While the S&P 500 did better than REITs for the first quarter of 2012, over the 12-month period ending March 31, REITs actually performed better than the market, thanks in part to dividends.
For that one-year period, the FTSE NAREIT All Equity REITs Index provided a total return of 11.29% and the FTSE NAREIT All REITs Index returned 10.91%; over the same span, the S&P 500 provided 8.54%. As an indicator of the major role dividends played, the price-only return of the FTSE NAREIT All Equity REITs Index over the 12-month period was 7.26%, and the price return of the FTSE NAREIT All REITs Index was 5.84%.
In Q1 of 2012, the S&P’s total return was 12.59% while the FTSE NAREIT All Equity REITs Index returned 10.49% and the FTSE NAREIT All REITs Index returned 10.41%. however, the REIT indexes outperformed the broad market for the month of March; the FTSE NAREIT All Equity REITs Index brought home a total return of 4.84% and the FTSE NAREIT All Equity REITs Index 4.39%, while the S&P 500 produced 3.29%.
Heres a look at how individual REIT sectors did compared to the S&P 500:
1. Industrial/Office Sector
The industrial/office sector did not fare well in 2011, providing negative returns for the year in all segments except mixed. However, for the month of March returns were positive, and for the current year to date returns are strong, particularly in the industrial and mixed subsectors.
On the other hand, the S&P 500, while it did considerably better for the month of March, was outpaced by the industrial/office sector for Q1 of this year.