The report also said U.S. REITs significantly outperformed the market in July. On a total return basis, the FTSE NAREIT All Equity REITs Index gained 11.79% and the FTSE NAREIT All REITs Index was up 10.36% for the first seven months of 2011 compared to 3.87% for the S&P 500. In July, the FTSE NAREIT All Equity REITs Index was up 1.05% and the FTSE NAREIT All REITs Index was up 0.39%, while the S&P 500 fell 2.03%.
On a 12-month basis ended July 31, the FTSE NAREIT All Equity REITs Index was up 23.72% and the FTSE NAREIT All REITs Index was up 22.37%, while the S&P 500 was up 19.65%.
All but one of the major REIT market sectors achieved gains for the first seven months of the year, and most sectors delivered strong double-digit returns, the NAREIT report said. The Self-Storage sector topped other REIT market sectors in the first seven months of 2011 with a 19.54% gain. Among the primary REIT “food groups,” the Apartment sector led the way with a 19.50% return. The Office sector delivered a 13.59% return followed by the Retail sector, up 12.64%. Within the Retail sector, Regional Malls drove performance with an 18.41% gain. The Industrial sector was up 11.42% for the first seven months.
For the 12 months ended July 31, the Industrial sector rewarded investors with a 45.13% return, followed by Apartments with a 36.37% return. Retail delivered a 29.13% return powered by the Regional Mall segment’s 36.16% return. The Office sector delivered a 20.56% return for the 12 months.REITs also continued to deliver strong yields for income-seeking investors. The dividend yield of the FTSE NAREIT All REITs Index was 4.44% and the yield of the FTSE NAREIT All Equity REITs Index was 3.43% at the end of July. The FTSE NAREIT Mortgage REITs Index’s dividend yield was 14.89%. By comparison, 10-year U.S. Treasury Notes yielded 2.80% at month-end.