By Chris Owens, Analyst, Atchison Consultants
Australian real estate investment trusts (AREITs), as represented by the S&P/ASX 200 REITs Index, returned 7.0% in the month ending 31 May 2020. The AREIT index outperformed the S&P/ASX 200 return of 4.4% over the month.
Over the 12 months to May 2020, AREITs posted a total return of -16.8% (21.2% lower than the S&P/ASX 200 return of 4.4%).
Sector Performance
Table 1 below shows the performance of AREITs for various periods ending 30 May 2020.
The restrictions arising from the pandemic have had a substantial impact on the medium-to-long term performance of the AREIT sector. Over the 3 years and 5 years to the end of May, the sector produced total returns of 0.8% and 3.8% per annum respectively.
Sector returns in May were led by Industrial AREITs with 16.7%, followed by Diversified AREITs with 8.4%, Retail AREITs with 0.7% and Office AREITs with -0.9%. The returns from Industrials and Diversifieds reflect recoveries after steep declines in March. Retails AREITs saw returns lower than the high of 29.6% in April. Office REITs have not recovered.