UBS said the collapse in the housing market provided opportunities for long-term investors. Real estate is the only one of the 11 major S&P 500 sectors to decline in 2024, down 4.7%. UBS analyst Jonathan Woloshin wrote in a note last week that significant uncertainty remains in the commercial real estate (CRE) market, including the direction of interest rates and concerns over the 2024-2026 expiration date. The problem of refinancing trillions of dollars of debt. However, capital remains available and reduced supply of new retail, multifamily and industrial real estate points to stronger operating fundamentals from 2025 to 2030, he said. There are also funds on the sidelines in the private equity market, he added, and about $33.5 billion in new CRE funds have been announced. .SPLRCR YTD Mountain S&P 500 Real Estate Sector Real estate investment trusts (REITs) also pay attractive dividends year-to-date, with an average yield of 4.2%, according to UBS. “Investors need to remember that no one is sounding the bell on the bottom,” Wolosin wrote. “While headlines may remain negative and commercial real estate will continue to face more challenges, we believe that having liquidity Patient investors with multi-year investment horizons have plenty of attractive risk-adjusted return opportunities in the commercial real estate and REIT markets. He strongly recommends focusing on qualities — such as management, balance sheet, property, location and dividends. coverage of free cash flow — rather than chasing yield. Here are two REITs on his list: Shares of Prologis have underperformed this year, down about 15% However, Wolosin said real estate investing is a big deal. The trust is the world’s largest owner of industrial properties such as warehouses and the industrial sector remains strong. He said: “PLD has a four-pronged operating model, including owned and operated properties, development, profit potential from the underlying business and the provision of multiple Strategic capital management for value creation potential. Prologis also pays a 3.4% dividend yield. Alexandria Real Estate shares, which yield 4.4%, are down more than 7% year to date. The company owns, operates and develops large campuses for life sciences companies. Woloshin Likes Alexandria Real Estate Equities’ Strong Assets “ARE has a long history of developing pre-leased assets and has a diversified, strong credit tenant base,” he said. “
