REIT Action Wednesday: Benchmark ETFs and Park Hotels take a hit
Most large real estate investment trusts (REITs) closed in the red on Wednesday when Federal Open Market Committee minutes became available. The hawkish tone of these minutes apparently makes it difficult for dividend payers like REITs.
The Real Estate Select SPDR FUND (XLRE) ETF ended down 0.07%:
This is the NASDAQ-traded fund comprised of more than 20 real estate investment trusts. For a basic idea of what it covers, its three main components are American Tower Corp AMT, ProLogis Inc. PLD and Crown Castle International Corp. ICC.
At this closing price, the Real Estate Select SPDR pays a dividend of 3.06%. Note how much the sector has fallen over the past 6 months or so and how it seems to be bouncing back from that mid-June low.
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Park Hotels & Resorts Inc. PACK fell today by 3.82%:
While this REIT is an important part of the real estate investment trust industry, it is also treated by institutional investors as a “consumer discretionary” item due to Park’s holdings, such as those in Hawaii and Miami Beach. A more hawkish Fed could mean fewer or shorter vacation trips for consumers.
This is a closing low below the lows of the previous summer. Park Hotel & Resorts pays a dividend of 0.29%.
No investment advice. For educational purposes only.
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