NAV Monitor: US equity REITs trade at steeper discounts as February ends

Editor's note: This Data Dispatch is updated monthly and was last published Feb. 2. The analysis includes current publicly traded U.S. equity real estate investment trusts that trade on the Nasdaq, NYSE or NYSE American with market capitalizations of at least $200 million. Click here to download these charts in Excel format.

Publicly listed U.S. equity REITs traded at a median 16.8% discount to their consensus S&P Capital IQ net asset value per-share estimates as of Feb. 28, up from an 11.9% discount at the end of January.

Largest discounts

For the seventh consecutive month, office REITs traded at the largest discount to NAV, at 47.6%. Seven office REITs were included in the top 10 overall discount ranking.

Hudson Pacific Properties Inc. traded at a 68.4% discount to NAV at the end of February, the largest discount within the office sector and the second-largest discount to NAV among all U.S. equity REITs with more than $200 million in market capitalization.

Office REITs Paramount Group Inc. and Brandywine Realty Trust ranked No. 3 and No. 5, respectively, on the largest discount list. Paramount Group traded at a 65.0% discount to NAV, while Brandywine Realty Trust traded at a 60.7% discount.

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The hotel sector traded at the second-biggest median discount at 30.4% below NAV, with RLJ Lodging Trust trading at the largest discount among hotel REITs at 46.5%.

Among all U.S. equity REITs in this analysis, industrial REIT Industrial Logistics Properties Trust traded at the largest discount to NAV as it closed Feb. 28 at $4.10, 72.0% below its consensus NAV estimate of $14.63.

Largest premiums

Only two sectors traded at median premiums to NAV at the end of February: casino and "other retail," which includes single-tenant retail and outlet center REITs.

The casino REIT that traded at the largest premium to NAV was VICI Properties Inc. at 13.6%. Among the REITs belonging to the "other retail" sector, Essential Properties Realty Trust Inc. traded at the largest premium at 26.0%.

Healthcare-focused Welltower Inc. ended February at the top of the overall biggest premiums list, trading 32.1% above its consensus NAV estimate of $56.10.