REITs outpace indexes in first quarter

Real estate investment trusts outperformed the Standard & Poor's 500 stock index, the Dow Jones Industrial Average, the Russell 2000 Index and Nasdaq Composite Index during the first quarter of 2008, according to the National Association of Real Estate Investment Trusts Inc. in Washington. The latest data shows equity REITs posted total returns, including dividends, of 1.4%, while all REITs, which include mortgage REITs, were down slightly at 0.42%. This outpaces the other major benchmarks, all of which posted negative returns. During the quarter, the S&P 500 fell 9.44%, the Dow slipped 7.55%, the Russell 2000 declined 9.9% and the Nasdaq fell 14.07% in the latest quarter. REITs were particularly strong in March, when the FTSE NAREIT All REIT Index advanced 3.88%. Self storage and residential REITs, which were hardest hit last year, enjoyed the biggest gains in the first quarter. Self-storage REITs delivered returns of 20.23% during the three-month period, while residential REITs were up 11.2%. REITs outperformed the S&P 500 for seven consecutive years between 2000 and 2007, before collapsing and ending their run with a dismal 17.8% negative return in 2007.