Why are Storage REITS Out performing Other REITS?

Recent developments in the REIT stocks have seen acritical divergence. Most REITs have outperformed S&P 500 index over the sample period that covers about twenty years. However, within different sectors of this industry, storage REITs are the outperformers. In this paper, we examine different forces that are impacting Storage REITs. Also, there are some structural trends that are having a significant effect on this sector of real estate. Using structural breakpoint methodology, we can identify changes that are occurring in this industry, in particular storage REITs and identify factors that affect the performance of this real estate sector.

Keywords

Storage REITs Breakpoints Sensitivity of Returns Economic Forces

References

i. J. D. Benjamin, P. Chinloy, and G. D. Jud (2004). “Real Estate Versus Financial Wealth in Consumption.” Journal of Real Estate Finance and Economics, 29, 341–354.
ii. Jushan Bai and Pierre Perron (1998). “Estimating and Testing Linear Models with Multiple Structural Changes.” Econometrica, 66, 47–78.
iii. Jushan Bai and Pierre Perron (2003). “Computation and Analysis of Multiple Structural Change Models.” Journal of Applied Econometrics, 18, 1–22.
iv. Sean D. Campbell and Francis X. Diebold (2009). “Stock Returns and Expected Business Conditions.” Journal of Business and Economic Statistics, 27, 266–278.
v. Mark M. Carhart (1997). “On Persistence in Mutual Fund Performance.” Journal of Finance, 52(1), 57–82.
vi. K. C. Chan, Patric H. Hendershott, and Anthony B. Sanders (1990). “Risk and Return on Real Estate: Evidence from Equity REITs.” AREUEA Journal, 18(4), 431–452.
vii. Nai-Fu Chen, Richard Roll, and Stephen A. Ross (1986). “Economic Forces and Stock Markets.” Journal of Business, 59, 383–404.
viii. Richard R. Correll (2003). “Market Analysis of Self-Storage Facilities.” Appraisal Institute Journal, Fall 2003.
ix. Eugene F. Fama and Kenneth R. French (1989). “Business Conditions and Expected Returns on Stocks and Bonds.” Journal of Financial Economics, 25, 23–49.
x. N. Hoskins, D. Higgins, and R. Cardew (2004). “Macroeconomic Variables and Real Estate Returns: An International Comparison.” The Appraisal Journal.
xi. Stephen C. Lee (2010). “The Changing Benefits of REITs to the Mixed-Asset Portfolio.” Journal of Real Estate Portfolio Management, 16(3), 201–216.
xii. Charles R. Nelson and Charles I. Plosser (1982). “Trends and Random Walk in Macroeconomic Time Series.” Journal of Monetary Economics, 10(2), 139–162.

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How to Cite

Dr. Rajendar K Garg, Dr. Mukesh Chaudhry , Dr.Suneel Maheshwari . (2021). Why are Storage REITS Out performing Other REITS?. DIAS Technology Review, 18(1), 61-65.

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[1] i. J. D. Benjamin, P. Chinloy, and G. D. Jud (2004). “Real Estate Versus Financial Wealth in Consumption.” Journal of Real Estate Finance and Economics, 29, 341–354.

[2] ii. Jushan Bai and Pierre Perron (1998). “Estimating and Testing Linear Models with Multiple Structural Changes.” Econometrica, 66, 47–78.

[3] iii. Jushan Bai and Pierre Perron (2003). “Computation and Analysis of Multiple Structural Change Models.” Journal of Applied Econometrics, 18, 1–22.

[4] iv. Sean D. Campbell and Francis X. Diebold (2009). “Stock Returns and Expected Business Conditions.” Journal of Business and Economic Statistics, 27, 266–278.

[5] v. Mark M. Carhart (1997). “On Persistence in Mutual Fund Performance.” Journal of Finance, 52(1), 57–82.

[6] vi. K. C. Chan, Patric H. Hendershott, and Anthony B. Sanders (1990). “Risk and Return on Real Estate: Evidence from Equity REITs.” AREUEA Journal, 18(4), 431–452.

[7] vii. Nai-Fu Chen, Richard Roll, and Stephen A. Ross (1986). “Economic Forces and Stock Markets.” Journal of Business, 59, 383–404.

[8] viii. Richard R. Correll (2003). “Market Analysis of Self-Storage Facilities.” Appraisal Institute Journal, Fall 2003.

[9] ix. Eugene F. Fama and Kenneth R. French (1989). “Business Conditions and Expected Returns on Stocks and Bonds.” Journal of Financial Economics, 25, 23–49.

[10] x. N. Hoskins, D. Higgins, and R. Cardew (2004). “Macroeconomic Variables and Real Estate Returns: An International Comparison.” The Appraisal Journal.

[11] xi. Stephen C. Lee (2010). “The Changing Benefits of REITs to the Mixed-Asset Portfolio.” Journal of Real Estate Portfolio Management, 16(3), 201–216.

[12] xii. Charles R. Nelson and Charles I. Plosser (1982). “Trends and Random Walk in Macroeconomic Time Series.” Journal of Monetary Economics, 10(2), 139–162.