REIT - REITs Say 'Good Riddance' To 2024

2025-01-05 09:00:00 ET

Summary

• U.S. equity markets sputtered in a choppy final week of 2024 as investors returned from the holidays with trepidation following the best two-year run for the S&P 500 since 1997-1998.
• The S&P 500 finished lower by 0.5% on the week, requiring a late-week rebound to pare steep declines following a historically ugly stretch of losses in the Christmas-to-New-Year period.
• Treasury yields posted a weekly decline for the first time in a month, pressured by a relatively weak slate of economic data, including soft PMI employment metrics and mortgage demand.
• For real estate equities, the new year couldn't come soon enough. REITs rebounded this week following a punishing final stretch of 2024 provoked by a surprising resurgence in interest rates.
• Office REITs extended their post-pandemic rebound into the first week of 2025 after a series of reports showed a continued rebound in leasing activity in recent months as major employers continue to rein in remote work policies.

Real Estate Weekly Outlook

U.S. equity markets sputtered in a relatively choppy final week of 2024 as investors returned from the holidays with some trepidation following the best two-year run for the S&P 500 since the late 1990s - a rally that has been almost entirely driven by a narrow subset of technology firms. Meanwhile, bond markets finally stabilized this week following a year-end slide in which the typically steady Bloomberg U.S. Aggregate Bond Index dipped by nearly 3% in the final three weeks of the year, part of an extended slide of over 5% since the Federal Reserve's initial rate cut in mid-September....

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