- Best of times or worst of times? Apartment REITs have a front-row seat to the burgeoning economic divide as the "urban exodus" continues to add fuel to the "suburban renaissance."
- While vaccines may eventually reverse recent dynamics, rental rates and occupancy levels have plunged in the high-density, coastal "shutdown cities" that employed more draconian lockdown measures.
- Meanwhile, Apartment REITs focused on Sunbelt and suburban markets delivered a solid year of FFO and NOI growth in 2020, and rental rates continue to trend higher in early 2021.
- Outside of the troubled urban metros, national apartment markets have been remarkably resilient throughout the pandemic. Apartment REITs' exposure to the troubled markets is more limited than valuations suggest.
- With gains of nearly 15% this year, apartment REITs aren't as cheap as they were in late 2020, but valuations still appear compelling as the U.S. housing industry continues to lead the early economic recovery.
For further details see:
Apartment REITs: Tale Of Two Americas