(1) At December 31, 2017. Source: Morningstar, NCREIF. Data quoted represents past performance, which is no guarantee of future results. Annualized returns for U.S. REITs/ private real estate: 1Y: 5.2%/7.6%; 3Y: 5.6%/10.4%; 5Y: 9.5%/11.5%; 10Y: 7.4%/5.0%; 20Y: 9.0%/8.9%; 30Y: 10.7%/7.3%. See page 4 for index definitions and additional disclosures.
Exhibit 2: P/E: price to earnings per share; P/FFO: price to funds from operations per share, the key earnings metric for REITs, calculated as GAAP net income, plus depreciation and amortization, minus any gains (or losses) from asset sales.
Exhibit 3: Treasury yield represents yield to maturity. REIT dividend yield represents the current share price divided by total dividends per share over the trailing 12 months.
Exhibit 4: Price to NAV is similar to price to book value, representing the net market value of a company’s assets minus liabilities. Sectors and market average represented by the FTSE NAREIT Equity REIT Index.
Index Associations and Definitions
All returns and investment characteristics discussed in this report are based on the indexes below. An investor cannot invest directly in an index and index performance does not reflect the deduction of any fees, expenses or taxes. Bonds: Barclays Capital U.S. Aggregate Bond Index is a broad-market measure of the U.S. dollar-denominated investment grade fixed-rate taxable bond market, and includes Treasuries, government-related and corporate securities, mortgage-backed securities, asset-backed securities, and commercial mortgage-backed securities. Private real estate: NCREIF Fund Index—Open-End Diversified Core Equity is a capitalization-weighted, gross-of-fees, time-weighted return index of 30 open-end commingled private funds pursuing a core U.S. real estate investment strategy. REITs: FTSE NAREIT Equity REIT Index contains all tax-qualified REITs, except timber and infrastructure REITs, with more than 50% of total assets in qualifying real estate assets other than mortgages secured by real property that also meet minimum size and liquidity criteria. Stocks: S&P 500 Index is an unmanaged index of 500 large-capitalization stocks that is frequently used as a general measure of U.S. stock market performance.
Data quoted represents past performance, which is no guarantee of future results. The information presented above does not reflect the performance of any fund or other account managed or serviced by Cohen & Steers, and there is no guarantee that investors will experience the type of performance reflected above. There is no guarantee that any historical trend illustrated herein will be repeated in the future, and there is no way to predict precisely when such a trend will begin. There is no guarantee that any market forecast made in this document will be realized. The views and opinions in the preceding document are as of the date of publication and are subject to change without notice. This material represents an assessment of the market environment at a specific point in time and should not be relied upon as investment advice, does not constitute a recommendation to buy or sell a security or other investment and is not intended to predict or depict performance of any investment. This material is not being provided in a fiduciary capacity and is not intended to recommend any investment policy or investment strategy or take into account the specific objectives or circumstances of any investor. We consider the information in this presentation to be accurate, but we do not represent that it is complete or should be relied upon as the sole source of suitability for investment. Cohen & Steers does not provide investment, tax or legal advice. Please consult with your investment, tax or legal professional regarding your individual circumstances prior to investing.
Risks of Investing in Real Estate Securities. The risks of investing in real estate securities are similar to those associated with direct investments in real estate, including falling property values due to increasing vacancies or declining rents resulting from economic, legal, political or technological developments, lack of liquidity, limited diversification and sensitivity to certain economic factors such as interest rate changes and market recessions. Cohen & Steers Capital Management, Inc. (Cohen & Steers) is a registered investment advisory firm that provides investment management services to corporate retirement, public and union retirement plans, endowments, foundations and mutual funds.
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