Single-family rental (SFR) homes are dwellings where the occupants rent, rather than own, their place of residence. This investment universe, which grown substantially since the 2008 financial crisis, has been dominated by small investors and individuals.This is changing somewhat. Consolidation is allowing specific REITs to benefit from economies of scale and, most importantly, providing the runway for substantial shareholder returns over time.
Digital Infrastructure REITs continue to benefit from the insatiable growth in demand for data storage facilities. Click here to view infographic
At 8% of our portfolio, the German Apartment sector is currently a significant “thematic investment” here at Reitway Global. In this note we provide a recap on our investment thesis, the REIT-status of these companies and how they are unlocking value for shareholders.
2015 will be remembered as a tumultuous year for global stock markets. The oil price plummeted, the dollar skyrocketed and a slowdown in China sparked significant uncertainty across the globe. During these periods of high volatility it is important to remind oneself that financial markets are social structures. They should not be approached like a natural science.
Growing Asset Values, M&A and Interest Rates dominated the REIT headlines in 2015 Global REITs pushed forward in Q4 with a 5.74% return. This recovery took the total return for 2015 up to a subdued 2.18%. On the positive side, the asset class did outperform both Global Equities (-0.32%) and Global Bonds (-5.50%) in what was a tumultuous year for markets around the globe.
A flight to safety followed by a REIT recoveryGlobal REITs returned 0.93% in US Dollar (USD) terms during the third quarter (3Q15) – but it didn’t come easy. This relatively flat figure in isolation disguises the sharp price movements that occurred during the quarter.
The past few months have been a disappointing time for investors in South African and other global stock markets. At the time of writing the JSE ALSI had lost 8% in value since the highs reached in April of this year. The Australian (-15.25%) and Brazilian markets (-19.09%) have declined even further from their highs for the year.
Canadian publicly listed real estate investment trusts (REITs) have declined on average by 16% in price since their January 2015 highs. This is in-line with the movement in the US REIT market over the same time period. These negative moves occurred as global financial markets digested lower growth expectations as well as the (ongoing) anticipation of an upward move in the US Federal Funds Policy rate.