOR is currently the predominant interest rate benchmark for the dollar and other global currencies and is referenced in instruments with “hundreds of trillions” of dollars of notional value, he noted. LIBOR is expected to be discontinued after 2021. SOFR was released on April 3 and is now publicly available. In July, Fannie Mae issued the market’s first-ever SOFR securities, followed by the World Bank and MetLife in August. “The market’s transition from LIBOR as a base borrowing index impacts most if not all of our real estate clients and the market broadly,” Marble said. It will impact newly-issued and legacy floating rate mortgages, corporate lines of credit, bank term loans, commercial mortgage backed securities (CMBS), as well as the market for interest rate hedges, he explained.
Mon, October 01, 2018
Pebblebrook to Finetune Portfolio Following LaSalle Merger
Jon Bortz, chairman, president, and CEO of Pebblebrook Hotel Trust, was a guest on the latest edition of Nareit’s REIT Report podcast. Early in September, Pebblebrook announced it would pay $5.2 billion to acquire fellow hotel REIT LaSalle Hotel Properties, ending a series of revised offers that began in March. The deal is expected to close later this year. Bortz, who founded both REITs, said the two companies share an “incredible similarity” in terms of assets, quality, markets, geography, and brands. Pebblebrook has said it plans to sell between $500 million and $1 billion of assets from the combined portfolio. The bulk of sales are likely to come from the LaSalle side and from the East Coast, Bortz said. “The sales will allow us to finetune the portfolio from a size and diversification perspective,” he noted. Looking ahead, Bortz said a number of opportunities exist within the LaSalle portfolio.
Thu, September 27, 2018
Kilroy Realty Heading to Carbon Neutral Status by 2020
Sara Neff, Kilroy Realty Corp.’s senior vice president for sustainability, was a guest on the latest edition of Nareit’s REIT Report podcast. Kilroy was recently named a global sector leader in the 2018 GRESB Real Estate Assessment. The West Coast office REIT has set a goal to achieve carbon neutral operations by the end of 2020. Neff noted that although buildings generate 40 percent of carbon emissions, they are still largely overlooked by both the real estate and the larger environmental community. Kilroy is attempting to change that and has already put agreements in place to reach the 2020 deadline, Neff said. “We are going to deliver.”
Wed, September 19, 2018
Blockchain Could Shrink Differences in How Public, Private Real Estate Returns Are Measured
Brad Case, Nareit senior vice president for research and industry information, was a guest on the latest episode of Nareit’s REIT Report podcast and discussed the impact of emerging blockchain technology on the real estate industry. Developed in connection with cryptocurrencies, blockchain is “essentially a set of practices that make it possible to keep records of who owns assets,” Case explaied. He noted that although blockchain is not the same as distributed ledger, for the purposes of considering the effect on real estate, the two terms can be treated as synonyms. Blockchain can establish ownership of an asset much more efficiently than at present, Case said. In addition, the technology makes it possible for governments to keep property records used for tax purposes at a reduced cost and lower probability of fraud.
Thu, September 13, 2018
Lodging Fundamentals “Very Bullish,” Ashford Executive Says
Conditions across the entire hotel industry are “very healthy,” said Ashford Inc. (NYSE American: AINC) Co-President and Chief Strategy Officer Rob Hays, who was a guest on the latest edition of Nareit’s REIT Report podcast. Ashford advises two REITs, Ashford Hospitality Trust, Inc., which focuses on the full-service segment, and Braemar Hotels & Resorts, which concentrates more on the luxury sector. Supply growth is holding firm at around two percent, while demand is staying ahead of that, Hays said. The industry has also seen some occupancy gains, combined with inflationary-type room rate increases, he added.
Tue, September 04, 2018
Real Estate Cycle “In a Good Place,” Strategist Says
Jacques Gordon, global head of research and strategy at LaSalle Investment Management, was a recent guest on the Nareit REIT Report podcast. Gordon will be speaking on the economic outlook for real estate at Nareit’s SFO Forum 2018 on Sept. 24. In terms of the real estate cycle, “we’re in a good place,” Gordon said. “Fundamentals are healthy. There’s a lot of new supply but there’s also a lot of demand. Rent growth is steadily upward,” Gordon noted. “There’s a lot of good news already registered in 2018 and we expect steady as she goes, positive for the rest of the year,” he added.
Fri, August 24, 2018
EPA ENERGY STAR Scores Expected to Fall After Aug. 27 Metric Changes
In the latest edition of Nareit’s REIT Report podcast, Leslie Cook, ENERGY STAR program manager at the Environmental Protection Agency (EPA), discusses upcoming revisions to ENERGY STAR score calculations and steps that REITs can take to prepare for the changes. ENERGY STAR’s online tool, ENERGY STAR Portfolio Manager, is used to measure and track the energy performance of commercial buildings across the nation. For eligible buildings, the tool calculates a one to 100 ENERGY STAR score for rating a facility’s energy performance. Cook notes that the calculations for current ENERGY STAR performance metrics are based on 2003 data. Models are now being updated to reflect the 2012 Commercial Buildings Energy Consumption Survey (CBECS) from the Department of Energy. The updates will be released on August 27.
Thu, August 16, 2018
REITs Offer Hedge Against Elevated Tech Stock Valuations, Strategist Says
Scott Crowe, chief investment strategist at CenterSquare Investment Management, was a guest on the latest edition of Nareit’s REIT Report podcast. CenterSquare recently published a report, “The REIT vs. FAANG Valuation Showdown.” It notes that the current valuation of FAANG (Facebook, Apple, Amazon, Netflix, and Alphabet’s Google) stocks roughly equate to $3 trillion of total equity value, versus $5.8 trillion for the entire U.S. institutional real estate market. “Essentially the choice that the market is giving investors today is, would you rather own the five most popular tech stocks in America, or half of all the commercial real estate in this country?” Crowe said. While FAANG stocks are interesting and dynamic, the largest tech companies of today may not be at the top a decade from now. Real estate, however, is still going to be around to house the companies of the future, he noted.
Fri, August 10, 2018
Daily NAV REIT Market Benefitting from Shift Away from Traditional Non-Listed Products
Allan Swaringen, president & CEO of JLL Income Property Trust, was a guest on the latest edition of the Nareit REIT Report podcast. JLL Income Property Trust is a perpetual life, daily NAV REIT that is advised by LaSalle Investment Management and sponsored by JLL. Swaringen described the landscape of the non-listed REIT sector today. He pointed to three substantive changes that have occurred in the last five to six years. They include: a move to perpetual offerings; increased regulation and the adoption of an institutional valuation methodology; and a movement toward programs diversified by property type.
Thu, July 26, 2018
SBA Communications Expects to Play “Front Row Role” in Transition to 5G
SBA Communications is a wireless infrastructure REIT active in North, Central, and South American markets. The company has been in operation for nearly 30 years. Today it owns and operates close to 30,000 towers across the Western Hemisphere—from the upper reaches of Canada to the tips of Argentina and Chile. Jeffrey Stoops, president and CEO, described the domestic leasing environment as “probably as good as it’s been in the last four or five years.” All four major wireless carriers are busy pursuing projects and enhancements that ultimately will advance their transition to 5G technology, he said. SBA benefits in terms of new leases and tenancies on towers where carriers may not have been before.
Mon, July 16, 2018
REIT Returns Higher Across Broad Swath of Industry
Brad Case, Nareit senior vice president for research and industry information, was a guest on the latest edition of Nareit’s REIT report podcast. Case highlighted the turnaround in REIT market performance seen since February. Prior to that, REITs had underperformed the broader stock market – particularly growth stocks - for about a year and a half.
Fri, July 06, 2018
Brixmor Says Investor Questions Focus on Tenant Demand, Valuation Disconnect
Stacy Slater, senior vice president for investor relations at Brixmor Property Group Inc. (NYSE: BRX), joined Nareit for a special edition of Nareit’s REIT Report Podcast recorded in New York during Nareit’s REITweek: 2018 Investor Conference. Slater said some of the questions most frequently asked by investors focus on tenant demand at its shopping center properties and how that might have changed from last year. Investors are also interested in the disconnect between valuation levels and where Brixmor is selling its assets, she said. Other investor areas of interest include where Brixmor and other retail REIT stocks are trading on an implied cap, rate, and the impact of rising interest rates. Slater described competition for capital as “hard,” noting that there have been outflows out of the REIT industry.
Thu, June 21, 2018
REIT Portfolio Manager Steve Brown Sees Inflection Point in Same-Store NOI
Steven Brown, senior portfolio manager at American Century Investments, joined Nareit for a special edition of Nareit’s REIT Report Podcast recorded in New York during Nareit’s REITweek: 2018 Investor Conference. Brown commented on REIT fundamentals, noting that following a deceleration in the last couple of years, “we’re starting to see an inflection point in terms of same-store net operating income (NOI).” If the United States economy continues to improve, that could bode well for an acceleration in REIT fundamentals in 2019, he added.
Fri, June 15, 2018
REIT Portfolio Managers Watching Capital Formation, M&A Activity and Risk-Taking
Laurel Durkay, portfolio manager at Cohen & Steers, and J. Scott Craig, portfolio manager at Eaton Vance, were guests on a special edition of Nareit’s REIT Report Podcast recorded in New York during Nareit’s REITweek: 2018 Investor Conference. Durkay and Craig discussed several key topics, including the messages from REIT management teams that they are paying most attention to.
Tue, May 29, 2018
REIT Valuation Levels Likely to Result in More Go-Private Transactions
Hans Nordby, managing director of CoStar Portfolio Strategy, is the guest on the latest edition of Nareit’s REIT Report podcast. Nordby discusses some of the main factors influencing REIT valuations and what the sharp disconnect between public and private market real estate values could mean going forward.
Thu, May 17, 2018
REIT Valuations Likely to Better Reflect Underlying Fundamentals Going Forward
Nareit’s Brad Case sees signs that investors are regaining interest in REITs.
Wed, May 09, 2018
Prologis/DCT Deal Underscores Continued Demand in Industrial REIT Sector, Analyst Says
Bloomberg’s Lindsay Dutch says deal may not change competitive landscape overall.
Wed, May 02, 2018
REIT Underlying Fundamentals Point to Upside Potential in 2018
Nareit’s Calvin Schnure says increased certainty on interest rates will support REITs.
Tue, April 24, 2018
Global Net Lease Sees “Tremendous Pipeline” of Acquisition Opportunities
James Nelson, president and CEO of Global Net Lease is the guest on the latest episode of Nareit’s REIT Report podcast. Nelson, who was named CEO in August 2017, notes that GNL’s net lease portfolio is about evenly split between the United States and Europe.
Tue, April 17, 2018
NIC Chief Economist Says Senior Housing Remains a Compelling Story for Investors
NIC’s Beth Mace says demographic forces “just getting better.”
Mon, April 09, 2018
NYU Schack Dean Sam Chandan Highlights Broad-Based Benefits of Diversity
Schack research points to link between diverse populations and long-term growth.
Fri, March 30, 2018
American Tower CEO Says REIT Taking Leading Role in 5G Transition
5G will allow mobile devices to stream high definition videos and offer augmented and virtual reality products. 5G will also enable a “really robust” Internet of Things environment, including the use of autonomous vehicles and drones, says James Taiclet, chairman, president and CEO of American Tower Corp.
Thu, March 29, 2018
ESG Focus Enhances REIT Performance, Investment Strategist Says
Scott Crowe, chief investment strategist at CenterSquare Investment Management, spoke about environmental, social and governance (ESG) trends within the REIT sector, and how CenterSquare’s own analysis of ESG matters has changed during the past two decades.
Mon, March 19, 2018
Nareit Initiative Seeks to Promote Role of Women in Real Estate
Bonnie Gottlieb, Nareit’s senior vice president for industry and member affairs, is Nareit’s liaison to its recently-launched Dividends Through Diversity initiative. She discussed the goals of the program, and why Nareit felt this was the right time to address the issue of diversity in REITs and the broader commercial real estate industry.
Wed, March 14, 2018
Retail REIT Washington Prime Group CEO Urges Thinking Outside the Box
Lou Conforti, CEO and director of retail REIT Washington Prime Group Inc. provides an overview of developments at Washington Prime as well as across the retail real estate industry more broadly.
Mon, February 26, 2018
Volatility Dominating REIT Market, Portfolio Manager Says
Salient’s Joel Beam highlights long-term benefits of REIT investment.
Wed, February 21, 2018
First Industrial Realty CEO Sees Golden Age for Industrial Real Estate
First Industrial Realty Trust, Inc.’s President and CEO Peter Baccile discusses his move from investment banking to the C-suite, priorities during his first year on the job and why this is a “golden age” for industrial real estate.
Thu, February 15, 2018
REITs and Interest Rates with Nareit's Calvin Schnure
Nareit's Calvin Schnure discusses the effects of interest rates and REITs.
Thu, February 01, 2018
Leisure and Hospitality REIT VICI Properties Lists on NYSE
VICI Properties CEO Ed Pitoniak discusses the timing of the company's IPO on Feb. 1.
Tue, January 23, 2018
Multifamily REITs a Sector to Watch in 2018
REIT analyst Richard Anderson of Mizuho reviews the tops stories in the REIT market from 2017 and looks ahead to the rest of 2018.
Tue, January 16, 2018
Nareit ESG Forum Tackles Top Real Estate Sustainability Issues
Nareit's Fulya Kocak provides a preview of the upcoming ESG Forum in Seattle from Jan. 23-24.
Thu, January 11, 2018
How the New Tax Law Affects REITs
Nareit’s Cathy Barre discusses impact of the new tax law changes on REITs. Nareit's REITwise: 2018 Law, Accounting & Finance Conference will have more in-depth information on the impact of tax reform on REITs.
Fri, December 22, 2017
Alexandria Real Estate Equities Implementing Award-Winning Health and Wellness Program
Alexandria sustainability lead Ari Frankel highlights benefits of Fitwel program.
Fri, December 08, 2017
Data Centers, Cell Towers Offer Tech Plays in Real Estate
Burl East, manager of the Altegris/AACA Opportunistic Real Estate Fund, discusses his thoughts on technology-focused investment opportunities in real estate, such as data centers and infrastructure.
Tue, November 07, 2017
Real Estate Companies Adapting to New Technologies
Deloitte’s Jim Berry says real estate companies facing similar concerns and opportunities as other businesses when it comes to disruptive technologies.
Wed, November 01, 2017
Enhancements to Nareit D&O Insurance Program
Learn about the changes to the Nareit Directors & Officers Liability Insurance Program from Tim Crowley, managing director, Crystal & Company; Stephen Kelly, director, Crystal & Company; and Howard Sider, underwriting manager, Arch Insurance Group. To learn more about how the 2017 enhancements can benefit your company, visit Nareit’s website or contact Crystal & Company Director Steve Kelly at 212-504-5847 or steve.kelly@crystalco.com.
Wed, November 01, 2017
One-on-One with American Tower CEO Jim Taiclet
In a special edition of The REIT Report: NAREIT’s Weekly Podcast, American Tower’s (NYSE: AMT) Jim Taiclet offered his perspectives on more than 15 years as CEO of what is now the largest REIT.
Tue, October 24, 2017
Health Care REIT Welltower Finds More Retirees Want Big City Life
Welltower CFO John Goodey discusses the growing desire among aging Americans to stay in major cities.
Tue, October 17, 2017
BDO Consultant Says Industrial Repurposing an Alternative for Surplus Retail Real Estate
BDO’s Dennis Duffy discusses the potential for converting retail properties into industrial assets.
Thu, October 05, 2017
Survey Finds Executives Still Bullish on Real Estate Market
DLA Piper’s John Sullivan says market still confident in investment from non-U.S. capital sources.
Mon, October 02, 2017
Green Street Analysts Says Single-Family Residential REITs Maturing
Size and quality of segment have “improved dramatically.”
Thu, September 21, 2017
Camden CEO Details Hurricane Recovery in Houston
Camden Property Trust Chairman and CEO Ric Campo discusses the impact of Hurricane Harvey on the Houston apartment market and how the company is responding to all of the damage.
Thu, September 14, 2017
Neuberger Berman Portfolio Manager Says REITs Offer Best Way to Build Global Real Estate Portfolio
REITs are “bricks and mortar with liquidity,” according to Neuberger Berman’s Gillian Tiltman.
Thu, August 17, 2017
Market Open to "Non-traditional" REIT IPOs
Dirk Aulabaugh of Green Street's Advisory Group says some mall REIT portfolios could become privatization targets.
Mon, August 14, 2017
Real Estate Fund Manager Says Europe Undervalued
Portfolio manager Jay Leupp of Lazard Asset Management discusses his outlook for global real estate investment in the remainder of 2017.
Mon, July 31, 2017
Former Host Hotels CEO Says Financial Crisis Posed Greatest Challenge of His Career
Ed Walter reflects on the evolution of the lodging business and REITs and real estate.
Thu, July 20, 2017
Apartment Living Now a Lifestyle Choice, According to Steadfast President
Ella Shaw Neyland of Steadfast Apartment REIT discusses trends in the multifamily real estate sector.
Thu, July 06, 2017
Analyst Says Office REITs Continue to Evolve to Meet Market Demands
Richard Anderson of Mizuho Securities downplays possibility of rush of deals in office sector.
Mon, June 19, 2017
Prologis Surpassing Goals for Cutting Greenhouse Gas Emissions
Prologis' Jeannie Renne-Malone discusses the results of the industrial REIT's latest sustainability report.
Tue, May 30, 2017
NAREIT CEO Previews REITWeek 2017
NAREIT’s Steve Wechsler says NAREIT’s Investor Forum showcases “breadth and depth” of the REIT industry.
Fri, May 26, 2017
Foreign Investors Still Keen on U.S. Real Estate
Michael Schwartz of RSM discusses trends in foreign investment in U.S. real estate.
Thu, May 18, 2017
Longtime Analyst Predicts REITs Will Own Growing Share of Real Estate Market
Steve Manaker discusses the changes to the REIT industry in his career.
Tue, May 09, 2017
Watson Land Company’s New CEO on the Industrial REIT’s Future
Newly appointed chief executive Jeffrey Jennison says the historic company will remain rooted in California.
Fri, April 28, 2017
Mortgage Delinquencies Lower Than Projected, Analyst Says
Trepp’s Manus Clancy analyzes the wall of maturities in the mortgage market.
Fri, April 21, 2017
REITs’ Strategies for Changes in Retail Paying Off
NAREIT’s Calvin Schnure discusses the impact of REITs’ efforts to adapt to shifts in consumer shopping behavior.
Thu, April 06, 2017
As Stores Close, Analyst Says Investing in Upgrades Key for Retail REITs
Alexander Goldfarb of Sandler O’Neill discusses how the wave of retailers going out of business has affected retail REITs.
Tue, March 28, 2017
Real Estate Industry Showing Early Signs of Optimism About Trump
FTI Consulting’s Michael Hedden says property markets demonstrated resilience in last year in face of global challenges.
Thu, March 16, 2017
Fundamentals Supporting Real Estate Demand “Quite Solid”
NAREIT’s John Worth previews a REITWise 2017 panel on the state of the real estate market.
Thu, March 09, 2017
Prologis Finds Strong Industrial Rent Growth Globally
Research head Chris Caton discusses factors driving up rents around the world.
Fri, February 24, 2017
The Evolution of Investor Activism in the REIT Industry
Equity Residential CFO Mark Parrell previews investor activism panel at REITWise 2017.
Fri, February 10, 2017
Blackstone’s Entry Energizes PNLR Market
Tony Chereso of the IPA says capital raising for PNLRs is on the upswing after debut of Blackstone Real Estate Income Trust.
Thu, February 02, 2017
With Trump in White House, Stability Key for Real Estate Investors
Malcolm Montgomery, partner with Shearman & Sterling, discusses his views on the potential impact of public policy changes on real estate investment. He also offers an upbeat assessment of the market for industrial, data center and single-family home rental REITs.
Wed, January 18, 2017
Co-working’s Impact on Office Real Estate
Lea Overby of Morningstar Credit Ratings on the effects of the growth of co-working on office real estate and commercial mortgage-backed securities.
Thu, January 12, 2017
Equinix Progressing on Renewable Energy Pledge
Equinix's David Rinard discusses the data center REIT's efforts to transition to 100 percent renewable energy.
Thu, January 05, 2017
REIT Stories to Follow in 2017
David Auerbach of Esposito Securities joins The REIT Report to look back at some of the key stories in the REIT market in 2016 and to discuss what lies ahead in the new year.
Wed, December 28, 2016
Air Quality a Focus of Welltower's Green Arrow Program
Rick Avery, vice president of sustainability at Welltower, discusses the objectives of the health care REIT's Green Arrow sustainability program with NAREIT's Fulya Kocak.
Thu, December 15, 2016
Macerich Sees Importance of Sustainability in Attracting Shoppers
Jeff Bedell, vice president for sustainability at retail REIT Macerich, talks with NAREIT's Fulya Kocak. Macerich won the 2016 Leader in the Light Award in the Retail category, and Bedell says sustainability plays a part in the company's expanding efforts to attract shoppers.
Thu, December 08, 2016
Kilroy Taking Strategic Steps to Finance Solar Power
In a special edition of The REIT Report, Sara Neff of Kilroy Realty discusses solar power’s impact on the company’s energy efficiency.
Thu, December 01, 2016
Vornado Emphasizes Tenant Engagement to Drive Sustainabiilty Success
In a special edition of The REIT Report, NAREIT's Fulya Kocak talks with Dan Egan, head of sustainability and utilities at Vornado Realty Trust (NYSE: VNO), about the company's efforts to use tenant engagement to improve sustainability performance. Vornado won the 2016 Leader in the Award in the Diversified category in recognition of the company's leadership and innovation in sustainability.
Fri, November 11, 2016
Investors Want to Know About REITs' Sustainability Plans
Gabe Buerkle and Michael Hudgins of EII Capital Management talk about the importance of sustainability in the eyes of real estate investors.
Thu, November 03, 2016
Keys to Successful Succession
Camille Lee and Dominic Cottone of Ferguson Partners discussed keys for succession planning in REIT leadership.
Thu, October 27, 2016
More Real Estate Consolidation “Inevitable”
Veteran REIT analyst Rich Moore talks about the future of REITs and real estate investment.
Fri, October 21, 2016
Capital Markets Receptive to REITs
Keven Lindemann of S&P Global Market Intelligence discusses REITs' capital raising actives in 2016.
Thu, October 06, 2016
REITs Improving Liquidity Profiles, Fitch Analyst Says
Steven Marks of Fitch Ratings discusses the firm's latest research on liquidity in the REIT market and REITs' access to the capital markets.
Fri, September 30, 2016
Health Care Real Estate “Fertile Ground” for Sustainability Programs
Jeff Miller, executive vice president and COO of health care REIT Welltower, Inc., discusses the evolution of the company’s sustainability program and the opportunities for better sustainability practices in the health care real estate sector.
Thu, September 15, 2016
Real Estate Funds Can Expect More Capital Flows
Steve Buller of Fidelity Investments discusses the impact of real estate being elevated to a new headline sector under the Global Industry Classification Standard (GICS) on the discipline of real estate investing.
Thu, September 08, 2016
REITs Will Gain Prominence from GICS Move
NAREIT’s Mike Grupe says the new real estate sector will mean REITs are more likely to trade in line with underlying fundamentals.
Thu, September 01, 2016
Industrial Real Estate Enjoying Strong Year
Jack Rosenberg of Colliers discusses some of the latest trends and developments in industrial real estate.
Thu, August 25, 2016
Mall REIT GGP Making Sustainability Strides
In the latest episode of The REIT Report: NAREIT's Weekly Podcast, GGP Executive Vice President and COO Shobi Khan discussed the results of the mall REIT’s 2016 sustainability report.
Thu, August 04, 2016
Low Interest Rates Driving Real Estate IPOs, Menna Says
“The game changes dramatically” once rates start to rise, according to real estate transactions specialist.
Fri, July 22, 2016
Industrial REITs Still Gaining from e-Commerce, Trader Says
David Auerbach, an institutional REIT trader with Esposito Securities, talks about the latest developments in single-family REITs, the impact of online retail on industrial REITs and how elevating real estate to a headline sector under the Global Industry Classification Standard will increase the visibility of REITs.
Fri, July 08, 2016
Investors Looking for Real Estate Deals in U.K. After Brexit
Jahn Brodwin of FTI Consulting says the fallout from the U.K. vote in favor of leaving the European Union means "London is on sale."
Fri, June 24, 2016
Mortgage Lending Key to Outlook for Multifamily REITs
Britton Costa of Fitch Ratings says credit markets are a key driver multifamily operating performance.
Thu, June 16, 2016
Brexit Vote Affecting Property Markets in England and Europe
CenterSquare’s Scott Crowe says real estate business is “on hold” as the markets await the results of the vote in the U.K.
Fri, June 03, 2016
Project Delivers More Building Efficiency Information
Cliff Majersik, executive director of the Institute for Market Transformation, discusses a new effort from the U.S. Department of Energy (DOE) and CoStar Group, Inc. to provide more information on the energy efficiency of buildings.
Thu, May 26, 2016
Policy Changes Impacting Skilled Nursing Real Estate
Kevin Tyler of Green Street Advisors on the latest developments in health care real estate.
Thu, May 12, 2016
Survey: Real Estate Executives Less Confident in Health of Market
Jay Epstien of DLA Piper on the results of the firm’s recent survey of real estate industry executives.
Fri, May 06, 2016
Office REIT Kilroy Reaching Sustainability Goals
Kilroy Realty’s Sara Neff talks about some of the company's latest achievements in energy efficiency, water conservation, and health and wellness.
Thu, April 28, 2016
Steers Looks Back at Formation of First Real Estate Securities Fund
Veteran REIT investor Bob Steers reflects on his experiences launching the first real estate securities mutual fund in 1985 and offers his views on the future of the industry.
Fri, April 22, 2016
Digital Realty Dedicated to Cutting Water Usage
Aaron Binkley of Digital Realty Trust discuss the points of emphasis in the company's sustainability program, including efforts to decrease its water consumption.
Fri, April 15, 2016
CMBS Issuance Undergoing Sharp Decline
Orest Mandzy, managing editor at Commercial Real Estate Direct, discussed the first quarter performance of the commercial mortgage-backed securities (CMBS) market.
Thu, April 07, 2016
Forecasters See Slowing Real Estate Growth
Anita Kramer of the Urban Land Institute analyzes the results of ULI's semi-annual forecast from real estate economists and analysts.
Tue, March 29, 2016
New Lenders Stepping Up to Refinance Debt Maturities
Anup Agarwal, head of mortgage-backed securities and asset-backed securities with Western Asset Management Company, discusses the impending wave of commercial mortgage debt maturities and how the financial markets are reacting.
Wed, March 23, 2016
Analyst Says Real Estate Assets Holding Firm
Joi Mar of Green Street Advisors discusses the supply-demand balance and asset valuations in the commercial real estate market.
Thu, March 17, 2016
More Institutional Investors Turning to REITs
CenterSquare Investment Management CEO and CIO Todd Briddell says major investors increasingly use REITs as part of their real estate allocations.
Fri, February 19, 2016
Online Retail Heating Up Demand for Industrial Space
Eric Frankel of Green Street Advisors break downs the latest developments in the industrial real estate sector, including the growth in demand for space.
Fri, February 12, 2016
Apartment Sector Yet to Hit Peak
CohnReznick's David Kessler says the multifamily sector still has room to run.
Thu, January 21, 2016
Real Estate Lending Adjusts to Regulatory Landscape
Malcolm Montgomery of Shearman & Sterling discusses some of the latest developments in the real estate lending markets.
Thu, January 14, 2016
FIRPTA Reform a Boost to U.S. Real Estate
Jim Fetgatter, chief executive of the AFIRE, offers his thoughts on the effects of legislative changes to the rules governing foreign investment in U.S. real estate and reviews the results of AFIRE's annual survey of investors.
Fri, January 08, 2016
Office REITs Face Changing Demand for Space
John Bejjani, a senior analyst with Green Street Advisors, discusses the economic backdrop for office REITs and how they are adjusting to the drive for more efficient use of space.
Wed, December 09, 2015
Episode 50: New Trends in Real Estate Development
Chris Caton of industrial REIT Prologis shares the latest findings of his research regarding development activity in the real estate industry.
Thu, December 03, 2015
Podcast 49: Real Estate Fundamentals Remain Healthy
Michael Hedden, managing director with FTI Consulting, covers the latest economic data and the implications for the real estate market.
Thu, November 12, 2015
Podcast 48: Apartment Deal to Drive Down CMBS Delinquencies
Trepp's Manus Clancy on the latest trends in the commercial mortgage-backed securities market.
Thu, November 05, 2015
Blackstone Deals Top Story for REITs in 2015
David Auerbach of Esposito Securities looks back at the biggest stories in the REIT market in 2015 and looks ahead to the coming year.
Fri, October 23, 2015
Podcast 46: Steadfast Apartment REIT Expands in Texas
Ella Neyland, president of Steadfast Apartment REIT, discusses the company's growth in Texas and value-add strategies in the increasingly competitive multifamily market.
Mon, October 12, 2015
Podcast 45: Real Estate and Technological Disruption
Deloitte's Bob O'Brien discusses how evolving technologies are changing the real estate business in the long run.
Fri, September 25, 2015
Podcast 44: REITs Should Weather Rate Hike
Mark Roberts of Deutsche Asset & Wealth Management discusses the near-term market outlook for real estate.
Wed, September 09, 2015
Podcast 43: Strategic Deal with Blackstone May Spark Hotel REIT Transactions
In the wake of the proposed sale of lodging REIT Strategic Hotels & Resorts to private equity firm Blackstone, Lukas Hartwich of Green Street Advisors analyzes the recent dealmaking activity in the hotel sector.
Mon, August 24, 2015
Podcast 42: American Campus Opens Work on 100th Property
American Campus Communities CEO Bill Bayless on a milestone for the company and the evolution of the student housing business.
Wed, August 19, 2015
Podcast 41: Devaluing the Yuan
Rodney Ramcharan of the USC Lusk Center for Real Estate explains the potential effects of the yuan's devaluation on the real estate industry.
Tue, July 21, 2015
Podcast 40: CMBS Market Update
Trepp's Manus Clancy on the latest developments in the market for commercial mortgage-backed securities.
Thu, July 02, 2015
Podcast 39: REITS and Modern Portfolio Theory
Creede Murphy of American Assets Capital Advisers on REIT investment through the lens of Modern Portfolio Theory.
Wed, June 17, 2015
Podcast 38: REITs and Institutional Investment Portfolios
Sean Ruhmann of NEPC discusses the argument that "REITs are real estate" and the case for institutional investment in REIT stocks.
Thu, May 28, 2015
Podcast 37: Real Estate as a Major Asset Class
Cornell University's David Funk discusses his recent article arguing that institutional investors should look at real estate as a permanent asset class alongside cash, stocks and bonds.
Wed, May 13, 2015
Podcast 36: Potential for REIT Privatizations
Steven Marks of Fitch Ratings on the possibility of stock exchange-listed REITs being taken private.
Thu, May 07, 2015
Podcast 35: Michael Hudgins, EII Capital Management
Michael Hudgins of EII Capital Management covers some of the major stories in real estate investment, including REIT valuations, the demand for real estate and the impact of secular factors on the U.S. real estate market.
Fri, May 01, 2015
Podcast 34: Joe Fisher, Deutsche Asset & Wealth Management
Joe Fisher of Deutsche Asset & Wealth Management discusses the relationship between interest rates and REIT market performance.
Tue, March 24, 2015
Podcast 33: Alok Singh, RealFoundations
Alok Singh, director for energy solutions with RealFoundations, discusses the results of new research on real estate companies' sustainability platforms.
Mon, March 09, 2015
Podcast: Susan Phillips, SelectLeaders
Susan Phillips of SelectLeaders discusses the latest trends in hiring in the real estate industry.
Wed, February 25, 2015
Podcast 31: Bob Gadsen, Alpine Funds
Bob Gadsden, portfolio manager of the Alpine Funds Realty Income and Growth Fund, some of his favorite real estate sectors in the current market.
Fri, February 13, 2015
Episode 30: Marcel Verbaas, Xenia Hotels & Resorts
Marcel Verbaas, president and CEO of Xenia Hotels & Resorts, Inc. (NYSE: XHR), discusses his company listing on the NYSE.
Fri, January 09, 2015
Episode 29: Christopher Volk, STORE Capital
Christopher Volk, president and CEO of STORE Capital, discusses the REIT's IPO in late 2014 and the transactions market in the net lease sector.
Thu, December 18, 2014
Podcast 28: David Auerbach, Esposito Securities
David Auerbach of Esposito Securities discusses the big stories in the REIT market in 2014 and looks ahead to 2015.
Tue, November 25, 2014
Episode 27: Bruce Schanzer, Cedar Realty Trust
Cedar Realty Trust President and CEO Bruce Schanzer discusses the upcoming holiday shopping season and its impact on retail REITs.
Thu, October 09, 2014
Episode 26: Sandy Paul, Delta Associates
Sandy Paul, executive vice president with Delta Associates, joins the NAREIT Podcast to discuss commercial real estate transaction volume.
Tue, September 30, 2014
Episode 25: Michael Hedden and Marc Shapiro, FTI Consulting
Michael Hedden and Marc Shapiro of FTI Consulting discuss the forecast for the commercial real estate market in the remainder of 2014 and look ahead to 2015.
Tue, September 23, 2014
Episode 24: Jim Rehlaender, Northwood Securities
Jim Rehlaender, CEO of Northwood Securities, discusses some of the latest trends in international real estate markets.
Fri, September 12, 2014
Episode 23: Jerry Cummins, Sidley Austin
Jerry Cummins, partner with Sidley Austin LP, joins the podcast to discuss some of the latest developments in commercial real estate transactions and the capital markets.
Thu, June 19, 2014
Episode 22: Mark Peternell, Regency Centers Corp.
Mark Peternell, vice president for sustainability with Regency Centers Corp. (NYSE: REG), joins the podcast to discuss some of his company's green initiatives and trends in the REIT industry.
Wed, May 14, 2014
Episode 21: Daniel Mense, Ness Holdings, Inc.
Daniel Mense, director with Ness Holdings, Inc., joins the NAREIT Podcast to discuss some of the latest trends in Los Angeles real estate, including international investment in the market.
Tue, April 08, 2014
Episode 20: Yoel Kranz, Goodwin Procter LLP
Yoel Kranz, partner with the law firm Goodwin Procter LLP, joins the podcast to discuss consolidation in the real estate market.
Tue, March 18, 2014
Episode 19: Peter Fass, Proskauer Rose LLP
Peter Fass, a partner in the New York office of law firm Proskauer Rose LLP, joins the NAREIT Podcast to discuss the latest trends in the public, non-listed REIT (PNLR) market. Fass also offers his thoughts on the implications of the growth in PNLRs with regard to stock exchange-listed REITs.
Wed, March 05, 2014
Episode 18: Jon Wheeler, Wheeler Real Estate Investment Trust
Jon Wheeler, chairman and CEO of shopping center REIT Wheeler Real Estate Investment Trust (NASDAQ: WHLR), joins the NAREIT Podcast to discuss his company's strategy of targeting secondary and tertiary geographic markets. Wheeler also offers his thoughts on the firm's transition to a stock exchange-listed REIT.
Wed, January 29, 2014
Episode 17: Bruce Schanzer, Cedar Realty Trust
Bruce Schanzer, president and CEO of Cedar Realty Trust (NYSE: CDR), discusses some of the latest developments at the shopping center REIT.
Mon, October 07, 2013
Episode 16: Joe Coradino, Pennsylvania Real Estate Investment Trust
The latest edition of the NAREIT Podcast features an interview with Pennsylvania Real Estate Investment Trust CEO Joe Coradino on his company’s efforts to rebalance its property portfolio.
Fri, September 27, 2013
Episode 15: Darryl Steinhause, DLA Piper
Darryl Steinhause, partner with the law firm DLA Piper, discusses the SEC's decision to lift its ban on the general solicitation of private placements and the effect on commercial real estate.
Fri, August 23, 2013
Episode 14: John Langer, SunTrust Banks
John Langer, manager of the REIT group at SunTrust Banks, joins the NAREIT Podcast to discuss trends in the REIT capital markets.
Fri, August 09, 2013
Episode 13: Clint Laurent of Global Demographics
Clint Laurent, managing director of Global Demographics Ltd., discusses the world's future socio-economic structure in light of trends in worldwide demography.
Thu, July 18, 2013
Episode 12: Ted Rollins of Campus Crest
Ted Rollins, CEO, co-chairman and co-founder of Campus Crest Communities, Inc. (NYSE: CCG), joins the REIT.com's Allen Kenney to discuss some of the latest news from his company and the student housing sector.
Wed, July 03, 2013
Episode 11: Haendel St. Juste of Morgan Stanley
Haendel St. Juste, equity research analyst with Morgan Stanley, appears on the NAREIT Podcast to discuss the impact of recent monetary policy developments on the REIT market.
Fri, June 28, 2013
Episode 10: Greg Williams of KPMG
Greg Williams, real estate sector leader with KPMG, joins NAREIT's Allen Kenney for a podcast to discuss the consensus among commercial real estate executives on the market outlook.
Fri, May 31, 2013
Episode 9: Ella Shaw Neyland of Steadfast Income REIT
Ella Shaw Neyland, president of Steadfast Income REIT, discusses the apartment market and her company's growth strategy.
Thu, May 16, 2013
Episode 8: Chuck Schreiber of KBS Capital Advisors
Chuck Schreiber of KBS Capital Advisors joins the NAREIT Podcast to discuss some of the latest trends in commercial real estate valuations and investment.
Wed, May 08, 2013
Episode 7: Jay Epstien of DLA Piper
Law firm DLA Piper recently surveyed commercial real estate executives about the state of the market and found significant enthusiasm for the sector's prospects. Jay Epstien, chair of DLA Piper's US Real Estate Practice, joined NAREIT's Allen Kenney for a podcast to discuss the findings.
Tue, April 30, 2013
Episode 6: Healthcare Trust of America
Scott Peters, president, CEO and chairman of Healthcare Trust of America (NYSE: HTA), joins NAREIT's Allen Kenney for a podcast to discuss the REIT's operating platform, business strategy and first year as a publicly traded company.
Wed, April 24, 2013
Episode 5: Capital Markets With Schecky Schechner
Schecky Schechner of Barclays Capital joins NAREIT's Allen Kenney for a podcast to discuss some of the latest trends in the commercial real estate capital markets.
Mon, March 25, 2013
Episode 4: Executive Compensation with Anthony Saitta of FTI Consulting
Anthony Saitta, managing director with FTI Consulting, joins NAREIT editorial director Allen Kenney for a podcast to discuss corporate governance and alternative approaches to executive compensation.
Thu, March 14, 2013
Episode 3: REITs and Inflation With United Realty's Jacob Frydman
Jacob Frydman, CEO of privately held real estate investment and advisory firm United Realty Partners, joins NAREIT editorial director Allen Kenney for a podcast to discuss the inflation-hedging benefits of commercial real estate investment.
Thu, March 07, 2013
Episode 2: Fundamentals of Fund Management With Cornerstone's Scott Westphal
Scott Westphal of Cornerstone Real Estate Advisers joins NAREIT editorial director Allen Kenney to discuss real estate fund management and ongoing trends in real estate investment.
loading...