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June 29, 2016

REIT returns strong, allocations remain low, study finds

Name: Second Annual Blue Vault Broker Dealer Educational Summit 2016
Item: Broker Dealer Educational Summit 2016
Rating: 5
Author: Derek Hayes

BY ARLEEN JACOBIUS | JUNE 27, 2016 | Pensions & Investments

Real estate investment trusts can’t get any love from institutional investors.

While REITs had the highest average net return, investors had the lowest allocation to the securities, on average just 0.6% of total assets, according to a new study of 17 years of data.

The study, by C.E.M. Benchmarking Inc., a Toronto-based research firm, was commissioned by the National Association of Real Estate Investment Trusts, Washington.

“What we didn’t expect was the relative performance of REITs to other asset classes,” said Alexander D. Beath, a senior research analyst at CEM and co-author of the report, which studied the asset allocations and returns of 12 asset classes from the beginning of 1998 through year-end 2014.

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