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REIT Replay: Reversing fortunes


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REIT Replay: Reversing fortunes

REITs and the broader markets posted notable losses Tuesday, Oct. 11, reversing their positive performance from a day ago.

The MSCI US REIT Index (RMZ) dropped 1.00% to 1,127.38, and the SNL US REIT Equity Index fell 0.95% to 301.84. The Dow Jones Industrial Average shed 1.09% to close at 18,128.66, while the S&P 500 declined 1.24% to end the day at 2,136.73.

Howard Hughes Corp. appointed David O'Reilly CFO, succeeding Andrew Richardson, who departed the company Oct. 5. O'Reilly, whose appointment is effective Oct. 17, was previously CFO of Parkway Properties Inc., which recently merged with Cousins Properties Inc. Howard Hughes said in a Tuesday release that President Grant Herlitz will serve as its interim CFO, principal financial officer and principal accounting officer.

Howard Hughes shares fell 2.62% to close at $110.39.

Chatham Lodging Trust lowered its third-quarter AFFO per-share guidance to 70 cents to 71 cents from a prior range of 72 cents to 75 cents. The company said in a Monday release that the reduced guidance follows reduced RevPAR performance, increased wage pressures and rising guest acquisition costs chiefly from online travel agency commissions.

Chatham Lodging Trust shares shed 4.36%, closing at $18.00.

American Hotel Income Properties REIT LP lowered its base hotel management fees to 3.0% from 3.5% of gross revenue for all 80 hotels in its portfolio and any future acquisitions, as part of an amendment to certain terms of its master hotel management agreement with its exclusive hotel manager, Tower Rock Hotels & Resorts Inc. The company said Tuesday that the move is meant to increase cash flow and improve AFFO.

Shares of American Hotel Income rose 0.37%, closing at C$10.79.

Kimco Realty Corp. said Tuesday that its third-quarter sales amounted to $150.7 million from the disposition of 12 shopping centers aggregating 1.4 million square feet, with the company's share of the sales price being $97.8 million. Its third-quarter acquisitions, meanwhile, came in at $292.8 million and 1.0 million square feet, with its share of the purchase price being $263.4 million.

Notable acquisitions include an additional 84% ownership interest in the Gateway Shopping Center in the Seattle-Bellevue-Everett MSA for a gross price of $18.1 million, as well as a 21,000-square-foot parcel near the company's Webster Square shopping center in Nashua, N.H., for $8.2 million.

Kimco Realty shares declined 0.32%, closing at $28.00.

BMO Capital Markets Corp. discontinued coverage on Farmland Partners Inc. and First Potomac Realty Trust due to reallocation of research resources, according to separate Monday notes by analyst Paul Adornato.

Farmland Partners shares declined 0.76% to $10.49, while First Potomac Realty shares dropped 1.48% to end the day at $8.68.

On the macro front, CoreLogic reported that foreclosure inventory in the U.S. slid 29.6% on a yearly basis in August, while completed foreclosures slumped 42.4%. Completed foreclosures during the month totaled 37,000, compared to 64,000 in August 2015, marking a 69% decline from the September 2010 peak of 118,221.

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Data Dispatch: REIT capital-raising activity up 11.3% YOY through September-end: During the two-week period between Sept. 16 and Sept. 30, REITs raised approximately $3.51 billion.

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