Real estate investment trusts have been on a tear this year, with leading REIT indexes trouncing equities, according to NAREIT.
The FTSE NAREIT Equity REIT Index was up 24.7% as of October 31, and the FTSE NAREIT All REITs Index was up 23.9%. That compares to the 7.8% gain on the S&P 500 index. Both REIT indexes gained more than 4% during October.
REITs have benefited from attractive yields this year, and all but one REIT sector has delivered double-digit returns over that period, led by apartments (up 38%), lodging/resorts (up 31%) and shopping centers (up 28%).
NAREIT noted that REITs have been busy de-leveraging since the 2008 financial collapse, raising enough equity to reduce the debt ratio of the FTSE NAREIT Equity REIT Index from 66.3% to 43.5% since March 2009.
The FTSE NAREIT All REITs Index cash dividend yield was 4.41% and the FTSE NAREIT Equity REIT Index cash dividend yield was 3.61% at the end of October, while the S&P 500's dividend yield was 1.96%, according to NAREIT.