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Eight of twenty-three (35%) publicly listed net lease REIT (with a full year of trading) saw share price appreciation during 2024 while ten generated positive total returns (including dividends)1.
Size did not guarantee positive investor returns during the year as of the eight net lease REIT with a year-end market capitalization above $5 billion (O; VICI; GLPI; WPC; NNN; ADC; STAG; EPRT), only two (EPRT; ADC) saw share price increase.
Despite the solid fundamentals of the property type, equity holders of the five largest industrial-focused net lease listed portfolios saw shares decline in value between 8 and 27%.
Given many REIT management teams took full advantage of the late summer / early fall rise in valuations with capital raising efforts, most of the group should remain well positioned to deploy previously priced capital in accretive investments during the first half of 2025.
All eyes will remain on the 10-year US Treasury as the ‘more hawkish’ forward guidance from the Federal Reserve has pushed the benchmark up ~90 bps since September and a tight inverse correlation to listed net lease REIT valuations continues.
-Sean Hostert