“S&P Capital IQ has a positive fundamental outlook on the retail REITs sub-industry. Although challenges remain, we think increasing absorption of retail space should present retail landlords with more pricing power. We expect consumer spending and retail sales to improve over the next 12 months, which should prompt a further slowdown in store closings. We still look for same-property revenue and net operating income to be positive across the sub-industry over the next 12 months. Most retail REITs have long-term leases with their customers that possess embedded rent adjustments that should help insulate them from economic fluctuations,” said the research firm.
After pulling in over $4.7 billion in new assets last year, enough to place it among the top 10 asset-gathering ETFs, VNQ has already added nearly $500 million in new assets in 2015.
“VNQ trades approximately 5 million shares on a daily basis and has a tight $0.01 bid/ask spread. We also believe the ETF is trading with bullish technical trends. Investor interest has been strong with more than $5 billion of fresh money moving into the ETF in the last 12 month,” said S&P Capital IQ.
The research firm rates VNQ overweight, S&P’s highest ETF rating.
Vanguard REIT ETF