‘The COVID Discount Bin’: Investors Lose Confidence In CRE As REIT Stocks Slump
September 22, 2020 | Jon Banister | Bisnow, Washington, D.C.
While major stock indices show the market has largely recovered from its coronavirus-induced plunge, REIT stocks are still well below their pre-crisis levels, showing a lack of investor confidence in the future of commercial real estate.
The Nareit index of all equity REITs was down 16.38% year-to-date as of Monday’s market close. The REIT sector is far underperforming the broader stock market, with the S&P 500 closing Monday up 0.78% on the year. “It’s a little bit puzzling because, in terms of operating performance, most sectors of commercial real estate have not been really hard-hit,” said Calvin Schnure, Nareit senior vice president of research and economic analysis. “What I suspect is going on is investors are concerned there may be longer-term structural changes in real estate markets.”
