A New Year and just maybe a brighter dawn for the quoted REITs? As I type we’re about to finish the results season for the December year end companies. Results have varied between slightly worse than expected to reasonably satisfactory which against a backdrop of a calamitous Q4 22 “data set” from the direct market means it’s generally been better than anticipated by some.

So, the MSCI/IPD direct market performance measure which has been around for 35 years now, recorded the worst quarterly performance on record, with capital values collapsing by over 15%, a pace of decline that even exceeds that during 2008. Add some gearing to that, no matter how modest, and REIT NAVs have dropped sharply not that equity markets were expecting anything else. In fact so chilled was the equity market that as companies announced their figures the immediate share price reaction to everyone was that prices went up and in many cases have stayed there. Admittedly the equity market has been on a bit of a tear reaching all-time highs, but even against that backdrop the REIT sector has bounced about 30% from the depths of the last mini-budget, and is marginally outperforming the equity market so far this year. The temptation to say “it’s all in the price” is almost, but not quite, overwhelming!