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Real Estate Funds Shift Allocations to Telecom REITs
Actively managed real estate funds increased their allocations in telecommunications REITs during the first quarter of 2024, overweighting the sector and giving it the second highest share in the funds, Nareit said Monday. Telecommunications now represents a 14% share in the funds, up nearly three percentage points year-over-year and now the second largest after residential with 17.3%.
Both retail and industrial had lower weights in Q1, dropping their rank by weight to third and fourth, respectively. Industrial’s share dropped 3.1 percentage points Y-O-Y, to 12.7%, while retail’s annual decline was smaller at 0.7 percentage points.
In terms of returns, active managers’ increase in specialty in Q4 2023 by nearly 1.5 percentage points matched the sector outperforming the index by 12.8 percentage points in Q1 2024. Easing off on industrial in Q4 matched underperformance in that sector, said Nareit. Funds reduced their share in industrial by 0.7 percentage points in Q4 2023, and the sector underperformed the index by 1.2 percentage points the next quarter.
- ◦Financing
