REITs Hit A New Record High!

REITs or Real Estate Investment Trusts hit a soaring record high of $52.4 billion of unsecured notes this last year. For those who are unfamiliar with REITs, REITs are companies that owns, operates or finances income-producing real estate, according to Investopedia. Essentially turning the real estate market into the stock market.

For a company to qualify as an REIT they have to follow a number of guidelines, one of which is trading on a major stock exchange in order to provide investors with a liquid stake in real estate. REITs tend to specialize in a certain sector of real estate like office REITs for example, which essentially can be only one part of a REITs large portfolio.

This years REITs beat previous years records, 2016 set a record of $38.6 billion, 36% down from this years new record of $52.4 billion. This years total of 75 REITs issued a whomping 131 bonds, a great deal of those REITs dealing in the cell tower and data center sector.

Coming in second was REITs that owned retail properties – with over 22 deals worth more than $8.9 billion. In addition to setting new records, interest rates are at a favorable state for investors which seems to show a great amount of promise for these investors this coming year. The 131 bonds issued held an average coupon rate of 4%, which is the same rate for ten-year bonds which also had a median coupon of 3.875%.

For a more in depth analysis and to learn more about REITs and its future for this coming year, check out Commercial Real Estate News’, “REITs Float Record-Shattering $52.4Bln of Unsecured Notes in 2017.”