REITs' Solid Results May Prove Fleeting

Wall Street Journal (05/07/08) P. C12; Forsyth, Jennifer S.; Frangos, Alex; Hudson, Kris
Keefe, Bruyette & Woods analyzed 64 REITs that have posted first-quarter earnings as of May 5 and determined that exactly half of them had exceeded analysts' consensus expectations, while 16 met expectations and 14 fell short. Analysts say this generally positive performance justifies the REIT sector's rally over the last couple of months, during which time the SNL U.S. REIT Equity Index ticked up 14 percent. REITs that specialize in self-storage properties have been the top-performing group since the first of the year, with total returns climbing 24 percent, followed by apartment REITs, which are up 15 percent. One factor helping apartments is the declining rate of homeownership amid the property slump.