Five Takeaways from the Non-Traded REIT & Retail Alternative Investment Symposium
Jun 21, 2018 | Mary Diduch |National Real Estate Investor
Non-traded REITS are making a comeback – that was the message that came across at the Non-Traded REIT & Retail Alternative Investment Symposium that took place this week in New York City. Fundraising has increased for the asset class, and new players have entered the space, looking to grow and diversify. Here are some highlights from the first day of the conference.
- Delaware statutory trust (DST) structures are “hot.” Kevin Gannon, managing director of investment banking firm Robert. A. Stanger & Co., said there is a lot of money being raised in DSTs, with roughly $2.5 billion expected this year, and there are big players in the space. Much of these are centered around multifamily assets, which serve their purposes for 1031 exchanges. “I’m told if you get the product out there, it will sell,” Gannon noted.
- Non-traded REIT performance continues to improve. For the 12 months ended in March, total returns for traditional non-traded REITs, on more than $47 billion of equity, were 6.22 percent, Gannon said. At the six-month mark, they were 3.06 percent. “That’s pretty good return in the real estate sector compared to the publicly traded REITs,” he added. Fundraising levels are also improving: after peaking at around $19.6 billion in 2013 and tapering off in the years after to around $4 billion annually, this year fundraising for non-traded REITs is anticipated to come in at around $5.1 billion, marking three quarters of growth in a row, Gannon said. “They’re starting to ramp up. They’re starting to come back.
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