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Investing January 3, 2005
REITs See Another Good Year in 2004
January 3, 2005 (PLANSPONSOR.com) - Real Estate
Investment Trusts (REITs) again performed well in 2004,
taking advantage of low interest rates, according to the
NAREIT Composite REIT Index.
Reported by Kip McDaniel
According to the company, the index posted a 30.4% gain in 2004. Worldwide real estate stock performance was even better, according to the company, posting 38% gains on the year.
This is slightly below the gains seen in 2003, when the index had its best year since 1976, posting 40% returns (See REITs End Year Nearly 40% Higher ).
Breaking down the index, retail investments performed the best, with regional malls bringing in an average of 40.3% gains on the year. Also notable was the industrial performance, which brought in 35.7% returns. On the lower end of the spectrum, manufactured homes brought in only 2.1% in 2004.
Equity REITs did even better than the basket of all REITs, with the return of diversified equities coming in at 32.56%.
According to a release from NAREIT, expectations for 2005 are not as high. REIT industry analysts are predicting total returns of as low as -10% to as high as 16%, with the average forecast in the 5-10% gain range,” according to the company.
To see a complete breakdown of REIT performance for 2004, please see http://www.nareit.com/nareitindexes/web4.htm .