Total return of the largest REITs U.S. 2023 | Statista (2024)

FAQs

Which REITs have the highest return? ›

Among the 50 real estate investment trusts (REITs) with the largest market cap, Prologis (PLD) and American Tower (AMT) recorded to the at the top of the list with around 93 and 83 billion US dollars each.

REITs in the United States saw an annual total return of 11.4 percent in 2023, according to the FTSE Nareit All Equity REITs index. Nevertheless, in 2022, the index had a negative total return of 25 percent. Performance improved for all property types, except for diversified, free standing retail, and infrastructure.

Over the long term, our research found that REITs have outperformed stocks. Since 1994, three REIT subgroups stood out for their ability to beat the S&P 500. Here's a closer look at these market-beating REIT types.

How to Qualify as a REIT? To qualify as a REIT, a company must have the bulk of its assets and income connected to real estate investment and must distribute at least 90 percent of its taxable income to shareholders annually in the form of dividends.

The FTSE Nareit All REITs index, which tracks the performance of all publicly traded REITs in the U.S., had an average annual total return (dividends included) of 3.58% during the five-year period that ended in August 2023. For the 10-year period between 2013 and 2022, the index averaged 7.48% per year.

The 75% Asset Test

Among other requirements, at the close of each calendar quarter, at least 75% of the value of a REIT's total assets must be represented by real estate assets, cash and cash items (including receivables), and government securities (the “75% asset test”).

Is now a good time to invest in a REIT? ›

The generous dividend payments enjoyed by REIT investors may look particularly attractive moving forward. With rate cuts on the horizon, dividend yields for REITs may look more favorable than yields on fixed-income securities and money market accounts.

Buffet and REITs

However, Berkshire sold its holdings of STORE Capital in 2022 after the company announced it was being acquired by two outside investment funds. Since then, filings have shown that Berkshire Hathaway has not owned shares of any other REIT.

Notable REITs

The five largest REITs in the United States in 2021 are: American Tower Corporation, Prologis, Crown Castle International, Simon Property Group and Weyerhaeuser.

5 percent of the value of the REIT's total assets may consist of securities of any one issuer, except with respect to a taxable REIT subsidiary. 10 percent of the outstanding vote or value of the securities of any one issuer may be held (again, a taxable REIT subsidiary is an exception to this requirement)

Direct real estate offers more tax breaks than REIT investments, and gives investors more control over decision making. Many REITs are publicly traded on exchanges, so they're easier to buy and sell than traditional real estate.

Physical property is generally bought and held for long periods of time, thus providing consistent cash flows to support REIT dividends. That's comparatively simple. The high yield on offer from AGNC is really a function of the risk inherent in the mortgage REIT sub-sector.