iREIT Daily

You Can’t Stop the REIT Beat

Brad Thomas

467 postsJuly 28, 2021

I’m looking at the next round of real estate investment trusts (REITs) that just reported their earnings. And I have to say, it’s inspiring a line from Hairspray, of all things, torun through my head.

I think it’s the closing song of the Broadway musical turned movie that goes, “You can’t stop the beat.” It begins like this:

“You can’t stop an avalanche as it races down the hill.
You can try to stop the seasons, girl, but you know you never will.
And you can try to stop my dancing feet, but I just cannot stand still.
“‘Cause the world keeps spinning ‘round and ‘round
And my heart’s keeping time to the speed of sound
I was lost ‘til I heard the drums, then I found my way.
“‘Cause you can’t stop the beat.”

Well, you can’t stop the REIT beat either. Those lyrics apply just as well (or nearly as well) to the earnings news.

That’s not to say they’re all peachy perfect. There’s still a lot of room for improvement in many companies and subsectors as well.

But the vast majority of them are still trucking along despite last year’s predictions.

As the song says, “The world keeps spinning ‘round and ‘round” regardless of the naysayers. That’s why consumer confidence is on the rise.

The Conference Board reported yesterday that it hit 129.1 this month, the highest it’s been since last February – even despite inflation.

Speaking of which…

Realist Requirements on REITs, Anything Effecting REITs, and Everything Else to Boot

Remember that we’re realists here at Wide Moat Research. That’s why we didn’t panic in 2020. And that’s why we’re not getting euphoric in 2021.

I’ve been saying for months – in the face of silly comments to the contrary too – that inflation wasn’t a “transitory” issue. And the International Monetary Fund is now beginning to admit as much, with “beginning” being the key word.

Here’s a bit on that from Fox Business:

“‘In the case of monetary policy, central banks should look through what are transitory inflation movements,’ IMF chief economist Gita Gopinath said in a blog post Tuesday. ‘However, it’s very important that they remain prepared and strongly communicate what they will do if it turns out that inflation goes up even more [high] and is much more persistent than expected.’
“Should [that happen]… Gopinath said, it could [lead] to a faster tightening of monetary policy, which could possibly disrupt market conditions.
“‘These are some of the major risks we are concerned about,’ she wrote.”

Perhaps that factored into Apple (AAPL) and Microsoft’s (MSFT) lackluster results yesterday. Not that the companies themselves did badly. They easily beat estimates for the quarter.

It was the response to their beats that didn’t look so good, with investors deciding to nitpick their news.

Speaking of responses, the Federal Reserve should come out today with an update about its bond purchase plans. Will it continue to inject money into the markets? Will it keep interest rates low?

My guess is yes. But we will see what we will see.

The World According to REITs

Now that we’ve acknowledged and addressed all of that, let’s get down to REITs and how they did. And just to reiterate my realist remarks up above, we’ll start with a company I’ve criticized a lot as of late:

EPR Properties (EPR) brought in total Q2-21 quarterly revenue of $125.36 million compared to Q2-20’s $106.36 million. Its adjusted funds from operations (AFFO) were $53 million versus $33.3 million, or $0.71 per diluted common share versus $0.44. EPR also terminated its covenant relief period earlier than expected and reinstated its monthly cash dividend of $0.25, to be paid out next month.
Extra Space Storage (EXR) reported net income attributable to common stockholders of $1.25 per diluted share – a 56.3% jump over Q2-20. FFO (minus non-cash interest adjustments) rose 33.3% to $1.64, and same-store occupancy increased from 94.2% to 97%. It also acquired 13 operating stores, two that are still in the works, and five more existent ones through joint ventures.
EastGroup Properties (EGP) achieved net income attributable to common stockholders of $0.69 per diluted share, a $0.09 increase year-over-year. FFO rose from $1.33 to $1.47, and rental rates on new and renewed leases came in 31.2% higher on a straight-line basis. EGP is now 98.3% leased and 96.8% occupied, with another 79,000 square feet of operating properties purchased during the quarter. It also acquired 264,000 square feet of value-add properties and started construction on five more projects.

And here’s your earnings season bonus:

Tremont Mortgage Trust (TRMT) says it’s still on track to merge with RMR Mortgage Trust (RMRM) this quarter. The move is having an immediate negative effect on its numbers, with net income down 95.9% year-over-year to $98,000. And adjusted distributable earnings fell 15.8% from $2.43 million to $2 million. However, President Tom Lorenzi says the “portfolio continues to perform well as we execute on our business objective…”

If that isn’t enough to digest, feel free – literally – to sign up for Intelligent REIT Daily, where you’ll find another three such updates.

(Source: The Daily REITBeat)

Happy Investing

Brad Thomas

467 posts

View all my Posts

Brad Thomas is Senior Research Analyst at iREIT and CEO of Wide Moat Research LLC. With over 30 years of real estate experience, he is also long-time Editor of Forbes Real Estate Investor, a monthly subscription-based newsletter that dives deep into the vast world of profitable properties, and since 2021, he has served as an adjunct professor at New York University.

Thomas has also been featured on or in Forbes magazine, Kiplinger's, U.S. News and World Report, Money, NPR, Institutional Investor, GlobeStreet, CNN, Newsmax, and Fox. And he was the #1 contributing analyst on Seeking Alpha in 2014, 2015, 2016, 2017, 2018, 2019, 2020 and 2021 based on both page views and number of followers.

Thomas is the recently-published author of The Intelligent REIT Investor Guide (2021), co-author of The Intelligent REIT Investor (2016), and he wrote The Trump Factor: Unlocking The Secrets Behind The Trump Empire (2016) - all available on Amazon.

Thomas received a bachelor of science in business/economics from Presbyterian College and is married with five wonderful kids.

Jobs and a Deluge of REIT Earnings

REIT Mutual Fund	Symbol
Alpine Realty Income and Growth Fund	AIGYX, AIAGX
American Century Real Estate Fund	REAIX, REACX, AREEX, AREWX, ARYCX, AREDX
Real Estate Securities Fund	MRESX
AR Capital Real Estate Income Fund	ARIAX, ARICX, ARIPX
AssetMark Real Estate Securities Fund	AFREX
Aston/Harrison Street Real Estate Fund	AARIX, ARFCX
Baron Real Estate Fund	BREIX, BREFX
BlackRock Real Estate Securities	BIREX, BAREX, BCREX
Brookfield U.S. Listed Real Estate Fund	BRUAX, BRUCX, BRUIX, BRUYX
CGM Realty Fund	CGMRX
West Loop Realty Fund	REIIX, REIAX, REICX
Cohen & Steers Institutional Realty Shares	CSRIX
Cohen & Steers Realty Income Fund	CSEIX, CSDIX, CSBIX, CSCIX
Cohen & Steers Realty Shares	CSRSX
Columbia Real Estate Equity Fund	CREAX, CREIX, CRRVX, CRERX, CREEX, CRRFX, CREWX, CRECX, CREBX
Compass EMP REC Enhanced Volatility Weighted Fund	CWRAX, CWRIX, CWRTX, CWRCX
Davis Real Estate Fund	RPFRX, DREYX, DRECX, DREBX
Delaware Real Estate Investment Trust Portfolio II	DPRTX, DPRBX
Delaware Real Estate Investment Trust Portfolio	DPREX, DPRSX, DPRRX, DPRCX
DFA Real Estate Securities Portfolio	DFREX
Dunham Real Estate Stock Fund	DAREX, DNREX, DCREX
DWS RREEF Real Estate Securities Fund	RRRRX, RRREX, RRRAX, RRRSX, RRRBX, RRRCX
DWS RREEF Real Estate Securities Income Fund	REFAX, REFCX, REFIX, REFSX
Eaton Vance Real Estate Fund	EAREX, EIREX
EII Realty Securities Fund	EIIRX
Fidelity Advisor Real Estate Fund	FHEIX, FHEAX, FHETX, FHECX, FHEBX
Fidelity Advisor Real Estate Income Fund	FRIRX, FRIQX, FRINX, FRIOX
Fidelity Real Estate Income Fund	FRIFX
Fidelity Real Estate Investment Portfolio	FRESX
Fidelity Spartan Real Estate Index Fund	FSRNX, FRXIX, FSRVX
Fidelity Series Real Estate Equity Fund	FREDX, FREFX
Fidelity Series Real Estate Income Fund	FSREX, FSRWX
Forward Real Estate Long/Short Fund	KSRYX, FRLSX, FFSRX, KSRAX, KSRCX, KSRBX
Forward Real Estate Fund	FPREX, FFREX, KREAX, KRECX
Forward Select Income Fund	KIFYX, FSIMX, FFSLX, KIFAX, KIFBX, KIFCX
Franklin Real Estate Securities Fund	FREEX, FRLAX, FRRSX, FSERX
GMO Real Estate Fund	GMORX
Goldman Sachs Real Estate Securities Fund	GREIX, GRETX, GREAX, GRESX, GRERX, GREBX, GRECX
Great-West Real Estate Fund	MXREX
Heitman REIT Fund	OARTX, OBRTX
ING Real Estate Fund	CRARX, IREWX, IDROX, CLARX, CRWRX, CRCRX, CRBCX
INVESCO Real Estate Fund	REINX, IARFX, IARIX, IARYX, IARAX, IARRX, IARCX, AARBX
Ivy Real Estate Securities Fund	IRSAX, IREIX, IRSYX, IRSRX, IREEX, IRSCX, IRSBX
John Hancock Real Estate Securities Fund	JIREX
Johnson Realty Fund	JRLTX
J.P.Morgan Realty Income Fund	URTLX, JRIRX, URTAX, URTBX, URTCX
J.P. Morgan Security Capital U.S. Core Real Estate Securities Fund	CEEAX, CEERX, CEEFX, CEESX, CEECX
J.P. Morgan U.S. Real Estate Fund	SUSIX
Lazard U.S. Realty Equity Portfolio	LREIX, LREOX
Lazard U.S. Realty Income Portfolio	LRIIX, LRIOX
Manning & Napier Real Estate Series	MNRIX, MNREX
Morgan Stanley Institutional U.S. Real Estate Portfolio	MSUSX, MUSDX, MSULX, MURSX
Natixis AEW Real Estate Fund	NRFAX, NRFYX, NRFBX, NRFCX, NRFNX
Neuberger Berman Real Estate Fund	NBRIX, NBRFX, NREAX, NRERX, NRECX, NRREX
Nuveen Real Estate Securities Fund	FREAX, FARCX, FRSSX, FREBX, FRLCX, FREGX
Oppenheimer Real Estate Fund	OREAX, OREIX, OREYX, ORENX, OREBX, ORECX
PHOCAS Real Estate Fund	PHREX
PIMCO RealEstateRealReturn Strategy Fund	PRRSX, PETPX, PETAX, PETDX, PETCX, PETBX
Pioneer Real Estate Shares	PWREX, PYREX, PCREX, PBREX
Principal Real Estate Securities Fund	PIREX, PIRPX, PREPX, PRETX, PREJX, PRRAX, PRERX, PRENX, PRAEX, PRCEX, PRLEX
ProFunds Real Estate UltraSector ProFund	REPIX
Prudential Select Real Estate Fund	SREAX
Prudential U.S. Real Estate Fund	PJEAX, PJEZX, PJECX, PJEBX
REMS Real Estate Income 50/50 Portfolio	RREIX
REMS Real Estate Value-Opportunity Fund	HLRRX, HLPPX
Rydex Real Estate Fund	RYREX, RYHRX, RYCRX
SA Real Estate Securities Fund	SAREX
SEI Institutional Mgd Real Estate Fund	SETAX, SEIRX
Spirit of America Real Estate Income & Growth Fund	SOAAX
SSgA Clarion Real Estate Fund	SSREX
Stratton Real Estate Fund	STMDX
T.Rowe Price Real Estate Fund	TRREX, PAREX
TIAA-CREF Real Estate Securities Fund	TIREX, TRRPX, TRRSX, TCREX
Vanguard REIT Index Fund	VGSNX, VGRSX, VGSLX, VGSIX
Virtus Real Estate Securities Fund	PHRAX, PHRIX, PHRCX, PHRBX

REIT ETF	Symbol
Flex Shares	ASET
Wisdom Tree Global Ex-US	DRW
S&P 500 Equal Weight	EWRE
iShares FTSE Industrial/Office	FNIO
MSCI Real Estate Index	FREL
S&P REIT Index	FRI
First Trust S&P REIT	FRI
iShares Real Estate 50	FTY
Flexshares Global	GQRE
iShares Cohen & Streers	ICF
iShares International Developed RE	IFGL
iShares US RE	IYR
Premium Yield Equity REIT	KBWY
ETRACS Monthly Pay 2x Leverage	MORL
Market Vector Mortgage	MORT
iShares Global REIT	REET
iShares FTSE Mortgage	REM
iShares Residential	REZ
IQ US Real Estate Small Cap	ROOF
iShares FTSE NAREIT Retail	RTL
DOW Jones Global RE	RWO
SPDR Dow Jones	RWR
Schwab US REIT	SCHH
Super Dividend REIT	SRET
ProShares Ultra RE	URE
Vanguard REIT	VNQ
Vanguard Global ex-US	VNQI
iShares International Developed	WPS
Wilshire US REIT	WREI
Pacer Benchmark Data & Infrastructure RE	SRVR
Pacer Benchmark Industrial RE	INDS
Pacer Benchmark Retail RE	RTL
Hoya Capital Housing	HOMZ
NetLease Corporate RE	NETL

REIT Name	Ticker	Annual Increases/yr
Federal Realty	FRT	51
Universal Health Realty	UHT	33
National Retail Properties	NNN	29
Realty Income	O	27
Tanger Outlets	SKT	26
Urstadt Biddle	UBA	25
Essex Property Trust	ESS	25
W.P.Carey	WPC	22
National Health Investors	NHI	17
Equity Lifestyle	ELS	15
Digital Realty	DLR	15

You Can’t Stop the REIT Beat

Brad Thomas

467 postsJuly 28, 2021

Featured Articles

The Great Housing Market Migration Is VERY Interesting

Let Dividends Help You Deal With Disappointment In The Stock Market

Amazon Wants to Ask What Ails You

Wall Street’s Workforce Crisis Should Be Taken Seriously

Santa Claus Has Left the Building

You Can’t Stop the REIT Beat

467 postsJuly 28, 2021

REIT Mutual Funds

REIT ETFs

Not All Dividends Are the Same