RIET - State Of The REIT Nation

• Amid mounting concerns over soaring interest rates, stagflation, and even outright recession, we take a look at high-level REIT fundamentals to chart the likely path forward for the real estate industry.
• Owing to the harsh lessons from the Great Financial Crisis, most REITs have been exceedingly conservative with their balance sheet and strategic decisions - ceding some ground to higher-levered private-market players.
• Amid the more challenging capital raising environment, the pendulum has quickly swung in favor of REITs over private players. The true competitive advantage of REITs is revealed in times of mild distress.
• Premium valuations in 2021 sparked a wave of external growth through M&A, IPOs, development, and property acquisitions. We've seen REITs "pump the breaks" in early 2022, but opportunities should emerge as over-levered private players seek an exit.
• REITs enter this period of economic uncertainty on solid footing and balance sheets as strong as they've been. The "REIT Recovery" from the pandemic is now complete as FFO levels are back to pre-pandemic levels while dividend payouts ratios remain near historic lows.

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