Timber companies had the lead, posting gains in excess of 10 percent. Weyerhaeuser Co. saw a return of 17.6 percent and Potatch Corp. posted an 18 percent gain. But apartment REITs saw a negative 4 percent return in the third quarter. Jay Leupp, a portfolio manager at Lazard Asset Management LLC, surmised that “apartment dwellers will be exiting apartments and stepping into the home-buying market.”
Investors feel optimistic in part because inventory is running at historically low levels, the Journal reported. As The Real Deal previously reported, new home starts reached an adjusted annual rate of 750,000 units in August — the highest number of starts since April 2010.
National vacancy for apartments slipped to 4.6 percent from 4.7 percent in the third quarter, showing signs that rental demand is declining. The apartment REIT that posted the largest negative return was Equity Residential — owner of 119,293 units — at 7.2 percent. [WSJ]