Cole Real Estate Income Strategy Leads Perpetual Life REITs In 5-Year Average Returns
Nov. 2, 2017 6:03 PM ET | Michael Stubben | Seeking Alpha
Summary
- Perpetual life REITs posted 6.0% TTM returns at 2Q17.
- Blackstone led perpetual life REITs with 7.1% TTM returns at 2Q17.
- Cole Real Estate Income Strategy has the highest 5-year average returns of 7.9%.
In 2Q17, perpetual life REITs, which are non-listed REITs that report daily or monthly net asset values, posted 1.6% quarterly returns and 6.0% trailing 12-month returns. Blackstone Real Estate Income Trust (“Blackstone”), which was declared effective recently on 9/22/16, posted the highest quarterly and trailing 12-month returns among perpetual life REITs at 2Q17. Blackstone reported a 2.7% quarterly return and 7.1% annualized return for the trailing 12 months in 2Q17.
While the perpetual life REIT market remains small, perpetual life REITs have experienced significant growth over the past two years. Perpetual life REITs, which raised $1.2 billion equity in 2016, are on pace to raise more than $1.5 billion equity in 2017. Blackstone is the capital raise leader for 2Q17 YTD, with $616 million equity raised out of $759 million equity for all perpetual life REITs. With many new market entrants, perpetual life REITs should experience strong growth in equity raise again in 2018.
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