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Fast Facts
Wednesday, 11 April 2012 06:28
  • With the addition of Ireland & South Africa in mid-2013, there are now 34 countries with REIT type investment vehicles, worth around USD$1.1tr (market cap).
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  • USA : -

  • Equity REIT total returns averaged 17.31% pa during the entire duration of the last real estate bull market, almost 16 ½ years from October 1990-January 2007, even including the REIT downturn of the late 1990s.

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  • By late-2013, real estate IPOs (REITs, ROCs & Mortgage Trusts had raised USD$3.9bn compared with USC$3bn in all of 2012, and the Bloomberg REIT increased over 300% since its 2009 low (but is recently down about 10%).
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  • Non-traded REITs raised approx $8.6bn in 1st Half 2013 – up 72% y-o-y.
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  • In excess of USD$300bn of commercial real estate debt will mature each year from now (mid-2013) until at least 2017.
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  • The US real-estate sector have raised USD$29.3bn this year (end-May 2013), up more than 90% from 2012, from IPO’s, follow-on offerings & equity conversion deals, the highest volume on record through. Of the 83 deals 79 were REITs, with equity REITs accounting for just over half & mortgage REITs the rest.
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  • In 2012, REITs raised an aggregate of USD$73.3bn in capital: USD$45.8bn in secondary equity common & preferred share offerings; USD$25.7bn in unsecured debt offerings; and USD$1.8bn in IPOs.
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  • The universe for non-traded REITs has almost tripled in the last five years, growing to just under $80 billion in assets from $28bn (late-2011).
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  • Land costs in some US cities are around 10% those of Singapore’s, with the value of properties potentially doubling or tripling in coming years as the US economy picks up (early-2013).
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  • Some 7 of 8 companies that have become US REITs since early-2009 rose more after their conversions than in any other sector, except Corrections Corp of America (early-2013).
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  • In the last 10 years, REITs have done a better job protecting wealth than commodities; REITs have delivered 3 times the returns that commodities have without adding extra volatility. REITs do particularly well when they grow dividends faster than the rate of inflation. This has been the case in 19 of the 25 years from 1987-2012, when dividends rose approx 5.7% annually. This goes against conventional wisdom, which says that REITs do poorly when rates rise, so it depends upon how fast a REIT can raise rents, which in turn drive its earnings and dividends. Similarly, again conversely, rising interest rates and / or inflation have helped REIT returns in the past.
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  • Public REITs & REOCs spent more than USD$54bn in cash on property acquisitions in 2012 (driving up prices for the most sought-after properties), and 63%, bought more properties than they sold. Sales of medical office buildings / MOB exceeded USD$2 billion in 2012, more than doubling the previous sales record set in 2007.
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  • REITs own around 10-20% of commercial real estate in the US.
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  • Blackstone & Colony Capital are expected to spend upto USD$10bn over the next 2 years to buy distressed single family homes (mid-2013).
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  • The US residential housing is worth about USD$18tr with a USD$10tr mortgage servicing sector (approx 85% owned by banks). There are 14m "for-lease" homes in the US with an average price of USD$200k, valuing the industry at about USD$2.8tr.
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  • There are 15 REITs that have managed to payout consistent and increased dividends for at least 5yrs straight, 8 which have paid-out for 10-24yrs, but only 3 “champions” that have done so for 25yrs: Realty Income/O + Tanger/SKT + Federal Realty/FRT (2013).
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  • Canada: Over the 3yrs end-June13, the TSX’s REIT index generated a total return of 53.20% or more than 3 times the return from the S&P/TSX Composite index over the same period. But one consequence was a fall in yields. Since then, it seems that investors have taken their interests to other sectors of the market although yields have risen and equity prices dropped to near levels reached a couple of years ago.
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  • AsiaPac: From a low of around 20% in around 2004, Asia Pacific now represents around 35% of the global listed real estate market.
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  • Since the launch of the first Japanese / J-REIT in September 2001, the Market Capitalisation has grown to USD$151bn (end-April 2013).
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  • As at late13, the 9 HK-REITs had a total market cap of USD$22.5bn; the 28 Singaporean trusts USD$43.7bn (including 5 listed in 2013); and 16 Malaysian REITs USD$7.4bn. APREA estimate the PRC real estate market could top out at USD$26.4bn in 2031 from just USD$1.86bn in 2011, during which time China’s investible real estate market would grow from 7% of the global total to 28.7%.
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  • In late-2012 APREA said that the Asian REIT market was poised for significant growth, despite the Market Cap of the sector having increased from about $2bn in 2001 to $50bn after 5 years, and $127bn now, between around 145 Asian-based REITs, which still only amounts to about 4% of investment grade stock and the lowest level of securitised real estate in the world. Hence, if this were to increase to 25% that would equate to a sectoral value well in excess of $500bn. Currently Japan & Singapore account for about 40% & 30% of the market.
  • Japan had 35 REITs with a total Market Cap of USD$60bn, while Singapore has 16 REITs with a market capitalization of $19.3bn, compared with HK's 7 valued at $8.8bn (early-2013).

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  • Since the launch of the first Japanese / J-REIT in September 2001, the Market Capitalisation has grown to USD$151bn (end-April 2013).

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  • India’s share of the global investable real estate market is currently just 1.3% (2013).

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  • HK listed REITs account for just 5% of the total listed real estate Market Cap in HK compared to30%+ in both Singapore & Japan (2014).

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  • Africa: The gross asset value of real estate in Africa is only €113bn or 1% of the world’s total value, despite the fact that the continent controls 15% of world population.

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  • South Africa: The Johannesburg Stock Exchange / JSE adopted REITs in May 2013, and by the end of 2014 about 30 South African property funds h­­ad listed, converting from property loan stock and property unit trust structures (which had caused confusion as they were taxed differently), with a market capitalisation of about R250bn / USD$23bn (up from just R5bn / USD$467m in 2002).

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  • UK: The UK's 75+ group is expanding just under 5 times as fast as its general population.

 

Last Updated on Wednesday, 05 August 2015 05:04