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REIT Replay: REITs, markets continue to post gains

Real estate investment trusts and the broader markets kept climbing Monday, June 4, on the back of stronger-than-expected U.S. jobs statistics for May from the U.S. Labor Department, which could lead to a June rate hike by the Federal Reserve.

The MSCI US REIT Index (RMZ) rose 0.93% to 1,119.51, and the SNL US REIT Equity Index climbed 0.92% to reach 307.65. The Dow Jones Industrial Average increased 0.72% to close at 24,813.69, while the S&P 500 added 0.45%, closing at 2,746.87.

Office REIT Kilroy Realty Corp. closed on its purchase of the Oyster Point life science development site in South San Francisco for approximately $308 million.

Shares of Kilroy Realty jumped 1.84%, closing at $77.34.

Multifamily REIT AvalonBay Communities Inc. sold two operating communities for $195 million in the second quarter. The company also expects to sell two additional communities for roughly $280 million.

AvalonBay Communities shares increased 1.13% to close at $169.00.

Full-service hotel REIT Chesapeake Lodging Trust agreed to sell the Hyatt Centric-Santa Barbara hotel in California for $90.0 million in a transaction expected to be completed within the next 60 days.

Shares of Chesapeake Lodging added 0.86% to close at $32.76.

Office REIT Vornado Realty Trust agreed June 1 to sell its 49.5% interest in the 666 Fifth Ave. office condominium in Manhattan, N.Y., to joint venture partner Kushner Cos. for $120 million in expected net proceeds, in a conditional deal expected to close in the third quarter.

Vornado Realty shares rose 1.02% to end the day at $71.38.

Urban office REIT Alexandria Real Estate Equities Inc.'s board increased the company's quarterly cash dividend 3% to 93 cents per share for the second quarter.

Alexandria Real Estate shares gained 1.30%, closing at $127.21.

A team of Evercore ISI analysts upgraded Education Realty Trust Inc. to "outperform" from "underperform" and lifted the per-share price target on the company's stock to $42 from $34, following a recent report that the student housing REIT was exploring a potential company sale and was in talks with private equity firms for a possible going-private deal.

The analysts said they are "not surprised" to see the company consider the purported move, given its "poor stock market performance" over the last 12 to 18 months and operational challenges.

Education Realty shares closed 1.16% higher at $38.38.

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Data Dispatch: NAV monitor: US equity REITs trading at 7% median discount at May-end: Chart Watch: The regional mall sector continued to trade at the largest median discount to net asset value, while the self-storage sector finished the month trading at the largest median premium to NAV.

Market prices and index values are current as of the time of publication and are subject to change.