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Cautious Optimism for REITs

Demand is decelerating but still robust.

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REITWeek 2016, the annual investor forum for the real estate investment trust industry, took place in New York last week. REIT management teams gave nearly 140 presentations, and we left with the following themes and takeaways.

Management teams are positive about underlying demand. Many REITs are still experiencing historically high levels of occupancy, which has helped fuel robust income growth for the past several years. Although this is moderating, there currently isn't a clear catalyst to negatively affect operations dramatically, though long-term demand questions remain for specific asset classes and markets (retail, skilled nursing facilities, Houston).

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Edward Mui does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.