REIT Replay: REIT indexes close final week of October in the red

US equity real estate investment trust indexes dropped during the final week of October.

The Dow Jones Equity All REIT index closed the recent week down 3.29%, while the MSCI US REIT (RMZ) index fell 2.88%.

The broader market stock indexes logged small gains for the week, with the S&P 500 up 0.71% and the Dow Jones Industrial Average increasing 0.75%.

Looking at the Dow Jones US real estate property sector indexes, the office REIT index saw the largest decline over the week, falling 7.62%. The self-storage and apartment REIT indexes followed, with declines of 7.47% and 5.92%, respectively.

The healthcare REIT index was the sole Dow Jones US real estate property sector index to close the week in the black, recording a 1.47% gain.

Life science office-focused Alexandria Real Estate Equities Inc. had the largest share-price decline among all US REITs with at least $200 million in market capitalization, down 24.79% for the week. The share price decline followed the REIT's third-quarter earnings release on Oct. 27. Alexandria Real Estate Equities reported funds from operations per share of $2.22 for the quarter, down 6.3% year over year. The REIT also lowered the midpoint of its 2025 FFO per share guidance by 25 cents to $9.01 from $9.26.

Primary drivers behind the REIT's lowered FFO per share guidance included a 1% reduction in projected 2025 same-store net operating income and a 0.9% decrease in projected operating occupancy percentage for its North America portfolio for year-end 2025. The reduction was attributed to slower-than-anticipated re-leasing of expiring spaces and lease-up of vacancy as primary causes, reflecting reduced demand across the life science industry.

Shopping center REIT SITE Centers Corp. and industrial REIT Industrial Logistics Properties Trust recorded the second- and third-largest share-price declines for the week, down 17.18% and 12.44%, respectively.

Turning to top performers, energy-oriented Fermi Inc.'s share price grew 11.34% over the week, the largest share-price increase of the group. Net lease retail REIT Alpine Income Property Trust Inc. ranked second with a share-price increase of 6.30%. Three healthcare REITs — Universal Health Realty Income Trust, Ventas Inc. and Omega Healthcare Investors Inc. — rounded out the top-five performing REIT stocks for the week with increases of 4.97%, 4.83% and 3.80%, respectively.