Alex Pettee, CFA- Alex Pettee, CFA
Earnings Recap: The REIT Revival Is Real
The domestic-focused, defensively-oriented REIT sector has been a standout so far in 2019 following several years of middling performance. 2Q19 earnings results confirmed the positive momentum.
REIT investors say good riddance to the "rising interest rate environment," a mantra that kept downward pressure on REIT valuations throughout much of the past half-decade.
The "REIT Rejuvenation" of 2019 has restored the coveted NAV premium for most sectors, giving these REITs the currency to re-open the acquisition pipeline which had essentially shutdown since 2017.
Earnings season was better than expected. 60% beat FFO estimates, which was roughly in line with historical averages. An impressive 50% of REITs raised guidance, however, which was well above historical averages.
FFO and dividends per share grew at the fastest rate since 2016. Occupancy reached new record highs, as did the size of the development pipeline.
