Short interest in US REITs down overall in October

Short interest in US equity real estate investment trusts declined further in October after falling in September.

Average short interest in REITs dropped 15 basis points during the month to 3.5% of shares outstanding, according to S&P Global Market Intelligence data.

Shopping center REITs see largest short interest decline

Shopping center REITs logged the largest drop in average short interest in October, dropping 64 bps to 2.7% of shares outstanding at the end of the month.

Average short interest in the communications and healthcare sectors dropped by 45 bps to 2.3% and 4.7% of shares outstanding, respectively.

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Short interest in the advertising sector, on the other hand, increased by 1 percentage point on average. Within the sector, Outfront Media Inc. saw short interest climb by 1.6 percentage points in October to 7.6% of shares outstanding, while short interest in Lamar Advertising Co. increased by 39 bps during the same period to 2.5% of shares outstanding.

REITs with the most change in short interest

Among all US REITs, Agree Realty Corp. recorded the largest increase in short interest as a percentage of shares outstanding. Short interest in the net lease retail REIT went up 4.8 percentage points during October to 13.5% of shares outstanding at month-end.

Power REIT ranked second, with short interest in the energy infrastructure REIT having risen 3.7 percentage points during the month to 5.0% of shares outstanding.

SITE Centers Corp., a shopping center REIT, rounded out the top three with a 3.3-percentage-point increase in short interest to 5.1% of shares outstanding.

Shopping center REIT Wheeler REIT Inc., on the other hand, logged the largest drop in short interest with a decline of 11.9 percentage points to 10.7% of shares outstanding.

Two healthcare REITs recorded the second- and third-largest drops. Short interest in National Health Investors Inc. fell 2.8 percentage points in October to 3.0% of shares outstanding, while American Healthcare REIT Inc. saw short interest decrease 2.3 percentage points to 3.8% of shares outstanding.

REITs with the largest short positions

Medical Properties Trust Inc. remained the most-shorted US REIT, with 222.2 million shares sold short as of October-end, or roughly 37.0% of the healthcare REIT's shares outstanding.

Office REITs Hudson Pacific Properties Inc. and Net Lease Office Properties ranked second and third, respectively. As of Oct. 31, short interest in Hudson Pacific Properties amounted to 22.8 million or 16.2% of shares outstanding. Short interest in Net Lease Office Properties, meanwhile, totaled 2.1 million or 13.9% of shares outstanding.