In the face of the extended decline in REIT prices over the last six months, this article* explores the primary drivers of the public and private real estate markets. For example, the recent price movements in the REIT market are not necessarily reflective of the prices of the underlying properties. REITs, in fact, are impacted considerably by the movement of 10 Year Treasury yields. Comparison to competing Treasuries has consistently shown to be the driving force of cap rates, which continue at historic lows.
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