5 REITs now hitting new 2022 lows

Some real estate investment trusts (REITs) are hitting new year-to-date lows as the fallout from Fed Chairman Jerome Powell’s hawkish remarks at this year’s Jackson Hole, Wyoming meeting sinks in. His specific references to a “tighter policy” and “some pain” suggest higher-than-expected interest rates and for a longer-than-expected period.

Since REITs are generally sensitive to interest rate hikes, it’s not surprising to see a sell-off in the sector after Jackson Hole. What is surprising, however, is seeing the number of REITs hitting new 2022 lows. Take a look at the daily price charts for these five, some of which are familiar to the real estate community:

Related: This little-known REIT has produced double-digit annual returns over the past five years

Welltower Inc. (NYSE: SO)

Last week’s low of $75.80 is lower than the mid-June lows and the February low. Note how Welltower traveled from the $98 peak in April to the new low. That’s a 22% drop in four months, a lot of movement for the big healthcare facilities REIT with an average daily volume of 2.28 million shares.

Ventas Inc. (NYSE: VTR)

Last week’s low of $47.24 appears to be slightly off the mid-June lows and is definitely below the late January selloff. Ventas’ March high of $63 seems distant in such a short time. It’s a 25% slippage. If it’s any consolation, the health care facilities REIT remains above the December 2021 low, just below $46.

Boston Properties Inc. (NYSE: BXP)

Last week’s low of $78.02 is a new low and represents a nearly 40% drop from the late March high of $130. This office REIT pays a dividend of 4.90%, which makes it vulnerable to rising interest rates. Boston Properties has an average daily volume of 1.15 million shares.

Kilroy Realty Corp. (NYSE: KRC)

Last week’s low is $47.17. From the March high of $78 this price is a 38% drop. Kilroy Realty is another office REIT that pays a decent dividend: 4.34%. The average daily volume on it is just 812,000 shares.

Independence Realty Trust Inc. (NYSE: IRT)

The low of $19.01 represents a continuation of a downtrend in effect from the April high of $28. This is a loss of about 32%. Independence Realty is a residential REIT that pays a dividend of 2.88%. It is actively traded with an average daily volume of 2 million shares.

Downtrends in major REITs are not a pleasant sight for investors in the sector. Major REITs hitting new year-to-date lows demonstrate the severity of the problem. Reversals could occur at any time, but fighting the trend can be difficult. Powell’s prediction of “some pain” is already evident in these pace-sensitive REITs.

Other NYSE-traded REITs are doing better than these five, but few are making new highs and most are looking bearish on daily charts.

Highlights of today’s real estate investment news

  • The Flagship Real Estate Fund by financing has acquired a townhouse rental community in Charlotte, NC, for approximately $6.3 million. The Flagship Real Estate Fund has returned YTD 6.9% so far in 2022.

Find more real estate investment news and deals at Benzinga Alternative Investments

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