Investors should not overlook the potential of real estate investment trusts, an asset class that has outperformed direct property and other equity-based asset classes year-to-date, claims rating agency Standard & Poor’s.
S&P’s third-quarter report into global property painted Reits as the idyllic yet elusive haven investors have been searching for. It is perhaps a sign of the times that performance producing a loss of 14.27% year-todate (as at September 30) could be considered a call to buy yet that is exactly the position in the S&P report.
Compared with the S&P Developed BMI index, which recorded a loss of 24.08% year-to-date, and S&P Developed Property index, which delivered a loss of 23.84%, the developed Reits index appears attractive.
Svitlana Gubriy, fund manager of the Standard Life International Global Reit fund, said that because Reits have daily pricing and daily trading, they react quickly to news, which means strong value is emerging in Reits.